TSE: 2451

Transcend Information, Inc.
Annual Report 2021

Notice to readersThis English-version annual report is a summary translation of the Chinese version
and is not an official document of the shareholders’ meeting. If there is any
discrepancy between the English and Chinese versions, the Chinese version shallprevail.

Printed on May 16, 2022
Transcend Information, Inc. annual report is available at https://tw.transcend-info.com/about/stockholders
Taiwan Stock Exchange Market Observation Post System: http://mops.twse.com.tw/mops/web/t57sb01_q5

Spokesperson
Name: Hsiao, Sheng-Yin
Title: Financial and Accounting Officer
Tel: (02) 2792-8000 #7533
E-mail: ir@transcend-info.com
Deputy Spokesperson
Name: Jenny Lin
Title: Director of Brand Marketing
Tel: (02) 2792-8000 #7533
E-mail: jenny_lin@transcend-info.com
Headquarters and Plant
Headquarters: No. 70, XingZhong Rd., NeiHu Dist., Taipei 114, Taiwan
Plant: No. 70, XingShan Rd., NeiHu Dist., Taipei 114, Taiwan
Tel: (02) 2792-8000
Fax: (02) 2792-3375 (Headquarters)(02) 2792-0517 (Plant)
Stock Transfer Agent
CTBC Bank Transfer Agency Department
Address: 5F., No.83, Sec. 1, Chongqing S. Rd., Zhongzheng Dist., Taipei 100,
Taiwan (R.O.C.)
Tel: (02) 6636-5566
Website: http://www.ctbcbank.com
Auditors
PricewaterhouseCoopers Taiwan
Auditors: Lin,Chun-Yao, Chen,Chin-Chang
Address: 27F, No. 333, Sec. 1, Keelung Rd., Xinyi Dist., Taipei 110, Taiwan
Tel: (02) 2729-6666
Website: http://www.pwc.com/tw
The name of any exchanges where the company's securities are tradedoffshore, and the method by which to access information on said offshore
securities: Not applicable
Corporate Website: https://tw.transcend-info.com/

1.

LETTER TO SHAREHOLDERS------------------------------------------------------------------------------------------ 1

2.

COMPANY PROFILE ------------------------------------------------------------------------------------------------------- 2
2.1.
2.2.

3.

DATE OF INCORPORATION -------------------------------------------------------------------------------------------------------- 2
COMPANY HISTORY --------------------------------------------------------------------------------------------------------------- 2
CORPORATE GOVERNANCE REPORT ------------------------------------------------------------------------------ 7

3.1.
3.2.
3.3.
3.4.
3.5.
3.6.

3.7.

3.8.
3.9.

4.

ORGANIZATION -------------------------------------------------------------------------------------------------------------------- 7
BACKGROUND INFORMATION ON DIRECTORS, GENERAL MANAGERS, VICE GENERAL MANAGERS,ASSISTANT MANAGERS AND HEADS OF VARIOUS DEPARTMENT AND BRANCHES --------------------------------------- 9
IMPLEMENTATION OF CORPORATE GOVERNANCE ---------------------------------------------------------------------------32
INFORMATION ON CPA FEES ----------------------------------------------------------------------------------------------------69
REPLACEMENT OF CPA ----------------------------------------------------------------------------------------------------------69
WHERE THE COMPANY'S CHAIRMAN, GENERAL MANAGER, OR ANY MANAGERIAL OFFICER IN CHARGE OFFINANCE OR ACCOUNTING MATTERS HAS IN THE MOST RECENT YEAR HELD A POSITION AT THE ACCOUNTINGFIRM OF ITS CERTIFIED PUBLIC ACCOUNTANT OR AT AN AFFILIATED ENTERPRISE OF SUCH ACCOUNTING FIRM,
THE NAME AND POSITION OF THE PERSON, AND THE PERIOD DURING WHICH THE POSITION WAS HELD, SHALLBE DISCLOSED. --------------------------------------------------------------------------------------------------------------------69
ANY TRANSFER OF EQUITY INTERESTS AND/OR PLEDGE OF OR CHANGE IN EQUITY INTERESTS BY A DIRECTOR,MANAGERIAL OFFICER, OR SHAREHOLDER WITH A STAKE OF MORE THAN 10 PERCENT DURING THE MOSTRECENT FISCAL YEAR AND DURING THE CURRENT FISCAL YEAR UP TO THE DATE OF PUBLICATION OF THISANNUAL REPORT. -----------------------------------------------------------------------------------------------------------------70
RELATIONSHIP INFORMATION, IF AMONG THE COMPANY'S TOP 10 SHAREHOLDERS ANY ONE IS A RELATEDPARTY, SPOUSE OR A RELATIVE WITHIN THE SECOND DEGREE OF KINSHIP OF ANOTHER --------------------------------71
THE TOTAL NUMBER OF SHARES AND TOTAL EQUITY STAKE HELD IN ANY SINGLE ENTERPRISE BY THE
COMPANY, ITS DIRECTORS, MANAGERIAL OFFICERS, AND ANY COMPANIES CONTROLLED EITHER DIRECTLY OR
INDIRECTLY BY THE COMPANY. -------------------------------------------------------------------------------------------------80

CAPITAL OVERVIEW ----------------------------------------------------------------------------------------------------- 81
4.1.
4.2.
4.3.
4.4.
4.5.
4.6.
4.7.
4.8.

5.

CAPITAL AND SHARES ------------------------------------------------------------------------------------------------------------81
STATUS OF CORPORATE BONDS ------------------------------------------------------------------------------------------------85
STATUS OF PREFERRED SHARES------------------------------------------------------------------------------------------------85
STAUTS OF OVERSEAS DEPOSITARY RECEIPTS -------------------------------------------------------------------------------85
STATUS OF EMPLOYEE STOCK OPTION ----------------------------------------------------------------------------------------85
STATUS OF NEW RESTRICTED EMPLOYEE SHARES --------------------------------------------------------------------------85
STATUS OF NEW SHARES ISSUANCE IN CONNECTION WITH MERGERS OR ACQUISITIONS ----------------------------85
IMPLEMENTATION OF THE CAPITAL ALLOCATION PLANS ------------------------------------------------------------------85
OPERATIONAL HIGHLIGHTS ----------------------------------------------------------------------------------------- 86

5.1.
5.2.
5.3.
5.4.
5.5.
5.6.
5.7.
6.

BUSINESS ACTIVITIES ------------------------------------------------------------------------------------------------------------86
MARKETS AND OVERVIEW OF PRODUCTION AND SALES -------------------------------------------------------------------98
THE NUMBER OF EMPLOYEES, AVERAGE SERVICE YEAR, AVERAGE AGE AND EDUCATIONAL LEVEL
DISTRIBUTION RATIO IN LAST TWO YEARS AND UP TO THE PUBLICATION DATE OF THIS ANNUAL REPORT ------ 108
ENVIRONMENTAL PROTECTION EXPENDITURES --------------------------------------------------------------------------- 109
LABOR RELATIONS ------------------------------------------------------------------------------------------------------------- 109
INFORMATION SECURITY MANAGEMENT ----------------------------------------------------------------------------------- 110
IMPORTANT CONTRACTS ------------------------------------------------------------------------------------------------------ 112
FINANCIAL INFORMATION ------------------------------------------------------------------------------------------ 113

6.1.
6.2.
6.3.
6.4.
6.5.
6.6.

CONDENSED BALANCE SHEET AND STATEMENT OF COMPREHENSIVE INCOME FOR THE MOST RECENT FIVEYEARS – BASED ON IFRS ----------------------------------------------------------------------------------------------------- 113
FINANCIAL ANALYSIS FOR THE MOST RECENT FIVE YEARS – BASED ON IFRS -------------------------------------- 117
AUDIT COMMITTEE’S REVIEW REPORT FOR THE MOST RECENT YEAR ------------------------------------------------ 121
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020, AND
INDEPENDENT AUDITORS’ REPORT------------------------------------------------------------------------------------------- 122
FINANCIAL STATEMENTS OF PARENT COMPANY ONLY FOR THE YEARS ENDED DECEMBER 31, 2021 AND
2020, AND INDEPENDENT AUDITORS’ REPORT ----------------------------------------------------------------------------- 195
THE COMPANY SHOULD DISCLOSE THE FINANCIAL IMPACT TO THE COMPANY IF THE COMPANY AND ITS
AFFILIATED COMPANIES HAVE INCURRED ANY FINANCIAL OR CASH FLOW DIFFICULTIES IN 2021 AND AS OF

THE DATE OF THIS ANNUAL REPORT. ---------------------------------------------------------------------------------------- 265

7.

REVIEW AND ANALYSIS OF FINANCIAL POSITION, FINANCIAL PERFORMANCE, AND
RISK MANAGEMENT --------------------------------------------------------------------------------------------------- 265
7.1.
7.2.
7.3.
7.4.
7.5.
7.6.
7.7.

8.

SPECIAL DISCLOSURE ------------------------------------------------------------------------------------------------ 275
8.1.
8.2.
8.3.
8.4.

9.

ANALYSIS OF FINANCIAL POSITION ------------------------------------------------------------------------------------------ 265
ANALYSIS OF FINANCIAL PERFORMANCE ----------------------------------------------------------------------------------- 266
ANALYSIS OF CASH FLOW ----------------------------------------------------------------------------------------------------- 268
THE EFFECT UPON FINANCIAL OPERATIONS OF ANY MAJOR CAPITAL EXPENDITURES DURING THE MOSTRECENT FISCAL YEAR --------------------------------------------------------------------------------------------------------- 268
REINVESTMENT POLICY FOR THE MOST RECENT FISCAL YEAR, THE MAIN REASONS FOR PROFITS OR
LOSSES GENERATED THEREBY, IMPROVEMENT PLANS, AND INVESTMENT PLANS FOR THE COMING YEAR------ 268
ANALYSIS OF RISK MANAGEMENT------------------------------------------------------------------------------------------- 269
OTHER MATERIAL MATTERS -------------------------------------------------------------------------------------------------- 273

INFORMATION OF AFFILIATED COMPANIES --------------------------------------------------------------------------------- 275
PRIVATE PLACEMENT OF SECURITIES IN 2021 AND AS OF THE DATE OF THIS ANNUAL REPORT --------------------- 278
STATUS OF THE COMPANY’S COMMON SHARES HELD AND DISPOSED BY SUBSIDIARIES IN 2021 AND AS OF
THE DATE OF THIS ANNUAL REPORT ----------------------------------------------------------------------------------------- 278
OTHER NECESSARY SUPPLEMENT -------------------------------------------------------------------------------------------- 278
LATEST MATTERS WITH MATERIAL IMPACTS ON SHAREHOLDERS’ INTERESTS OR
SECURITY PRICES INDICATED IN PARAGRAPH 3 SUBPARAGRAPH 2 OF ARTICLE 36 OF
THE SECURITIES AND EXCHANGE ACT IN 2021 AND AS OF THE DATE OF THIS ANNUALREPORT --------------------------------------------------------------------------------------------------------------------- 278

1.

Letter to Shareholders

Dear Shareholders,Though global industrial and economic development in 2021 continued to be affected by
COVID-19, it has prompted to adapt to the pandemic changes by adopting various technologies,
such as remote technology, AI, VR, and automatic production. Benefited from the pressure of
global digital transmission, it has led to a great demand in memory market. Transcend has reached
a better performance in revenue and profit compared with 2020, despite the rising costs triggeredby the component shortage and global port congestion. I would like to express my sincere gratitude
to all the shareholders, clients, suppliers, and employees, whose support and trust have led
Transcend through all the ups and downs and created another great accomplishment.
Transcend’s consolidated revenue totaled NT$14.3 billion in 2021. Consolidated gross profit
totaled NT$4.18 billion, with a gross profit rate of 29.2 percent. Operating income totaled NT$2.89
billion. Income before tax totaled NT$3.13 billion. Net income totaled NT$2.53 billion. EPS was
NT$5.90 calculated at the weighted average of outstanding share capital of NT$4.3 billion.
In the post-pandemic era, all kinds of lifestyle have gradually shifted to online and remote, which
simultaneously leads to the development of home economy and contactless economy. The
metaverse, 5G communication, AIoT, and virtual economy have led to a strong growth in thememory market demand. Transcend has been actively investing in the development of embedded
solutions and strategic products by launching brand-new 112-layer 3D NAND storage solutions,industrial SSDs with high-performance and high-endurance, as well as new-gen DDR5 memory
modules. Transcend has readily prepared to meet the needs of diverse industrial applications. In
terms of the consumer market, Transcend has been dedicated to creating strategic products to fulfill
the needs of various customers, including the high-performance PCIe M.2 SSD 240S designed foradvanced gamers and content creators, the high-speed USB flash drive JetFlash 930C to support
the next-gen home video game consoles, dual-camera dashcam DrivePro 620 and the DrivePro 20,
both designed with high-sensitivity image sensor.
In addition to the dedication in the innovation and continuation of brand power, digitaladvertisements have been placed in the main industrial markets in order to expand the popularity
and influence of the brand in the industrial market; while in the consumer market, in response to
the impact of the pandemic on physical channels and events, more resources have concentrated on
establishing and optimizing e-commerce platforms. With online e-commerce, virtual shows, social
media, and collaboration with KOL, Transcend has implemented the omnichannel strategy thatcreates deeper interactions with consumers and enhances brand value, in order to arrange the newretail era. These efforts proved their merit when Transcend was listed as one of Interbrand’s Top 25
Best Taiwan Global Brands in 2021 for the 15th year in a row.
Transcend is also active in social engagement in Taiwan, by continuously sponsoring youth athletic
activities such as the High School Basketball League, High School Volleyball League and Black
Panthers Cup. We have also initiated the long-term Remote Area Basseball Seed Program aimed atunderprivileged school baseball teams since 2015, expecting to nurture more future sport stars for
Taiwan. Above all, Transcend has demonstrated our commitment to corporate social responsibility
and sustainable development.
Looking forward to 2022, Transcend will continue to develop new products, strengthen supply
chain management, improve production performance and create a win-win situation with ourcustomers. Thank you for your investment and continued interest in Transcend. We look forward to
growing together into a better tomorrow.
Chairman: Shu, Chung-Won-1-2. Company Profile
2.1. Date of Incorporation
Date of Incorporation: August 30, 1989.
2.2. Company History
Year
1989

-

1990

-

1991
1992

-

1993
1994

1995

1996

-

1997

-

1998

-

Milestones
Transcend Information, Inc. is founded by Peter Shu in Taipei,
Taiwan.
The first products offered are the “JetMate” laser printer driverand the “KeyPro” software protection system.
Authorized and paid-in capital: NT$ 10,000,000
Transcend USA opens in Los Angeles, California.
Transcend begins manufacturing Taiwan's earliest laser printercontroller for producing Chinese characters.
Transcend begins to offer PCRAM expansion cards for desktops.
Authorized and paid-in capital: increased to NT$ 20,000,000
Transcend opens its Hamburg, Germany office.
Transcend begins manufacturing software securit y solutions.
Authorized and paid-in capital: increased to NT$ 60,000,000
Transcend is recognized as one of Taiwan's remarkable Smalland Medium Enterprises (SMEs) for outstanding performance ininformation application.
Transcend begins to offer PCMCIA expansion products for
laptop computers.
Transcend's annual revenue totaled NT$1.5 billion, up 135%.
Authorized and paid-in capital: increased to NT$ 102,000,000
Transcend begins to offer PCMCIA flash card products.
Transcend's annual revenue totaled NT$2.4 billion, up 62%.
Authorized and paid-in capital: increased to NT$ 162,000,000
Transcend expands its European operations by opening an officein Rotterdam, the Netherlands.
Transcend launches proprietary memory products for fax
machines and video game consoles.
Transcend opens distribution centers and bonded factories,
facilitating foreign trade.
Transcend opens a branch office in Tokyo, Japan.
Transcend launches its first digital still camera memory
products.
Transcend is awarded ISO -9001 Certification.
Transcend merged Won Deng Co., Ltd. Authorized and paid-in
capital: increased to NT$ 182,000,000.
Executed capital increase through capitalization of retained earnings of NT$
182,000,000 and cash capital increase of NT$ 60,700,000. The authorized
and paid-in capital was increased to NT$ 424,700,000. In addition, theretroactive handling of public offering was performed.
Transcend receives the National Award of Outstanding SMEs.
Executed capital increase through capitalization of retained earnings of NT$
84,940,000 and capital increase through capitalization of capital reserves of
-2-

-

1999

-

2000

-

2001

-

2002

-

2003

-

2004
2005

2006

-

NT$ 42,470,000. The authorized and the paid-in capital was increased toNT$ 552,110,000.
Transcend begins offering PC133 and Rambus memory modules.
Transcend receives Taiwan's 2nd annual Rising Star Award foroutstanding performance in foreign trade.
Transcend opens its first two retail stores in Taipei.
Transcend's annual revenue totaled NT$4.3 billion, up 34%.
Executed capital increase through capitalization of retained earnings of NT$
331,266,000 and capital increase through capitalization of capital reserves of
NT$ 55,211,000. The authorized capital was NT$ 2,000,000,000 and thepaid-in capital was increased to NT$ 938,587,000.
Transcend opens its retail store in Hong Kong.
Transcend launches its first DDR memory products.
Transcend moves into E-commerce by offering on-line direct B2C sales ofTranscend-brand products in Taiwan.
Transcend's annual revenue totaled NT$5.74 billion, up 42%.
Executed capital increase through capitalization of retained earnings of NT$
328,505,450, capital increase through capitalization of capital reserves of
NT$ 46,929,350 and the cash capital increase of NT$ 10,978,200. The
authorized capital remains NT$ 2,000,000,000, and the paid-in capital wasincreased to NT$ 1,325,000,000.
Transcend holds its Initial Public Offering on the Taiwan Stock
Exchange.on May 3, 2001.
Executed capital increase through capitalization of retained earnings of NT$
331,250,000 and capital increase out of employee bonus of NT$ 8,870,000.
The authorized capital was increased to NT$ 2,500,000,000 and the paid-in
capital was increased to NT$ 1,665,120,000.
Transcend expands its product line to include JetFlash USB flas hdrives and card readers.
Executed capital increase through capitalization of retained earnings of NT$
340,880,000. The authorized capital was NT$ 2,500,000,000 and the paid-in
capital was increased to NT$ 2,006,000,000.
Transcend company headquarter is relocated to its large newfacilit y in Taipei's Neihu Technology District.
Transcend launches its StoreJet line of flash memory storage
products.
Transcend expands product line to include disk storage anddisplay systems.
Issuance of Euro -Convertible Bonds US$35,000,000.
Transcend's annual revenue totaled NT$9.52 billion, up 47%.
Transcend begins offering DDR2 memory modules andintroduces a number of multimedia products to the market.
Transcend's annual revenue totaled NT$14.59 billion, up 53%.
Transcend opens branch offices in Hertfordshire, England andMaryland, USA.
Transcend diversifies its range of flash products to include MP3
music players.
Transcend receives the 13th National Qualit y Award.
Transcend wins iF Design Award 2005.
Transcend unveils its Operation Facilit y in Shanghai, China.
-3-

-

2007

-

2008
-

2009
-

2010

-

2011

-

2012

-

-

Transcend becomes the first company in the world to receive ISO 9001, ISO
14001 and HSPM (QC 080000) certifications.
Transcend is honored with 2006 Taiwan Superior Brands award from the
Bureau of Foreign Trade, commissioned by the Ministry of Economics
Affairs (MOEA) of Taiwan.
Transcend celebrates its 20th anniversary as it opens its
Shanghai factory.
Transcend opens office in Osaka, Japan.
Transcend is named by GfK the No.1 brand of Memory Devices (Memory
Cards and USB drive) in 2006 in Taiwan's retail market.
Transcend Korea opens in Seoul, South Korea.
Transcend wins Best Taiwan Global Brands commissioned by the MOEA of
Taiwan with a brand value of USD $244 million.
Transcend wins Taiwan Excellence Award for 5 consecutive years with a
total of 19 products being awarded.
Transcend is ranked 62nd place as "Top 100 IT Brands o 2008"
by Bloomberg Businessweek.
Transcend wins Germany's Red Dot award for its product design.
Transcend wins Japan's Good Design award.
Transcend is the first memory module manufacturer in the world to garnerfive Quality Management System certificates issued by the International
Organization for Standardization.
Transcend's patented non-volatile memory technology wins the silver prizeof National Invention and Creation Award from the Taiwan Intellectual
Property Office (IPO).
Transcend's StoreJet 25M and StoreJet 25C external hard drives wins
Germany's Red Dot award for their design.
Transcend's JetFlash T5 USB flash drive wins Japan's Good Design award.
Transcend is the world's third-largest flash drive manufacturer with a global
market share of 11.6%, according to a Gartner survey in 2008.
Transcend launches a complete series of USB 3.0 flash solutions.
Transcend's patented flash memory technology wins the golden prize of
National Invention and Creation Award from the Taiwan IPO.
Transcend completes its Neihu factory in Taipei, Taiwan.
Transcend opens its third US office in Miami, Florida.
Transcend wins for the 5th consecutive year Best Taiwan Global Brands
commissioned by the MOEA of Taiwan.
Transcend's patented non-volatile memory technology wins the silver prizeof National Invention and Creation Award from the Taiwan IPO.
Transcend extends its corporate social responsibility by sponsoring youth
sports activities, such as the HBL.
Transcend organizes its first Working Holiday program, aiming to attract
young talents from all over the globe.
Transcend expands its product line with wireless storage products.
Transcend wins the award for best companies to work for commissioned by
Taipei City Government Labor Affairs Bureau.
Transcend is named the third-largest manufacturer of USB flash drives andthe fourth-largest manufacturer of memory cards in the world, according to a
Gartner survey in 2012.
Transcend continues to expand its sponsorship of all youth sports events,
-4-

-

2013

-

2014

-

2015
-

2016
2017

-

2018
2019

-

including basketball, volleyball, cheerleading, soccer, and softball
tournaments.
Transcend opens office in Silicone Valley, USA.
Transcend expands its product line to include DrivePro dashcams.
Transcend receives the ISO/TS 16949:2009 Quality Management System
Certification by SGS, demonstrating Transcend’s continuous improvement inquality management to meet the needs of the automotive industry.
Transcend wins Taiwan Excellence Award for the 10th consecutive year witha total of 48 products being awarded.
Transcend's patented memory block management technology wins the silver
prize of National Invention and Creation Award from the Taiwan IPO.
Transcend wins the award for best companies to work for commissioned by
Taipei City Government Labor Affairs Bureau.
Transcend expands its product line to include Mac-compatible upgrade
solutions.
Transcend expands its DrivePro dashcam product line and is honored with
ICT Month 100 I.T. Innovative Elite Award.
Transcend begins to sponsor the 2nd Black Panther High School BaseballTournament.
Transcend expands its product line to include DrivePro Body wearable
cameras.
Transcend wins Good Design Award 2015 for the design of its DrivePro 520
dashcam and JetDrive Lite expansion cards for Mac.
Transcend initiates its long-term Baseball Mentoring Program aimed atunderprivileged school baseball teams, aspiring to help young promisingathletes fulfill their dreams.
Transcend expands its product line to include StoreJet Cloud personal cloudstorage.
Transcend wins for the 10th consecutive year Best Taiwan Global Brands
commissioned by the MOEA of Taiwan.
Transcend's DrivePro 50 dashcam wins Japan's Good Design Award 2016.
Transcend's embedded SSDs are in fourth place in global market share,
according to a Gartner survey in 2015.
Transcend launches its first PCIe M.2 SSD series.
Transcend wins Good Design Award 2017 for its CM42 M.2 SSD enclosure
kit.
Transcend is honored by Taiwan's Ministry of Education for the first time in2017 for actively promoting sports activities.
Transcend continues to sponsor youth sports events, winning the silver prizeof Sports Activist Awards and the Long-Term Sponsorship Award in 2017.
Transcend launches a dual lens dashcam and a body camera with a tetheredcamera unit, and is honored with ICT Month 100 I.T. Innovative EliteAward.
Transcend wins Taiwan Excellence Award for the 15th consecutive year witha total of 77 products being awarded.
Transcend's JetDrive 855 SSD Upgrade Kits for Mac wins Japan's Good
Design award.
Transcend is honored with the golden prize of Sports Activist Awards for its
continuous efforts in sponsoring youth sports events.
Transcend unveils its cutting-edge Portable SSD product series.
-5-

-

2020
2021

-

Transcend is granted 2019 Badge of Accredited Healthy Workplace by
Taiwan's Ministry of Health and Welfare for health promotion at theworkplace.
Transcend wins Taiwan Excellence Award for the 17th consecutive year.
Transcend expands its product line to include 3D NAND SSDs with
Extended Temperature Tolerance.
Transcend launches its first CFExpress Type B memory card.
Transcend launches its first QLC NAND SSD.
Transcend wins Top 25 Internation Brands in Taiwan for the 15th
consecutive year.
Transcend launches its first PCIe Gen4 x4 SSDs.
Transcend launches its first motorcycle dashcam DrivePro 20.
Transcend launches the DDR5-4800 DRAM module product line.
Transcend launches industrial-grade 112-layer 3D NAND SSDs.

-6-

3. Corporate Governance Report
3.1. Organization
3.1.1. Organizational Chart-7-

3.1.2. Major Corporate Functions
Department

Sales

Functions

Responsible for the establishment of the sales plan for all markets worldwide, including
physical/virtual channels, direct stores and project brands of the Company, industry grade,
network communication/POS/medical/military application/automobile application and OEM
customers, as well as the development and maintenance of customers, business management
and promotion, collection and response to new business opportunities.

Responsible for the research, development and design related matters for memory products,
R&D
computers and mobile phone peripheral products and vehicle continuous video recording (CVR)
Tech Support
and wearable cameras.
Responsible for product production, testing, repair and production schedule control, productProduction shipping operation, production technologies, manufacturing quality improvement and related
matters.
Responsible for the management of reasonable pricing and fair distribution of the Company’s
products, summarization and analysis of product information and pros/cons of products of eachproduct line, and also provide assistance to customization demands. Responsible for mattersPM &related to the brand marketing activities, strengthening of brand image, product and market
Marketinginformation collection, establishment and execution of marketing plans, contact and applicationof broadcast media, planning of the Company’s website and assistance to sales activity
arrangement and design, etc.
FAD

Responsible for the Company’s financial analysis, accounting affairs, statements preparation,difference analysis, fund management, planning of the Company’s taxes, finance, stock affairs
and investments as well as monitoring of the cash flow of all subsidiaries.

PUR

Responsible for understanding the quality condition and price trend of raw materials,
component parts, machine equipment and office supplies necessary for the products andoperation of the Company in order to perform price negotiation and purchase. It is also
responsible for maintaining the safety stock of the purchase items and assisting the handling ofslow-moving materials.

Information Responsible for matters related to the Company’s software and hardware constructions for
Systemsystems, networks and computers.

ADM

Responsible for coordinating the Company’s administrative management, human resource,
legal, patent and trademark related affairs, in order to ensure that all administrative affairs of theCompany comply with the laws and regulations, and also responsible for establishing internal
regulations according to laws in order to ensure the compliance of all employees in theorganization.

Responsible for the establishment of the Company’s quality assurance system, promotion of
Quality
ISO system and QA management system, direct internal audit and external certification, andAssurance communication with other departments to achieve objectives of the organization, customer audit
and subsequent follow-up management.
Responsible for the monitoring and assessment of the design of internal control systems of the
Audit Office parent company and its subsidiaries and also determine whether their executions are effective,
and propose improvement recommendations.

-8-3.2. Background Information on Directors, General Managers, Vice General Managers, Assistant Managers and Heads of Various Department and Branches
3.2.1. Directors
April 19, 2022

Title

Nationality/
Place of
Incorporation

Name

GenderAge

DateElectedTerm(Years)Date FirstElectedShareholding when
Current Shareholding
ElectedShares%Shares%Spouse & Minor
Shareholding

Shareholding by
NomineeArrangement

SharesShares%Male
Chairman

R.O.C

SHU,
CHUNG-WON

61-70
years old

2021.08.26

3

2003.06.03

9,990,453

2.33%

9,990,453

2.33%

-

0.00%

-

Male
Director

R.O.C

SHU,
CHUNG-CHENG

71-80
years old

2021.08.26

3

2004.06.11

6,244,098

1.46%

6,244,098

1.46%

-

0.00%

-

FemaleDirector

R.O.C

CHUI, LI-CHU

61-70
years old

2021.08.26

32021.08.26

3

2003.06.03(discharged
on2009.6.13
after
expiration of
two terms ofoffice)2021.08.26

32021.08.26

Male
Director

R.O.C

HSU,
CHIA-HSIAN

Director

R.O.C

CHEN, PO-SHOU

61-70
years old2015.06.12

-

0.00%

-

0.00%

9,990,453

2.33%

-

Title

Name

Relation

CEO of Transcend Information Inc.
Department of Electrical
Chairman of Taiwan IC Packaging
Engineering, National Cheng Corporation
Kung University
Director of C-Tech Corporation and
0.00%
Project Manager of Hewlett- Transcend Information Trading GmbH
Packard Development
Supervisor of Wan An Technology Inc.
Company, L.P.
President of Transcend Information TradingGmbH

Director

SHU,
CHUNGCHENG

Brother

Chairman of C-Tech Corporation, Cheng
Chuan Technology Development Inc. and
Shu Min Investment Inc.
Executive Director of Transcend Information
Department of Civil(Shanghai), Ltd. and Transtech Trading
Engineering, National Taipei(Shanghai) Co., Ltd.
0.00% Institute of Technology
Director of Wan An Technology Inc., Won
General Manager ofChin Investment Inc., Wan Min Investment
Transcend Information Inc.
Inc., Wan Chuan Investment Inc., Saffire
Investment Ltd., Memhiro Pte. Ltd. andTranscend Information (H.K.) Limited.
Consultant of Transcend Information Inc.

Remark(Note)-

Director

CHUI,
LI-CHU

SpouseChairmanand CEOSHU,
CHUNGWON

Brother-

Director

CHUI,
LI-CHU

Seconddegree
Relatives

Chairmanand CEOSHU,
CHUNGWON

SpouseDirector

SHU,
CHUNGCHENG

Seconddegree
Relatives

Department of French,
Tamkang University
0.00%
Administrative officer of Ho
Cheng Investment Inc.

Supervisor of Won Chin Investment Inc.

Consultant of Transtech Trading (Shanghai)Co., Ltd.

None

None

None

-

San Jose State University
Economics
Sales Director of Transcend
Information, Inc.

Sales Vice General Manager of Transcend
Information, Inc.

None

None

None

-

487,2440.11%

487,244

0.11%

26,7440.01%-

Department of AutomaticControl Engineering, Feng
0.00% Chia University
President of China area ofTranscend Information Inc.

-

0.00%

-

0.00%

-

0.00%

-

0.00%

-9-

Other Position

Executives, Directors or
Supervisors Who are Spouses orwithin Two Degrees of Kinship

%

Male
41-50
years oldExperience（Education）-

TitleDirector

Indeoendent
Director

Nationality/
Place of
Incorporation

R.O.C

R.O.C

Name

WU,
KUAN-DEWANG,
YI-HSIN

Term
GenderDate Elected (Years)
Age

Date FirstElectedShareholding
when Elected

Current
Shareholding

Spouse & Minor
Shareholding

Shareholding by
NomineeArrangement

SharesSharesSharesShares%%%2021.08.26

32021.08.26

-

0.00%

-

0.00%

-

0.00%

-

Female61-70
years old

2021.08.26

3

2012.06.15

-

0.00%

-

0.00%

-

0.00%

-10-

Other Position

%

Male
31-40
years oldExperience（Education）-

Master of Mechanical Engineering,
National Taiwan University
Factory Chief of Transcend
0.00% R&D Director of Transcend Information,
Information, Inc.
Inc.

Ph.D, Accounting, University of Kentucky
Professor of Department of Accounting,National Chung Hsing University
Vice President of National Taipei
University, Library Director
Independent Director of Bestcom Infotech
Corp.
Independent Director of United
Professor of Department of Accounting,
BioPharma Inc.
National Taipei University
President and Professional Development Chairman of Accounting Research andCommittee Chairperson, Institute ofDevelopment Foundation
Internal Auditors-Chinese Taiwan
Chairman of Taipei Trend Research
Director and Member of Professional
Foundation
Ethics Committee and International
Supervisor of Telecom Technology
0.00% Relationship Committee, International
CenterInternal Audit Association
Committee Member ofFinancial Officer of Asian Alliance,“Telecommunications Universal
International Internal Audit Association
Services Fund Management Committee,
Committee Member of “Park Operation ” National Communications
Fund Supervisory Management
Commission, Executive Yuan
Committee,” National Science Council,
Director of Yu Da University of
Executive Yuan
Science and Technology
Committee Member of “Committee forGovernment Accounting Standards,”
Directorate-General of Budget,
Accounting and Statistics, Executive Yuan
Director of First Financial Holding Co.,
Ltd.

Executives, Directors or
Supervisors Who are Spouses orwithin Two Degrees of Kinship

Remark(Note)

Title

Name

Relation

None

None

None

-

None

None

None

-

TitleIndeoendent
Director

Indeoendent
Director

Nationality/
Place of
Incorporation

R.O.C

R.O.C

Name

CHEN,
YI-LIANG

CHEN,
LO-MIN

Term
GenderDate Elected (Years)
Age

Date FirstElectedShareholding
when Elected

Current
Shareholding

Spouse & Minor
Shareholding

Shareholding by
NomineeArrangement

SharesSharesSharesShares%%%2021.08.26

3

2012.06.15

-

0.00%

-

0.00%

-

0.00%

-

Male
61-70
years old

2021.08.26

3

2012.06.15

-

0.00%

-

0.00%

-

0.00%

Other Position

%

Male
61-70
years oldExperience（Education）-

MBA, University of California, Los
AngelesPresident of China area of HewlettPackard Development Company, L.P.
Financial Vice President of Taiwan area of
Hewlett-Packard Development Company,
0.00%
Director of Tai Hwa Oil Industrial Co.,
L.P.
Ltd.
Independent Director of Nano-Op Co.,Ltd.
Independent Director of Lextar
Electronics Corp.

Department of Business Administration of
National ChengChi University
Global Executive Vice President of
Diebold Inc.
President of Asia-Pacific area of Diebold
Independent Director of Hitron
0.00% Inc.
Technologies Inc.
President of Great China Business divisionof Royal Phlips
President of NCR China Co., Ltd.
Vice President of Taiwan branch of NCR
Corp.

Executives, Directors or
Supervisors Who are Spouses orwithin Two Degrees of Kinship
Title

Name

Relation

None

None

None

-

None

None

None

-

3.2.2. Disclose the name of the Institutional Shareholders if the Company’s Direcor is a representative of an Institutional Shareholder: None.
3.2.3. Top 10 Shareholders’ Names and Shareholding Ratio of the Institutional Shareholders: Not applicable.

-11-

Remark(Note)

3.2.4. Disclosure of information as professional qualifications and independent status of directors and independent directors
Criteria

Professional Qualifications and Experience

Independent Status

Department of Electrical Engineering, National Cheng Kung University.
He is former Project Manager of Hewlett-Packard Development Company,
L.P. Presently, he has been dedicated in the memory industry business
management for more than 34 years since the establishment of theCompany in 1988. In addition to the positions of Director and President at
a subsidiary 100% owned by the Company, he also acted as the Chairmanof the affiliated company of Taiwan IC Packaging Corporation andvertically integrates the industry value chain.

He is the CEO of the Company, and concurrently acts as the Director andPresident of the affiliated company of Transcend Information Trading
GmbH.

Name

SHU,
CHUNG-WONSHU,
CHUNG-CHENG

He is equipped with extensive industry knowledge, practical experience,business management and leadership, and he is also equipped with insighton the industrial development trend. With regard to the promotion ofoverseas market business, he also understands various commercial
environment, economy, culture and relevant risks. Accordingly, his
valuable experience is able to propose comments and directives on mattersrelated to corporate governance, operational management and risk
management to the board of directors of the Company, thereby achieving
the functions of strategic guidance and performance improvement.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

He is in a marital relationship with Director CHUI, LI-CHU.
SHU, CHUNG-CHENG is a second-degree relative of him and he also
acts the Director of affiliated companies of Transcend Information(Shanghai) Ltd., Transtech Trading (Shanghai) Ltd., Transcend
Information (H.K.) Ltd., Won Chin Investment Inc., Saffire Investment
Ltd., and Memhiro Pte. Ltd.
The number of shares held by him and his second-degree relative SHU,CHUNG-CHENG is 16,234,551 shares, accounting for 3.78%, and they
are listed as individual shareholders of the top 10 shareholding percentage.

0

Act as the Chairman of Taiwan IC Packaging Corporation, an affiliatedcompany invested under the equity method.

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.

Not been a person of any conditions defined in Article 30 of the Company
Law.

Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

Department of Civil Engineering, National Taipei Institute of Technology.
Acted as the President of the Company from November 1998 to March

He is the Director of affiliated companies of Transcend Information(Shanghai) Ltd., Transtech Trading (Shanghai) Ltd., Transcend

-12-

0

Criteria

Professional Qualifications and Experience

Independent Status2020. Currently acts as a consultant of the Company. He has been
dedicated in the memory industry business management for more than 24
years, and also acts as the Chairman or Director in related companies of
the Company, in order to contribute his expertise in corporate governance.

Information (H.K.) Ltd., Won Chin Investment Inc., and Saffire
Investment Ltd., Memhiro Pte. Ltd.

Name

He is equipped with extensive industry knowledge, practical experience,business management and crisis handling capabilities, and also has certain
understanding on the overall business policy, objective of the overall
operation as well as major business decision of the Company, such that heis able to promptly adopt changes, adjust strategies and implement timely
responsive measures. Accordingly, with his valuable experience he is able
to propose comments and directives on matters related to corporate
governance, operational management and risk management to the board of
directors of the Company, and provide references and adjustments for the
management team.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

He is in the second-degree relative relationship with Director CHUI, LICHU.
SHU, CHUNG-WON is a second-degree relative of him and he also acts
the Director and President of affiliated companies of Transcend
Information Trading GmbH.
The number of shares held by him and his second-degree relative SHU,CHUNG-WON is 16,234,551 shares, accounting for 3.78%, and they arelisted as individual shareholders of the top 10 shareholding percentage.

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.

He acts as the Chairman of Cheng Chuan Technology and also acts as the
Director of Won Chin Investment Inc., where both Cheng Chuan
Technology and Won Chin Investment Inc. are business partners of theCompany.

Not been a person of any conditions defined in Article 30 of the Company
Law.

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

CHUI, LI-CHU

Department of French, Tamkang University. Since 2006, she has assumed
positions of Supervisor of Won Chin Investment Inc. and Administrative
officer of Ho Cheng Investment Inc. She is equipped with more than 15
years of working experience in investment business, and is able to

She is not an employee, director and supervisor of affiliates.
Her spouse SHU, CHUNG-WON is the Director and President ofTranscend Information Trading GmbH.

-13-

0

Criteria

Professional Qualifications and Experience

Independent Status

promptly propose comments and directives related to corporate
governance and operation management to the board of directors of theCompany.

SHU, CHUNG-CHENG is a second-degree relative of her and he also acts
the Director of affiliated companies of Transcend Information (Shanghai)Ltd., Transtech Trading (Shanghai) Ltd., Transcend Information (H.K.)
Ltd., Won Chin Investment Inc., Saffire Investment Ltd., and Memhiro
Pte. Ltd.

Name

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.
Not been a person of any conditions defined in Article 30 of the Company
Law.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

The number of shares held by her spouse SHU, CHUNG-WON and her
second-degree relative SHU, CHUNG-CHENG is 16,234,551 shares,
accounting for 3.78%, and they are listed as individual shareholders of the
top 10 shareholding percentage.
She acts as the Supervisor of Won Chin Investment Inc. in business
relationship with the Company.
She has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

HSU,
CHIA-HSIAN

Department of Automatic Control Engineering, Feng Chia University. He
participated in the Company since the establishment in 1988 and retired in2015. He has been dedicated in the memory industry for more than 27
years and has participated in numerous projects. His last position was the
President of China area, and he is responsible for the development ofbusiness and factory establishment and management in the China region.
He is equipped with extensive information electronic industry knowledge,
practical experience, business management and decision making

He is not an employee, director and supervisor of affiliates.
His spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.
The number of shares held by him is 487,244 shares, accounting for
0.11%.

-14-0Criteria

Professional Qualifications and Experience

Independent Status

capabilities, and he is also equipped with extensive experience in industry
development along with several years of overseas practical experience. He
is able to communicate on relevant business management affairs withother directors and to provide comments and directives to the management
team.

He is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.

Not having a marital relationship, or a relative within the second degree ofkinship to any other director of the Company.

Not been a person of any conditions defined in Article 30 of the Company
Law.

Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

San Jose State University Economics. Since July 1, 2019, he has acted as
the Export Business Vice President of the Company and he is also
equipped with the seniority of 14 years of service. He is mainly
responsible for the export business unit’s annual operation goal and sales
strategy of the Company, and he also provides guidance on the businessdevelopment direction and maintains customer relationships.

He is the Sales Vice General Manager of the Company.

Name

He is equipped with extensive industry experience, and has in-depth
CHEN,PO-SHOU

understanding on the industry development trend, marketing, sales andrelevant risk management. Act as the manager of the board of directors topromptly propose comments and directives related to corporate
governance, operation management and risk management.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.

His spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.
The number of shares of the Company held by him and his spouse,
relatives within the second degree of kinship (or under the name of others)
is 0 shares.
He is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.

Not been a person of any conditions defined in Article 30 of the Company

Not having a marital relationship, or a relative within the second degree of

-15-

0

Criteria

Professional Qualifications and Experience

Independent Status

Name
Law.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

kinship to any other director of the Company.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

Master of Mechanical Engineering, National Taiwan University. He has
serviced the Company since October 18, 2010, and was promoted to
Factory Director from R&D Department Manager on October 1, 2020,
with nearly 12 years of seniority. He is mainly responsible for the productmanufacturing process arrangement, improvement of manufacturing
technologies and process quality, as well as application of relevant
information technology on manufacturing process.

WU, KUAN-DE

He is equipped with the memory industry knowledge, R&D and productmanagement, information technology application, leadership and crisis
handling capability, and he is also able to propose comments anddirectives related to the operation of the Company to the board of
directors.

He is the manufacturing unit factory affairs responsible officer of theCompany.
His spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.
The number of shares of the Company held by him and his spouse,
relatives within the second degree of kinship (or under the name of others)
is 0 shares.
He is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.

Not been a person of any conditions defined in Article 30 of the Company
Law.

Not having a marital relationship, or a relative within the second degree ofkinship to any other director of the Company.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

-16-

0

Criteria

Professional Qualifications and Experience

Independent Status

MBA, University of California, Los Angeles. He currently acts as the
Director of Tai Hwa Oil Industrial Co., Ltd. He once acted as the Presidentof China area of Hewlett-Packard Development Company, L.P., Financial
Vice President of Taiwan area of Hewlett-Packard Development Company,
L.P., and Independent Director of Nano-Op Co., Ltd. He is equipped withthe experience in corporate governance, finance, operation management
capability and cooperate business development. He is able to provide
recommendations to the management team, to improve the corporate
governance quality of the board of directors, to implement audit
committee supervisory authority and to strengthen the salary andremuneration management function.

He is not an employee, a director and supervisor of the Company or any of
its affiliates.

Name

CHEN,
YI-LIANG

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.
(with more than 30 years of professional experience in commerce, financeand corporate business development).
Not been a person of any conditions defined in Article 30 of the Company
Law.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

His spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.
The number of shares of the Company held by him and his spouse,
relatives within the second degree of kinship (or under the name of others)
is 0 shares.
He is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.

0

He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.
Not having a marital relationship, or a relative within the second degree ofkinship to any other director of the Company.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

CHEN, LO-MIN

Department of Business Administration of National ChengChi University.
He currently acts as the Independent Director of Hitron Technologies Inc.
He once acted as the Global Executive Vice President of Diebold Inc.,
President of Asia-Pacific area of Diebold Inc., President of Great China
Business division of Royal Phlips, President of NCR China Co., Ltd., andVice President of Taiwan branch of NCR Corp. He is equipped with the

He is not an employee, a director and supervisor of the Company or any of
its affiliates.
His spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.

-17-

1

Criteria

Professional Qualifications and Experience

Independent Status

experience in corporate governance, operation management capability andcooperate business development. He is able to provide recommendations
to the management team, to improve the corporate governance quality ofthe board of directors, to implement audit committee supervisory authority
and to strengthen the salary and remuneration management function.

The number of shares of the Company held by him and his spouse,
relatives within the second degree of kinship (or under the name of others)
is 0 shares.

Name

Have Work Experience in the Areas of Commerce, Law, Finance, or
Accounting, or Otherwise Necessary for the Business of the Company.
(with more than 30 years of professional experience in commerce, financeand corporate business development).
Not been a person of any conditions defined in Article 30 of the Company
Law.

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

He is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.
He has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.
Not having a marital relationship, or a relative within the second degree ofkinship to any other director of the Company.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

WANG, YI-HSIN

Ph.D, Accounting, University of Kentucky. She is equipped with financial
and accounting processional expertise. She currently acts as the Professorof Department of Accounting, National Taipei University, Chairman of
Accounting Research and Development Foundation, Committee Member
of “Telecommunications Universal Services Fund Management
Committee,” National Communications Commission Executive Yuan, andDirector of Yu Da University of Science and Technology. She once acted
as the Professor of Department of Accounting, National Chung Hsing
University, Vice President of National Taipei University, Director of First
Financial Holding Co., Ltd., Independent Director of Bestcom Infotech
Corp., Independent Director of United BioPharma Inc., President andProfessional Development Committee Chairperson, Institute of Internal
Auditors-Chinese Taiwan, Director and Member of Professional Ethics

She is not an employee, a director and supervisor of the Company or anyof its affiliates.
Her spouse, relative within the second degree of kinship or direct blood
relative within the third degree of kinship is not an employee, director andsupervisor of the Company or its affiliates.
0
The number of shares of the Company held by her and her spouse,
relatives within the second degree of kinship (or under the name of others)
is 0 shares.
She is not assuming any position of director, supervisor or employee of acompany having a special relationship with the Company.

-18-

Criteria

Professional Qualifications and Experience

Independent Status

Committee and International Relationship Committee, International
Internal Audit Association and Financial Officer of Asian Alliance,
International Internal Audit Association. She is equipped with theprofessional skills in corporate governance, finance and accounting, as
well as internal audit. She is able to provide recommendations to the
management team, to improve the corporate governance quality of theboard of directors, to implement audit committee supervisory authority
and to strengthen the salary and remuneration management function.

She has not provided the services of commerce, law, finance andaccounting to the Company or its affiliates in the last 2 years.

Name

Not having a marital relationship, or a relative within the second degree ofkinship to any other director of the Company.
Not a governmental, juridical person or its representative as defined in
Article 27 of the Company Law.

Have an Instructor or Higher Position in a Department of Commerce, Law,
Finance, Accounting, or Other Academic Department Related to the Business
Needs of the Company in a Public or Private Junior College, College or
University., and Work Experience in the Areas of Commerce, Law,

Finance, or Accounting, or Otherwise Necessary for the Business of theCompany. (with more than 30 years of professional experience incommerce, finance and corporate business development).
Not been a person of any conditions defined in Article 30 of the Company
Law.

-19-

Number of Other
Public Companies
in Which the
Individual is
Concurrently
Serving as an
Independent
Director

3.2.5. Diversity and Independence of the Board of Directors(1)Diversity of the Board of Directors
The nomination and election of board members of the Company comply with the ”Procedures for Election of Directors” and ”Corporate
Governance Best-Practice Principles” , in order to ensure the diversity and independence of board members. According to Article 20 ofthe”Corporate Governance Best-Practice Principles” of the Company, the composition of the board of directors shall consider the diversity,
focusing on gender equality, and directors shall be generally equipped with knowledge, skills and expertise necessary for executing their job duties.
To realize the ideal of corporate governance, the board of directors as a whole shall possess the abilities, including operational judgment capability,
accounting and financial analysis capability, business management capability, crisis handling capability, industrial knowledge, international market
view, leadership capability, decision-making capability, etc.
The Company’s diversity policy for current Board members and its implementation are as follows:-20-

Core ofdiversify

Basic composition
Tenure and seniority
of independent
directors

Age40-60 61-70

Shu,
Chung-Won
Shu,
Chung-Cheng

V

Professional ability
Accounting

Bank

Nationality Gender Employee
Name

Industry experience

Over Below 3-9 Over 9
71 3 years years years

Business
Marketingmanagement

andInformation

Risk

R&D
Financial Technology Management
Analysis

R.O.C

Male

V

R.O.C

Male

Chui, Li-Chu

R.O.C

FemaleV

V

Hsu,
Chia-Hsian

R.O.C

Male

V

V

Chen, Po-Shou

R.O.C

Male

V

V

V

Wu, Kuan-De

R.O.C

Male

V

V

V

Chen, Yi-Liang

R.O.C

Male

V

V

V

V

V

Chen, Lo-Min

R.O.C

Male

V

V

V

V

V

Wang, Yi-Hsin

R.O.C

Female

V

V

V

V

V

V

-21-

V

V

V

V

V

V

V
V
V

V

V

V

V
V

V

V

V

All directors are equipped with extensive experience in leadership, decision, operation determination, business management, crisis handling, andare also equipped with industrial knowledge and international market view such that they are equipped with various capabilities necessary to
execute the corporate governance. Independent directors, Mr. CHEN, YI-LIANG, Mr. CHEN, LO-MIN and Ms. WANG, YI-HSIN, are equippedwith the professional backgrounds in accounting and financial analysis, such they are able to provide professional recommendations to theCompany from different viewpoints and aspects.
The current nine directors are of the nationality of the R.O.C., and the composition structure includes three independent directors, accounting for
33% of all directors. Three directors have the identity of an employee, accounting for 33%, and two directors are female directors (including one
independent director), accounting for 22%. Furthermore, with regard to the age distribution, one director is above the age of 71 years old, six
directors are of the age of 61–70 years old, and two directors are under the age of 60 years old. In addition to the above, according to “Taiwan
Stock Exchange Corporation Operation Directions for Compliance with the Establishment of Board of Directors by TWSE Listed Companies andthe Board’s Exercise of Powers,” the Chairman and CEO of the Company refer to the same person, and no less than four independent directors
shall be established before the end of 2023. Through the addition of new independent directors, the diversity and independence of the board of
director composition can be enhanced.
(2) Independence of the Board of Directors
According to the provisions of the Securities and Exchange Act, the Company has obtained written declarations issued by all independent directors
during their assumption of office, and they are confirmed to comply with the provision specified in Article 14-2 of the Securities and Exchange Act
and relevant requirements specified in Regulations Governing Appointment of Independent Directors and Compliance Matters for PublicCompanies. The number of terms of office of the independent directors of the Company has reached four terms consecutively, and to further
emphasize the supervision and implement external independent functions, fixed compensation is provided to independent directors only.
Accordingly, after evaluation, the independence thereof is not reduced.
The Company is of the opinion that the board of directors is able to evaluate the independence of directors according to actual condition, including
the required recusal of directors due to conflict of interest, and to provide reports on important operation affairs, risk management, sustainable
operation issues and corporate governance, and whether directors are able to express perspectives different from other directors. In addition,according to the provisions of Paragraph 3 and Paragraph 4 of Article 26-3 of the Securities and Exchange Act, the percentage of directors having
the relationship of a spouse or relatives within the second degree is 33% only, less than half of the total number of directors, and it is evaluated ascomplying with the regulations.
-22-3.2.6. Management Team
April 19, 2022
Title

Nationality

Name

Gender

Date
ElectedShareholding
Shares%Spouse & Minor
Shareholding

Shareholding
by Nominee
Arrangement

SharesShares%Experience (Education)

Other
Position%
Department of ElectricalEngineering, National
Cheng Kung University
 Project Manager of
0.00%
Hewlett-Packard
Development Company,
L.P.
 Chairman of Transcend
Information, Inc.
 Department of Electronic
Engineering, Inha
University
 Chairman of Samsung
0.00%Electronics Taiwan Co.,Ltd.
 General Manager ofTranscend Information,
Inc.
 University of Illinois
MBA
0.00%  Sales Vice General
Manager of Transcend
Information, Inc.
 Master of Information
Management, National
Taiwan University of
0.00%
Science and Technology
 R&D Vice General
Manager of Transcend
Information, Inc.

Managers who are Spouses orWithin Two Degrees of Kinship

Remark(s)

Title

Name

Relation(Note 2)

None

None

None

-

None

None

None

None

-

None

None

None

None

-

None

None

None

None

-



Chairman& CEO(Note 1)

R.O.C

Shu,
Chun-Won

Male

1991.06.01 9,990,453

2.33%

-

0.00%

-

GeneralManager

Korea

Hong,
Wan-HoonMale

2020.03.05

-

0.00%

-

0.00%

-

Vice
GeneralManager

R.O.C

Wang,
Jen-Ming

Male2017.07.01

-

0.00%

-

0.00%

-

Vice
GeneralManager

R.O.C

LI,
TSENG-HOMale

2020.10.01

-

0.00%

4,000

0.00%

-

-23-

April 19, 2022
Title

Nationality

Name

Gender

Date
ElectedShareholding
Shares%Spouse & Minor
Shareholding

Shareholding
by Nominee
Arrangement

SharesShares%Experience (Education)

%

Other
PositionManagers who are Spouses orWithin Two Degrees of Kinship
Title

Name

Remark(s)Relation

University of Southern
California Electrical
Vice
Engineering
Fang,
General
R.O.C
Male 2019.09.01- 0.00% 25,967 0.01%- 0.00%  Administration Vice
None
None
None
None
Wen-Jeng
Manager
General Manager ofTranscend Information,
Inc.
 San Jose State University
Director
Economics& ViceChen,
R.O.C
Male 2019.07.01- 0.00%- 0.00%- 0.00%  Sales Vice General
None
None
None
None
GeneralPo-ShouManager of TranscendManager
Information, Inc.
 Master of Accounting,National Taiwan
CFO &University
Corporate
Hsiao,
R.O.C
Male(Note 3)
- 0.00%- 0.00%- 0.00%  Financial and
None
None
None
None
Governan
Sheng-Yin
Accounting Manager ofce Officer
Transcend Information,
Inc.
Note 1: Due to the needs of the Company’s operation and business development, presently, the Chairman and CEO refer to the same person. However, a majority of the directors are not concurrently
assuming the positions of employees or managerial officers. The supervisory function of the board of directors is still complete. In the future, to cope with the regulatory requirements, the structureof the board of directors is planned to be adjusted (such as the increase of the number of independent directors).
Note 2: Chairman of Taiwan IC Packaging Corporation
Director of C-Tech Corporation and Transcend Information Trading GmbH
Supervisor of Wan An Technology Inc.
General Manager of Transcend Information Trading GmbH
Note 3: Elected date of CFO: August 1, 2019; Elected date of Corporate Governance Officer: May 6, 2021.
-24-

3.2.7. Remuneration of Directors, Independent Directors, General Manager and Vice General Managers
1. Remuneration of Directors and Independent Directors
Dec.31,2021; Unit:NT$ thousands
Remuneration

Title

Base
Compensation (A)Severance Pay(B)

Directors
Compensation (C)Allowances (D)Companies intheconsolidatedfinancialstatemen
ts

The
com
pany

Companies in the
consolidatedfinancialstatemen
ts

The
comp
any

Companies in the
consolidatedfinancialstatemen
ts

The
com
pany

Companies intheconsolidatedfinancialstatemen
ts

The
compa
ny

2,400

2,400

-

-

2,300

2,300

260

260

2,160

2,160

-

-

900

900

330

330

Name
The
comp
any

Chairman
Director
Director
Director
Director(Note 2)
Director(Note 2)
Director(Note 2)
Director(Note 2)
Independent
Director
Independent
Director
Independent
Director

Shu,
Chung-Won
Shu,
Chung-Cheng
Chui, Li-Chu
Hsu,
Chia-Hsian
Wang,
Jen-Ming

Ratio of Total
Remuneration(A+B+C+D) to Net
Income (%)

Relevant Remuneration Received by Directors Who are Also Employees

Salary, Bonuses,
and Allowances (E)Severance Pay(F)

Companies intheconsolidatedfinancialstatemen
ts

The
com
pany

Companies in the
consolidatedfinancialstatements

Companies in the
consolidatedfinancialstatemen
ts

The
compa
ny

0.20%

0.20%

13,856

13,856

-

0.13%

0.13%

-

-

-

Employee Compensation (G)(Note)

The company

Companies intheconsolidated
financialstatements

Cash

Stock

Cash

Stock

-

903

-

903

-

-

-

-

Ratio of Total
Compensation(A+B+C+D+E+F+
G) to Net Income(%)

Remunerationfrom
venturesother
thansubsidiaries orfrom theparentcompan
y

The
compa
ny

Companies in theconsolidatedfinancialstatemen
ts

-

0.78%

0.78%

963

-

0.13%

0.13%

-

Li, Tseng-Ho
Chen,
Po-Shou
Wu,
Kuan-DeChen,
Yi-Liang
Chen,
Lo-MinWang,
Yi-Hsin-25-

1. Please describe the policy, system, standard, and structure of remuneration to independent directors, and the correlation between duties, risk, and time input with the amount of remuneration:
Transportation allowance is issued according to the attending status of the independent directors of the Company in the board of directors’ meetings and functional committees. The determination of the remuneration of directors is made based on the considerationof the overall business performance of the Company, future operational risk and development trend of the industry, along with the consideration of the contribution of each director on the operation of the Company and the annual performance evaluation result by
the board of directors (including individual director), in order to issue reasonable remuneration. According to Article 22 of the Articles of Incorporation of the Company, where the Company has a profit for each fiscal year, the Company shall set aside no morethan 0.2% of the profit for distribution to directors as remuneration.
2. In addition to the above remuneration, director remuneration shall be disclosed as follows when received from companies included in the consolidated financial statements in the most recent year to compensate directors for their services, such as being independent
contractors: NT$2,800 thousands.
Note 1: The compensation of employees approved by the Board of Directors for the year ended December 31, 2021 is NT$31,542,266.
Note 2: The Company has conducted the election of directors on August 26, 2021. Wang, Jen-Ming and Li, Tseng-Ho were dismissed on August 26, 2021; Chen, Po-Shou and Wu, Kuan-De assumed the office on August 26, 2021.

-26-

Name of Directors
Total of (A+B+C+D)

Total of (A+B+C+D+E+F+G)

Range of Remuneration
The company

Companies in the consolidated
financial statements

Less thanNT$ 1,000,000

Shu, Chung-Won,
Shu, Chung-Cheng, Chui, Li-Chu,
Hsu, Chia-Hsian,Wang, Jen-Ming, Li, Tseng-Ho,
Chen, Po-Shou, Wu, Kuan-De

Shu, Chung-Won,
Shu, Chung-Cheng, Chui, Li-Chu,
Hsu, Chia-Hsian,Wang, Jen-Ming, Li, Tseng-Ho,
Chen, Po-Shou, Wu, Kuan-De

NT$1,000,000 ~ NT$1,999,999

Chen,Yi-Liang, Chen, Lo-Min,
Wang, Yi-Hsin

Chen,Yi-Liang, Chen, Lo-Min,
Wang, Yi-Hsin

NT$2,000,000 ~ NT$3,499,999

The company

Companies in the consolidated
financial statements

Shu, Chung-Cheng,Shu, Chung-Cheng,
Chui, Li-Chu, Hsu, Chia-Hsian Chui, Li-Chu, Hsu, Chia-Hsian

Chen, Po-Shou, Wu, Kuan-De, Chen, Po-Shou, Wu, Kuan-De,
Chen, Yi-Liang, Chen, Lo-Min, Chen, Yi-Liang, Chen, Lo-Min,
Wang, Yi-Hsin
Wang, Yi-Hsin
Wang, Jen-Ming,
Wang, Jen-Ming,
Li, Tseng-Ho
Li, Tseng-Ho

NT$3,500,000 ~ NT$4,999,999
NT$5,000,000 ~ NT$9,999,999

Shu, Chung-Won

Shu, Chung-Won,11

11

NT$10,000,000 ~ NT$14,999,999
NT$15,000,000 ~ NT$29,999,999
NT$30,000,000 ~ NT$49,999,999
NT$50,000,000 ~ NT$99,999,999
Greater than or equal to NT$100,000,000
Total

11

11

-27-

2. Remuneration of the General Manager and Vice General Managers
Salary (A)
Title

Name

Chairman and
CEO

Shu,
Chung-Won

General Manager

Hong,
Wan-HoonVice General
Manager

Wang,
Jen-Ming

Vice General
ManagerLi,
Tseng-HoVice General
Manager

Fang,
Wen-Jeng

Director andVice General
Manager

Chen,
Po-Shou

Severance Pay (B)Employee Compensation (D)(Note 1)

Bonuses and Allowances (C)Companies in
Companies in
Companies inThe
the consolidatedThe
the consolidatedThe
the consolidated
company
financialcompany
financialcompany
financialstatements
statements
statements

Cash

Stock

26,4981,520-

26,498

-

-

8,261

8,261

The company

Note 1: The compensation of employees approved by the Board of Directors for the year ended December 31, 2021 is NT$31,542,266.

-28-

Companies in the
consolidated
financial statements
Cash
Stock

1,520

-

Dec. 31, 2021; Unit: NT$ thousands
Ratio of total compensation Remuneration(A+B+C+D) to net income (%) from venturesother thansubsidiaries
Companies in theTheor from theconsolidated
company
parentfinancial statements
company

1.43%

1.43%

963

Name of General Manager and Vice General Managers
Range of Remuneration
Less than NT$ 1,000,000
NT$1,000,000 ~ NT$1,999,999
NT$2,000,000 ~ NT$3,499,999
NT$3,500,000 ~ NT$4,999,999
NT$5,000,000 ~ NT$9,999,999
NT$10,000,000 ~ NT$14,999,999
NT$15,000,000 ~ NT$29,999,999
NT$30,000,000 ~ NT$49,999,999
NT$50,000,000 ~ NT$99,999,999
Greater than or equal to NT$100,000,000
Total

The company

Companies in the consolidated
financial statements

Wang, Jen-Ming, Li, Tseng-Ho,
Fang, Wen-Jeng, Chen, Po-Shou
Shu, Chung-Won
Hong, Wan-Hoon

Wang, Jen-Ming, Li, Tseng-Ho,
Fang, Wen-Jeng, Chen, Po-Shou
Shu, Chung-Won
Hong, Wan-Hoon

6

6

-29-

3. Employee Compensation for Managerial Officers
Title

Dec. 31, 2021; Unit: NT$ thousands
Ratio of Total
Employee Compensation
Total Amount to Net
in Stockin CashIncome (%)

Name

Chairman and CEO
Shu, Chung-Won
General Manager
Hong, Wan-Hoon
Vice General Manager
Wang, Jen-Ming
Vice General Manager
Li, Tseng-Ho
Managerial Vice General Manager
Fang, Wen-Jeng
Officers Director andChen, Po-Shou
Vice General Manager
CFO and
Corporate Governance Officer
Hsiao, Sheng-Yin(Note 1)
Note 1: New appointment of Corporate Governance Officer on May 6, 2021.

1,758

1,758

0.07

3.2.8. The ratio of total remuneration paid by the Company and by all companies included in the
consolidated financial statements for the two most recent fiscal years to Directors, General
Manager and Vice General Managers of the Company, to the net income:
Year
Title

Ratio of total remuneration paid to Directors, General Manager andVice General Manager to net income (%)
2021
2020
Companies in the
Companies in the
The company
consolidated
The company
consolidated
financial statements
financial statements

Directors

0.91%

0.91%

1.84%

1.84%

General Manager andVice General Managers

1.43%

1.43%

2.68%

2.68%

3.2.9. The policies, standards, and portfolios for the payment of remuneration, the procedures fordetermining remuneration, and the correlation with risks and business performance:
Transportation allowance is issued according to the attending status (listed for attendance) of thedirectors and independent directors of the Company in the board of directors’ meetings andfunctional committees. The determination of the remuneration of directors is made based on theconsideration of the overall business performance of the Company, future operational risk anddevelopment trend of the industry, along with the consideration of the contribution of eachdirector on the operation of the Company and the annual performance evaluation result by theboard of directors (including individual director), in order to issue reasonable remuneration.
Furthermore, according to Article 22 of the Articles of Incorporation of the Company, when the
Company has a profit for each fiscal year, an amount no more than 0.2% of the profit shall beappropriated as the remuneration of directors, and after the resolutions of the Remuneration
Committee and the Board of Directors, the remuneration is then issued to each director.
The salaries of the CEO, General Manager, Vice General Managers and other managerial officers,etc., are issued based on the consideration of the standard adopted in the same industry, market
status, professional competence and job duties. According to Article 22 of the Articles ofIncorporation of the Company, when the Company has a profit for each fiscal year, an amount
not less than 1% of the profit shall be appropriated as the remuneration of employees, and thepersonal annual work performance, including the achievement rate of revenue and profit of theentire company and his/her in-charge department, personal goal achievement rate, operational
management capability, and whether there is any special contribution or negative events, etc.,-30-

such that the amount of distribution is determined after comprehensive evaluation of all aspects.
Remuneration performance evaluation and reasonableness for directors and managerial officers
are reviewed and approved by the Remuneration Committee and Board of Directors. The
remuneration system is also reviewed according to the actual condition of business and relevantlaws and regulations appropriately at all times.

-31-

3.3. Implementation of Corporate Governance3.3.1. Operations of the Board of Directors
A total of 5 meetings of the Board of Directors were held in the previous period. The attendance of
directors were as follows:
Title

Name

Attendancein Person

By ProxyAttendance Rate (%)

ChairmanShu, Chung-Won

5

0

100

DirectorShu, Chung-Cheng

5

0

100

Director

Chui, Li-Chu

4

0

80

Director

Hsu, Chia-Hsian

2

0

40

Director

Wang, Jen-Ming

3

0

100

Director

Li, Tseng-Ho

3

0

100

Director

Chen, Po-Shou

2

0

100

DirectorWu, Kuan-De

2

0

100

5

0

100

5

0

100

5

0

100

Independent
Chen, Yi-Liang
Director
Independent
Chen, Lo-Min
Director
Independent
Wang, Yi-Hsin
Director
Other mentionable items:
1.

Remarks
2021.08.26
Renewal of office2021.08.26
Renewal of office2021.08.26
Renewal of office2021.08.26
Renewal of office2021.08.26
Previous term ofoffice2021.08.26
Previous term ofoffice2021.08.26
New term ofoffice2021.08.26
New term ofoffice2021.08.26
Renewal of office2021.08.26
Renewal of office2021.08.26
Renewal of office

If any of the following circumstances occur, the dates of the meetings, sessions, contents of motion, allindependent directors’ opinions and the company’s response should be specified:(1) Matters referred to in Article 14-3 of the Securities and Exchange Act.
(2) Other matters involving objections or expressed reservations by independent directors that were recorded orstated in writing that require a resolution by the board of directors.
None. Please refer to “3.3.12 Major resolutions of Shareholders’ Meeting, Board of Directors Meetings, Audit
Committee meetings and Remuneration Committee meetings in the most recent year and up to the publication
date of this Annual Report” for major resolutions of Board of Directors Meetings in the most recent year and up
to the publication date of this Annual Report.

2.

If there are directors’ avoidance of motions in conflict of interest, the directors’ names, contents of motion,
causes for avoidance and voting should be specified:
None.

3.

TWSE/TPEx-listed companies are required to disclose the evaluation cycle and period, scope of evaluation,
evaluation method, and evaluation items of the self evaluations conducted by the Board of Directors:-32-

Evaluation

Evaluation

Scope of

Evaluation

cycle

periodevaluation

methodOnce aJanuary 1,

Board ofSelf-assessment (1) Board performance evaluation: level ofyear

2021 toDirectors,

by directors,

participation in company operations, theDecemberindividualinternal

quality of Board decisions, Board

31, 2021

directors,

self-evaluation

composition and structure, appointment ofandby the Board of

directors and their continued development,functional

Directors andand internal controls.

committees

functional(2) Individual director performance evaluation:committees

grasp of company targets and missions,

Evaluation items

understanding of the director's role andresponsibilities, level of participation incompany operations, internal relationshipmanagement and communication, director's
specialty and continued development, andinternal controls.
(3) Audit committee performance evaluation:
Participation in company operations,
understanding of the responsibilities of Audit
committees, improvement of thedecision-making quality of Audit
committees, composition of Audit
committees, and member selection andinternal control.
(4) Remuneration committee performance
evaluation: Participation in company
operations, understanding of the
responsibilities of Remuneration committees,
improvement of the decision-making qualityof Remuneration committees, andcomposition of Remuneration committees,
and member selection.
The results of the Board performance evaluation for the year ended December 31, 2021 have been disclosed on
corporate website at: https://tw.transcend-info.com/about/board_of_directors
4.

Evaluation of targets for strengthening of the functions of the board during the current and immediately
preceding fiscal years, and measures taken toward achievement thereof:(1) The Company established Remuneration committee in 2011 and Audit Committee in 2012 to assist the-33-

Board of Directors in carrying out its various duties. The board of directors also established the ”Codes of
Ethical Conduct for Directors and Managerial Officers” in 2013 in order to provide guidance to the
conducts of directors and managerial officers for compliance with the moral standards, thereby achievingsound corporate governance.
(2) To strengthen the independent directors’ participation in the operation of the board of directors and to
improve the understanding of the company affairs, at least two independent directors are required to attend
a board of directors’ meeting in person. (Note)(3) To implement corporate governance and to improve the function of the board of directors, performancegoals are established in order to enhance the operational efficiency of the board of directors. The
Company’s board of directors approved the “Rules for Performance Evaluation of Board of Directors” onMarch 5, 2020 and implemented them in 2021. The evaluation period was from January 1, 2021 to
December 31, 2021, and the evaluation result was reported to the board of directors on March 3, 2022.
Please refer to the aforementioned Point 3 for the evaluation content and result.
(4) To strengthen the effective operation of the board of directors, the Company established Corporate
Governance Officer on May 6, 2021 to assist the Board of Directors in carrying out its various duties andcompliance with the laws and regulations.
Note: Attendance of each independent directors during Board of Director meetings held in 2021.
Independent
The First
The Second
The Third
The Forth
The Fifth
Directors
Meeting
Meeting
Meeting
Meeting
Meeting
Attendance
Attendance
Attendance
Attendance
Attendance
Chen, Yi-Liangin Person
in Person
in Person
in Person
in Person
Attendance
Attendance
Attendance
Attendance
Attendance
Chen, Lo-Min
in Person
in Person
in Person
in Person
in Person
Attendance
Attendance
Attendance
Attendance
Attendance
Wang, Yi-Hsinin Person
in Person
in Person
in Person
in Person

3.3.2. Operations of the Audit Committee
1. Information on the members of the Audit Committee
Criteria
Professional Qualificationand Experience

Identity

Independent Director
Independent Director
Independent Director& Convener

NameChen, Yi-Liang
Chen, Lo-Min
Wang, Yi-Hsin

Independent Status

Please refer to “3.2.4 Information disclosure of the professional
qualifications of directors and independence of independent
directors”.

2. The Company established Audit Committee on June 2012. The Committee composed of theentire number of independent directors, which are three persons in total. The Committee
operations by the Company’s Audit Committee Charter, and the main function of the Audit
Committee is to supervise the following matters:(1) Fair presentation of the financial reports of this Corporation.
(2) The hiring (and dismissal), independence, and performance of certificated public
accountants of this Corporation.
-34-

(3) The effective implementation of the internal control system of this Corporation.
(4) Compliance with relevant laws and regulations by this Corporation.
(5) Management of the existing or potential risks of this Corporation.
3. The powers of the Committee are as follows:(1) The adoption of or amendments to the internal control system pursuant to Article 14-1 of
the Securities and Exchange Act.
(2) Assessment of the effectiveness of the internal control system.
(3) The adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act,of the procedures for handling financial or business activities of a material nature, suchas acquisition or disposal of assets, derivatives trading, loaning of funds to others, andendorsements or guarantees for others.
(4) Matters in which a director is an interested party.
(5) Asset transactions or derivatives trading of a material nature.
(6) Loans of funds, endorsements, or provision of guarantees of a material nature.
(7) The offering, issuance, or private placement of equity-type securities.
(8) The hiring or dismissal of a certified public accountant, or their compensation.
(9) The appointment or discharge of a financial, accounting, or internal audit officer.
(10) Annual financial reports and second quarter financial reports that must be audited andattested by a CPA, which are signed or sealed by the chairman, managerial officer, andaccounting officer.
(11) Other material matters as may be required by this Corporation or by the competentauthority.
4. The key tasks of the Audit Committee of the Company for the year of 2021 includes: Review
of all quarterly and annual financial statements, review of annual earning distribution proposal,
examine the effectiveness of the internal control system, review of material asset transactions,
corporate governance related affairs, risk management matters, appointment and compensationof CPAs, etc. Please refer to “3.3.12 Major resolutions of Shareholders’ Meeting, Board of
Directors Meetings, Audit Committee meetings and Remuneration Committee meetings in themost recent year and up to the publication date of this Annual Report” for major resolutions ofAudit Committee meetings in the most recent year and up to the publication date of thisAnnual Report.
5. A total of 4 Audit Committee meetings were held in the previous period. The attendance of the
independent directors was as follows:
Title

Name

Attendancein Person

By ProxyAttendance Rate (%)

Independent
Director

Chen, Yi-Liang

4

0

100

Independent
Director

Chen, Lo-Min

4

0

100

Independent
Director

Wang, Yi-Hsin

4

0

100

Remarks
2021.08.26
Renewal of
office2021.08.26
Renewal of
office2021.08.26
Renewal of
officeOther mentionable items:
1.

If any of the following circumstances occur, the dates of meetings, sessions, contents of motion, thecontent of the objections, reservations or material recommendations of independent directors, resolutionsof the Audit Committee and the Company’s response to the Audit Committee’s opinion should be-35-

specified:(1) Matters referred to in Article 14-5 of the Securities and Exchange Act.
(2) Other matters which were not approved by the Audit Committee but were approved by two-thirds ormore of all directors.
None. Please refer to “3.3.12 Major resolutions of Shareholders’ Meeting, Board of Directors Meetings,
Audit Committee meetings and Remuneration Committee meetings in the most recent year and up to the
publication date of this Annual Report” for major resolutions of Audit Committee meetings in the mostrecent year and up to the publication date of this Annual Report.
2.

If there are independent directors’ avoidance of motions in conflict of interest, the directors’ names,
contents of motion, causes for avoidance and voting should be specified:
None.

3.

Communications between the independent directors, the Company's chief internal auditor and CPAs (e.g.
the material items, methods and results of audits of corporate finance or operations, etc.):(1) The internal auditors have communicated the result of the audit reports to the members of the Audit
Committee periodically, and have presented the findings of all audit reports in the quarterly meetingsof the Audit Committee. The internal auditors report the next Annual Audit Plan and get the approvalof the Audit Committee in the last Audit Committee meeting every year. Should the urgency of thematter require it, the Company's chief internal auditor will inform the members of the Audit Committee
outside of the regular reporting. There was no such special situation in 2021. The communication
channel between the Audit Committee and the internal auditor has been functioning well.
(2) The Company’s CPAs have presented the findings or the comments for the quarterly corporate
financial reports, as well as those matters communication of which is required by law, in the regularquarterly meetings of the Audit Committee. Under applicable laws and regulations, the CPAs are
required to communicate to the Audit Committee any material matters that they have discovered. There
was no such special situation in 2021. The communication channel between the Audit Committee andthe CPAs has been functioning well.

-36-

3.3.3. Corporate Governance Implementation Status and Deviations from “the Corporate
Governance Best-Practice Principles for TWSE/TPEx Listed Companies”
Implementation Status

1.

2.

Deviations
from “theCorporate
GovernanceBest-PracticeEvaluation Item
Principles for
Yes NoAbstract Illustration
TWSE/TPEx
ListedCompanies”
and Reasons
Does the company establish v
The Company has established the Corporate Noneand disclose the Corporate
Governance Best-Practice Principles based on the
Governance Best-Practice“Corporate Governance Best-Practice Principles for
Principles based on
TWSE/TPEx Listed Companies”. The information“Corporate Governancehas been disclosed on the Company’s website.
Best-Practice Principles for
http://tw.transcend-info.com/about/policies
TWSE/TPEx Listed
Companies”?
Shareholding structure &shareholders’ rights(1) Does the company establish
an internal operatingprocedure to deal withshareholders’ suggestions,doubts, disputes andlitigations, and implement
based on the procedure?

v

The Company has established spokesperson and None
investor relationship unit to handle issues ofshareholders’ suggestions or disputes.

(2) Does the company possess
the list of its major
shareholders as well as theultimate owners of thoseshares?

v

The Company reports the shareholding change None
status of insiders (directors, managerial officers andshareholders with shareholding over 10% of thetotal number of shares) in time, and also discloses
the top 10 shareholders’ information in theshareholders’ meeting annual report every year.
Furthermore, the financial statements also disclose
the information of major shareholders with theshareholding over 5% on a quarterly basis.

(3) Does the company establish
and execute the risk
management and firewall
system within its
conglomerate structure?

v

The Company has established the related party Nonetransaction control operation in order to implement
the risk control mechanism thoroughly.

(4) Does the company establish
internal rules against
insiders trading with
undisclosed information?

v

The Company has established and disclosed Nonethe”Codesof
EthicalConduct
for
Employees”, ”Codes of Ethical Conduct for
Directors
andManagerial
Officers”
and ”Procedures for Handling Material Inside
Information” on the Company’s website, in order toprohibit employees to allow themselves or any third
party to gain personal benefits through the use of-37-

Implementation Status

Evaluation ItemYes NoAbstract Illustration

Deviations
from “theCorporate
GovernanceBest-PracticePrinciples for
TWSE/TPEx
ListedCompanies”
and Reasons

the Company’s assets, information of through one’s
job duties.
3.

Composition andResponsibilities of theBoard of Directors(1)

Does the Board of Directors v
establish a diversified
policy, set goals andimplement themaccordingly?

1. The nomination and election of board members Noneof the Company comply with the ”Procedures forElection of Directors” and ”Corporate
Governance Best-Practice Principles” , in orderto ensure the diversity and independence ofboard members. According to Article 20 ofthe”Corporate
GovernanceBest-PracticePrinciples” of the Company, all directors are
preferably required to possess knowledge, skills
and literacy necessary for performing duties, anddiversity directives have been established.
2. All directors are equipped with extensive
experienceinleadership,
operation
determination, business management, crisis
handling, and are also equipped with industrial
knowledge and international market view suchthat they are equipped with various capabilities
necessary to execute the corporate governance.
Independent directors, Mr. CHEN, YI-LIANG,
Mr. CHEN, LO-MIN and Ms. WANG, YI-HSIN,
are equipped with the professional backgrounds
in accounting and financial analysis, such they
are
able
to
provideprofessional
recommendations to the Company from different
viewpoints and aspects.
3. The ratio of directors equipped with the identityof employees of the Company accounts for 33%
of all directors, the ratio of independent directors
accounts for 33% of all directors, and the female
director ratio accounts for 22%. Three
independent directors have the term of officeseniority above 9 years, one director at the age
above 71 years old, six directors at the age
between 61–70 years old, and two directors at theage under 60 years old. According to “Taiwan
Stock
Exchange
Corporation
Operation
DirectionsforCompliance
with
the
-38-

Implementation Status

Evaluation ItemYes NoAbstract Illustration

Deviations
from “theCorporate
GovernanceBest-PracticePrinciples for
TWSE/TPEx
ListedCompanies”
and Reasons

Establishment of Board of Directors by TWSE
Listed Companies and the Board’s Exercise ofPowers,” the Chairman and CEO of theCompany refer to the same person, and no lessthan four independent directors shall beestablished before the end of 2023. Through theaddition of new independent directors, thediversity and independence of the board of
director composition can be enhanced.
4. The board of directors has disclosed the policy
for the formation of diverse board members on
the Company’s website and the Market
Observation Post System (MOPS).
(2)

Does the company
voluntarily establish otherfunctional committees in
addition to theRemuneration Committee
and the Audit Committee?

v

Presently, the Company has established the None
Remuneration Committee and Audit Committee,
and these two committees are composed of all of
the independent directors. Other types of functional
committees are continuously being assessed.

(3)

Does the company establish v
a standard to measure theperformance of the Boardand implement it annually,
and are performance
evaluation results submitted
to the Board of Directors
and referenced when
determining the
remuneration of individual
directors and nominations
for reelection?

The Company has established and disclosed Nonethe ”Rules for Performance Evaluation of Board of
Directors” on the Company’s website, and theevaluation period is from January 1 to December 31
of each year. The result is reported to the board of
directors before the end of March of the following
year in order to be used as a reference for review
and improvement. The evaluation result on theperformance of the board of directors of theCompany will be used as a reference for election or
nomination of directors. The result of 2021 boardof directors performance evaluation has beenreported to the board of directors’ meeting on
March 3, 2022. Please refer to “3.3.1 Operationsof the Board of Directors”.

(4)

Does the company regularly v
evaluate the independenceof CPAs?

The Company periodically evaluates the None
independence of the CPAs on an annual basis, andthe result has been approval by the board of
directors on March 4, 2021. After examination of
the CPAs’ independence evaluation checklist, andthe evaluation items include that the CPAs have no
direct or material indirect financial benefit-39-

Implementation Status

Evaluation ItemYes NoAbstract Illustration

Deviations
from “theCorporate
GovernanceBest-PracticePrinciples for
TWSE/TPEx
ListedCompanies”
and Reasons

relationships with the Company, not assuming theposition of director, managerial officer or any job
position that has material impack on the audit workof the Company, not engaging in any financing or
guarantee activities with the Company or directorsof the Company, not acting or representing as anagent of the Company, or involving any defense orcoordination for the Company, not providing
non-audit services other than certification andfinancial tax services to the Company that may
have direct impact on the audit word, and not
relatives to all of the aforementioned personnel, etc.
Accordingly, the independence of the CPAs of theCompany has been evaluated properly andconfirmed to comply with the requirements
4.

Does the company appointa suitable number ofcompetent personnel and asupervisor responsible forcorporate governancematters (including but notlimited to providing
information for directors
and supervisors to performtheir functions, assisting
directors and supervisors
with compliance, handlingwork related to meetings ofthe board of directors andthe shareholders' meetings,
and producing minutes ofboard meetings andshareholders' meetings)?

v

The Company assigns FAD as the main Nonepromotional unit for corporate governance. On May
6, 2021, the board of directors appointed the CFOof the Company to act as the Corporate Governance
Officer to be in charge of corporate governancerelated affairs. The officer is equipped with theexperience of the supervisor role in the financial,stock affairs and corporate governance relatedaffairs units of publicly listed companies for morethan three years. The main responsibilities andauthorities of the corporate governance unit are toprovide documents and information necessary fordirectors to perform duties, to assist the Company
and directors in the compliance with the laws andregulations, and to handle affairs for board of
directors’ meetings and shareholders’ meetings.
The key operational tasks for the current year are as
follows:
1. Organize 2021 board of directors’ meetings,
functional
committees’
meetings,
andshareholders’ meetings, including planning andestablishment of agenda, mailing of meeting
notice within the statutory time-limit, providing
all documents and data necessary for the
meetings, and also prepare meeting minutes after
such meetings.
2. Assist the assumption of new directors.
3. Assist and organize continuing educational-40-

Implementation Status

Evaluation ItemYes NoDeviations
from “theCorporate
GovernanceBest-PracticePrinciples for
TWSE/TPEx
ListedCompanies”
and Reasons

Abstract Illustration

courses for directors.
4. Perform 2020 board of directors’ performance
evaluation, and submitted the evaluation result tothe board of directors’ meeting on March 4,2021.
5. Summarize amendments of latest laws of thecompetent authority, and revise internal
regulations of the Company accordingly.
6. Provide appropriate and timely company
information to directors.
7. Make public announcements on all material
resolutions reached by the Company andmaterial information of the Company according
to the laws.
8. Handle registration alternation related affairs.
9. Update and disclose all corporate governanceinformation, including the composition of boardof directors and functional committees, audit
plan of each year, organization and management
team of the Company, important internal
regulations of the Company and interested party
section, etc.
10. Handle directors liability insurance relatedaffairs.
11. Other matters related to corporate governance.
Continuing Education Training of Corporate
Governance Officer in 2021
Date

Host by

Training/Speech
Title

Hours

2021/09/01

Financial
Supervisory
Commission
R.O.C.
(Taiwan)

The 13th Taipei
Corporate
Governance
Forum

6

The Company has established the Corporate
Governance Officer section on the Company’s
website, please refer tohttps://tw.transcend-info.com/about/directors-41-

Implementation Status

5.

Deviations
from “theCorporate
GovernanceBest-PracticeEvaluation Item
Principles for
Yes NoAbstract Illustration
TWSE/TPEx
ListedCompanies”
and Reasons
Does the company establish v
The definition of interested parties of the Company Nonea communication channel
includes employees, suppliers, shareholders andand build a designatedcustomers. The Company has established various
section on its website forcommunication and compliant channels, such as thestakeholders (including but
spokesperson system, contact mailbox and website,
not limited to shareholders,etc., and feedback information of theemployees, customers, andaforementioned interested parties are collected, in
suppliers), as well as handle
order to provide the latest information andall the issues they care forcommunication channels of the Company. In
in terms of corporate social
addition, international trend and regulations,
responsibilities?
customer demands and methods adopted in thesame industry are also considered, and issues
concerned by all interested parties are identified, inorder to list out the responsiveness andcommunication method for each issue.
The Company has established the Interested Party
section on the Company’s website, please refer to:https://tw.transcend-info.com/about/stakeholders

6.

Does the company appointa professional shareholder
service agency to deal withshareholder affairs?

7. Information Disclosure(1) Does the company have a
corporate website todisclose both financial
standings and the status ofcorporate governance?

v

The Company has appointed Transfer Agency None
Department of CTBC Bank to handle stock affairsof the Company.

v

1. The Company has established official corporate None
website to disclose relevant information timely.
The website address is: http://tw.transcend-info.com/
2. Financial information disclosure status:
The Chinese and English versions of theCompany’s website are established with theInvestor Information section, disclosing financial
information, and the information is updated
periodically for investors’ reference.
https://tw.transcend-info.com/about/month_sales
https://us.transcend-info.com/about/month_sales

3. Corporate governance information disclosure
status:The Company has disclosed the information on
the composition of the committees, including
board of directors, annual audit plan, company
organization and management team, importantinternal regulations and interested party sectionof the Company on the Company’s website.
http://tw.transcend-info.com/about/board_of_directors-42-

Implementation Status(2)

Deviations
from “theCorporate
GovernanceBest-PracticeEvaluation Item
Principles for
Yes NoAbstract Illustration
TWSE/TPEx
ListedCompanies”
and Reasons
Does the company havev
1. The Company has assigned dedicated personnel Noneother information
to be responsible for the collection and disclosure
disclosure channels (e.g.
of the Company’s information,andbuilding an English
spokesperson system is implemented according
website, appointing
to the regulations. The procedure anddesignated people to handle
presentation files of institutional investors’
information collection andconferences are also published on the Company’s
disclosure, creating a
website.
http://tw.transcend-info.com/about/conference
spokesman system,
2. The Company has set up the English website towebcasting investor
provide investors from all countries to makeconferences)?
inquiries and to understand relevant information.
Please refer to:https://us.transcend-info.com/(3)

Does the company
announce and report annual
financial statements within
two months after the end ofeach fiscal year, andannounce and report Q1,
Q2, and Q3 financial
statements, as well asmonthly operation results,
before the prescribed time
limit?

8.

Is there any other important v
information to facilitate abetter understanding of thecompany’s corporate
governance practices (e.g.,
including but not limited to
employee rights, employee
wellness, investor relations,
supplier relations, rights ofstakeholders, directors’ andsupervisors’ training
records, the implementationof risk management policies
and risk evaluation
measures, thev The Company convened the board of directors’ The Company
meeting on March 3, 2022 to approve the annual makes publicfinancial statements for 2021, and the annual announcement
financial statements were publicly announced and and reports thereported on the same day. And financial statements annual andfor Q1, Q2 and Q3 of the fiscal year were reported quarterly
to the board of directors’ meetings on May 6, 2021, financial
August 5, 2021 and November 4, 2021 respectively. statements
And they were also publicly announced and according toreported on the same day.
the time limits
specified in
Article 36 of
the Securities
and ExchangeAct.
1. Employees’ rights and interests, employee care None
execution status: Please refer to ”5.5 Labor
Relations” of this Annual Report.
2. Investor relationship, supplier relationship,
interested parties’ rights and customer policy
execution status: The Company has set up theInterested Party section on the Company’s
website.
https://tw.transcend-info.com/about/stakeholders

3. Continuing education status of directors andsupervisors: Please refer to ”3.3.5.Continuing
Education/Training of Directors in 2021” of thisAnnual Report.
4. Risk Management Policies and risk evaluation
measures execution status: Please refer to ”7.6
-43-

Implementation Status

Evaluation Item

implementation of customer
relations policies, andpurchasing insurance fordirectors and supervisors)?

9.

Yes NoAbstract Illustration

Deviations
from “theCorporate
GovernanceBest-PracticePrinciples for
TWSE/TPEx
ListedCompanies”
and Reasons

Analysis of Risk Management” of this Annual
Report and the Company’s website:
https://tw.transcend-info.com/about/risk_management_policy

5. Customer policy execution status: The Company
rigorously complies with the customer
confidentiality rules and the Ethical Corporate
Management Best-Practice Principles. In
addition, the Company maintains excellent
supply relationship with customers and has
established different internal teams to service
customers.
6. Status on the Company’s purchase of liability
insurance for directors and supervisors: The
Company has purchased directors’ and officers
liability insurance, which has been approved by
the board of directors on November 4, 2021 andhas been publicly announced on MOPS.
7. The Company emphasizes the cultivation ofsenior management talents and promotes R&D
Vice General Manager, Sales Vice General
Manager and Directors of all divisions. The
Company also focuses on the management
capability and professional competence of senior
managers, and through the transfer of different
duties, senior managers are able to develop
different attributes and capabilities, thereby
achieving integration and utilization to enhance
decision making and understanding ofmanagement principles. Accordingly, candidates
for board of directors and CEO can beappropriately selected from the senior managers.

Please explain the improvements which have been made in accordance with the results of the Corporate
Governance Evaluation System released by the Corporate Governance Center, Taiwan Stock Exchange,and provide the priority enhancement measures.
(1) Status of improvement:
A. The Company has established the corporate governance officer in 2021, to be in charge ofcorporate governance related affairs, and the job function scope of the corporate governanceofficer and the continuing education status of the current year have been disclosed on the
Company’s website.
https://tw.transcend-info.com/about/directors
B. The Compnay in order to protect shareholders’ interests and fair treatment to shareholder, hascompleted the preparation of the English version of the annual report for the annual regularshareholders’ meeting in 2021, and it is uploaded onto the Market Observation Post System-44-

Implementation Status

Deviations
from “theCorporate
GovernanceBest-PracticeEvaluation Item
Principles for
Yes NoAbstract Illustration
TWSE/TPEx
ListedCompanies”
and Reasons(MOPS) and the English version of the Company’s website 16 days before the convention of theshareholders’ meeting.
C.

The Compnay in order to enhance information transparency, has completed the preparation of the
English version of the parent company only financial statements in 2021, and it is uploaded onto
the MPOS 16 days before the convention of the shareholders’ meeting.

(2) For the one item without scores, explanations are provided in the following:
A. Enhancing information transparency, promotion of sustainable operation: The Company has
started the preparation of the ESG report since 2022, and the ESG report will be uploaded onto
the MPOS and the Company’s website every year.

-45-

3.3.4. Composition, Responsibilities and Operations of the Remuneration Committee
To achieve sound corporate governance and to enhance remuneration management function,
the Company has established the Remuneration Committee in accordance withthe ”Regulations Governing the Appointment and Exercise of Powers by the Remuneration
Committee of a Company Whose Stock is Listed on the Taiwan Stock Exchange or the Taipei
Exchange”. The number of members of the Remuneration Committee of the Company is three,
and the members are to be appointed in accordance with the resolution of the board of
directors. The committee is formed by three external experts satisfying the professional
qualification and independence requirements. For the Remuneration Committee meetings of
the Company, at least two regular meetings are convened annually in order to periodicallyreview the remuneration regulations of the Company and to provide recommendations onamendments, to periodically review the performance evaluation of directors and managerial
officers and the policy, system, standard and structure for the salary and remuneration, as wellas to periodically evaluate and establish salary and remuneration of directors and managerial
officers of the Company. For the content of the performance evaluation standards for directors
and managerial officers, please refer to ”3.2.8. The ratio of total remuneration paid by theCompany and by all companies included in the consolidated financial statements for the twomost recent fiscal years to Directors, General Manager and Vice General Managers of theCompany, to the net income” and ”3.2.9. The policies, standards, and portfolios for thepayment of remuneration, the procedures for determining remuneration, and the correlation
with risks and business performance”.
1. Information on the members of the Remuneration Committee
Criteria
Professional
Qualificationand Experience

Identity
Name
Independent Director& Convener
Independent Director
Independent Director

Chen, Yi-Liang
Chen, Lo-Min
Wang, Yi-Hsin

Independent Status

Number of Other
Public Companies inWhich the Individual is
Concurrently Serving
as an Remuneration
Committee Member

Please refer to “3.2.4 Information disclosure of the professional
qualifications of directors and independence of independent directors”.

-46-

2. Operation of Remuneration Committee:(1) There are three members in the Remuneration Committee.
(2) Term of service: August 26, 2021 to August 25, 2024.
A total of two Remuneration Committee meetings were held in the previous period. The
attendance record of the Remuneration Committee members was as follows:
Attendance
Attendance Rate
Remarks
Title
Name
By Proxyin Person(%)
Convener

Chen, Yi-Liang

2

0

100%

MemberWang, Yi-Hsin

2

0

100%

MemberChen, Lo-Min

2

0

100%

2021.08.26
Renewal of
office2021.08.26
Renewal of
office2021.08.26
Renewal of
officeOther mentionable items:
1.

If the board of directors declines to adopt or modifies a recommendation of the
remuneration committee, it should specify the date of the meeting, session, content of
the motion, resolution by the board of directors, and the Company’s response to the
remuneration committee’s opinion:
None. Please refer to “3.3.12 Major resolutions of Shareholders’ Meeting, Board of
Directors Meetings, Audit Committee meetings and Remuneration Committee
meetings in the most recent year and up to the publication date of this Annual Report”
for major resolutions of Remuneration Committee meetings in the most recent year and
up to the publication date of this Annual Report.

2.

Resolutions of the remuneration committee objected to by members or expressed
reservations and recorded or declared in writing, the date of the meeting, session,
content of the motion, all members’ opinions and the response to members’ opinion
should be specified:
None.

-47-

3.3.5. Continuing Education/Training of Directors in 2021
Title/Name
Director/Shu, Chung-Won

Director/Shu, Chung-Cheng

Director/
Chui, Li-Chu

Director/
Hsu, Chia-Hsian

Date

Host bySecurities and Futures
2021/11/12
Institute2021/09/15

Digital Governance
Association

2021/11/03

Securities and Futures
Institute2021/09/15

Digital Governance
Association

2021/11/12

Securities and Futures
Institute2021/10/15

Accounting Research andDevelopment Foundation

2021/11/09

Securities and Futures
Institute2021/09/15

Digital Governance
Association

2021/12/07 Taiwan Stock Exchange

Director/
Chen, Po-Shou

Director/Wu, Kuan-De

Independent
Director/
Chen, Lo-Min
Independent
Director/
Wang, Yi-Hsin
Independent
Director/
Chen, Yi-Liang

2021/11/18

Taiwan Corporate
Governance Association

2021/10/20

Taiwan Corporate
Governance Association

2021/09/15

Digital Governance
Association

2021/10/20

Taiwan Corporate
Governance Association

2021/09/15

Digital Governance
Association

Financial Supervisory
2021/09/01 Commission R.O.C.
(Taiwan)Financial Supervisory
2021/09/01 Commission R.O.C.
(Taiwan)Financial Supervisory
2021/09/01 Commission R.O.C.
(Taiwan)Financial Supervisory
2021/09/01 Commission R.O.C.
(Taiwan)-48-

Training/Speech Title
2021 Insider trading prevention
educational seminar
Director and supervisor
responsibility and risk management
seminar
2021 Insider trading prevention
educational seminar
Director and supervisor
responsibility and risk management
seminar
2021 Insider trading prevention
educational seminar
Latest “Corporate Governance 3.0– Sustainable Development
Blueprint” financial report
preparation issues and response inpractice
2021 Insider trading prevention
educational seminar
Director and supervisor
responsibility and risk management
seminar
2021 Cathay Sustainable Finance
And Climate Change Summit
Case analysis of hostile mergers andacquisitions, and anti-takeovermeasures
Understand related party transaction
and non-arm’s length transaction
from actual case studies
Director and supervisor
responsibility and risk management
seminar
Understand related party transaction
and non-arm’s length transaction
from actual case studies
Director and supervisor
responsibility and risk management
seminar

Hours
3
3
3
3
3

3

3
3
3
3

3

3

3

3

The 13th Taipei Corporate
Governance Forum6

The 13th Taipei Corporate
Governance Forum6

The 13th Taipei Corporate
Governance Forum6

The 13th Taipei Corporate
Governance Forum6

3.3.6. Implementation of sustainable development promotion and difference from the Sustainable
Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons thereof
Implementation Status

Deviations from“the Sustainable
Development
Best-PracticeAssessment Item
Principles for
Yes NoAbstract Explanation
TWSE/TPEx Listed
Companies” andReasons
1. Does the companyv
Transcend Information appoints the Brand Marketing Noneestablish the governancedivision to be the main unit for promoting thestructure for promoting thesustainable development, and the directors of othersustainable development,
divisions assume the positions of team leader
and set up a unit that
according to the nature of business. The director of thespecializes (or is involved)
Brand Marketing division uniformly manages and isin the promotion of
dedicated in the social participation and feedback
sustainable development,
activities in addition to the promotion of sustainable
and does the board ofdevelopment. The Brand Marketing division also
directors authorize thediscusses routine business promotion affairs andsenior management for
performs information collection and summarization as
handling such mater, andwell as reviews the execution status of the sustainable
the supervision status ofdevelopment with the Chairman.
the board of directors?
The division also provides report to the board of
directors on important promotion items once annually.
The board of directors reviews the management
directives, execution status and future plans, and also
provides opinions to the management team forreference to make adjustment.
Please refer to the Company’s website for detailed
information:
https://tw.transcend-info.com/about/social_responsibility

2. Does the company assess
ESG risks associated with
its operations based on theprinciple of materiality,and establish related risk
management policies or
strategies?

v

1. This risk assessment boundary mainly focuses on None
the Taiwan headquarters and factory site as the coreof the assessment, and overseas business offices are
excluded.
2. During the pursuit of sustainable operation andprofit, the Company also conducts relevant risk
assessment on environment, society and corporate
governance related to the company operation inaccordance with the materiality principle. By
activelyfulfilling
sustainable
development
responsibilities, and through communication withinternal and external stakeholders, review ofdomestic and international relevant reports in thesame industry and evaluation documents of all
department, as well as incorporates such matters
into the management directives and operating
activities of the Company, thereby achieving thegoal of sustainable operation.
3. To enhance the corporate governance and toestablish sound risk management operation, theboard of directors has approved the Risk
Management Policies on November 10, 2020, in-49-Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasonsorder to provide guidance on effective
identification, measurement, supervision andcontrol of all kinds of risks to all units of theCompany during the performance of duties, and toalso control the possible risks within the acceptablelevel, thereby achieving the goal of reasonable risk
and compensation as well as the objective ofsustainable operation of the Company.
4. Reported various business risks and proposed
control strategy and method in the board of
director’s meeting on November 4, 2021, pleaserefer to the Company’s website:
https://tw.transcend-info.com/about/risk_management_p
olicy

3. Environmental issues(1) Does the companyv
establish proper
environmental
management systems
based on the characteristicsof their industries?

(2) Does the company
endeavor to utilize all
resources more efficiently
and use renewablematerials which have low
impact on theenvironment?

v

Transcend adopts the product life cycle notion and None
performs planning based on the characteristics of ourindustry and also obtains the ISO14001:2015
environmental management system certification.
Accordingly, we continue to reduce negative impacts
on the environment and improve our environmental
performance.
1. Products: During the product manufacturing None
process, the Company uses parts complying with
RoHS EU environmental protection standards, andall of the Company’s products qualify for the
QC080000 certification in order to reduce negative
impacts on the environment.
2. Energy saving:i. The factory started purchasing new eco-friendly
diesel trucks in 2020. All of the trucks have
replaced to new eco-friendly trucks in 2021, inorder to comply with the environmental
protection laws and regulations and to reduce
emission of air pollution.
ii. In 2021, the factory completed the manufacturing
process equipment – reflow oven replacement
project, which can reduce the power
consumption by approximately 223,520 degrees
per year. In 2021, the Company will also
comprehensively review the internal documents
and forms and will be dedicated in the promotionof document digitization, in order to achieve theeffects of sustainable environment, energy saving
and carbon reduction.
-50-

Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasonsiii. In 2021, the factory 1F lighting fixture power
consumption reduction and replacement project
was completed. In comparison to 2020, theefficiency of the lighting fixtures has increasedby more than 40%, thereby achieving theoutcome of sustainable environment, energy
saving and carbon reduction.
3. Resource recycling: The wastepaper, waste plastics,
waste metals and lighting fixtures generated by theCompany daily are recycled by qualified recycling
vendor periodically.
(3) Does the companyv
evaluate the potential risks
and opportunities inclimate change with regard
to the present and future ofits business, and takeappropriate action tocounter climate change
issues?

1. The mitigation and adaption of climate change are None
the main issues for sustainable development
concerned by the corporates nowadays. The climatechange generally causes the temperature to rise,
which indirectly affects the loading of the air
conditioning equipment of companies. To cope with
the impact on the company operation, the Company
performs machine equipment maintenance and also
replaces relatively older equipment in order toprevent relatively higher carbon emission, thereby
reducing the generation of greenhouse gas.
2. While facing potential impacts on the caused byclimate change, the Company also understands theopportunities for operation improvement associatedwith relevant responsive measure. For example,
during the replacement of old machines with newones, the Company cooperates with the government
subsidy policy and applies for relevantenergy-saving subsidy and incentives. To create afriendly environment, the Company enhances green
manufacturing and develops technologies beneficial
to the environment, including semi-high PCB andnew packaging materials, etc. The Company also
develops relevant manufacturing processes toreduce energy consumption in order to achieve a
low-carbon future. Please refer to the Company’s
website for details:
https://tw.transcend-info.com/about/energysaving
https://tw.transcend-info.com/about/green(4) Does the company takev
inventory of its greenhousegas emissions, water
consumption, and total
weight of waste in the last

1. This data covers the Taiwan headquarters and None
factory site; however, overseas business offices are
excluded.
2.
i. Greenhouse gas emissions:-51-

Implementation Status

Assessment Item

Abstract Explanation

Yes Notwo years, and implement
policies on energy
efficiency and carbon
dioxide reduction,
greenhouse gas reduction,water reduction, or waste
management?

Year

Scope 1

Scope 22021
2020

37,721
44,265

3,953,752
4,112,986

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

Unit: KgCO2e
Emission per unit
revenue
0.00030.0004ii. Water consumption:
Unit: million tons
Water consumption
27.71
29.11

Year
2021
2020

iii. Total weight of waste:
Year
2021
2020

Hazardous industrial
waste
13.03813.017

Unit: tons
General industrial
waste
219.064244.379

3. The Company evaluates the risks and opportunitiesof all units in order to establish environmental
objective plans and to execute follow-up
appropriately every year. Some of theenvironmental objective plans are described in thefollowing:
2019: Replacement project of factory warehouselighting fixture
2020: Replacement project of road lamp power
consumption reduction at office and factorybuildings
2021: Complete eco-friendly vehicle replacements
for all existing vehicles, and factory 1F lighting
fixture replacement project2022: Factory 3F–5F lighting fixture replacement
project
The Company establishes environmental objectiveplans and executes follow-up appropriately every
year. For relevant objective plans and specificexecution measures, please refer to the Company’s
website for details:
https://tw.transcend-info.com/about/energysaving

4. Presently, the Company has passed environment
related certifications, including ISO 14001 and
QC080000.
4. Social issues(1) Does the company
formulate appropriatev

The Company is committed to complying with the None
national labor laws, “BSCI Code of Conduct”, “RBA-52-

Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

Responsible Business Alliance Code of Conduct” andother applicable industrial standards and international
conventions. The Company also continues to improve
the working environment and employee welfare for all
employees.
To achieve such commitment, the Company
periodically identifies employee occupational safety
and health risks, material environmental concerns, andentrusts a third-party authentication institution to
perform audit periodically. Please refer to theCompany’s website for detailed information:

management policies andprocedures according torelevant regulations andthe International Bill of
Human Rights?

https://tw.transcend-info.com/about/human(2) Does the company havereasonable employee
benefit measures(including salaries, leave,
and other benefits), and do
business performance or
results reflect on employee
salaries?

v

1. The Company has established the salary Nonemanagement regulations and employee bonus
distribution system. In addition to the distribution of
year-end bonus, the Company also distributes
performance bonus quarterly depending on the
profit of the Company in order to share the businessoutcome with employees, thereby encouraging andrewarding employees for their effort at work.
2. The Company has established the employee welfarecommittee to plan and provide various welfare to
employees, such as wedding gift money, childbirthgift money, funeral condolence, groupmeal
compensation, annual and holiday gifts. To allow
employees to achieve a balance between work andliving, the Company has set up recreation facilities
and a gym in order to allow employees to relax andrelieve pressure. Furthermore, the Company alsoplans free annual health examinations and arranges
for a physician to provide on-site periodic
consultation in order to care for and protect theemployees’ health properly.
3. The Company promotes the equal remuneration
criteria for same job duties and equal promotion
opportunities for employees of different genders. In
2021, the number of female employees accounted
for 49% of all employees, and the number of female
supervisors accounted for 18% of all management
staff.
4. Please refer to ”5.5.1 Employee benefit plans,continuing education, training, retirement systems,
the status of their implementation, and the status oflabor agreements and measures for preserving
employees' rights and interests” and corporatewebsite:-53-

Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

https://tw.transcend-info.com/about/employee_benifit(3) Does the company provide
a healthy and safe working
environment and organize
training on health andsafety for its employees ona regular basis?

v

1. Environmental Safety and Health Policy
None
The Company is committed to continuously
promoting various handling/control mechanism
plans, to fulfill corporate responsibilities inenvironmental protection and employee safety andhealth, prevention of occupational injuries anddisease, reduction of environmental/safety andhealth management risks, and maintaining thecompetitiveness and improvement status of theCompany. In addition, the Company also aims toconvey its philosophy to all staff working for theorganization and even to all stakeholders, in order toestablish the cornerstone for the sustainable
operation of the Company.
2. Health and Safety of Employees in the Workplace
The Company, according to the hazard identification
and risk opportunity assessment, effectively controls
hazards and reduces risks, in order to improve thesafety and health performance. In addition, theCompany has also established the safety and healthrelated operation control, in order to ensure that
operations comply with the regulations andmanagement system requirements. The Company
also continues to implement the five main plans(human factor engineering, abnormal workload,
illegal infringement, labor health service andmaternity protection plans), and performs
monitoring and performance measurement analysis
and evaluation, and periodically convenes safetycommittee review meetings, in order to ensure theeffective operation of safety and health, and toprovide physical and mental protection toemployees, thereby achieving zero-hazard safety
and health working environment.
In 2021, the Company continues to participate in the“Healthy Workplace” of the Health Promotion
Administration and “CHR Healthy Corporate
Citizen Commitment” of Common Health.
3. Labor Working Environment Monitoring andTesting
The Company implements workplace monitoringsemi-annually in order to protect employees fromphysical and chemical hazards in the workplace andto ensure exposure concentration complies with theregulatory standards. The chemical exposure-54-Implementation Status

Assessment ItemYes NoAbstract Explanation

concentrations of the Company are far lower than
1/2 of the acceptable concentration standards forhazardous substances in the air specified by thelaws.
4. Health Management and Health Promotion
The Company sets up the health management room
and also employs full-time nursing personnel
according to the provisions of health protection laws
in order to handle on-site worker health service
affairs. In addition, the Company also contracts a
specialized physician for labor health service inorder to provide the monthly on-site service in theplant.
The
Company
providesregularphysicalexamination before the on-boarding of all new
employees, and all of the expenses for the
aforementioned examination are borne by theCompany. In 2021, the Company provided all
employee health examination and items superior to
the regulatory requirements, and employee relatives
and friends are also entitled to the healthexamination based on the benefit plan, in order toachieve greater health benefits. After healthexamination, the internal professional nurse
classifies the health reports of all employees forhealth management, and provides active care andconducts tracking on abnormal health items, inorder to allow employees to understand theirpersonal health conditions.
The internal nurse promotes various healthpromotion activities and targets annually according
to the employee health abnormality items, andevaluatestheoutcomeandprovidesrecommendations, in order to improve potential andexisting health issues of employees, thereby
preventing occurrence of diseases, improving
personal health condition and promoting employee
health. In the future, the Company will continue to
implement the same activities in conjunction withappropriate reward measures to allow employees tounderstand health and to achieve balance between
work and life.
5. Safety and Health Education and Training
The Company organizes safety and health educationand training annually, in order to improve the safety
and health knowledge of employees. In 2021, there
was a total of five types of courses organized for the-55-

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasonsImplementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

internal education and training, and a total of 1,294
employees participated the training. There was a
total of six types of license courses, and a total of 30
employees participated in such courses.
6. Corporate Certification Status
The Company and all factory sites in Taiwan haveobtained the dual system certifications of ISO 45001
and CNS 45001 (TOSHMS).
7. Occupational Accident Prevention and Improvement
In 2021, the number of disability injuries was 0
cases, and there were 13 people with minor injuries(loss of working hours less than one day)(accounting for 1.26% of the total number of
employees). The Company conducts investigations
on all accidents, analyzes causes and executes
improvement, in order to prevent re-occurrence ofthe same problems, including review of hazard
identification and risk and opportunity assessment
content,
engineering
improvement
priority
execution, procedure revision document andenhancement of education in order to improve
employees’ understanding and knowledge.
Please refer to the Company’s website for detailed
information:
https://tw.transcend-info.com/about/healthy_safety(4) Does the company provide
its employees with careerdevelopment and training
sessions?

v

The Company establishes annual education and None
training plan to provide knowledge necessary for
employees to perform works. Supervisors of all units
also provide training planning necessary for the careerand competence development of their department staff.
In 2021, training sessions were held, and a total of
1,917 people participated in these sessions. The periodof toal training session is 3,897 hours.

(5) Do the company's products v
and services comply with
relevant laws andinternational standards inrelation to customer healthand safety, customer
privacy, and marketing andlabeling of products andservices, and are relevant
consumer protection andgrievance procedure
policies implemented?

1. The Company has established the “Privacy None
Policy,” and for both domestic or overseas
companies, all personal information collection,
processing, use and protection shall comply with
GDPR。
2. Transcend is a global leading manufacturer in
consumer electronics and industrial products, andrecommendations on products provided by
end-users are the most important basis for theCompany’s product improvement. The Company
has established the Technical-Support Division in
charge of the handling of product related issues for-56-

Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

customers. The Customer Service Department is
responsible for irregularly and actively inspecting
and confirming the execution status of customer
policies and accepting customer complaints andhandling. In addition, the Company has establishedthe “Customer Service Satisfaction Investigation
Operation Procedure” and “CAR Work Handling
Guideline” in order to allow consumers to resolve
problems promptly and receive professional
services, thereby properly protecting the interests ofcustomers.
(6) Does the company
implement suppliermanagement policies,
requiring suppliers to
observe relevant
regulations onenvironmental protection,
occupational health andsafety, or labor and humanrights? If so, describe theresults.

v

1. The Company has established the “Supplier None
Selection and Management Work Guideline,” andthe standard selection process has been implemented
before the addition of new suppliers, and suppliers
are also requested to sign the following documentsof“environmental
protection
regulations
complianceguarantee”,“supplierethicsundertaking”, “supplier social responsibility
undertaking”, or the supplier is requested toprovide relevant responsibility statements. in order
to comply with the regulations of environmental
protection, occupational safety and health or laborrights.
2. The Company has established the GMP system to
inform suppliers of the latest hazardous substancestandard and relevant environmental protection
regulations of the Company in real time.
3. Supplier evaluation is performed annually. For the2021 supplier evaluation result, all of the suppliers
qualified the evaluation standard and complied withthe supplier code of practice.
Please refer to the Company’s website for detailed
information:
https://tw.transcend-info.com/about/vendor_management

5. Does the company
reference internationallyaccepted reporting
standards or guidelines,
and prepare reports that
disclose non-financial
information of thecompany, such as ESG
reports? Do the reportsv The Company has not yet prepared the ESG Report .

-57-

The Company will
prepare andpublicly announce
the 2021 ESG
Report in 2022.

Implementation Status

Assessment ItemYes NoAbstract Explanation

Deviations from“the Sustainable
Development
Best-PracticePrinciples for
TWSE/TPEx Listed
Companies” andReasons

above obtain assurance
from a third party
verification unit?
6. Describe the difference, if any, between actual practice and the sustainable development principles, if thecompany has implemented such principles based on the Sustainable Development Best Practice Principles for
TWSE/TPEx Listed Companies:
The Company has established the “Corporate Social Responsibility Best-Practice Principles” in 2014, having nomajor difference from the “Sustainable Development Best-Practice Principles for TWSE/TPEx Listed
Companies”, and there have been no major abnormalities in the actual operation.
7. Other useful information for explaining the status of sustainable development practices:(1) Environmental protection: Please refer to “5.4. Environmental Protection Expenditures”.
(2) Consumers’ rights and interests: The Company has established the dedicated Customer Service Center tohandle customer complaint issues. The direct-sale stores of the Company also provide the service of productreturn and exchange to consumers.
(3) Employees’ rights and interests: Please refer to “5.5.1 Employee benefit plans, continuing education,
training, retirement systems, the status of their implementation, and the status of labor agreements andmeasures for preserving employees' rights and interests”.
(4) Safety and health: The Company has obtained the ISO 45001 occupational safety and health management
system certification for the workplace, and has also qualified the TOSHMS certification standard (CNS
45001).
(5) Products: In terms of the quality management, the Company has obtained the ISO 9001 quality management
system certification. With outstanding product design and research and development strength, the Company
has received the honor of Taiwan Excellence Award for consecutive years, thereby establishing a quality
brand image.
(6) Specific promotion plan and implementation outcome for corporate social responsibility: The Company
upholds the value of creating a better future for the society and actively engages in social participation.
Through long-term support in sports related sponsorship and numerous domestic and overseas youth
cultivation events, the Company is active in promoting the development of youth and sports in Taiwan. The
Company collaborates with the Chinese Taipei School Sport Federation and provides schematic supports insports events, such as HTV and HBL contests, etc., through monetary sponsorship and product sponsorship.
In addition, to further promote the junior league baseball in Taiwan, the Company launches the remotebaseball seed project and sponsors remote elementary schools with hardware equipment and materials, inorder to fulfill the corporates responsibility and to return to the society. The youth sports development
outcome achieved by the Company has been well recognized, and the Company has received the honor ofSports Activist Award for eight consecutive years. The Company has further received the “Long-termSponsorship Award in Sponsorship Category” for the Sports Activist Award in 2021.

-58-

3.3.7. Fulfillment of Ethical Corporate Management and Deviations from the "Ethical Corporate
Management Best Practice Principles for TWSE/GTSM Listed Companies"
Implementation Status

Evaluation ItemYes NoAbstract Illustration

Deviations from the“Ethical Corporate
Management Best
Practice Principles
for TWSE/GTSM
Listed Companies”
and Reasons

1. Establishment of ethicalcorporate management
policies and programsv

The “Ethical Corporate Management Best-Practice None
Principles” of the Company has been approved in theboard of directors’ meeting in 2014, and theregulations of the “Codes of Ethical Conduct for
Directors and Managerial Officers” and “Codes of
Ethical Conduct for Employees” , etc. have also been
approved in the board of directors’ meeting in 2013.
The Company requests directors and all employees tocomply with such provisions accordingly. Please referto the Company’s website:
https://tw.transcend-info.com/about/policies(2) Does the company havev
mechanisms in place toassess the risk ofunethical conduct, andperform regular analysis
and assessment ofbusiness activities withhigher risk of unethicalconduct within the scopeof business? Does thecompany implement
programs to prevent
unethical conduct basedon the above and ensure
the programs cover at
least the matters describedin Paragraph 2, Article 7of the Ethical Corporate
Management Best
Practice Principles for
TWSE/TPEx Listed
Companies?

The Company has established the “Ethical Corporate None
Management Best-Practice Principles”, “Codes of
Ethical Conduct for Directors and Managerial
Officers” and “Codes of Ethical Conduct for
Employees”, and all of these provisions have covered
the operating activities of relatively higher risk ofunethical conduct described in the content of all
subparagraphs of Paragraph 2 of Article 7 of the“Ethical Corporate Management Best-PracticePrinciples for TWSE/GTSM Listed Companies” andother operating scope.
Ethical corporate management and ethical code of
conduct are the core guidelines for the Company. The
contents of these provisions are published on the
Company’s website for relevant personnel’s review at
any time.
The Company provides internal and externalreporting channels. In case where a violation is foundto be true, different level of disciplinary action is
imposed depending upon the severity of the violation.

(1) Does the company have a
Board-approved ethicalcorporate management
policy and stated in its
regulations and externalcorrespondence theethical corporate
management policy andpractices, as well as theactive commitment of theBoard of Directors andmanagement towards
enforcement of suchpolicy?

-59-

Implementation Status

Evaluation Item

(3) Does the company
provide clearly theoperating procedures,code of conduct,
disciplinary actions, andappeal procedures in the
programs against
unethical conduct? Does
the company enforce theprograms above
effectively and perform
regular reviews andamendments?
2. Fulfill operations integrity
policy(1) Does the company
evaluate business
partners’ ethical records
and include ethics-relatedclauses in business
contracts?

Deviations from the“Ethical Corporate
Management Best
Practice Principles
Yes NoAbstract Illustration
for TWSE/GTSM
Listed Companies”
and Reasonsv
The Company has established the “Ethical Corporate None
Management Best-Practice Principles”, “Codes of
Ethical Conduct for Directors and Managerial
Officers” and ”Codes of Ethical Conduct for
Employees” . All of these provisions are published on
the Company’s website for relevant personnel’s
review. The Company also requests all employees
and directors to comply with these provisions
accordingly.

v

Prior to engaging in business dealings with suppliers, None
the Company conducts evaluation and review process
on all aspects of the suppliers, and requests the
suppliers to provide the “Supplier Ethics
Undertaking.” Prior to engaging in business dealings
with customers, the Company evaluates the financial
and credit status according to the credit investigation
policy of the Company. In case where transaction
counterparty involves in unethical conducts, theCompany may terminate or rescind contracts at anytime.

(2) Does the company have aunit responsible for
ethical corporate
management on afull-time basis under the
Board of Directors which
reports the ethicalcorporate management
policy and programs
against unethical conduct
regularly (at least once ayear) to the Board of
Directors while
overseeing suchoperations?

v

The Company assigns the Financial and Accounting None
Department and the Administration Department to be
the concurrent units responsible for the establishmentof ethical corporate management policies andexecution of supervision, and according to the job
duties and scope of each unit, including theestablishment and revision of the “Ethical Corporate
Management Best-Practice Principles,” organizing
ethical corporate management related propaganda andeducational training, etc., in order to ensure thethorough implementation of ethical corporate
management principles. Important items and relevant
affairs promotion status are reported to the board of
directors once annually.

(3) Does the company
establish policies toprevent conflicts ofinterest and provide
appropriatev

The Company has established the “Codes of Ethical None
Conduct for Directors and Managerial Officers”,“Codes of Ethical Conduct for Employees”,“Employee Code of Conduct and Reward andDiscipline Management Regulations”, “Regulations-60-

Implementation Status

Evaluation ItemYes Nocommunication channels,
and implement it?

Abstract Illustration

Deviations from the“Ethical Corporate
Management Best
Practice Principles
for TWSE/GTSM
Listed Companies”
and Reasons

Governing Procedure for Board of Directors
Meetings” and “Audit Committee Charter.” All ofthese provisions have clearly specified mattersrequiring recusal in case of encountering the situationof conflict of interest. The Company provides
complaint channel, such that in case where any
director, managerial officer or employee is verified tohave violated the code of ethical conduct, then such
violator shall be punished in accordance with thedisciplinary measures specified in the code of ethicalconduct.

(4) Does the company haveveffective accounting andinternal control systems inplace to implement ethicalcorporate management?
Does the internal audit
unit follow the results of
unethical conduct risk
assessments and devise
audit plans to audit thesystems accordingly toprevent unethical conduct,or hire outsideaccountants to performthe audits?

The Company prepares the financial statements in Noneaccordance with the International Financial ReportingStandards (IFRSs), International
AccountingStandards (IAS) and interpretations. For the 2021
consolidated financial statements, the PwC Taiwan
has issued the audit report with unqualified opinion.
The Company establishes an internal control system
for all operating activities. The internal audit unit
performs audit work according to the audit plan andalso reports to the Audit Committee and board of
directors periodically.

(5) Does the company
regularly hold internaland external educational
trainings on operational
integrity?

To establish the corporate culture of ethical Nonemanagement and sound development, the Company
has constructed a proper business operation structureand has established the “Ethical Corporate
Management Best-Practice Principles,” and theseprinciples are implemented in the daily operation.
The new employees’ orientation training includes
ethical management related education courses, andthe content mainly covers the courses employee
ethical conduct, employee code of conduct, ethics andfair trade and duty of confidentiality, etc. In 2021,
four orientation training sessions were held, and a
total of 68 people participated in these sessions. The
period of each training session is 0.5 hours. The
course materials are provided to employees after theorientation training. The Company also places thecourse contents related to internal material
information handling operation and insider trading
related courses in the Company’s system and website
as references for directors, managerial officers and

v

-61-

Implementation Status

Evaluation ItemYes NoAbstract Illustration

Deviations from the“Ethical Corporate
Management Best
Practice Principles
for TWSE/GTSM
Listed Companies”
and Reasons

employees.
3. Operation of the integrity
channel(1) Does the company
establish both areward/punishment
system and an integrity
hotline? Can the accused
be reached by anappropriate person forfollow-up?

v

The Company has established the “Regulations for None
Company’s Whistleblowing Reports on Illegal andUnethical Conducts” and has also set up specificwhistleblowing mailbox and employee suggestion
box in order to allow internal and external personnel
to file complaint or whistleblowing reports to theCompany. After the receiving unit clarifies relevantfacts and evidence, it is reported to the managementlevel for handling.

(2) Does the company havein place standard
operating procedures forinvestigating accusation
cases, as well as
follow-up actions andrelevant ost-investigation
confidentiality measures?

v

The content of the “Regulations for Company’s None
Whistleblowing Reports on Illegal and UnethicalConducts” established by the Company specifies thehandling procedures related to the filing ofcomplaints, investigation and post-investigation
measures, and the whistleblower’s identity is kept
strictly confidential.

(3) Does the company
v
provide proper
whistleblower protection?

The “Regulations for Company’s Whistleblowing None
Reports on Illegal and Unethical Conducts” of theCompany also specifies that the whistleblower shallnot be subject to unfavorable disposal due to thewhistleblowing report, and the Company shallprovide sufficient protection to all whistleblowers.

4. Strengthening information
disclosure(1) Does the company
disclose its ethicalcorporate management
policies and the results of
its implementation on thecompany’s website and
MOPS?

v

The Company has disclosed relevant ethical Nonemanagement principles on the Company’s website
and MOPS. The Company has also set up the EthicalManagement section on the Company’s website andhas disclosed ethical management related informationin the annual report.
https://tw.transcend-info.com/about/integrity

5. If the company has established the ethical corporate management policies based on the Ethical Corporate
Management Best-Practice Principles for TWSE/TPEx Listed Companies, please describe any discrepancy
between the policies and their implementation:
The Company has established the “Ethical Corporate Management Best-Practice Principles” in 2014, having nomajor difference from the “”Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed
Companies,” and there have been no major abnormalities in the actual operation.
-62-

Implementation Status

Deviations from the“Ethical Corporate
Management Best
Evaluation Item
Practice Principles
Yes NoAbstract Illustration
for TWSE/GTSM
Listed Companies”
and Reasons
6. Other important information to facilitate a better understanding of the company’s ethical corporate management
policies (e.g., review and amend its policies)(1) The Company periodically reviews the update status of the “Ethical Corporate Management Best-PracticePrinciples for TWSE/TPEx Listed Companies” and timely reviews and conducts evaluation to determine
necessary amendments.
(2) In the provisions of the “Codes of Ethical Conduct for Directors and Managerial Officers”, “Codes of EthicalConduct for Employees” and the “Employee Code of Conduct and Reward and Discipline Management
Regulations,” the Company has specified that unethical conducts are prohibited, conflict of interests shall be
avoided and obtaining of improper personal benefits and interests shall be prevented.
(3) In the “Audit Committee Charter” and “Regulations Governing Procedure for Board of Directors Meetings,”
the Company has specified the directors’ recusal system for conflict of interest.
(4) To implement the education on ethical management, the Company includes the ethical management in thecourse content of new employees’ orientation training, thereby allowing new employees to understand theCompany’s policy and direction on ethical management.
(5) The Company has established the “Patent Management Regulations” and “Intellectual Property Right
Management Control Operation” in order to serve as the basis for the obtaining, protection and managementof intangible assets.

3.3.8. Corporate Governance Guidelines and Regulations
Please refer to the Company’s website at http://tw.transcend-info.com/about/policies
3.3.9. Other Important Information Regarding Corporate Governance
The Company has established the “Procedures for Handling Material Inside Information”. The
Company informs all employees via e-mail when newly establishment of the procedures andsubsequent amendments, and also makes public announcement through the intranet of theCompany for employees’ review and use. All departments and employees handling possible
material information and disclosure of such information are required to comply with theseprocedures as well as laws and regulations. “Procedures for Handling Material Inside
Information” has been disclosed on the Company’s website.
Please refer to: http://tw.transcend-info.com/about/policies-63-3.3.10. Implementation of Internal Control Systems
1. Statement of Internal Control Systems
Transcend Information, Inc.
Statement of Internal Control Systems
March 3, 2022
Based on the findings of a self-assessment, Transcend Information, Inc. (Transcend) states thefollowing with regard to its internal control system during the year 2021:
1.

Transcend’s Board of Directors and management are responsible for establishing, implementing,and maintaining an adequate internal control system. Our internal control is a process designed
to provide reasonable assurance over the effectiveness and efficiency of our operations(including profitability, performance and safeguarding of assets), reliability, timeliness,transparency of our reporting, and compliance with applicable rulings, laws and regulations.

2.

An internal control system has inherent limitations. No matter how perfectly designed, aneffective internal control system can provide only reasonable assurance of accomplishing its
stated objectives. Moreover, the effectiveness of an internal control system may be subject tochanges due to extenuating circumstances beyond our control. Nevertheless, our internal control
system contains self-monitoring mechanisms, and Transcend takes immediate remedial actions
in response to any identified deficiencies.

3.

Transcend evaluates the design and operating effectiveness of its internal control system basedon the criteria provided in the Regulations Governing the Establishment of Internal Control
Systems by Public Companies (herein below, the“Regulations”). The criteria adopted by theRegulations identify five key components of managerial internal control: (1) control environment,(2) risk assessment, (3) control activities, (4) information and communication, and (5)monitoring activities.

4.

Transcend has evaluated the design and operating effectiveness of its internal control system
according to the aforesaid Regulations.

5.

Based on the findings of such evaluation, Transcend believes that, on December 31, 2021, it has
maintained, in all material respects, an effective internal control system (that includes thesupervision and management of our subsidiaries), to provide reasonable assurance over ouroperational effectiveness and efficiency, reliability, timeliness, transparency of reporting, andcompliance with applicable rulings, laws and regulations.

6.

This Statement is an integral part of Transcend’s annual report and prospectus, and will be madepublic. Any falsehood, concealment, or other illegality in the content made public will entail
legal liability under Articles 20, 32, 171, and 174 of the Securities and Exchange Law.

7.

This Statement was passed by the Board of Directors in their meeting held on March 3, 2022,with none of the nine attending directors expressing dissenting opinions, and the remainder all
affirming the content of this Statement.
Transcend Information, Inc.
Chairman: Shu, Chung-Won
General Manager: Hong, Wan-Hoon-64-

2. If CPA was Engaged to Conduct a Special Audit of Internal Control System, Provide Its
Audit Report: None.
3.3.11. If there has been any legal penalty against the company and its internal personnel, or any
disciplinary penalty by the company against its internal personnel for violation of the internal
control system, during the most recent fiscal year or during the current fiscal year up to the
publication date of the annual report, where the result of such penalty could have a material
effect on shareholder interests or securities prices, the annual report shall disclose the penalty,
the main shortcomings, and condition of improvement:
None.
3.3.12. Major resolutions of Shareholders’ Meeting, Board of Directors Meetings, Audit Committee
meetings and Remuneration Committee meetings in the most recent year and up to the
publication date of this Annual Report:
1. Major resolutions of Shareholders’ Meeting
Date

Material Decisions
Adoption of 2020 Business Report and(1)
Financial Statements.

Resolutions and Implementation Status
Approved after voting.

Approved after voting. To appropriate legal
Adoption of the proposal for distribution of reserve NT$119,625,135 and to reverse special(2)2020 earnings.
reserve NT$13,657,293 from 2020 earnings inaccordance with the regulations.
Amendments to “Rules and Procedures of(3)
Approved after voting.
Shareholders’ Meeting”.
2021.08.26
Amendments to “Procedures for Election of(4)
Approved after voting.
Directors”.
Approved after voting and elected 9 directors.
The term of directors starts from Aug 26, 2021
(5) Election of directors.
and will concludes on Aug 25, 2024.
To release the prohibition on directors from
(6)
Approved after voting.
participation in competing business.

2. Material resolutions of Board of Directors Meetings
Date

Material Decisions(1)

Resolutions and Implementation Status2020 Business Report and Financial
Statements.

(2) Proposal for distribution of 2020 earnings.
2021.03.04(The FirstTime in2021)(3)

Cash distribution from 2020 retained
earnings.

Approved by all presented directors andproposed to Shareholders’ meeting for
ratification.
Approved by all presented directors andproposed to Shareholders’meeting for
ratification.
Approved by all presented directors. To
appropriate cash dividend NT$1,094,107,271(NT$2.55 per share) from 2020 earnings andsubmit a report to Shareholders’ meeting.

(4) Cash distribution from capital surplus.

Approved by all presented directors. The capitalsurplus derived from the issuance of new sharesat a premium totaling NT$214,530,838 will be
distributed in cash of NT$0.50 per share. And
submit a report to Shareholders’ meeting.

(5) CPA Independence Assessment.

Approved by all presented directors.
-65-

Extension of the period of endorsement and Approved by all presented directors. The(6) guarantee to subsidiary Transcend Japan
handling department has executed such matterInc.
according to the regulations.
Approved by all presented directors and(7) Election of directors.
proposed to Shareholders’ meeting for election.
Approved by all presented directors andAmendments to “Rules and Procedures of(1)
proposed to Shareholders’ meeting for
Shareholders’ Meeting”.
discussion.
Appointment of Corporate GovernanceApproved by all presented directors.
2021.05.06 (2)Officer.
(The
The Qualification Review of the Elected
SecondDirectors and Independent Directors
Approved by all presented directors andTime in (3)Candidate for the 2021 Annual Regular
proposed to Shareholders’ meeting for election.
2021)
Shareholders’ Meeting.
Approved by all presented directors and
To release the prohibition on directors from(4)
proposed to Shareholders’ meeting forparticipation in competing business.
discussion.
2021.08.05
Approved by all presented directors. The(The Third Extension of the period of endorsement andhandling department has executed such matter
Time inguarantee to subsidiary Transcend Japan Inc.
according to the regulations.
2021)
2021.08.26
Approved by all presented directors and(1) Election of Chairman.
(Theappointed SHU, CHUNG-WON as chairman.
FourthAppointment of the Remuneration
Time in (2)Approved by all presented directors.
Committee Members.
2021)
Approved by all presented directors. The Audit
Office is requested to execute such matter
2021.11.04 (1) 2022 Annual Internal Audit Plan.
according to the regulations.
(The fifthTime inApproved by all presented directors. The
Renewal of Directors and Officers’ Liability
2021)
(2)
handling department has executed such matter
Insurance.
according to the regulations.
Approved by all presented directors and2021 Business Report and Financial(1)
proposed to Shareholders’ meeting forStatements.
ratification.
Approved by all presented directors and(2) Proposal for distribution of 2021 earnings. proposed to Shareholders’ meeting for
ratification.
Approved by all presented directors. To
Cash distribution from 2021 retained
appropriate cash dividend NT$2,231,120,710(3)earnings.
(NT$5.20 per share) from 2020 earnings andsubmit a report to Shareholders’ meeting.
2022.03.03
Approved by all presented directors. The capital(The First
surplus derived from the issuance of new shares
Time in(4)
Cashdistribution
fromcapitalsurplus.
at a premium totaling NT$343,249,340 will be
2022)
distributed in cash of NT$0.80 per share. And
submit a report to Shareholders’ meeting.
Approved by all presented directors. The original
CPA in charge of the audit of the Company has
serviced the Company for seven years, therefore(5) Change of CPA.
starting from the 2022 Q1 financial statements,
CPA for auditing the Company have beenchanged.
(6) CPA Independence Assessment.

Approved by all presented directors.
-66-

Extension of the period of endorsement and Approved by all presented directors. The(7) guarantee to subsidiary Transcend Japan
handling department has executed such matterInc.
according to the regulations.
For this proposal, except directors of
stakeholders who recused themselves from
Renewal of land lease agreement at No. 70(8)participating in the discussion due to conflict ofXingshan Road.
interest, this proposal was approved by theattending directors.
2022.05.05
The first quarter 2022 consolidated(1)
Approved by all presented directors.
(The
financial statements.
SecondTime in (2) Amendments to “Corporate Governance Approved by all presented directors.
Best Practice Principles”.
2022)

3. Material resolutions of Audit Committee Meetings
Date

Material Decisions

Resolutions and Implementation Status
Approved by all presented committee members
2020 Business Report and Financial(1)
and proposed to Board of directors’ meeting forStatements.
discussion.
Approved by all presented committee members(2) Proposal for distribution of 2020 earnings. and proposed to Board of directors’ meeting fordiscussion.
Approved by all presented committee members
and proposed to Board of directors’ meeting for
Cash distribution from 2020 retained
2021.03.04 (3)discussion. To appropriate cash dividend
earnings.
(The First
NT$1,094,107,271 (NT$2.55 per share) fromTime in2020 earnings.
2021)
Approved by all presented committee members
and proposed to Board of directors’ meeting fordiscussion. The capital surplus derived from the(4) Cash distribution from capital surplus.
issuance of new shares at a premium totaling
NT$214,530,838 will be distributed in cash of
NT$0.50 per share.
Extension of the period of endorsement and Approved by all presented committee members(5) guarantee to subsidiary Transcend Japanand proposed to Board of directors’ meeting forInc.
discussion.
2021.05.06(The
Approved by all presented committee members
To release the prohibition on directors from
Secondand proposed to Board of directors’ meeting forparticipation in competing business.
Time indiscussion.
2021)
2021.08.05
Approved by all presented committee members(The Third Extension of the period of endorsement andand proposed to Board of directors’ meeting forTime in guarantee to subsidiary Transcend Japan Inc.
discussion.
2021)
2021.11.04(The
Approved by all presented committee members
Fourth 2022 Annual Internal Audit Planand proposed to Board of directors’ meeting forTime indiscussion.
2021)
2022.03.03
Approved by all presented committee members(The First
2021 Business Report and Financial(1)
and proposed to Board of directors’ meeting forTime inStatements.
discussion.
2022)
-67-

Approved by all presented committee members
and proposed to Board of directors’ meeting fordiscussion.
Approved by all presented committee members
and proposed to Board of directors’ meeting for
Cash distribution from 2021 retained(3)
discussion. To appropriate cash dividend
earnings.
NT$2,231,120,710 (NT$5.20 per share) from2021 earnings.
Approved by all presented committee members
and proposed to Board of directors’ meeting fordiscussion. The capital surplus derived from the(4) Cash distribution from capital surplus.
issuance of new shares at a premium totaling
NT$343,249,340 will be distributed in cash of
NT$0.80 per share.
Approved by all presented committee members(5) Change of CPA.
and proposed to Board of directors’ meeting fordiscussion.
Extension of the period of endorsement and Approved by all presented committee members(6) guarantee to subsidiary Transcend Japanand proposed to Board of directors’ meeting forInc.
discussion.
Approved by all presented committee members
Renewal of land lease agreement expiration(7)
and proposed to Board of directors’ meeting for
at No. 70 Xingshan Road.
discussion.
(2) Proposal for distribution of 2021 earnings.

2022.05.05(The
The first quarter 2022 consolidated financial
Secondstatements.
Time in2022)

Approved by all presented committee members
and proposed to Board of directors’ meeting fordiscussion.

4. Material resolutions of Remuneration Committee Meetings
Date
2021.03.04(The FirstTime in2021)

Material Decisions
Resolutions and Implementation Status
Distribution of 2020 employees’ profit(1)
sharing bonus and directors’ compensation. Approved by all presented committee members
Remuneration of managerial officers inand proposed to Board of directors’ meeting for
(2)
2021.
discussion.
(3) Remuneration of directors in 2021.

2021.11.04
Remuneration of managerial officers in
(1)
(The
2021.
Approved by all presented committee members
Secondand proposed to Board of directors’ meeting forTime in (2) Remuneration of directors in 2021.
discussion.
2021)
Distribution of 2021 employees’ profit
2022.03.03 (1) sharing bonus and directors’ compensation.
Approved by all presented committee members(The First
Remuneration of managerial officers inand proposed to Board of directors’ meeting forTime in (2) 2022.
discussion.
2022)(3) Remuneration of directors in 2022.

3.3.13. Major Issues of Record or Written Statements Made by Any Director Dissenting to Important
Resolutions Passed by the Board of Directors in the Most Recent Year up to the Publication
Date of this Annual Report:
None.
3.3.14. Resignation or Dismissal of the Company’s Key Individuals, Including the Chairman, CEO,-68-

and Heads of Accounting, Finance, Internal Audit, Corporate Governance and R&D in the
Most Recent Year and up to the Publication Date of this Annual Report:
None.
3.4. Information on CPA fees
Unit: NT$ thousands
Accounting Firm

Name of
CPA

Audit Period

Lin,
Pricewaterhouse Chun-Yao
2021.01.01~2021.12.31
Coopers
Chen,
Chin-Chang

Audit Fee

3,735

Non-audit Fee(Note)
2,913

Total

Remark

6,648-

Note: The non-audit services are for Transfer Pricing Report, Tax Compliance Audit service
and other Tax Consulting services.
3.4.1. When the company changes its accounting firm and the audit fees paid for the fiscal year inwhich such change took place are lower than those for the previous fiscal year, the amounts of
the audit fees before and after the change and the reasons shall be disclosed.
Not applicable.
3.4.2. When the audit fees paid for the current fiscal year are lower than those for the previous fiscal
year by 10 percent or more, the reduction in the amount of audit fees, reduction percentage,
and reason(s) therefor shall be disclosed.
None.
3.5. Replacement of CPA
Not applicable.
3.6. Where the company's chairman, general manager, or any managerial officer in charge offinance or accounting matters has in the most recent year held a position at the accounting firmof its certified public accountant or at an affiliated enterprise of such accounting firm, the nameand position of the person, and the period during which the position was held, shall be
disclosed.
None.

-69-

3.7. Any transfer of equity interests and/or pledge of or change in equity interests by a director,
managerial officer, or shareholder with a stake of more than 10 percent during the most recent
fiscal year and during the current fiscal year up to the date of publication of this Annual Report.
3.7.1. Changes in shares held by Directors, Managerial Officers and Major Shareholders
2021

Title

As of April 19, 2022
Increase
Increase
Increase
Increase(decrease)(decrease)(decrease) of(decrease) ofof sharesof shares
shares held
shares held
pledgedpledged-Name

Chairman and CEO
Director
Director
DirectorShu, Chung-Won
Shu, Chung-Cheng
Chui, Li-Chu
Hsu, Chia-Hsian
Chen, Po-Shou
Director & Sales Vice
(Elected date of director:
General Manager
2021/8/26)
Wu, Kuan-De
Director(Elected date of director:
2021/8/26)
Independent Director Chen, Yi-Liang
Independent Director Chen, Lo-Min
Independent Director Wang, Yi-Hsin
General Manager
Hong, Wan-Hoon
Wang, Jen-Ming
Sales Vice General(Dismissal date of director:
Manager
2021/8/26)
Li, Tseng-Ho
R&D Vice General(Dismissal date of director:
Manager
2021/8/26)
Administration Vice
Fang, Wen-Jeng
General Manager
Financial andAccounting Officer &Hsiao, Sheng-Yin(Note 2)
Corporate Governance
Officer
Shareholder holding
Won Chin Investment Inc.
10% or more of shares
Note 1: The status of the increase/decrease of shares held and pledged shall be based on the period of thedirectors and managerial officers’ term of office.
Note 2: New appointment of Corporate Governance Officer on May 6, 2021.

3.7.2. Shares Trading with Related Parties
Not applicable.
3.7.3. Shares Pledge with Related Parties
Not applicable.

-70-

-

-

-

-

-

3.8. Relationship information, if among the company's Top 10 shareholders any one is a related
party, spouse or a relative within the second degree of kinship of another

Name

Current Shareholding
Shares%Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
Relationship
Wan An Technology
Inc.

Same person as the
ChairmanWan Min Investment
Inc.

Same person as the
Chairman

Wan Chuan Investment Same person as theInc.
ChairmanCheng Chuan
Technology
Development Inc.

Ho Cheng Investment
Inc.
Won ChinInvestment Inc.
Representative:
Shu, Chung-Yu

74,783,600 17.43%

-

-

-

Shin Chuang
Investment Inc.

Shu, Chung-Won

Shu Min Investment
Inc.

Shu, Chung-Cheng

Wan AnTechnology Inc.
Representative:
Shu, Chung-Yu

34,142,854

7.96%

-

-

-

-71-

The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Won
Chin
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Won
Chin
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Won
Chin
This shareholder is arelative within two
degrees of kinship of
the Chairman of Won
Chin
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Won
Chin
This shareholder is arelative within two
degrees of kinship of
the Chairman of Won
Chin

Won Chin Investment
Inc.

Same person as the
ChairmanWan Min Investment
Inc.

Same person as the
Chairman; Investmentof Wan An on Wan
Min is evaluatedunder equity method

-

Name

Current Shareholding
SharesCheng Chuan
Technology
Development Inc.
32,971,701
Representative:
Shu,
Chung-Cheng

%

7.68%

Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
RelationshipSame person as the
Chairman; Investment
Wan Chuan Investmentof Wan An on Wan
Inc.
Chuan is evaluatedunder equity method
The Chairman of thecompany listed here isCheng Chuana relative within two
Technology
degrees of kinship ofDevelopment Inc.
the Chairman of Wan
An
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
Ho Cheng Investment
the Chairman of Wan
Inc.
An; Investment of
Wan An on He Chengis evaluated underequity method
The Chairman of thecompany listed here is
Shin Chuanga relative within two
Investment Inc.
degrees of kinship of
the Chairman of Wan
An
This shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Wan
An
The Chairman of thecompany listed here is
Shu Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Wan
An
This shareholder is arelative within two
Shu, Chung-Cheng
degrees of kinship of
the Chairman of Wan
An
The Chairman of thecompany listed here is
Won Chin Investment a relative within twoInc.
degrees of kinship of
the Chairman ofCheng Chuan
The Chairman of thecompany listed here is
Wan An Technology
a relative within twoInc.
degrees of kinship of
the Chairman ofCheng Chuan

-72-

Name

Current Shareholding
SharesWan MinInvestment Inc.
Representative:
Shu, Chung-Yu

29,726,397

%

6.93%

Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
Relationship
The Chairman of thecompany listed here is
Wan Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman ofCheng Chuan
The Chairman of thecompany listed here is
Wan Chuan Investment a relative within twoInc.
degrees of kinship of
the Chairman ofCheng Chuan
The Chairman of thecompany listed here is
Ho Cheng Investment a relative within twoInc.
degrees of kinship of
the Chairman ofCheng Chuan
The Chairman of thecompany listed here is
Shin Chuanga relative within two
Investment Inc.
degrees of kinship of
the Chairman ofCheng Chuan
This shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman ofCheng Chuan
Same person as the
Chairman; Investment
Shu Min Investmentof Cheng Chuan on
Inc.
Shu Min is evaluatedunder equity method

-

-

-

Shu, Chung-Cheng

Chairman of Cheng
Chuan

Won Chin Investment
Inc.

Same person as the
Chairman

Wan An Technology
Inc.

Same person as the
Chairman; Wan Min
is an investee of Wan
An under equity
methodWan Chuan Investment Same person as theInc.
ChairmanCheng Chuan
Technology
Development Inc.

-73-

The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Wan
Min

Name

Current Shareholding
SharesWan Chuan
Investment Inc.
Representative:
Shu, Chung-Yu

29,505,896

%

6.88%

Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
Relationship
The Chairman of thecompany listed here is
Ho Cheng Investment a relative within twoInc.
degrees of kinship of
the Chairman of Wan
Min
The Chairman of thecompany listed here is
Shin Chuanga relative within two
Investment Inc.
degrees of kinship of
the Chairman of Wan
Min
This shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Wan
Min
The Chairman of thecompany listed here is
Shu Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Wan
Min
This shareholder is arelative within two
Shu, Chung-Cheng
degrees of kinship of
the Chairman of Wan
Min

-

-

-

-

Won Chin Investment
Inc.

Same person as the
Chairman

Wan An Technology
Inc.

Same person as the
Chairman; Wan
Chuan is an investeeof Wan An underequity method

Wan Min Investment
Inc.

Same person as the
ChairmanHo Cheng Investment
Inc.

Shin Chuang
Investment Inc.

Cheng Chuan
Technology
Development Inc.

-74-

The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Wan
Chuan
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Wan
Chuan
The Chairman of thecompany listed here isa relative within two
degrees of kinship of
the Chairman of Wan
Chuan

Name

Current Shareholding
Shares%Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
RelationshipThis shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Wan
Chuan
The Chairman of thecompany listed here is
Shu Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Wan
Chuan
This shareholder is arelative within two
Shu, Chung-Cheng
degrees of kinship of
the Chairman of Wan
Chuan
Shin Chuang
Investment Inc.

Ho Cheng
Investment Inc.
Representative:
Shu, Chung-Mei

14,426,462

3.36%

-

-

-

-75-

-

Same person as the
Chairman

The Chairman of thecompany listed here is
Won Chin Investment a relative within twoInc.
degrees of kinship of
the Chairman of Ho
Cheng
The Chairman of thecompany listed here isa relative within two
Wan An Technology
degrees of kinship of
Inc.
the Chairman of Ho
Cheng; He Cheng is
an investee of Wan An
under equity method
The Chairman of thecompany listed here is
Wan Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Ho
Cheng
The Chairman of thecompany listed here is
Wan Chuan Investment a relative within twoInc.
degrees of kinship of
the Chairman of Ho
Cheng
The Chairman of thecompany listed here isCheng Chuana relative within two
Technology
degrees of kinship ofDevelopment Inc.
the Chairman of Ho
Cheng
This shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Ho
Cheng

Name

Current Shareholding
Shares%Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
Relationship
The Chairman of thecompany listed here is
Shu Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Ho
Cheng
This shareholder is arelative within two
Shu, Chung-Cheng
degrees of kinship of
the Chairman of HoCheng
Ho Cheng Investment
Inc.

Shin Chuang
Investment Inc.
Representative:
Shu, Chung-Mei

13,947,294

3.25%

-

-

-

-76-

-

Same person as the
Chairman

The Chairman of thecompany listed here is
Won Chin Investment a relative within twoInc.
degrees of kinship of
the Chairman of Shin
ChuangThe Chairman of thecompany listed here isCheng Chuana relative within two
Technology
degrees of kinship ofDevelopment Inc.
the Chairman of Shin
ChuangThe Chairman of thecompany listed here is
Wan An Technology
a relative within twoInc.
degrees of kinship of
the Chairman of Shin
ChuangThe Chairman of thecompany listed here is
Wan Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Shin
ChuangThe Chairman of thecompany listed here is
Wan Chuan Investment a relative within twoInc.
degrees of kinship of
the Chairman of Shin
ChuangThis shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Shin
ChuangThe Chairman of thecompany listed here is
Shu Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Shin
ChuangName

Current Shareholding
Shares%Shu, Chung-Won 9,990,453

2.33%

Shu MinInvestment Inc.
Representative:
Shu,
Chung-Cheng

1.50%

6,437,842

Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
RelationshipThis shareholder is arelative within two
Shu, Chung-Cheng
degrees of kinship of
the Chairman of Shin
ChuangThis shareholder is arelative within two
Wan An Technology
degrees of kinship of
Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two
Wan Min Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two
Wan Chuan Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
This shareholder is a
Cheng Chuanrelative within two
Technology
degrees of kinship ofDevelopment Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two- Ho Cheng Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two
Shin Chuang
degrees of kinship ofInvestment Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two
Won Chin Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
This shareholder is arelative within two
Shu Min Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
The two shareholders
are relatives within
Shu, Chung-Cheng
two degrees ofkinship
The Chairman of thecompany listed here is
Wan An Technology
a relative within twoInc.
degrees of kinship of
the Chairman of Shu
Min

-77-

Name

Current Shareholding
Shares%Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
Relationship
The Chairman of thecompany listed here is
Wan Min Investmenta relative within twoInc.
degrees of kinship of
the Chairman of Shu
Min
The Chairman of thecompany listed here is
Wan Chuan Investment a relative within twoInc.
degrees of kinship of
the Chairman of Shu
Min
Same person as theCheng Chuan
Chairman; Shu Min isTechnology
an investee of Cheng
Development Inc.
Chuan under equity
methodThe Chairman of thecompany listed here is
Ho Cheng Investment a relative within twoInc.
degrees of kinship of
the Chairman of Shu
Min
The Chairman of thecompany listed here is
Shin Chuanga relative within two
Investment Inc.
degrees of kinship of
the Chairman of Shu
Min
The Chairman of thecompany listed here is
Won Chin Investment a relative within twoInc.
degrees of kinship of
the Chairman of Shu
Min
This shareholder is arelative within two
Shu, Chung-Won
degrees of kinship of
the Chairman of Shu
MinShu, Chung-Cheng

Wan An Technology
Inc.
Shu,
Chung-Cheng

6,244,098

1.46%

-

-

-

Wan Min Investment
Inc.

-78-

Chairman of Shu Min
This shareholder is arelative within two
degrees of kinship of
the Chairman of thecompany listed here
This shareholder is arelative within two
degrees of kinship of
the Chairman of thecompany listed here

Name

Current Shareholding
Shares%Shareholding
Name and Relationship Between the
Spouse’s/minor’s
by Nominee Company’s Top Ten Shareholders, or Spouses
Shareholding
Arrangement
or Relatives Within Two Degrees
Shares%Shares %Name
RelationshipThis shareholder is arelative within two
Wan Chuan Investment
degrees of kinship of
Inc.
the Chairman of thecompany listed here
Cheng Chuan
Technology
Development Inc.
Ho Cheng Investment
Inc.

Shin Chuang
Investment Inc.

Won Chin Investment
Inc.

Shu, Chung-Won

Shu Min Investment
Inc.

-79-

This shareholder isthe Chairman of theCompany listed here
This shareholder is arelative within two
degrees of kinship of
the Chairman of thecompany listed here
This shareholder is arelative within two
degrees of kinship of
the Chairman of thecompany listed here
This shareholder is arelative within two
degrees of kinship of
the Chairman of thecompany listed here
The two shareholders
are relatives within
two degrees ofkinship
This shareholder isthe Chairman of theCompany listed here

3.9. The total number of shares and total equity stake held in any single enterprise by the company,
its directors, managerial officers, and any companies controlled either directly or indirectly by
the company.

AffiliatedEnterprises(Note)

April 19, 2022; Unit: Shares
Direct or Indirect Ownership
Ownership by the Company
by Directors/
Total OwnershipManagerial officers
Shares%Shares%Shares%Taiwan IC Packaging
Corporation

21,928,036

12.49%

4,471,641

Saffire Investment Ltd.

36,600,000

100%

-

Transcend Information
Inc. (USA)625,000

100%

Transcend Japan Inc.

6,400

Transcend Korea Inc.

40,00026,399,677

15.04%-

36,600,000

100%

-

-

625,000

100%

100%

-

-

6,400

100%

100%

-

-

40,000100%

Note: Invested by the company using the equity method.

-80-

2.55%

4. Capital Overview
4.1. Capital and Shares
4.1.1. Source of Capital
Authorized CapitalFace Value
Per Share(NT$)
10

Shares500,000,000

Type of
Stock
CommonStock

Paid-in Capital

Amount(NT$ thousands)
5,000,000

RemarkAmount(NT$ thousands)

Shares429,061,675

4,290,617

No change in Authorized Capital andPaid-in Capital in 2021 and as of thedate of this Annual Report.

Authorized Capital
Shares Outstanding(Note)

Un-issued Shares

429,061,675

RemarkTotal Shares

70,938,325

25,000,000 shares arereserved for employee stock
options.

500,000,000

Note: Listed Shares.

Information for Shelf Registration: None.
4.1.2. Shareholder Structure
As of April 19, 2022
Shareholders
Structure Government

Agencies

Financial
Institutions

Quantity

Number of
Shareholders
Shareholding(Shares)
Holding
Percentage

Foreign
Other Juridical
Domestic
Institutions andPersons
Natural Persons
Natural Persons

Total

-

10

105

26,857

205

27,177-

8,843,000

248,981,220

128,757,161

42,480,294

429,061,675

0.00%

2.06%

58.03%

30.01%

9.90%

100.00%4.1.3. Shareholding Distribution Status
As of April 19, 2022 (Note 1)
Class of shareholding(Shares)
1~999
1,000~5,000
5,001~10,000
10,001~15,000
15,001~20,000
20,001~30,000
30,001~40,000
40,001~50,000
50,001~100,000
100,001~200,000
200,001~400,000

Number of shareholders

Shareholding (Shares)

Shareholding percentage (%)

4,635
18,557
2,141
583
357
325
154
80
166
83
42

738,984
35,774,478
16,816,400
7,486,371
6,563,832
8,293,093
5,517,287
3,739,921
11,713,088
11,514,058
12,395,835

0.17%
8.34%
3.92%
1.74%
1.53%
1.93%
1.29%
0.87%
2.73%
2.68%
2.89%

-81-

400,001~600,000
600,001~800,000
800,001~1,000,000

12
11
4

5,657,606
7,301,470
3,291,385

1.32%
1.70%
0.77%

1,000,001 or over27

292,257,867

68.12%

Total

27,177429,061,675

100.00%Note 1: It refers to the most recent shareholding dispersal base date provided by the stock affairs agent.
Note 2: The Company does not issue preferred shares.

4.1.4. List of Major Shareholders
SharesShareholding(Shares)Name of major shareholders
Won Chin Investment Inc.

Percentage (%)

74,783,600
34,142,854
32,971,701
29,726,397
29,505,896
14,426,462
13,947,294
9,990,453
6,437,842
6,244,098
252,176,597

Wan An Technology Inc.
Cheng Chuan Technology Development Inc.
Wan Min Investment Inc.
Wan Chuan Investment Inc.
Ho Cheng Investment Inc.
Shin Chuang Investment Inc.
Shu, Chung-Won
Shu Min Investment Inc.
Shu, Chung-Cheng
Total

17.43%
7.96%
7.68%
6.93%
6.88%
3.36%
3.25%
2.33%
1.50%
1.46%
58.78%

4.1.5. Market Price, Net Worth, Earnings, and Dividends per Share in the Past Two Years
Unit: NT$; Thousand shares
Year
Item

2020

2021

As of March 31,
2022(Note 1)

84.00
91.90
75.80
Market Highest
Price per Lowest
61.80
61.40
69.50
Share
Average
69.40
69.81
72.05
Beforedistribution
43.52
46.23
42.13
Net Worthper Share After distribution
40.47
40.23
42.13
Earnings Weighted Average Shares
429,064
429,062
429,062
per Share
Earnings per Share (EPS)
2.79
5.90
7.27 (Note 2)
(EPS)
3.05
6.00
Not applicable
Dividend Cash dividendper Share Cumulative unpaid dividends
Return on Price-to-earning ratio
24.87
11.83
9.91 (Note 2)
Investment Price-dividend ratio
22.75
11.64
Not applicable(ROI)
Cash dividend yield rate
4.39
8.59
Not applicable
Analysis
Note 1: The consolidated financial statements of 2022 Q1 have been prepared in accordance to the IFRS andhave been reviewed by the CPAs.
Note 2: The calculation of Earnings per Share (EPS) and Price-to-Earnings Ratio for 2022 Q1 have beenannualized.
-82-

4.1.6. Dividend Policy and Implementation Status
1. Dividend Policy
According to Article 22-1 of the Company’s Articles of Incorporation, if the Company has
earnings after the annual final accounting, it shall be allocated in the following order:(1) To pay taxes.
(2) To cover accumulated losses, if any.
(3) To appropriate 10% legal reserve unless the total legal reserve accumulated has
already reached the amount of the Company’s authorized capital.
(4) To appropriate or reverse special reserve in accordance with the regulations.
(5) To reserve certain amount, on the premise that there is no effect on the Company’s
normal operations and no violation of regulations, for maintaining stability of
dividends.
(6) For any remainder, adding on accumulated unappropriated retained earnings, theboard of directors shall propose the earnings distribution proposal and shall handle inaccordance with the following provision: the board of directors is authorized to
distribute dividends and bonuses or legal reserve and capital reserve in whole or inpart which be paid in cash after a resolution has been adopted by a majority vote at a
meeting of the board of directors attended by two-thirds of the total number of
directors; and in addition thereto a report of such distribution shall be submitted to theshareholders’ meeting in accordance with Section 5 of Article 240 and Section 1 of
Article 241 of the Company Act. In case of the dividends and bonuses or legal reserveand capital reserve in whole or in part be distributed in the form of new shares to beissued by the company, shall be proposed to the shareholders' meeting for review andapproval by a resolution in accordance with Article 240 of the Company Act.
The Company distributes dividends taking into consideration the Company's economic
environment and growth phases, future demands of funds, long-term financial planning,
and the cash flows that the stockholders desire. Under the circumstances of no material
investment plans and other special situation, the proportion of dividend distributed shall not
be less than 80% of after-tax profit, and cash dividends shall account for at least 5% of thetotal dividend distributed. The Company currently distributes dividend all in cash, andthere is no consideration for the distribution of stock dividends.
2. Proposed Distribution of Dividend:
The appropriation for cash dividends from 2021 earnings and cash payment from capitalsurplus have been approved by the Board of Directors during its meeting on March 3, 2022.
Unit: NT$
year

2021

Dividends per Share
Retained Earnings
Cash
Dividend
Capital surplus
Retained
Earnings
Free Share
Assignment
Capital surplus
Total

5.20
0.80
0.00
0.00
6.00

3. Major Change Expected in the Dividend Policy:
None.
4.1.7. Impacts of free share assignment intended through the current shareholders meeting on the
Company's operational performance and earnings per share:
Not applicable.
-83-4.1.8. Compensation for Employees and Directors
1. The percentage or range of compensation for employees and directors based on the Article
of Incorporation:
Bases on Article 22 of the Article of Incorporation, where the Company has a profit before
tax for each fiscal year, the Company shall first reserve certain amount of the profit torecover losses for preceding years, and then set aside no less than 1% of the remaining
profit for distribution to employees as compensation and no more than 0.2% of theremaining profit for distribution to directors as compensation.
The compensation may be paid in stock or cash. For remuneration in the form of shares, theemployees of subsidiaries meeting specific condition are also entitled to the payment. The
Board is authorized to decide such qualifications and allocation.
2. Basis for estimating the amount of compensation for employees and directors, basis forcalculating the number of shares to be distributed as employee compensation, and theaccounting treatment of the discrepancy, if any, between the actual distributed amount andthe estimated amount, for the current period:
If the actual amounts approved by board of directors differ from the estimated amount, thedifference will be recorded in the year when board of directors makes the resolution as achange in accounting estimate.
3. Distribution of Compensation of Employees and Directors for 2021 Approved in the Boardof Directors Meeting:
The compensation of employees and directors for the year ended December 31, 2021 has
been approved by the Board of Directors during its meeting on March 3, 2022.
Unit: NT$
Compensation of Employees andApproved in the Board of
Estimated Amount
Directors for 2021
Directors Meeting
Employee Compensation – in Cash
31,542,266
32,690,586
Directors’ Compensation – in Cash
3,200,000
4,576,682
Note 1: The difference between the actual amounts approved by board of directors and theestimated amount will be taken as a change in accounting estimate and adjusted in profit
or loss for 2022.
Note 2: The Company did not distribute the compensation of employees and directors in stocks.

4. The actual distribution of employee and director compensation for the previous fiscal year(with an indication of the number of shares, monetary amount, and stock price, of theshares distributed), and, if there is any discrepancy between the actual distribution and therecognized employee and director compensation, additionally the discrepancy, cause, andhow it is treated:
Unit: NT$
Approved in the Board ofCompensation of Employees andDirectors Meeting
Estimated Amount
Directors for 2020
(Actual distribution Amount)
Employee Compensation – in Cash
14,786,482
15,224,586
Directors’ Compensation – in Cash
2,160,000
2,131,442
Note: The above-mentioned actual distribution of compensation of employees and directors wasin line with the resolution of the Board of Directors. The difference between the actual
distribution amounts and the estimated amount was taken as a change in accounting
estimate and adjusted in profit or loss for 2021.

-84-4.1.9. Buy-back of Treasury StockNone.
4.2. Status of Corporate Bonds
None.
4.3. Status of Preferred SharesNone.
4.4. Stauts of Overseas Depositary Receipts
None.
4.5. Status of Employee Stock Option
None.
4.6. Status of New Restricted Employee SharesNone.
4.7. Status of New Shares Issuance in Connection with Mergers or Acquisitions
None.
4.8. Implementation of the Capital Allocation Plans
Any uncompleted public issue or private placement of securities, or issues and placements thatwere completed but have not yet fully yielded the planned benefits: None.

-85-

5. Operational Highlights
5.1. Business Activities
5.1.1. Business Scope
1. Main areas of business operations
The main areas of business operations of the Company registered on the registration
alternation form issued by the Ministry of Economic Affairs are as follows:(1) Computers and Peripheral Equipment Manufacturing.
(2) Data Storage Media Manufacturing and Duplicating.
(3) Wholesale of Computers and Clerical Machinery Equipment.
(4) Wholesale of Computer Software.
(5) Wholesale of Electronic Materials.
(6) International Trade.
(7) Information Software Services.
(8) Electronics Components Manufacturing.
(9) Restrained Telecom Radio Frequency Equipment and Materials Import.
(10) Restrained Telecom Radio Frequency Equipment and Materials Manufacturing.
(11) All business items that are not prohibited or restricted by law, except those that are
subject to special approval.
2. Revenue distribution in the Most Recent Two Fiscal Years

Item

Unit: NT$ thousands
2020
Amount%2021
Amount%

FLASH+DRAM products

11,996,864

83.81

9,041,918

78.99

Others2,317,951

16.19

2,404,778

21.01

Total

14,314,815

100.0011,446,696

100.00(1) Main Products
A. DRAM Modules
UDIMM, SODIMM, ECC UDIMM, ECC SODIMM, RDIMM, and the application
scope includes memory modules for desktop/notebook computers, memory
modules for servers/workstations, memory modules for routers, and memory
modules for commercial and industrial applications, etc.
B. Flash Products
SSD with the interface of PATA/SATA/PCIe, form factor including 2.5", M.2,
mSATA, mSATA mini, half-slim, and external SSD. Type of memory cards
includes CF Card, CFast Card, SD Card and microSD Card, flash memory modules
with the interface of PATA/SATA/USB for special industrial application platform,
and portable disks complying with the standards of USB 2.0, USB3.0 & USB3.1
specifications.
C. Multimedia Products
Dashcam, body camera, and external DVD burners, etc.
D. Hard Disk Products
Various types of portable hard disk storage devices, and NAS cloud hard disks, etc.
E. Card Readers and Accessories
Various types of card readers, hubs and adapter cards, etc.
(2) New products development-86-

A. DRAM Modules
DRAM modules of higher frequency, DRAM modules of higher capacity, DRAM
modules for gaming sports, wide temperature DRAM modules for industrial
purposes, and memory modules for servers / workstations / desktop computers /notebook, etc.
B. Flash Products
i. SSD: Capacity expansion, higher transmission speed, various form factors, highspeed USB portable disks, high-endurance SSD for embedded products, wide
temperature SSD, SSD with power loss protection, and SSD with AES function.
ii. Memory cards: Memory cards for surveillance cameras, high speed memory
cards, memory cards with high Read/Write numbers, wide temperature memory
cards for embedded products.
iii. USB portable disks: Type-C series of portable disks, flash memory portabledisks built-in with multiple functions, flash memory portable disks with highspeed, flash memory portable disks with ultra-high capacity, and flash portabledisks equipped with encryption specification, etc.
C. Multimedia Products
Motorcycle Dashcams, various body cameras, personal portable recording devices
and accessories and NAS cloud storage products, etc.
D. Hard Disk Products
2.5,” various types of high capacity SSD (Solid State Disk), various 2.5”/3.5” large
capacity portable hard disks of stylish appearance and different functions, Network
Attached Storages (NAS) and external DVD burners, etc.
E. Card Readers and Accessories
Type-C interface related peripheral products, such as Hub, card reader, andDocking Station, etc. Card readers equipped with stylish appearance and support
the latest memory card specification, and card readers equipped with encryptionfunction. Card readers which are applicable to OTG portable disks, etc.
5.1.2. Industry Overview
1. The Current Status and Development of the Industry(1) DRAM Memory Industry Overview
Still widely used in industrial applications, and the demand for commercial
applications continues to increase. With the broad applications of Internet of Things(IoT) and the increasing need of industrial computers, cloud computers and servers, inconjunction with increase of the applications in the fields of the edge computing,media streaming and auto electronics, etc. derived from the AI technologies, DDR4 has
certainly become the main stream specification in the market, and the capacity ofmemory modules continues to increase. At the same time, DDR5 also debuted this year.
Transcend will continue to develop modules of higher frequency and larger capacity,
and work in the industrial market.
(2) Flash Memory Industry Overview
Memory cards are small in size and have a variety of applications. In addition to smart
phones, digital cameras and gaming devices used by consumers, the demand of
surveillance cameras, network cameras and cloud cameras for commercial use
continues to grow such that memory cards are maintained with a certain sales volume;
however, the demand for USB portable disks, except for developing countries, hasslowed down due to the development of cloud storage.
-87-

SSDs have greater speed than traditional hard disks, and they are also equipped withthe advantages of compact, lightweight, energy saving and shock resistant, etc. In
terms of price, consumer acceptance has increased significantly. Compact and light
Notebooks equipped with SSD are still the mainstream in the market. Diverse machine
requirements include different format factors and customization demands will also
drive the demand for SSDs.
Under the rapid development and the transformation of manufacturing process of TLC
and 3D Nand in recent years, the production costs of suppliers have decreased, which
is beneficial to the transformation of need and the continuous growth of the demandfor Nand flash. In 2020, the main application of Nand Flash were mobile phone
built-in Nand flash and SSD products. After 2021, 5G smartphones, business laptop,
automobile application and data center, etc. are the main demands for Nand Flash andit is expected that the Nand flash growth in 2022 will surpass the performance in 2021.
Accordingly, for flash products, Transcend will still focus on the development of fieldsof SSD and industrial applications as the main targets.
2. The Links Between Upstream, Midstream and Downstream of the Industry Supply Chain
Upstream

Middle Stream

Dynamic Random Access
Memory (DRAM)
Manufacturer

Downstream
SystemIntegrator

Static Random Access
Memory (SRAM)
Manufacturer

Flash Memory (FLASH)
Manufacturer

End User
DRAM Module/
Flash Memory
Manufacturer

PCB
Manufacturer

ChipsetManufacturer

Retailer

Connecter
Manufacturer

Electronic Component(Resistor, Capacitor, Plate,Lens, Display, & Power
Supply, etc) Supplier

Distributor-88-

3. Development Trends and Competition status of Products
The main application of DRAM is for general personal computers and enterpriseapplications. The growth of personal computer market has been slow due to saturated
demands; however, the demand for enterprise applications is still strong under two major
trends of cloud and automation. A lot of DRAM suppliers adopt the countermeasure of
reduction of production to cope with the trends. The module industry also adjusts thestrategy and has shifted the main product development focus to niche products, such as AIedge computing, 5G products, data center, servers or industrial applications, etc.
Flash demand also faces similar problem. The smart phone market, which is the greatest
consumption of memory cards, is quite saturated and highly competitive. For other sources
with use of memory cards, such as digital camera market, such sources have been
suppressed due to the development of smart phones. As for USB portable disks, due to thedevelopment of new storage products of cloud storage, etc., the market is facing thechallenge of decreasing or shifting demand.
Nevertheless, for the upcoming era of 5G, 5G network will be widely applied to AI
technology and other new technologies of IoT platform, etc., data quantity will be driven to
expand rapidly, and to meet such rapid expansion, the market demand for real-time
computation and massive storage is expected to grow significantly. Such demands havebegun to develop in commercial and industrial applications, which will drive the increased
demand for DRAM and Flash.
In general, since consumer products are affected by the decrease of ASP and the reductionof market scale, the competition becomes more severe. Nevertheless, with the diversified
demands of industrial application market, relevant component markets are continuously
driven to grow. Industrial applications are equipped with the characteristics of higer quality,
stable and long-term focus on research and development, capability for high customizationand flexibility in operation as well as stable supply, etc., the entry barrier is high.
Transcend has deep-rooted in the management of the industrial application market andcontinue to invest in research and development; therefore, the company can provide
customers with diverse needs and actively focuses on competitive advantages.
Under the ever-changing market and competitive industrial environment, the Company has
been able to achieve continuous growth. The Company has not only been ranked 62nd by
the U.S. Bloomberg Businessweek among Top 100 Technology Company Worldwide but
also been ranked by Ministry of Economic Affairs as Top 25 International Brand in Taiwan
for the 15th consecutive year, indicating that under such increasingly severe international
market, the Company has been able to demonstrate its stable brand development andmanagement strength.
The competitive advantages of the Company are well demonstrated in the following four
aspects:(1) Supply and Logistics
A. Rigorous supply chain management
B. Global timely logistics: virtual warehouse
C. Excellent inventory management(2) Innovation and Production
A. Professional internal research, development and design teams
B. Own factory manufacturing and rigorous quality control(3) Product and Inventory
A. Diverse product lines offering a wide range of products
B. Complete after-sale service-89-

C. Global inventory real-time management(4) Comprehensive Backend Support
A. Rigorous financial and accounting management
B. Brand reputation and global marketing support
C. Product return and exchange management and repair technical service
As a leading manufacturing well-known for its professional storage media, all employeesof the Company continue to pursuit greater achievements. To active development ofchannel service, we also establish a broader vision: with our technology advantages in the
products of memory cards, flash memory products, storage equipment products,
multimedia products and industrial products, along with the global logistics and marketing
network providing quality and professional services, we have been able to successfully
establish a sound brand image and has become the leading manufacturer in global
consumer electronics and embedded products.

-90-5.1.3. Technologies, Research and Development Overview
1. A Listing of Research and Development Expenditures as well as Technologies and/or
Products Successfully Developed in 2021 and as of the date of this Annual Report
Year R&D Expenses

2021

151,458

Unit: NT$ thousands
R&D Achievements[Memory Card] SDXC 340S memory card is equipped with the UHS-I
interface specification, and further complies with the Video Speed Class 30(V30) interface standard, in order to provide smooth and highly efficient
4K recording quality. microSDXC 340S is targeted at mobile phone games
and palm gaming devices, and satisfies the latest generation of A2 speed
grade, focuses on providing excellent random R/W performance, making itsuitable to process the R/W of small files, and is also able to accelerate the
App opening time.
[Memory Card] SDXC460T is equipped with high quality 3D stacked flash
memories, achieving outstanding continuous program speed, and it is also
equipped with 3K program/erase cycles, equivalent to the durability of
MLC chip, thereby achieving higher stability and useful lifetime. It isapplicable to industrial environmental applications requiring high stableperformance, such as medical devices, surveillance system and POS
terminal.
[Memory Card] It is equipped with SDC220I memory card of Transcend’s
exclusive SuperMLC technology, and its speed and durability are able toreach those of SLC flash memory with price competitiveness. It isequipped with outstanding continuous write speed and repetitive
program/erase cycles. In addition, it is able to operate under a wide
temperature range (-40° to 85°C), thereby demonstrating high stability anduseful lifetime. Its high compatibility making it applicable to relatively
stable and mature industrial environmental applications, such as medical
devices and POS terminal.
[SSD] SSD422K solid state hard disk is equipped with the SATA III 6Gb/stransmission interface. It is equipped with a built-in powerful controller andadopts the high quality MLC flash memory chip, in order to provide fasttransmission speed and long-term reliability.
[SSD] MSA372M/MSA380M/MSA372I mSATA SSD uses Serial ATA
interface and is equipped with built-in powerful controller, such that it isable to provide fast transmission speed and long-term reliability. It
complies with the mSATA dimension specification, and its size is only 1/8
of conventional 2.5” SSD, and it is most suitable for Ultrabook, tablet
computers and thin servers with confined space.
[SSD] HSD372M/HSD372I Half-Slim solid state hard disk adopts the
SATA III 6Gb/s high speed transmission interface and powerful control
chip, such that it is able to achieve outstanding R/W performance under the
JEDEC MO-297 specification. Transcend’s Half-Slim solid state hard disk
undergoes rigorous tests to ensure the highest quality, high performanceand outstanding reliability, making it most suitable for executing highdensity application programs with limited space on mobile computing
devices, including industrial control system, medical equipment, portabledevice and POS terminal.
[SSD] MTS402M/MTS410M(2242)/MTS602M(2260)/MTS802M/
MTS810M (2280) M.2 solid state hard disk adopts the SSD M.2
specification, and in comparison to standard solid state hard disks, it ismore compact than SSD complying with the M.2 specification, making itsuitable for slim type of portable devices, such as Ultrabook and slim
notebook computers. With the combination of the SATA III 6Gb/s-91-

Year R&D Expenses

R&D Achievements
transmission interface and power control chip, Transcend M.2 SSD is able
to effectively shorten the system response time and accelerate themultimedia program processing speed.
[SSD] MTE110Q adopts the latest technology of QLC 3D NAND, andfurther upgrades the small space storage capacity, making it suitable toworkloads of intense read and write. It is equipped with PCI Express®
Gen3 x4 high speed interface, such that its read speed reaches 2,000 MB/s;
write speed reaches 1,500 MB/s.
[Memory Card] CFX602 industrial grade CFast memory card supports
SATA III interface, and its compact size allows it to be used for booting
disk, and it is equipped with high transmission speed and large storage
capacity space. With one card on hand, the user is able to easily use it forindustrial platform applications while enjoying high performance andconvenience.
[Memory Card] CFX722I, with Transcend’s exclusive SuperMLC
technology, is able to achieve performance nearly equivalent to SLC flash
memory chip, and its prices are more competitive than SLC memory card.
CFX722I CFast memory card equipped with SuperMLC technology
provides high transmission speed, durability and stability in data writing.
Its compact size allows it to be used as a boot disk, demonstrating
performance equivalent to SSD, and providing outstanding convenience toindustrial applications.
[Apple solution] JetDrive Lite 330 expansion card is designed for
MacBook Pro of 2021 version, and it is equipped with compact size. It canbe flatly inserted into the expansion card to serve as part of the notebook
while increasing the storage capacity by multiple folds. It is equipped withthe plug and play function. Once it is inserted into the MacBook card
expansion slot, it is able to expand the notebook storage capacity by
512GB, in order to allow the user to store RAW photos, 4K high quality
videos or music, etc., thereby expanding the space for creativity.
[Dash Cam] TS-DP20A-32G is a driving recorder designed for motorcycle
riders. Its compact size requires only few simple steps for installation on asafety helmet. It uses STARVIS™ high sensitivity photo element to provide
Full HD 1080P high quality dynamic recording at 60fps, in order to clearly
capture driving details and images. It is equipped with the waterproof andanti-dust characteristics, satisfying the protection level of IP68, such that it
can be used under any weather condition. It is equipped with the built-in
Wi-Fi function, and the user is able to link images to his/her portabledevices, achieving convenient user experience.
[Memory Module] DDR5 4800 U-DIMM/SO-DIMM/ECC-DRMM/
R-DIMM memory modules are suitable to industrial desktop computersand notebook computers.
[SSD] SSD470K is equipped with SATA III 6Gb/s transmission interface,and adopts the latest version of 3D NAND technology, and it is able tostack a maximum of 112 layers of flash memories. With built-in DRAM
flash memory, it provides remarkable random access speed. Furthermore,
the product has also undergone rigorous internal tests to achieve thedurability level of 3K program/erase cycles. Furthermore, it is equippedwith quasi-wide temperature range (-20°C to 75°C), such that it is able tosatisfy the demand for intense task applications.
[SSD] SSD460K 2.5” DRAM-less industrial SSD is equipped with the
SATA III 6Gb/s transmission interface, and adopts the latest 3D NAND
technology and can be stacked with a maximum of 112 layers of flash
memories. In addition, it has also qualified rigorous factory test while being-92-

Year R&D Expenses

R&D Achievements
able to achieve the durability level of 3K program/erase cycles.
Furthermore, it is equipped with quasi-wide temperature range (-20°C to75°C). Its outstanding and reliable performance is able to satisfy thedemands of task intense applications completely.
[SSD] SSD455K-I 2.5” SSD is equipped with SATA III transmissioninterface, and adopts the latest version of 3D NAND technology, and it isable to stack a maximum of 96 layers of flash memories. With built-in
DRAM flash memory, it provides remarkable random access speed.
Furthermore, the product has also undergone rigorous internal tests toachieve the durability level of the 3K program/erase cycles. SSD455K-I
complies with TCG Opal 2.0 standard, and data can be encrypted forpreservation and layer management, in order to ensure the data security. In
addition, it is equipped with the characteristic of wide temperature range,
and it is able to operate stably between the temperature of -40°C and 85°C,
thereby ensuring stable operation of industrial machines during task intense
applications.
[SSD] MTS970T M.2 SSD is equipped with SATA III 6Gb/s transmissioninterface, and adopts the latest version of 3D NAND technology, and it isable to stack a maximum of 112 layers of flash memories. With built-in
DRAM flash memory, it provides remarkable random access speed.
Furthermore, the product has also undergone rigorous internal tests toachieve the durability level of the 3K program/erase cycles. MTS970T is
also equipped with 30µ" gold finger coating layer PCB and Corner Bondtechnology to provide outstanding reliable performance. In addition, it isequipped with quasi-wide temperature characteristic (-20°C to 75°C).
Accordingly, it is able to satisfy task intense application demands.
[SSD] MTS960T M.2 DRAM-less industrial SSD is equipped with the
SATA III 6Gb/s transmission interface, and adopts the latest version of 3D
NAND technology, with a maximum of 112 layers of flash memories, andalso complies with the M.2 specification. Its size is more compact and issuitable to thin and lightweight portable devices. Its outstanding andreliable performance is able to achieve the durability level of 3K
program/erase cycles. In addition, it is equipped with quasi-wide
temperature characteristic (-20°C to 75°C), such that it is able to satisfy
demands of task intense applications completely.
[SSD] MTS952A M.2 SSD is equipped with SATA III transmissioninterface, and adopts the latest version of 3D NAND technology, and it isable to stack a maximum of 96 layers of flash memories. With built-in
DRAM flash memory, it provides remarkable random access speed.
Furthermore, the product has also undergone rigorous internal tests toachieve the durability level of the 3K program/erase cycles. It complies
with TCG Opal 2.0 standard, and data can be encrypted for preservationand layer management, in order to ensure the data security. In addition, it isequipped with the characteristic of quasi-wide temperature (-20℃ to 75℃)
and has outstanding and reliable performance such that it is able to satisfy
demands of task intense applications completely.
[SSD] MTS570T M.2 SSD is equipped with SATA III 6Gb/s transmissioninterface, and adopts the latest version of 3D NAND technology, and it isable to stack a maximum of 112 layers of flash memories. With built-in
DRAM flash memory, it provides remarkable random access speed.
Furthermore, the product has also undergone rigorous internal tests toachieve the durability level of the 3K program/erase cycles. MTS570T is
also equipped with 30µ" gold finger coating layer PCB and Corner Bondtechnology to provide outstanding reliable performance. In addition, it is-93-Year R&D Expenses

R&D Achievements
equipped with quasi-wide temperature characteristic (-20°C to 75°C).
Accordingly, it is able to satisfy task intense application demands.
[SSD] MTS560T M.2 DRAM-less industrial SSD is equipped with the
SATA III 6Gb/s transmission interface, and adopts the latest version of 3D
NAND technology, with a maximum of 112 layers of flash memories, andalso complies with the M.2 specification. Its size is more compact and issuitable to thin and lightweight portable devices. Its outstanding andreliable performance is able to achieve the durability level of 3K
program/erase cycles. In addition, it is equipped with the wide temperature
characteristic (-20°C to 75°C), such that it is able to satisfy demands of task
intense applications completely.
[SSD] MSA470T SATA III 6Gb/s mSATA SSD uses Serial ATA interface
and is equipped with built-in powerful controller, in order to provide fasttransmission speed. It uses the latest generation of 112 layers of 3D flash
memories, thereby significantly breaking through the upper limit of unit
density, and achieving higher storage performance. It is equipped with 30µ"
gold finger coating layer PCB and the reinforcement technology of Corner
Bond in order to provide excellent durability, and it is also equipped withbuilt-in DRAM flash memory, in order to accelerate the random accessspeed. In addition, MSA470T SSD is equipped with the quasi-wide
temperature range (-20°C to 75°C) characteristic such that it is able toachieve hot and cold environment resistance performance, and it is also
equipped with the durability level of 3K program/erase cycles. It complies
with the mSATA dimension specification, and its size is only 1/8 ofconventional 2.5” SSD, and it is most suitable for Ultrabook, tablet
computers and thin servers with confined space.
[SSD] HSD470T SATA III Half-Slim SSD adopts the SATA III 6Gb/s highspeed transmission interface, powerful control chip and the latest
generation of 112 layers of 3D flash memories, thereby significantly
breaking through the upper limit of unit density, and achieving higher
storage performance. The edge reinforcement technology of Corner Bond
provides excellent durability, and it is also equipped with built-in DRAM
flash memory. Furthermore, HSD470T SSD is equipped with thecharacteristic of quasi-wide temperature range (-20°C to 75°C) such that it
is able to achieve hot and cold environment resistance, and it is also
equipped with the durability level of 3K program/erase cycles. With
compliance with the JEDEC MO-297 specification, HSD470T
demonstrates outstanding R/W performance and has undergone rigorous
tests to ensure the highest quality, high performance and outstanding
reliability, making it most suitable for executing high density application
programs with limited space on mobile computing devices, including
industrial control system, medical equipment, mobile device and POS
terminal.
[SSD] MTE662P PCIe Gen 3x4 interface, complying with the latest
specification of NVMe 1.3. It is equipped with DRAM flash memory inorder to provide excellent random access speed and to achieve thedurability level of 3K program/erase cycles It is equipped with 30µ" gold
finger coating layer PCB and the edge reinforcement technology of Corner
Bond. MTE662T2 is equipped with the characteristic of quasi-wide
temperature (-20℃–75℃), and it also supports the intelligent powerprotection (IPS) function in order to ensure the integrity of data and tosatisfy demands of task intense applications completely.

-94-Year R&D Expenses

R&D Achievements[SSD] MTE632T M.2 industrial SSD is equipped with the PCIe Gen 3x4
interface, and complies with the latest specifications of NVMe 1.3 and M.2.
Its size is more compact and is suitable to thin and lightweight portabledevices. It is equipped with outstanding and reliable performance while
reaching the durability level of 3K program/erase cycles.
[SSD] MTE710T & MTE710T-I adopts the PCIe Gen 4x4 interface,complying with the latest NVMe 1.4 specification, with the use of the latest
generation of 3D NAND technology, and it can be stacked with amaximum of 112 layers of flash memories. In comparison to the former
generation of 96 stacking layers of 3D NAND, it has reached significant
increase of unit density, thereby achieving greater storage capacity andbenefit. Transcend MTE710T SSD is equipped with DRAM flash memory
in order to provide excellent random access speed and to achieve thedurability level of 3K program/erase cycles. It is equipped with the 30µ"
gold finger coating layer PCB and edge reinforcement Corner Bondtechnology. In addition, it is also equipped with quasi-wide temperature
characteristic (-20°C to 75°C), such that it is able to satisfy demands of task
2022
44,380intense applications completely.
Q1
Transcend also releases MTE710T-I SSD equipped with the characteristicof wide temperature range, such that it is able to operate stably between-40°C and 85°C, in order to ensure that industrial machines are able toachieve outstanding operation performance.
[SSD] MTE670T PCIe Gen 3x4 interface, complying with the latest
specification of NVMe 1.3. achieves the durability level of 3K
program/erase cycles It is equipped with 30µ" gold finger coating layer
PCB and edge reinforcement Corner Bond to provide outstanding reliable
performance. Futhermore, MTE670T is equipped with the characteristic ofquasi-wide temperature (-20℃–75℃), such that it is able to satisfy
demands of task intense applications completely.
The above information for the year 2021 has been summarized for the period from January 1 to
December 31, 2021. The information for year 2022 has been summarized for the period fromJanuary 1 to March 31, 2022.

-95-

2. Ongoing R&D Projects
Product
Line

Ongoing Projects

DRAM
Products

DRAM modules ofhigher frequency,
DRAM modules ofhigher capacity,
DRAM modules forgaming sports, andwide temperature
DRAM modules forembedded products,
etc.

Flash
Products

Capacity expansion,
higher transmission
speed, various form
factors, high speed
USB portable disks,
SSD with high R/W
numbers, wide
temperature SSD forembedded products,
SSD for special
purposes such as
power failure protector
and encryptionfunction.

Strategy
Products

Storage devices withvarious new
specifications/interfaces, dual lens Dash Cam,body camera
equipment andaccessories, and otherperipheral application
products.

Current
Progress

Expected Mass
Production Time

Key Success Factors

Developmentin progressSome products have (1) Specialized
entered the mass
specification for
production stage,different fields
and others under(2) Increase of data
development
transmission speed
progress are(3) Increase of productexpected to enter
reliability andthe mass production
compatibility, increase
stage starting fromof operating2022.
temperature

Developmentin progress(1) Increase of accessSome products havecapacity and R/Wentered the mass
speed
production stage,(2) Increase of dataand others under
security anddevelopment
encryption level
progress are(3) Compact and light
expected to enterwith great portability
the mass production(4) Implementation ofstage starting fromnew memory2022.
manufacturing process

Developmentin progress(1) Product specifications
and functions withunique characteristics
in comparison to otherproducts in the market
Some products have(2) Proper control ofentered the mass
product mass
production stage,
production and market
and others underlaunch scheduledevelopment(3) Completeness ofprogress areaccessories
expected to enter(4) Exclusive functions
the mass production
for regional market
stage starting fromand special groups
2022.
(5) Increase of data
security andencryption level(6) Simplify productcomplexity

The R&D budget for the ongoing projects accounts for approximately 80% of the total R&D budget in
2022. And the R&D budget is estimated to account for 1.0%–1.5% of the whole-year revenue in 2022.

-96-5.1.4. Long-term and Short-term Business Development Plans
1. Short-term Business Development Plan
(1) Embedded Business Management
The Company has focused on embedded market and invested a great amount of
resources in the development of embedded products for a long period of time, and theCompany has always adopted the business philosophy of excellent quality andcustomer-oriented approach; consequently, the Company has been able to successfully
gain customers’ trust and support and became the leading brand in the embedded field.
Transcend further actively invests in the embedded products business and copes withthe development trend of industrial computer and automation, etc., thereby expanding
the business performance in the embedded field.
(2) Expansion of R&D Department
The Company is equipped with a complete R&D team, and in the future, the Company
will continue to actively recruit outstanding R&D talents in order to continuously
develop and launch comprehensive and multi-function product series based on theattitude of pursuit for excellence and perfection, in order to provide quality products to
consumers and to establish brand loyalty, to satisfy the market consumer trend and tomeet consumer demands, as well as to effectively reduce cost and improve production
efficiency at the same time.
2. Long-term Business Development Plan
(1) Brand Management and Channel Planning
A. Global Comprehensive Planning
The Company establishes its headquarters in Taipei, and subsidiaries or service
centers are also established in Germany, the Netherlands, United Kingdom, UnitedStates, Japan, Hong Kong, Beijing, Shanghai, Shenzhen and South Korea. The
Company’s products are sold in more than 130 countries, and more than 80% of theCompany’s customers are from markets outside Taiwan. To continue to enhance theplanning and establishment of sales channel, collaborate with online and offline
global channel distributors/retailers closely, and deep-rooted in 3 channel systems(traditional IT channel, camera channel and Telecommunication Channel), theCompany will continue to establish sales points at all major areas worldwide,
thereby raising the brand image and visibility of the Company.
B. Investment in Marketing Activities
The Company mainly develops the market with the own brand of “Transcend.”
Accordingly, the Company has always been active in the development of marketing
activities. Through collaboration with local channel distributors/retailers in different
regions, the Company provides the marketing budget and organizes various
marketing activities, such as online and offline advertisement, new product launch,
product media testing, distributor training and contest and show, etc., while
matching with the local customs and culture, thereby achieving local market
development and establish the brand of Transcend. Consequently, maximum
marketing effect through effective resources can be achieved.
C. Deep-rooted in Local Market
The Company recruits outstanding talents at overseas subsidiaries and implements
the strategy of recruiting local sales specialists and management personnel in orderto develop the market in depth and to enhance management performance through thelocal talent’s language advantages and cultural understanding. The Company also
engage in close collaboration with local channel distributors/retailers to develop-97-marketing channels.
(2) Continue to Optimize Operational System
A. Completeness and Diversity of Product Lines
The greatest advantage of the Company lies in the diversity of products capable ofsatisfying the one-stop shopping demand of customers. The product lines of theCompany include standard and special memories, various types of flash memory
cards, portable disks, SSDs, portable hard disks, Dashcam, body cameras, andpersonal cloud storage devices, with the number of product types reaching more than
1,000.
B. Product Customization Service and Comprehensive Embedded Solution
The Company provides complete product customization service to satisfy demandsof different customer groups. Plentiful embedded product lines demonstrating
diverse solutions for embedded purposes. In addition, the Company upholds theprinciple of excellence and perfection to continuously optimize the quality control
system. The Company will continue to collaborate with outsourcing wafer
packaging vendors equipped with ISO/TS16949 certification, in order to ensure thebest protection for customers and to push the Company’s products to the global
automotive market.
For diverse and comprehensive product functions, the Company aims to satisfy thepurchase characteristics of different consumer groups through various sales channels inorder to further expand the depth and breadth of the sales level, thereby achieving thebenefit of economics of scale and increasing the global market share.
(3) Complete After-Sale service
Since customers emphasize the after-sale service and product quality, rather than mere
price difference, brand value becomes apparent when products are of excellent quality.
The function and performance differences among memory products are reducing;
therefore, the Company aims to demonstrate the strength and to differentiate from thecompetitors through kind product consultation and complete after-sale service while
continuously improving the product quality, thereby establishing the brand recognition
and trust of Transcend among distributors and users.
5.2. Markets and Overview of Production and Sales
5.2.1. Market Analysis
1. Main Products and Sales Region
The Company has diverse and comprehensive products. The product lines of the Company
cover channel products and embedded products, including special and standard memories,
various types of small flash memory cards, portable disks, portable hard disks, Dashcam,
body camera and personal cloud storage devices, etc. Under the complete global planning,
the Company has 13 business locations worldwide and Taiwan as the main production base,and the region of sales further includes all global markets. Through comprehensive sales
strategy and excellent quality, the brand of Transcend is promoted worldwide.

-98-

Sales region in the last two years:
Unit: NT$ thousands
Area
TaiwanAsia
Americas
EuropeOthersTotal

2021
Amount3,400,049
5,221,283
1,759,042
3,155,301
779,140
14,314,815

2020
%
23.75
36.48
12.29
22.04
5.44

Amount2,521,695
4,075,807
1,163,131
2,822,582
863,481100.0011,446,696

%
22.03
35.61
10.16
24.66
7.54
100.002. Market Share
Regarding the DRAM memory industry and the flash memory industry, due to the fine
product categories (SDRAM, DDR, DDR2, DDR3, DDR4, DDR5, flash memory card,
portable disk, Dashcam, body camera, personal cloud storage device, and SSD, etc.), anddue to the difference between the contract market and spot market, the market share cannot
be estimated precisely. According to the results of various market survey institutions, theglobal market share of Transcend continues to increase. Looking into the future, theCompany will continue to increase the market share and achieve the goal of reasonableprofit through continuous effort.
3. Future Market Demand/Supply Conditions and Growth Potential(1) DRAM Module
DRAM module carrying rate continues to increase, the shipping ratio for themainstream 4GB/8GB/16GB modules continue to rise. As the quantity of cloudcomputers, servers and data centers increases, the shipping volume of 16GB/32GB
module is expected to grow rapidly. With the launch of the new DDR5, a new wave of
demand is expanding.
(2) Flash Products
As the application of SSD becomes more popular, including broad applications in
portable hard disks and built-in storage devices of handheld video recorders, theconsumption volume of SSD will continue to increase. Regarding the field ofembedded products, applications related to 5G, AI and data center in 2021 have grown,
and the demand for workstation and server have increased. All of these applications
require massive data storage; therefore, the data storage demand will continue toincrease, which will further drive the shipping volume of SSD.
For memory cards, the applications will continue to be widely used as storage medium
for channel products, such as 3C consumer electronics of smart phones, digital video
recorders, tablet computers, Notebook, Ultrabook, multimedia players, gaming devices,surveillance cameras, home care cameras and automobile navigators, etc. In addition,with the continuous emerging of new applications, memory card demand is expected
to maintain the same level.
4. The Company’s Competitive Niche(1) Internationalization of sales network, distribution of market channels
Since the establishment, the Company has been committed to the own brandmanagement and channel planning and continuously exerts efforts in differentiating-99-

the Company from traditional domestic professional OEM manufacturer. In terms of
the sales and marketing strategies, the Company aims to establish the brand image ofhigh quality for the brand of “Transcend,” and in the professional storage field, theCompany targets the “End Customers,” supply distributors, system operators and retailmarket, thereby reducing the channel gap and allowing both the Company andcustomers to obtain greater profits. In addition, with the continuous improvement of
the Company’s position in the industry and through providing comprehensive productlines and complete after-sale service system, the Company is able to increase customer
sales continuously, including strategic collaboration with international front line
channel operators. Presently, the Company has over 5,000 loyal customers worldwide
and has established a solid and stable sales network with cooperation of subsidiaries invarious countries.
(2) Establish brand image, deep-rooted in local market“Transcend” is one of the few successful domestic brands that have received highpraise internationally. For both domestic and international memory product markets,
Transcend is the brand representing stability and high quality, and such brand image
has been deep-rooted in the mind of consumers. Through media advertisements ofmagazines, newspapers, outdoor large signboards and internet network, as well as
marketing activities of news release, etc., the Company expands the brand image ofTranscend, which is beneficial to the improvement of the brand awareness;nevertheless, the Company still values excellent product and quality service as themost essential factors to achieve high brand value. Furthermore, through the Transcend
online shopping website, the Company is able to obtain the comments and feedback
from the end consumers directly, thereby using such comments and feedback as thereference for product and service improvement.
(3) Utilize purchase advantage effectively, expand product competitiveness
The Company has been established for more than thirty years, and the type andquantity of purchase items are enormous and continue to increase. Through excellent
partnership with upstream vendors of DRAM and NAND Flash established for a long
period of time over the past years, the Company is able to achieve the best cost
structure, thereby increasing the product price competitiveness. In addition, throughthe in-depth collaboration with the upstream vendors, the Company is able tointroduce new products in the market faster than competitors, in order to seize thebusiness opportunities in the market effectively and to become the leading brand in themarket.
(4) Continue to develop strategy products, strengthen brand value
The Company started the business based on the niche memory modules, following
which the Company then entered the standard memory module and flash memory
market. As the Company’s planning in the global traditional sales channel becomes
more complete, the Company actively engages in the development of strategic
products of Dash Cam, body camera, external portable hard disks, card readers,personal cloud storage device and SSDs, etc., such that through diverse product series
along with the addition of other sales channels, the Company is able to satisfy thepurchase characteristics of different consumer groups and to further expand the depth
and breadth of sales level.
5. Favorable and Unfavorable Factors for Future Development and Response to Such Factors
Favorable Factors(1) Complete product lines, diverse product types-100-

With more than thirty years of development, the Company invests great research anddevelopment budget and human resource for the establishment of complete productlines, and the main products include various memories, digital memory cards, USB
portable disks, external hard disks, card readers, personal cloud storage devices,
Dashcam, body camera and SSDs, etc. There are more than 1000 types of products
available for all kinds of electronic product applications, thereby satisfying thecustomers’ demand of “one-stop shopping.”
With more than thirty years of experience and qualified technical personnel, the R&D
team of the Company also synchronizes with the market trend, and will continue todevelop and launch innovative products satisfying the market demands.
(2) Establish brand image, deep-rooted in local market
Over the past years, the Company has invested important resources in both productappearance design and product packaging continuously, in order to design and provide
products meeting the global trend. In addition, the Company has received greatrecognition with numerous international industrial design awards, and also provides
multi-language instruction manuals and product catalogues for various countries inorder to be deep-rooted in the local market. Accordingly, the Company has
successfully obtained great support from consumers on the Company’s products.
(3) Internationalization of sales network, distribution of market channels
The Company is devoted to the own brand management and marketing, and customers
around the globe are considered to be the market for the Company. Through theestablishment of international market channels and after extensive years of market
development and deep-rooted in new emerging markets and countries, the Company
has accumulated more than 5,000 loyal customers worldwide, and through thecooperation of branch offices in various countries, the Company has established asolid and stable sales network. The overseas customers of the Company accounts fornearly 80%, demonstrating the solid international sales network of the Company.
(4) Equipped with comprehensive global logistics management capability
The Company has established subsidiaries or sales offices at Germany, the Netherlands,
the United Kingdom, the United States, Japan, Hong Kong, Beijing, Shanghai,
Shenzhen and South Korea. Due to the great number of product types, customers arewidely distributed worldwide. To effectively control inventory and to manage the sales
targets, the Company and all overseas sales offices are established with computer
information system with complete functions. Accordingly, the headquarters is able tosufficiently and promptly understand the order receipt and inventory status of all
overseas sales offices through network, in order to reduce the cost associated withoverstock and to successful delivery, thereby improving product image andcompetitiveness.
(5) Increase product value with outstanding industrial design
Since several years ago, Transcend has already realized the importance of industrial
design, and the Company is staffed with a professional industrial design team in
pursuit of outstanding industrial design in order to improve product value. In recent
years, the Company has received numerous important industrial grant awards ofGermany iF design award, reddot design award, Japan Good Design award, etc., andalso received the honor of “Taiwan Excellence Award” for the seventeen consecutive
years, a remarkable record achieved by the Company.
(6) Professional and dedicated R&D team
The Company has established a professional and dedicated R&D team for each-101-

product, whether standard products in large quantities or highly customized products,
the Company’s own R&D team is able to promptly satisfy all aspects of demands ofcustomers in terms of the product compatibility, reliability and yield rate, etc., thereby
establishing an irreplaceable team and strength that cannot be overcome or surpassedby operators in the same industry.
Unfavorable Factors and Actions(1) Violent price fluctuation of critical raw materials of DRAM chips, affecting
operational stability
The prices of the critical raw materials of DRAM, NAND Flash chips of the Company
fluctuate violently, and if a downstream operator cannot effectively manage the chip
supply sources and control the inventory, then under the situation where the demandfor chips is higher than supply and the market price surges, such operator would not beable to handle customers’ strong demand and to provide sufficient products.
Furthermore, when the chips are under the condition of supply over demand and themarket price plunges, then the production cost and overstock cost would become
overly high due to the high purchase price of the original raw materials. Consequently,
market price fluctuation often results in the control difficulty of the sales price andcost, such that the stability of the operation is affected in certain extend.
Action
The Company has constructed a complete information system, and the inventory
level can be reasonably controlled and enhanced through the assistance of such
system. Furthermore, the Company focuses on the operation and long-term
collaboration relationship with the suppliers and customers, and the Company also
appropriately controls risks and adjusts strategies according to the market condition
periodically, thereby ensuring reasonable price and maintaining a health inventory
level.
(2) Low entrance barrier for standard memory card products and flash memory card
products, leading to price war
Most of the operators in the same industry expand production capacity to seek highrevenue; however, the market demand is not as optimistic as expected. To fill up the
production capacity gap newly created, a lot of the operators are lowering their prices
for competition, or even selling products for minimum profit or no profit, leading to
the situation of chaotic market prices that is unfavorable to the product development
and promotion. Unless a company is able to manage niche products and channels, or isequipped with brand value, it would be difficult to achieve stable development.
Transcend is equipped with both of these characteristics and values them as thelong-term goal.
 Action
In addition to standard products, for DRAM and NAND Flash related products, theCompany also offers special products at a certain ratio. The Company also develops
numerous industrial control products and strategic products in order to increase thedifference from the competitors and to improve profitability while providing the
one-stop shop service to customers.

-102-

5.2.2. Main Usage and Manufacturing Processes of Main Products
1. Main Products and Their Main Usage(1) Digital memory card/USB portable disk products
For flash memory card/USB portable disk, the main application is to increase the data
storage memory capacity of various digital equipment, such as multimedia mobile
phones, digital cameras, tablets, PC/NB, surveillance cameras, gaming devices andsmart phones.
(2) Solid State Drive (SSD)
The company's main products are SSDs. SSD is equipped with the characteristics thatare absent in traditional hard disks, and such characteristics include shock resistant,high Read/Write speed, quiet and low power consumption, etc. Presently, for bothnotebook computers and desktop computers, the ratio of SSD has increased
significantly, and the individual upgrades with SSD made by end users in theafter-market also indicate great popularity. As the price of SSD becomes widely
accepted by consumers, flash memories are expected to have the greatest popularity
and application in the future.
(3) Memory products
The memory modules are another main products, its function is to expand thecomputer data processing capacity and to increase the processing speed, and the main
applications include personal computer system, network system, industrial computers,
as well as equipment, such as desktop computers, notebook computers, laser printers,
servers, workstations, routers and fax machines.
(4) Dashcam
As the global automotive market continues to grow, consumers focus more on the
personal driving safety. In the years of 2020/2021, Transcend continued to launch avariety of Dashcam and kept develop in the Dashcam market.
(5) Body Camera
In addition to the automotive market, in 2015, Transcend has launched Body Camera,
which is the best partner for military and police security. For the years of 2020/2021,
the Company continuously launched new models and achieves further growth in the
security and surveillance market.
(6) Storage equipment
To satisfy the demand for information and personnel mobility, portable hard disks areequipped with the characteristics of compact size, high capacity and portability. The
personal data portability and the design of confidentiality and security are increased inorder to provide a comprehensive portable data solution for professionals in various
sectors. As the industrial control application demand increases, Transcend launches
numerous storage products satisfying different industrial applications, such as SSD,
flash memory modules and industrial grade CF/SD memory cards.
(7) Accessories and card readers
As the popularity of digital camera, camera phones and multimedia devices increase,the demand for transmitting and exchanging videos, music and various multimedia
data effectively and swiftly among personal computers and other portable devices are
increasing. Transcend launches various types of portable card readers and adapters,
providing direct and convenient access interfaces, such that they offer the best choices
to users having the preference of using high speed memory cards for transmission ofdigital data, music and photos. In addition, in view of the great popularity of-103-

smartphones and tablets nowadays, for the upcoming USB 3.2 era, Transcend further
launches high speed products and OTG/Type-C flash drives products, allowing users
to enjoy faster transmission speed and achieving greater convenience in cross-platform
data transmission, also making the overall storage product series more complete.

-104-2. Main Products and Their Manufacturing Processes
Flow Chart of Manufacturing Processes
Sales

Finished goods

Department

Warehouse

N

N
ManufacturingY
Production Schedule

W/O

Material Preparation

SMT

Y

Outsourced Processing

In-plant Processing

Incoming Quality

SecondStage
Processing

N

Testing

Control (IQC)

Packaging

Final Quality Control(FQC)

Warehouse Receiving-105-

5.2.3. Supply Status of Major Raw Materials
Major Raw Materials

DRAM

Purchasing Strategy and Supply Situation
The Company maintains excellent and long-term relationship withthe two largest DRAM suppliers in the industry and also signed
memorandums of cooperation with them. Accordingly, even under
the condition of tight supply, the Company is still able to obtainstable supply with an advantageous price, thereby ensuring
sufficient supply of products to downstream customers.

Nand FlashThe Company maintains excellent relationship with leading
operators in the industry. In addition to obtaining stable supply
source and cost advantages through purchase strategy, the Company
has established long-term technical collaboration relationship with
suppliers in order to maintain strong competitiveness for, NAND
FLASH related products of the Company.

Hard Drive

As the hard disk market supply is considered stable, after the
strategic adjustment, the prices of suppliers are maintained at adecreasing trend. The Company will continue to control inventory inorder to prevent the risk of price dropping. The Company will also
maintain close relationship with the key suppliers in order toachieve clear advantages in terms of material supply, quality andcost.

Controller

The Company selects cooperating partners carefully, and all of thecooperating partners are well-known operators with excellent
company structure, thereby ensuring the product quality and costadvantages.

PCB

All of the cooperating partners of the Company are global top
hundred PCB suppliers, and the Company also places orders
according to the capacity and expertise of suppliers, such that theeffects of quality and cost can be achieved at the same time while
maintaining stable product supply.

Optical Disk Device

The overall market for optical drive indicates slow decline, and theprice of optical drives is slowly dropping. The suppliers of theCompany are top two suppliers in the industry and their corporate
structures are sound. In addition, the Company adopts the strategic
collaboration method to ensure the quality, stable supply and pricecompetitiveness.

Mechanical Part

Most of the designs of mechanical parts are customized. The
Company is able to select stable long-term cooperating partners
through detailed cost structure analysis and comparison in order tomaintain stable quality and to continue to contact new suppliers forcost comparison, thereby ensuring price competitiveness.

-106-5.2.4. Company Names, Amount and Percentage of Major Suppliers and Customers which were commanding 10%-plus Share of annual ordervolume in the Last Two Years
1. Major Suppliers
Unit: NT$ thousands
2020
2021
2022(as of March 31, 2022) (Note 3)
Ratio toRatio toRatio toRelation
Relation
Relation
Item Company
Annual Net
Company
Annual Net
Company
Quarterly
AmountwithAmountwithAmountwith
NameSupplies
Name
Supplies
Name
Net Supplies
Transcend
Transcend
Transcend
(%)
(%)
(%)
1
A
2,950,652
31.45
None
A
3,794,965
31.66
None
B
654,458
30.98
None
2
B
2,631,361
28.04
None
B
2,939,313
24.52
None
A
583,401
27.61
None
3
C
1,741,714
14.53
None
C
244,500
11.57
None
OthersOthers3,800,943
40.51
3,511,626
29.29
Others630,276
29.84
Net Total
Net Total
Net Total
9,382,956
100.0011,987,618
100.002,112,635
100.00
Supplies
Supplies
Supplies
Note 1: Due to the restrictions of commercial confidentiality and non-disclosure of contracts, the names of suppliers are shown by codes.
Note 2: Changes of increase/decrease were due to the business needs.
Note 3: The financial statements of 2022 Q1 have already been reviewed by the CPAs.

2. Major Customers
The sales income of one customer from the company between 2021 and 2020 did not show 10% of the consolidated net operating
income.

-107-5.2.5. Production in the Last Two Years
Major Products
FLASH+DRAM
Products
Others
Total

Unit: 1,000 pieces; NT$ thousands
2020
Capacity
Quantity
AmountCapacity

2021
Quantity

22,59019,784

8,101,610

22,47918,682

6,951,685

2,454
25,044

1,898
21,682

1,808,793
9,910,403

2,563
25,042

2,048
20,7301,911,124
8,862,809

Amount5.2.6. Sales in the Last Two Years
2021
Major Products
Qty
FLASH+DRAM
Products
Others
Total

Local
Amount

Qty

ExportAmount

Unit: 1,000 pieces; NT$ thousands
2020
Local
Export
Qty
Amount
Qty
Amount11,737

3,094,895 16,821

8,901,969 12,586 2,197,359

15,553

6,844,559

224
11,961

305,154 1,826
3,400,049 18,647

2,012,797
250
324,336
10,914,766 12,836 2,521,695

1,827
17,3802,080,442
8,925,001

5.3. The Number of Employees, Average Service Year, Average Age and Educational Level Distribution
Ratio in Last Two Years and up to the Publication Date of this Annual ReportYear
Number of
EmployeeDirectIndirect
Total

Average Age
Average Years of
Ph.D.
Masters
Bachelor’s
DegreeEducation
SeniorHigh
Below
Senior

2020

2021

670
640
1,310
37.6
8.7
0.0%
15.2%

642
604
1,246
38.6
9.1
0.0%
14.7%

As of
April 19, 2022
627
596
1,223
38.8
9.7
0.0%
14.9%

59.6%

59.5%

59.5%

22.0%

22.4%

22.2%

3.2%

3.4%

3.4%

-108-

5.4. Environmental Protection Expenditures
For all selected raw materials, auxiliary materials and packaging materials, internal professional
personnel has performed product compliance inspection in order to ensure that the products comply
with the international environmental protection laws and regulations.
The main manufacturing processes of the Company’s products include component mounting, board
cutting, assembly, testing, packaging and sales to the customer end. During the manufacturing
process, no waste gas or wastewater is discharged, and only industrial wastes are generated from theprocess. The industrial wastes are collected and classified according to their properties, andqualified supplier approved by the Environmental Protection Administration is entrusted to handle
the cleaning and disposal of the wastes. The qualification certificate of the supplier entrusted isreviewed rigorously, and testing and reporting are performed in accordance with the laws andregulations in order to ensure that the industrial wastes are properly handled.
1. Any losses and disposition suffered by the company in the most recent fiscal year and up to thisAnnual Report publication date due to environmental pollution incidents: None.
2. Material Environmental Protection Expenditures: None.
5.5. Labor Relations
5.5.1. Employee benefit plans, continuing education, training, retirement systems, the status of theirimplementation, and the status of labor agreements and measures for preserving employees' rights
and interests:
1. Employee benefit plans:(1) Insurance: To provide greater living protection to employees, in addition to the enrollmentof labor and health insurances for employees according to the laws, the Company plans thegroup insurance for employees, and it covers term life insurance, accident insurance,
hospitalization and medical insurance, and cancer health insurance, etc. For employees
traveling on business trips, additional business travel safety insurance is applied in order toprovide greater protection to employees.
(2) Entertainment activities: The Company has established the Employees’ Welfare Committee
according to the laws, and the activities of year-end party, family day and sports contest,
etc., are organized annually in order to achieve physical and mental relaxation and toachieve coherence. Furthermore, the activity center is also installed with various fitness
and recreation facilities, such as, table football, table tennis, snooker, fitness room andother equipment for employees’ use during their free time. Employees are also encouraged
to participate in club activities and to establish friendship and communication through club
activities.
(3) Other benefits: Employees’ health is considered a fundamental aspect for the Company’s
development. In addition to providing annual health examination to employees, theCompany also sets up basketball courts and fitness room to provide diverse sports andrecreation facilities. Employees are offered with the employee discount prices for thepurchase of the Company’s products for own use. The employee cafeteria and café alsooffer meals at discount prices to employees. The Company irregularly provides gifts andissues marriage and maternity cash gift and funeral consolation money. Furthermore,through cross-industry alliance with other vendors, the Company provides greater benefits
to the living of employees.
2. Emoloyee continuing education and training:
As the Company is in the highly competitive technology industry, talents are the key factors-109-determining the success of a corporate. Transcend has also valued talents as the most powerfuland significant backup to the company. Through various learning methods of professional
competence improvement courses, work transfer, overseas business trips and trade shows, etc.,
arranged by the Company, Transcend is able to cultivate employees equipped with functions ofgreater diversity and depth, thereby achieving the goals of the organization.
In terms of the training courses, each year, the Company organizes orientation training for new
employees and also organizes competence improvement courses for sales, purchase and R&D
personnel, as well as organizes or assigns personnel to participate in relevant external trainings
according to laws and regulations.
3. Retirement systems:
To meet the requirements specified by the laws and regulations, the Company contributes 6%of the insured monthly salary and deposits into the pension personal account at the Bureau ofLabor Insurance monthly for new employees on-board since 2005 and existing employees whochose the new retirement pension system. For existing employees who chose the old retirement
pension system and maintained their service years under the old system, the Company
appropriates an appropriate pension reserve and deposits in the dedicated account at Bank of
Taiwan, and the Supervisory Committee members are responsible for the supervision of thereserve fund.
4. Other labor agreements:
The agreements between the labor and management of the Company are handled in accordancewith the Labor Standards Act, and are explained in conjunction with the personnel management
regulations upon the time when employees joining the Company for service. Relevant
regulations are added or revised depending upon the operational needs of the Company.
5.5.2. Any Losses due to Labor Disputes and Any Estimated Losses and Countermeasures
1. Any losses and disposition suffered by the company in the most recent fiscal year and up to
this Annual Report publication date due to labor disputes: None.
2. Any estimanted losses and countermeasures: None.

5.6. Information Security Management
5.6.1. Information Security Management Strategy and Structure
1. Information Security Risk Management Structure
The Company established the “Information Security Execution Team” in May 2019 to be
responsible for the establishment of policies, execution, recording and review of information
security events and information security accidents, and to also accept the annual information
cycle supervision of the Auditing Office. The Administrative Vice President concurrently acts
as the information officer to take the role of convener in order to convene meetings annually,
and to also report information security governance status to the board of directors.
2. Information Security Policy
To improve the information security management system, and to ensure the confidentiality,
legality, reliability and integrity of the Company’s information, personnel, assets, software andhardware, the Company establishes the information security policy according to the ISMS
information security management system, and the objective is to reduce information risk to theacceptable level through control methods, in order to improve the information security risk
management of the Company.
-110-Information security control measures:(1) Establish information asset list, and perform classification control according to theinformation risk assessment.
(2) All new employees are required to participate in the information security education andtraining, in order to improve employees’ understanding and concept on the information
security. In addition, educational promotion on information security precautions are also
executed periodically.
(3) The internal and external networks of the Company are installed with firewall, andemployees are prohibited to use private network equipment to connect to the external
network or intranet of the Company.
(4) Mainframes of confidentiality are installed in an isolated network environment. For
database and file access, use authorities are established and remote backup is performed
periodically.
(5) Perform information asset inspection operation and system abnormality drill periodically, inorder to maintain the system reliability.
(6) Establish information security event management standard and information security event
reporting procedure.
(7) All employees using information provided by the Company to perform relevant information
job duties and suppliers with business dealings or visitors shall bear the responsibility andobligation to protect the information assets obtained or used, and it is prohibited to perform
access, modification or illegal disclosure without authorization.
(8) Personal computers shall be installed with anti-virus software and updated with the latest
virus codes. In addition, software management policy shall be established, and any
unauthorized software shall be prohibited from use.
(9) Employees possessing accounts, passwords and authorizations provided by the Company
shall bear the custody responsibility properly and shall also update passwords periodicallyaccording to the request.
(10) All employees of the Company shall comply with the laws and regulations as well as therequirements of the information security policy of the Company. The supervising unit shallbear the supervision responsibility, implement the system and improve employees’
understanding on the information security and legal concepts.
3. Specific Management Plan
(1) It is necessary to identify the information security event root cause and adopt an effective
strategy, as well as establishing the method and procedure to improve future incident
handling according to the information security incident classification.
(2) The information security execution team proposes the information security incident
statistical information according to the internal audit information cycle requirements of the
Auditing Office, in order to facilitate the continuous improvement of the information
security management system.
(3) Important information security event handling result shall be periodically summarized, andunder condition where no personal privacy and trade secret is involved, announcement canbe published on the monthly report or intranet to describe the incident occurrence cause,
process, handling method, improvement and precaution recommendations, etc., in order to
use it as reference information for information security education and information security
event prevention.
(4) Based on the consideration that information security risk is a new emerging type of risk,
the Company is currently under the evaluation stage. In the future, the Company willcontinue to improve the information security system management and will also conduct-111-

information security evaluation periodically. Through repetitive drills and continuous
review and improvement, the information security hazard awareness of employees andresponse capability of information security handling personnel of the Company can beenhanced, thereby preventing occurrence of information security events.
4. Information Security Management Resources
The Administrative Vice President concurrently acts as the information officer to take the roleof convener in order to convene meetings in October, to review report records and to review
information security policy and future development direction. In addition, the information
security governance status has been reported to the board of directors on November 4, 2021.
Please refer to the Company’s website for details:
https://tw.transcend-info.com/about/information_security_management
5.6.2. Losses, possible impacts and countermeasures as a result of major information security incidents
in the last year up to the publication date of this annual report, state the reasons if losses cannot bereasonably estimated: None.

5.7. Important Contracts
Agreement

Counterparty

Contract Period

Major Contents

Lease

Won Chin Investment Inc. 2022.6.12-2027.6.11

Land Lease Contract

None

Lease

Cheng Chuan Technology
2022.6.12-2027.6.11
Development Inc.

Land Lease Contract

None

Lease

Won Chin Investment Inc. 2019.6.12-2022.6.11

Land Lease Contract

None

Lease

Cheng Chuan Technology
2019.6.12-2022.6.11
Development Inc.

Land Lease Contract

None

License Intel Corporation
LicenseMemory Technologies
LLC

Thunderbolt Technology
License Agreement
MEMORY PATENT
2019.12.26-2024.12.31
LICENSE AGREEMENT
2014.4.18--112-

Restrictions

None
None

6. Financial Information
6.1. Condensed Balance Sheet and Statement of Comprehensive Income for the Most Recent Five Years– Based on IFRS
6.1.1. Consolidated Condensed Balance Sheet
Unit: NT$ thousands
Financial Summary for The Last Five Years (Note 1)

Year
Item
Current assets
Property, Plant and Equipment
Intangible assets
Other assets
Total assets
Before distribution
Current
liabilities After distribution
Non-current liabilities
Before distribution
Total
liabilities After distribution
Equity attributable toshareholders of the parent

2017

2018

2019

2020

19,189,793
2,706,923
873,765
22,770,481
2,066,617
4,651,187
205,569
2,272,186
4,856,756

16,115,783
2,599,493
3,149,236
21,864,512
1,649,287
3,803,096
234,923
1,884,210
4,038,019

15,411,700
2,438,154
3,350,936
21,200,790
1,501,579
3,432,357
292,363
1,793,942
3,724,720

14,615,264
2,282,324
3,840,034
20,737,622
1,837,754
3,146,392
227,8422,065,596
3,374,234

2021(Note 3)
16,773,957
1,942,013
3,722,531
22,438,501
2,401,653
4,976,023
202,0132,603,666
5,178,036

20,498,295

19,980,302

19,406,848

18,672,026

19,834,835

As of March
31, 2022(Note 2)
18,277,161
1,625,537
3,667,568
23,570,266
5,207,373
5,207,373
288,569
5,495,942
5,495,942
18,074,324

Capital stock
4,307,617
4,307,617
4,307,617
4,290,617
4,290,617
4,290,617
Before distribution
4,691,385
4,605,233
4,346,854
3,945,369
3,730,914
3,387,665
Capitalsurplus
After distribution
4,605,233
4,346,775
3,960,698
3,730,838
3,387,665
3,387,665
11,546,540
11,129,024
10,999,853
10,553,284
12,003,819
10,551,923
Retained Before distribution
earnings After distribution
9,048,122
9,233,673
9,455,231
9,459,177
9,772,698
10,551,923
Other equity interest(47,247)(61,572)(130,902)(117,244)(190,515)(155,881)
Treasury stock(116,574)
Non-controlling interest
Before distribution
20,498,295
19,980,302
19,406,848
18,672,026
19,834,835
18,074,324
Total
equityAfter distribution
17,913,725
17,826,493
17,476,070
17,363,388
17,260,465
18,074,324
Note 1: 2017–2021 financial statements have been audited and certified by CPAs.
Note 2: The financial statements of 2022 Q1 have been reviewed by the CPAs.
Note 3: For the proposal for distribution of 2021 earnings, in accordance with the provisions of the Articles of Incorporation, theproposal on the distribution of earnings in cash and the proposal on the cash distribution from capital surplus have been
approved by the board of directors’ meeting through special resolution. The remaining distribution items have not been
approved through the resolution of the shareholders’ meeting; therefore, no adjustment has been made.

-113-

6.1.2. Condensed Consolidated Balance Sheet - Parent Company Only
Unit: NT$ thousands
Financial Summary for The Last Five Years (Note 1)

Year
Item

As of March
31, 2022(Note 2)

2017

2018

2019

2020

2021
(Note 3)Current assets
Property, Plant and Equipment
Intangible assets
Other assets
Total assets
Before distribution
Current
liabilities After distribution
Non-current liabilities
Before distribution
Total
liabilities After distribution

18,502,683
1,724,494
2,927,401
23,154,578
2,480,264
5,064,834
176,019
2,656,283
5,240,853

15,269,713
1,712,699
5,229,958
22,212,370
2,027,568
4,181,377
204,500
2,232,068
4,385,877

14,532,387
1,644,401
5,256,311
21,433,099
1,810,735
3,741,513
215,516
2,026,251
3,957,029

13,722,813
1,540,175
5,686,690
20,949,678
2,114,521
3,423,159
163,1312,277,652
3,586,290

15,783,618
1,435,144
5,511,805
22,730,567
2,746,155
5,320,525
149,577
2,895,732
5,470,102

Equity attributable toshareholders of the parent

20,498,295

19,980,302

19,406,848

18,672,026

19,834,835 Not Applicable

Capital stock
4,307,617
4,307,617
4,307,617
4,290,617
4,290,617
Before distribution
Capital4,691,385
4,605,233
4,346,854
3,945,369
3,730,914
surplus
After distribution
4,605,233
4,346,775
3,960,698
3,730,838
3,387,665
Retained Before distribution
11,546,540 11,129,024 10,999,853 10,553,284 12,003,819
earnings After distribution
9,048,122
9,233,673
9,455,231
9,459,177
9,772,698
Other equity interest(47,247)(61,572)(130,902)(117,244)(190,515)
Treasury stock(116,574)
Non-controlling interest
Before distribution
Total
20,498,295 19,980,302 19,406,848 18,672,026 19,834,835
equityAfter distribution
17,913,725 17,826,493 17,476,070 17,363,388 17,260,465
Note 1: 2017–2021 financial statements have been audited and certified by CPAs.
Note 2: Pursuant to Article 7 of the Regulations Governing the Preparation of Financial Reports by Securities Issuers (adopting theInternational Financial Reporting Standards), the Company is not required to prepare the parent company only financial
statements of 2022 Q1; therefore, the Company provides no financial information for 2022 Q1.
Note 3: For the proposal for distribution of 2021 earnings, in accordance with the provisions of the Articles of Incorporation, theproposal on the distribution of earnings in cash and the proposal on the cash distribution from capital surplus have been
approved by the board of directors’ meeting through special resolution. The remaining distribution items have not been
approved through the resolution of the shareholders’ meeting; therefore, no adjustment has been made.

-114-

6.1.3. Consolidated Condensed Statement of Comprehensive Income
Unit: NT$ thousands
As of March
31, 2022(Note 2)Financial Summary for The Last Five Years (Note 1)

Year
Item

Operating revenue
Gross profit
Profit from operations
Non-operating income (expenses)
Profit before income tax
Profit from continuing operations
Loss from discontinued
operations
Profit for the year
Other comprehensive income(loss), net of taxes

2017

2018

2019

2020

2021

20,964,853
5,526,844
3,997,648(685,066)
3,312,582
2,655,717
2,655,717

17,615,965
3,530,250
2,139,754
513,7932,653,547
2,081,995
2,081,995

13,496,186
3,087,531
1,781,010
308,733
2,089,743
1,728,967
1,728,967

11,446,696
2,470,096
1,211,936
290,445
1,502,381
1,197,735
1,197,735

14,314,815
4,175,686
2,891,794
236,860
3,128,654
2,533,294
2,533,294

3,449,636
860,503
524,040
457,545
981,585
779,444779,444

100,214(15,418)(32,117)

12,175(61,923)

34,415

1,209,910

2,471,371

813,859

1,197,735

2,533,294

779,444---

1,209,910

2,471,371

813,859

-

-

-

2.79
2.79

5.90
5.90

1.82
1.82

Total comprehensive income for
2,755,931
2,066,577
1,696,850
the year
Profit attributable to shareholders
2,655,717
2,081,995
1,728,967
of the parent
Profit attributable to noncontrolling interest
Total Comprehensive income
attributable to Shareholders of the2,755,931
2,066,577
1,696,850
parentTotal Comprehensive income
attributable to non-controllinginterest
Earnings per share (Note 3)
6.17
4.83
4.01
Earnings per share (Note 4)
6.16
4.83
4.01
Note 1: 2017–2021 financial statements have been audited and certified by CPAs.
Note 2: The financial statements of 2022 Q1 have been reviewed by the CPAs.
Note 3: It is calculated based on the outstanding weighted average number of shares.
Note 4: It is calculated based on number of shares after retroactive adjustment.

-115-

6.1.4. Condensed Statement of Comprehensive Income - Parent Company Only
Unit: NT$ thousands
Financial Summary for The Last Five Years (Note 1)

Year
Item
Operating revenue
Gross profit
Profit from operations
Non-operating income (expenses)
Profit before income tax
Profit from continuing operations
Loss from discontinued operations
Profit for the year
Other comprehensive income(loss), net of taxes

2017

2018

2019

2020

2021

20,007,792
4,752,426
3,958,066(669,836)
3,288,230
2,655,717
2,655,717

16,809,530
2,862,617
2,140,740
490,1392,630,879
2,081,995
2,081,995

12,860,887
2,521,479
1,871,034
173,005
2,044,039
1,728,967
1,728,967

10,937,519
1,982,871
1,315,135
146,157
1,461,292
1,197,735
1,197,735

13,747,158
3,586,255
2,883,281
233,678
3,116,959
2,533,294
2,533,294

100,214(15,418)(32,117)

12,175(61,923)

As of March
31, 2022(Note 2)

Toal comprehensive income for
2,755,931
2,066,577
1,696,850
1,209,910
2,471,371
Not
the yearApplicable
Profit attributable to shareholders
2,655,717
2,081,995
1,728,967
1,197,735
2,533,294of the parent
Profit attributable to noncontrolling interest
Total Comprehensive income
attributable to Shareholders of the2,755,931
2,066,577
1,696,850
1,209,910
2,471,371
parentTotal Comprehensive income
attributable to non-controllinginterest
Earnings per share (Note 3)
6.17
4.83
4.01
2.79
5.90
Earnings per share (Note 4)
6.16
4.83
4.01
2.79
5.90
Note 1: 2017–2021 financial statements have been audited and certified by CPAs.
Note 2: Pursuant to Article 7 of the Regulations Governing the Preparation of Financial Reports by Securities Issuers (adopting
the International Financial Reporting Standards), the Company is not required to prepare the parent company only
financial statements of 2022 Q1; therefore, the Company provides no financial information for 2022 Q1.
Note 3: It is calculated based on the outstanding weighted average number of shares.
Note 4: It is calculated based on number of shares after retroactive adjustment.

6.1.5. Auditors’ Opinions from 2017 to 2021
Year

CPA Firm

CPA

Audit Opinion

2017

Pricewaterhouse Coopers

Lin Chun-Yao, Chou Chien-Hung

Unqualified Opinion

2018

Pricewaterhouse Coopers

Lin Chun-Yao, Chou Chien-Hung

Unqualified Opinion

2019

Pricewaterhouse Coopers

Lin Chun-Yao, Chou Chien-Hung

Unqualified Opinion

2020

Pricewaterhouse Coopers

Lin Chun-Yao, Chen Chin-Chang

Unqualified Opinion

2021

Pricewaterhouse Coopers

Lin Chun-Yao, Chen Chin-Chang

Unqualified Opinion-116-6.2. Financial Analysis for the Most Recent Five Years – Based on IFRS
6.2.1. Consolidated Financial Analysis
Financial Analysis for the Last Five Years (Note 2)
Year
Item

2017
Debt Ratio (%)

Financial
structure

Ratio of long-term capital toproperty, plant and equipment (%)

2018

2019

2020

2021

As of
March 31,2022
(Note 3)

9.98

8.62

8.46

9.96

11.60

23.32

764.85777.66807.96828.101,031.76

1,129.65

Current ratio (%)
928.56977.14 1,026.37
795.28698.43350.99Quick ratio (%)
338.95261.44432.06313.12225.62126.00Interest earned ratio (times)
11,154.47
1,121.51
738.18 2,507.93
5,394.32
Accounts receivable turnover
7.80
7.57
7.44
7.85
9.36
8.32
(times)Average collection period
47
48
49
47
39
44
Inventory turnover (times)
2.96
3.34
3.96
3.41
2.26
1.83
OperatingAccounts payable turnover (times)
10.08
11.26
9.11
8.05
7.83
8.28
performance
Average days in sales
123
109
92
107
162
199
Property, plant and equipment
7.70
6.64
5.36
4.85
6.78
7.74
turnover (times)
Total assets turnover (times)
0.92
0.79
0.63
0.55
0.66
0.60
Return on total assets (%)
11.63
9.33
8.04
5.72
11.74
13.56
Return on stockholders' equity (%)
13.01
10.29
8.78
6.29
13.16
16.45
ProfitfromPre-tax
92.80
49.67
41.35
28.25
67.40
48.85
operations
income toProfitability
paid-in capital Profit before
76.90
61.60
48.51
35.02
72.92
91.51
(%)
income tax
Profit ratio (%)
12.67
11.82
12.81
10.46
17.70
22.59
Earnings per share (NT$) (Note 1)
6.17
4.83
4.01
2.79
5.90
7.27
Cash flow ratio (%)
147.10265.71
69.36(13.52)101.81
1.27
Cash flow
Cash flow adequacy ratio (%)
93.80
86.36
84.50
65.18
62.14
53.73
Cash reinvestment ratio (%)
2.11
9.62
(6.19)(12.99)6.31
0.42
Operating leverage
1.36
1.61
1.69
1.98
1.41
1.60
Leverage
Financial leverage
1.00
1.00
1.00
1.00
1.00
1.00
Analysis of financial ratio differences for the last two years: (Not required if the difference does not exceed 20%)
1. Ratio of long-term capital to property, plant and equipment: Since the assets expected to be sold were transferred to
non-current assets held for sale in 2021, the ration of long-term capital to property, pland and equipment increased
correspondingly.
2. Quick ratio: Since inventory purchase and income before income tax increased in 2021, accounts payable and accrual
tax liabilies at the end of the period increased correspondingly. Accordingly, the quick ratio decreased from last year.
3. Interest earned ratio: Since the gross profit increased in 2021, the income before tax increased correspondingly,
resulting in an increase in the interest earned ratio.
4. Inventory turnover and average days in sales: Adjusting inventory amounts according to market conditions
increased inventory; thus, inventory turnover decreased and average days in sales increased.
5. Property, plant and equipment turnover and total assets turnover : Since the revenue increased in 2021, property,
plant and equipment turnover and total assets turnover increased correspondingly.
6. Profitability: Since the revenue and gross profit increased in 2021, operating profit, profit before tax and net income
after tax increased correspondingly. Accordingly, the profitability related financial ratios raised from last year.
7. Cash flow ratio and cash flow adequacy ratio: Since profitability increased in 2021, cash inflow generated fromoperations; thus, cash flow ratio and cash flow adequacy ratio increased from last year.
8. Operating leverage: The increased in revenue was greater than the variable business costs in 2021, and operating
profit also increased; thus, operating leverage decreased from last year.

Solvency-117-Note 1: It was calculated based on the outstanding weighted average number of shares.
Note 2: 2017–2021 financial statements have been audited and certified by CPAs.
Note 3: The financial statements of 2022 Q1 have been reviewed by the CPAs.

1. Financial Structure(1) DebtrRatio=total liabilities/total assets(2) Ratio of long-term capital to property, plant and equipment=(total shareholders’ equity＋
non-current liabilities)/ net value of property, plant and equipment
2. Liquidity(1) Current ratio=current assets/current liabilities(2) Quick ratio=(current assets-inventory-pre-paid expense)/ current liabilities(3) Interest earned ratio =earning before income tax and interest expense/interest expense of the term
3. Operating Performance(1) Accoutns receivables(including accounts receivables and notes receivables due to business) turnover=Net sales/ average balance of accounts receivables(including accounts receivables and notes
receivables due to business)(2) Average collection period =365/ accounts receivables turnover(3) Inventory turnover =Cost of goods sold/average inventory(4) Accounts payable (including accounts payables and notes payables due to business) turnover =cost ofgoos sold/ average balance of accounts payables(including accounts payables and notes payables due
to business)(5) Average days in sales =365/ inventory turnover(6) Property, plant and equipment turnover=net sales/average net value of property, plant and equipment(7) Total assets turnover =net sales/average total assets
4. Profitability(1) Return on Assets=[profit(loss) for the year+interest expense×(1-tax rate)]/average total assets(2) Return on stockholders' equity = profit(loss) for the year /average total stockholders' equity(3) Profit ratio= profit(loss) for the year /net sales(4) Earnings per share=( Profit(loss) attributable to shareholders of the parent –preferred stock
dividends)/ weighted average share outstanding
5. Cash Flow
(1) Cash flow ratio = Cash inflow generated from operations / current liabilities(2) Cash flow adequacy ratio = Cash inflow generated from operations of the most recent five years /(capital expenditure+increased amount of inventory+cash dividends) of the most recent five years(3) Cash reinvestment ratio =( Cash inflow generated from operations –cash dividends)/( gross value of
property, plant and equipment +long-term investment+other assets+working capital)
6. Leverage(1) Operating leverage=(net sales-variable business costs and expenses)/ Profit(loss) from operations(2) Financial leverage= Profit from operations /( Profit from operations –interest expense)-118-6.2.2. Parent Conpany Only Financial Analysis
Financial Analysis for the Last Five Years (Note 2)
Year
Item

2017
Debt Ratio (%)

Financial
structure

Ratio of long-term capital toproperty, plant and equipment (%)

Current ratio (%)
Solvency
Quick ratio (%)
Interest earned ratio (times)
Accounts receivable turnover(times)Average collection period
Inventory turnover (times)
OperatingAccounts payable turnover (times)
performance
Average days in sales
Property, plant and equipment
turnover (times)
Total assets turnover (times)
Return on total assets (%)
Return on stockholders' equity (%)
Profit from
Pre-tax
operations
income toProfitability
paid-in capital Profit before(%)
income tax

2018

2019

2020

2021

11.47

10.05

9.45

10.87

12.74

1,198.86

1,178.54

1,193.28

1,222.92

1,392.50

746.00266.16
11,072.48

753.10181.78-802.57
325.76
3,024.73

648.98245.75
1,776.57

574.75
170.6912,827.99

7.24

7.44

7.67

8.50

10.45

50
3.10
7.58
118

49
3.45
8.21
106

48
4.12
6.66
89

43
3.55
5.89
103

35
2.34
5.97
156

11.85

9.78

7.66

6.87

9.24

0.86
11.45
13.01

0.74
9.18
10.29

0.59
7.93
8.78

0.52
5.66
6.29

0.63
11.60
13.16

91.89

49.70

43.44

30.65

67.20

76.34

61.08

47.45

34.06

72.65

As of
March 31,2022
(Note 3)Not
appicable

Profit ratio (%)
13.27
12.39
13.44
10.95
18.43
Earnings per share (NT$) (Note 1)
6.17
4.83
4.01
2.79
5.90
Cash flow ratio (%)
117.59218.4347.98(11.99)89.74
Cash flow
Cash flow adequacy ratio (%)
97.36
85.80
82.60
62.32
60.46
Cash reinvestment ratio (%)
1.60
10.26
(7.42)(13.61)
6.64
Operating leverage
1.18
1.29
1.30
1.45
1.21
Leverage
Financial leverage
1.00
1.00
1.00
1.00
1.00
Analysis of financial ratio differences for the last two years: (Not required if the difference does not exceed 20%)
1. Quick ratio: Since inventory purchase and income before income tax increased in 2021, accounts payable and accrual
tax liabilies at the end of the period increased correspondingly. Accordingly, the quick ratio decreased from last year.
2. Interest earned ratio: Since the gross profit increased in 2021, the income before tax increased correspondingly,
resulting in an increase in the interest earned ratio.
3. Accounts receivable turnover: Since the revenue increased in 2021, and the Company stably collected accounts
receivables; accordingly, accounts receivable turnover increased.
4. Inventory turnover and average days in sales: Adjusting inventory amounts according to market conditions
increased inventory; thus, inventory turnover decreased and average days in sales increased.
5. Property, plant and equipment turnover and total assets turnover : Since the revenue increased in 2021, property, plantand equipment turnover and total assets turnover increased correspondingly.
6. Profitability: Since the revenue and gross profit increased in 2021, operating profit, profit before tax and net income
after tax increased correspondingly. Accordingly, the profitability related financial ratios raised from last year.
7. Cash flow ratio and cash flow adequacy ratio: Since profitability increased in 2021, cash inflow generated fromoperations; thus, cash flow ratio and cash flow adequacy ratio increased from last year.

-119-Note 1: It was calculated based on the outstanding weighted average number of shares.
Note 2: 2017–2021 financial statements have been audited and certified by CPAs.
Note 3: Pursuant to Article 7 of the Regulations Governing the Preparation of Financial Reports by Securities
Issuers (adopting the International Financial Reporting Standards), the Company is not required to prepare
the parent company only financial statements of 2022 Q1; therefore, the Company provides no financial
information for 2022 Q1.

1. Financial Structure(1) DebtrRatio=total liabilities/total assets(2) Ratio of long-term capital to property, plant and equipment=(total shareholders’ equity＋
non-current liabilities)/ net value of property, plant and equipment
2. Liquidity(1) Current ratio=current assets/current liabilities(2) Quick ratio=(current assets-inventory-pre-paid expense)/ current liabilities(3) Interest earned ratio =earning before income tax and interest expense/interest expense of the term
3. Operating Performance(1) Accoutns receivables(including accounts receivables and notes receivables due to business) turnover=Net sales/ average balance of accounts receivables(including accounts receivables and notes
receivables due to business)(2) Average collection period =365/ accounts receivables turnover(3) Inventory turnover =Cost of goods sold/average inventory(4) Accounts payable (including accounts payables and notes payables due to business) turnover =cost ofgoos sold/ average balance of accounts payables(including accounts payables and notes payables due
to business)(5) Average days in sales =365/ inventory turnover(6) Property, plant and equipment turnover=net sales/average net value of property, plant and equipment(7) Total assets turnover =net sales/average total assets
4. Profitability(1) Return on Assets=[profit(loss) for the year+interest expense×(1-tax rate)]/average total assets(2) Return on stockholders' equity = profit(loss) for the year /average total stockholders' equity(3) Profit ratio= profit(loss) for the year /net sales(4) Earnings per share=( Profit(loss) attributable to shareholders of the parent –preferred stock
dividends)/ weighted average share outstanding
5. Cash Flow
(1) Cash flow ratio = Cash inflow generated from operations / current liabilities(2) Cash flow adequacy ratio = Cash inflow generated from operations of the most recent five years /(capital expenditure+increased amount of inventory+cash dividends) of the most recent five years(3) Cash reinvestment ratio =( Cash inflow generated from operations –cash dividends)/( gross value of
property, plant and equipment +long-term investment+other assets+working capital)
6. Leverage(1) Operating leverage=(Net sales-variable business costs and expenses)/ Profit(loss) from operations(2) Financial leverage= Profit from operations /( Profit from operations –interest expense)-120-

6.3. Audit Committee’s Review Report for the Most Recent Year
Audit Committee’s Review Report

The Board of Directors has prepared the Company’s 2021 Business Report, Financial Statements andEarnings Distribution Proposal. Transcend Corporation’s Financial Statements have been audited andcertified by Mr. Chun-Yao Lin and Mr. Chin-Chang Chen, the CPA of the Pricewaterhouse Coopers. The
Business Report, Financial Statements and Earnings Distribution Proposal have been reviewed andconsidered to be complied with relevant rules by the undersigned, the audit committee of Transcend
Corporation. Pursuant to Article 14-4 of the Securities and Exchange Act and Article 219 of the Company
Act, we hereby submit this report.

The Audit Committee of Transcend Information, Inc.

Chairman of the Audit Committee: WANG, YI-HSIN

March 03, 2022

-121-

6.4. Consolidated Financial Statements for the Years Ended December 31, 2021 and 2020, andIndependent Auditors’ Report

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESREPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of Transcend
Information, Inc. as of and for the year ended December 31, 2021, under the Criteria Governing the
Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statementsof Affiliated Enterprises are the same as those included in the consolidated financial statements preparedin conformity with the International Financial Reporting Standard 10, “Consolidated Financial
Statements.” In addition, the information required to be disclosed in the combined financial statements is
included in the consolidated financial statements. Consequently, Transcend Information, Inc. andSubsidiaries do not prepare a separate set of combined financial statements.
Very truly yours,
TRANSCEND INFORMATION, INC.
Chairman: SHU, CHUNG-WON
March 3, 2022

-122-

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

PWCR21000372
To the Board of Directors and Shareholders of Transcend Information, Inc.
OpinionWe have audited the accompanying consolidated balance sheets of Transcend Information, Inc. and its
subsidiaries (the “Group”) as at December 31, 2021 and 2020, and the related consolidated statements ofcomprehensive income, of changes in equity and of cash flows for the years then ended, and notes to theconsolidated 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, 2021 and 2020, and its consolidated
financial performance and its consolidated cash flows for the years then ended in accordance with theRegulations Governing the Preparation of Financial Reports by Securities Issuers and the International
Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC
Interpretations as endorsed by the Financial Supervisory Commission.
Basis for opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of
Financial Statements by Certified Public Accountants and generally accepted auditing standards in the
Republic of China. Our responsibilities under those standards are further described in the Auditors’
responsibilities for the audit of the consolidated financial statements section of our report. We are
independent of the Group in accordance with the Norm of Professional Ethics for Certified Public
Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities inaccordance with these requirements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the Group’s 2021 consolidated financial statements. These matters were addressed in the context
of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we
do not provide a separate opinion on these matters.
Key audit matters for the Group’s 2021 consolidated financial statements are stated as follows:-123-Valuation of inventories
Description
Refer to Notes 4(13), 5(2) and 6(5) to the consolidated financial statements for the information on theGroup’s inventory accounting policy, estimates and assumptions and allowance for inventory valuation
losses.
The percentage of the Group’s inventories to total assets is material and the Group applies judgements
and estimates in determining the net realizable value of inventories at the balance sheet date. The Group
mainly produces DRAM and flash memory. As these products have a short life cycle and belong to ahighly competitive industry, the market prices change frequently. Since the Group’s inventories and theallowance for inventory valuation losses are material to the financial statements, the valuation of
inventories has been identified as a key audit matter.
How our audit addressed the matter
We performed the following audit procedures in respect of the above key audit matter:
A. Obtained an understanding of the Group’s operations and industry. Assessed the reasonableness ofthe policy and procedures to recognize allowance for inventory valuation losses.
B. Obtained an understanding of the Group’s inventory control procedures. Reviewed annual inventory
count plan and observed the annual physical count of inventory in order to assess the effectiveness ofinternal controls over inventory.
C. Obtained relevant evaluation reports of inventory and tested the logic and accuracy of information toassess the reasonableness of allowance for inventory valuation losses.
Estimation of allowance for sales discountDescription
In consideration of business volume, the Group provides a variety of business incentives to specificcustomers or products, and based on that, the Group can estimate the allowance for sales discountmonthly. Refer to Notes 4(25) and 6(4) to the consolidated financial statements for the information on theestimation of allowance for sales discount.
Since the contracts are numerous and the result could affect the net revenue in the consolidated financial
statements, the estimation of allowance for sales discount has been identified as a key audit matter.

-124-

How our audit addressed the matter
We performed the following audit procedures in respect of the above key audit matter:
A. Obtained an understanding of the Group’s operations, industry and the procedures to recognize
allowance for sales discount.
B. Obtained an understanding of the Group’s sales procedures and interviewed management to assess
the appropriateness of sales allowance contracts and internal control over estimation of allowance.
C. Obtained the evaluation list of allowance for sales discount, and tested material sales allowance
contracts and recalculated it to assess the reasonableness of allowance determined by the Group.
Other matter –Parent company only financial reports
We have audited and expressed an unqualified opinion on the parent company only financial statementsof Transcend Information, Inc. as at and for the years ended December 31, 2021 and 2020.
Responsibilities of management and those charged with governance for the consolidated financial
statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with the Regulations Governing the Preparation of Financial Reports by
Securities Issuers and the International Financial Reporting Standards, International AccountingStandards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory
Commission, and for such internal control as management determines is necessary to enable thepreparation of consolidated financial statements that are free from material misstatement, whether due tofraud 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 andusing the going concern basis of accounting unless management either intends to liquidate the Group or tocease operations, or has no realistic alternative but to do so.
Those charged with governance, including the audit committee, are responsible for overseeing theGroup’s financial reporting process.

-125-

Auditors’ responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ reportthat includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with the generally accepted auditing standards in the Republic of China
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error andare considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with the generally accepted auditing standards in the Republic of China,
we exercise professional judgement and maintain professional skepticism throughout the audit. We also:A.

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, andobtain 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 ofinternal control.

B.

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

C.

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

D.

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

E.

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.

-126-

F.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness 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 remainsolely 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 othermatters 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 thatwere of most significance in the audit of the consolidated financial statements of the current period andare 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 ofdoing so would reasonably be expected to outweigh the public interest benefits of such communication.

Lin, Chun-Yao

Chen, Chin-Chang

For and on behalf of PricewaterhouseCoopers, Taiwan
March 3, 2022------------------------------------------------------------------------------------------------------------------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and results ofoperations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions otherthan the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of suchfinancial statements may differ from those generally accepted in countries and jurisdictions other than the Republic ofChina. Accordingly, the accompanying consolidated financial statements and independent auditors’ report are not intended
for use by those who are not informed about the accounting principles or auditing standards generally accepted in the
Republic of China, and their applications in practice.
As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability
for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from thetranslation.

-127-

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETSDECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)
Assets

December 31, 2021
AMOUNT%

Notes

December 31, 2020
AMOUNT%

Current Assets
Cash and cash equivalents

6(1)Financial assets at fair value through profit

6(2)

$

or loss – current
Current financial assets at amortised cost,

2,018,106

9

1,506,595$

736,8524

73,510,998

17

5,567,177

25

5,659,889

27

6(3)

net
Notes receivable, net

6(4)

2,499

-

759

-

Accounts receivable, net

6(4)1,622,484

7

1,434,454

7

108,850-

71,351-Other receivables
Inventories, net

6(5)5,774,825

26

3,190,466

15

Non-current assets held for sale, net

6(6)159,976

1--

13,445-

10,495-

16,773,957

75

14,615,264

70

111,599-744,9224

629,5763

111,000

1

148,5141

95,724-

Other current assets
Total Current Assets
Non-current Assets
Non-current financial assets at fair value

6(2)through profit or loss
Non-current financial assets at fair value

6(7)through other comprehensive income
Investments accounted for using equity

6(8)methodProperty, plant and equipment, net

6(9) and 8

1,942,013

92,282,324

11

Right-of-use assets

6(10) and 7

124,054-

187,0791

Investment property, net

6(12)2,602,088

12

2,612,426

13

Deferred tax assets

6(24)47,355-41,472-Other non-current assets

6(13)59,345-47,411-

5,664,544

25

6,122,358

30

22,438,501

100

20,737,622

100

Total Non-current Assets
Total Assets$(Continued)

-128-

$

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETSDECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)
Liabilities and Equity

December 31, 2021
AMOUNT%

Notes

December 31, 2020
AMOUNT%

Current Liabilities
Accounts payable$

1,364,835

6

52,241Other payables
Current tax liabilities

Accounts payable - related parties

Current lease liabilities

7

7

Other current liabilities
Total Current Liabilities$

1,134,266

6-

37,416-286,1681

246,635

1

592,8863

295,381

2

16,917-51,010-88,606

1

73,046-2,401,653

11

1,837,754

9

Non-current Liabilities
Deferred tax liabilities

6(24)128,7841

139,700

1

Non-current lease liabilities

7

26,033-34,705-

Other non-current liabilities

6(14)47,196-53,437-

202,0131

227,84212,603,666

12

2,065,596

10

4,290,617

19

4,290,617

21

3,730,914

16

3,945,369

19

Legal reserve

4,803,503

21

4,683,878

22

Special reserve

117,2441

130,9021

7,083,072

32

5,738,504

28

Total Non-current Liabilities
Total Liabilities
Equity Attributable to Owners of Parent
Share capital6(15)Common stock
Capital surplus

6(16)Capital surplus
Retained earnings

6(17)Unappropriated retained earnings
Other equity interest6(18)Other equity interest(

190,515) (Total Equity
Significant contingent liabilities and1) (19,834,835

88

22,438,501

100

117,244) (1)

18,672,026

90

20,737,622

100

9unrecognized contract commitments
Significant events after the balance sheet date
Total Liabilities and Equity

11
$

$

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

-129-

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars, except for earnings per share amount)

Items
Notes
Operating Revenue
6(19) and 7
Operating Costs
6(5)(23) and 7
Gross Profit
Operating Expenses
6(23)Sales and marketing expenses
Administrative expenses
Research and development expenses
Impairment loss determined in accordance
6(4)with IFRS 9
Total operating expenses
Operating Profit
Non-operating Income and Expenses
Interest income
6(20)Other income6(21)Other gains and losses
6(22)Net gain from derecognizing financial assets 6(3)measured at amortised cost
Finance costs
6(10)Share of profit (loss) of associates and joint
6(8)ventures accounted for using the equity
methodTotal non-operating income and expenses
Profit before Income Tax
Income tax expense
6(24)Profit for the Year
Other Comprehensive Income (Loss)
Components of other comprehensive
income (loss) that will not be reclassified to
profit or loss
Gains (losses) on remeasurements of defined 6(14)benefit plans
Unrealized gain (loss) on financial assets at
6(7)(18)
fair value through other comprehensive
incomeShare of other comprehensive income (loss) of
associates and joint ventures accounted forusing the equity method
Components of other comprehensive
income (loss) that will be reclassified to
profit or loss
Exchange differences on translation of foreign 6(18)financial statements
Income tax related to components of other6(18)(24)comprehensive income that will bereclassified to profit or loss
Other Comprehensive (Loss) Income for theYear
Total Comprehensive Income
Net profit attributable to:
Owners of parent
Comprehensive income attributable to:
Owners of parent
Earnings Per Share (in dollars)
Basic earnings per share
Diluted earnings per share$(

Year ended December 31
2021
2020
AMOUNT%AMOUNT
14,314,815
100 $
11,446,696
10,139,129) (71) (8,976,600) (4,175,686
29
2,470,096

%
100
78)
22

(
(
(

765,171) (366,696) (151,458) (

5) (
3) (
1) (

692,592) (431,320) (133,355) (

6)
4)
1)

(
(

567)
1,283,892) (2,891,794

- (
9) (
20

893)
1,258,160) (1,211,936

11)
11

79,117
37,253
69,1481
173,952
38,721
163,899

1
11,248)- (17,2102,038)-$

52,590236,860
3,128,654
595,360) (2,533,294

- (
2
22
4) (
18 $

1,299)
290,445
1,502,381
304,646) (1,197,735

2
13
2)
11

$

2,344

- ($

1,072)-

11,826- (3,164)

-

200

- (

411)

-

95,365) (1)

21,027-

19,072- (4,205)

-

(

(

(

($
$

61,923) (2,471,371

1)
17

$
$

12,175
1,209,910

11$

2,533,294

18$

1,197,735

11$

2,471,371

17$

1,209,910

11

5.90
5.90

$
$

6(25)
$
$

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

-130-

2.79
2.79

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN EQUITYYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)
Equity attributable to owners of the parent
Retained Earnings

Capital Reserves

Notes
Year ended December 31, 2020
Balance at January 1, 2020
Net income for the year
Other comprehensive income (loss)
6(7)(18)
Total comprehensive income (loss)
Appropriations and distribution of 2019 6(17)earnings
Legal reserve
Cash dividends
Special reserve
Cash payment from capital surplus
6(17)Expired unclaimed dividends recognized
as capital surplus
Purchase of treasury stock6(15)Cancellation of treasury stock
6(15)Balance at December 31, 2020
Year ended December 31, 2021
Balance at January 1, 2021
Net income for the year
Other comprehensive income (loss)
6(7)(18)
Total comprehensive income (loss)
Appropriations and distribution of 2020 6(17)earnings
Legal reserve
Cash dividends
Reversal of special reserve
Cash payment from capital surplus
6(17)Net gain on disposal of financial assets at6(7)(18)
fair value through other comprehensive
incomeExpired unclaimed dividends recognized
as capital surplus
Balance at December 31, 2021

Common stock

Additional paid-in
capitalDonated assets
received

Net assets frommergerLegal reserve

Special reserve

Unappropriatedretained earnings

Other Equity Interest
Unrealized gain or
Exchangeloss on financial
differences on
assets at fair valuetranslation ofthrough otherforeign financial
comprehensive
statements
income

$

$

$

$

$

$

$

($

4,307,617
-

-

(
$
$

17,000 )4,290,617
4,290,617--$

4,307,541
-

4,185
-

35,128-4,510,981-

61,572-(

386,156 )--

172,897-

69,330-($15,422 )3,905,963

93
4,278

35,1284,683,878

130,902$(3,905,963-$$

214,531 )

4,278
-

$
$

35,128-$$4,683,878---

119,625
-

$
$

(

(

(
(
(

(
$

130,902-$13,658 )-((6,427,300
1,197,735
1,483 )
1,196,252

172,897 )1,544,622 )
69,330 )98,199 )5,738,504
5,738,504
2,533,294
2,544
2,535,838

-

-

-

-

8,804

3,691,432

76
4,354

35,1284,803,503

117,244

7,083,072

$

$

$

$

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

-131-

($
(
(

121,639 )76,293 )76,293 )

-

-

$

($

121,639 )-

4,290,617

$
(
(

-

119,625 )1,094,107 )
13,658--$138,461 )
16,822
16,822($

197,932 )

7,559
3,164 )
3,164 )

Treasury shares

($

-

$
$

4,395
4,395
11,826
11,826

116,574 )
-

-

(
$
$

14,047 )
130,621-

Total equity$ 19,406,848
1,197,735
12,175
1,209,910((

1,544,622 )
386,156 )93
14,047 )$ 18,672,026($ 18,672,026
2,533,294(
61,923 )2,471,371--(

8,804 )

-

-

$

7,417

-

76
$ 19,834,835$((

1,094,107 )
214,531 )TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)Year ended December 31
Notes

2021

2020

CASH FLOWS FROM OPERATING ACTIVITIESProfit before tax
Adjustments
Adjustments to reconcile profit (loss)
Net gain on financial assets at fair value through profit or loss
Share of profit or loss of associates and joint ventures accounted forusing the equity method
Expected credit loss
(Gain) loss on disposal of property, plant and equipment
Depreciation
Interest income
Interest expense
Dividend income
Changes in operating assets and liabilities
Changes in operating assets
Financial assets mandatorily measured at fair value through profit orloss
Notes receivable
Accounts receivable
Accounts receivable - related parties
Other receivables
Inventories
Other current assets
Changes in operating liabilities
Accounts payable
Accounts payable - related parties
Other payables
Other current liabilities
Other non-current liabilities
Cash inflow (outflow) generated from operations
Dividends received
Interest received
Income tax paid
Net cash flows from (used in) operating activities$

6(2)(22)
6(8)
6(4)
6(22)
6(23)
6(20)
6(10)
6(7)(22)

3,128,654(

84,872 )(52,590 )567
12 )253,806
79,117 )
1,248
6,787 )(((

2,012,362
1,740 )
188,555 )
41,547 )2,584,359 )
2,950 )(((((

230,569
14,82539,533
15,5603,897 )
2,650,698
6,787
83,165295,582 )2,445,068

(

(

$

(

1,502,381

147,742 )
1,299
893
2,098
257,272
73,952 )2,038
3,834 )(((

916,025 )
2,295
43,3108
43,684
1,127,807 )
7,478

(

128,916
15,412 )20,481 )
57,735819 )
256,665 )
3,834
82,99478,570 )248,407 )

(
(
(
(

(
(

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of non-current financial assets at fair value throughprofit or loss
Acquisition of non-current financial assets at fair value through profit or loss
Proceeds from disposal of financial assets at amortised cost
Acquisition of financial assets at amortised cost
Proceeds from disposal of non-current financial assets at fair value throughother comprehensive income
Acquisition of non-current financial assets at fair value through othercomprehensive income
Proceeds from disposal of property, plant and equipment
Acquisition of property, plant and equipment
Acquisition of investment property(Increase) decrease in other non-current financial assets
Net cash flows from investing activities

841,021130,785 )2,619,758
2,530,400 )((

611,063 )6,287,094
3,884,624 )

(
(

6(7)
54,426
(
6(9)
6(12)

(
(
(

6(17)

(
(

561,176 )20
15,334 )2,409 )
11,934 )263,187

29,700 )1,082 )
3,783
1,764,408((

CASH FLOWS FROM FINANCING ACTIVITIESCash dividends paid (including cash payment from capital surplus)
Repayment of lease liabilities
Expired unclaimed dividends recognized as capital surplus
Purchase of treasury stock
Net cash flows used in financing activities
Effect of exchange rate changes
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year(($

1,308,638 )
56,105 )76
1,364,667 )
62,334 )1,281,254
736,852
2,018,106

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

-132-

(
(
(
(
(
$

1,930,778 )
54,459 )93
37,371 )2,022,515 )
9,959
496,555 )
1,233,407
736,852

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars, except as otherwise indicated)

1. HISTORY AND ORGANIZATION
Transcend Information, Inc. (the “Company”) was incorporated under the provisions of the Company
Law of the Republic of China (R.O.C.) in August 1989. The main activities of the Company and its
subsidiaries (collectively referred herein as the “Group”) are manufacturing, processing and sales ofcomputer software and hardware, peripheral equipment and other computer components. The Securities
and Futures Commission of the Republic of China had approved the Company’s shares to be listed on
the Taiwan Stock Exchange and the shares started trading on May 3, 2001.
2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL
STATEMENTS AND PROCEDURES FOR AUTHORIZATION
These consolidated financial statements were authorized for issuance by the Board of Directors on
March 3, 2022.
3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS(1)Effect of the adoption of new issuances of or amendments to International Financial ReportingStandards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)
New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as
follows:

New Standards, Interpretations and Amendments
Amendments to IFRS 4, ‘Extension of the temporary exemption fromapplying IFRS 9’
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate
Benchmark Reform— Phase 2’
Amendment to IFRS 16, ‘Covid-19-related rent concessions beyond 30 June
2021’

Effective dateby International
AccountingStandards Board
January 1, 2021
January 1, 2021
April 1, 2021 (Note)

Note: Earlier application from January 1, 2021 is allowed by the 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.

-133-

(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:

New Standards, Interpretations and Amendments
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

Effective dateby International
AccountingStandards Board
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:

New Standards, Interpretations and Amendments
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’
Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 –comparative information'
Amendments to IAS 1, ‘Classification of liabilities as current or noncurrent’
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 arisingfrom a single transaction’-134-

Effective dateby International
AccountingStandards Board
To be determinedby International
AccountingStandards Board
January 1, 2023
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 POLICIESThe principal accounting policies applied in the preparation of these consolidated financial statements
are set out below. These policies have been consistently applied to all the periods presented, unlessotherwise stated.
(1)Compliance statement
The consolidated financial statements of the Group have been prepared in accordance with theRegulations Governing the Preparation of Financial Reports by Securities Issuers, International
Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC
Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”).
(2)Basis of preparation
A. Except for the following items, the consolidated financial statements have been prepared under
the historical cost convention:(a) Financial assets at fair value through profit or loss.
(b) Financial assets at fair value through other comprehensive income.
(c) Defined benefit liabilities recognized based on the net amount of pension fund assets lesspresent value of defined benefit obligations.
B. The preparation of financial statements in conformity with requires the use of certain criticalaccounting estimates. It also requires management to exercise its judgement in the process ofapplying the Group’s accounting policies. The areas involving a higher degree of judgement orcomplexity, or areas where assumptions and estimates are significant to the consolidated
financial statements are disclosed in Note 5.
(3)Basis of consolidation
A. Basis for preparation of consolidated financial statements:(a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries
are all entities (including structured entities) controlled by the Group. The Group controls anentity when the Group is exposed, or has rights, to variable returns from its involvement withthe entity and has the ability to affect those returns through its power over the entity.
Consolidation of subsidiaries begins from the date the Group obtains control of thesubsidiaries and ceases when the Group loses control of the subsidiaries.
(b) Inter-company transactions, balances and unrealized gains or losses on transactions between
companies within the Group are eliminated. Accounting policies of subsidiaries have beenadjusted where necessary to ensure consistency with the policies adopted by the Group.
-135-

(c) Profit or loss and each component of other comprehensive income are attributed to theowners of the parent and to the non-controlling interests. Total comprehensive income isattributed to the owners of the parent and to the non-controlling interests even if this resultsin the non-controlling interests having a deficit balance.
(d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing
control of the subsidiary (transactions with non-controlling interests) are accounted for as
equity transactions, i.e. transactions with owners in their capacity as owners. Any difference
between the amount by which the non-controlling interests are adjusted and the fair value ofthe consideration paid or received is recognized directly in equity.
(e) When the Group loses control of a subsidiary, the Group remeasures any investment retainedin the former subsidiary at its fair value. That fair value is regarded as the fair value on initialrecognition of a financial asset or the cost on initial recognition of the associate or joint
venture. Any difference between fair value and carrying amount is recognized in profit orloss. All amounts previously recognized in other comprehensive income in relation to thesubsidiary are reclassified to profit or loss on the same basis as would be required if therelated assets or liabilities were disposed of. That is, when the Group loses control of a
subsidiary, all gains or losses previously recognized in other comprehensive income inrelation to the subsidiary should be reclassified from equity to profit or loss, if such gains orlosses would be reclassified to profit or loss when the related assets or liabilities are disposedof.
B. Subsidiaries included in the consolidated financial statements:
Name ofInvestor
Transcend
TaiwanOwnership (%)
December December
31, 2021
31, 2020
100
100

Name of
Subsidiary
Saffire Investment Ltd.
(Saffire)

Main Business
Activities
Investment holdings

Transcend Japan Inc.
(Transcend Japan)

Wholesale and import ofcomputer memory
modules and peripheralproducts

100

100

Transcend Information
Inc. (Transcend USA)

Wholesale and import ofcomputer memory
modules and peripheralproducts

100

100

Transcend Korea Inc.
(Transcend Korea)

Wholesale and import ofcomputer memory
modules and peripheralproducts

100

100

-136-

Description

Ownership (%)
December December
31, 2021
31, 2020
100
100

Name of
Name ofInvestor
Subsidiary
SaffireMemhiro Pte. Ltd.
Investment Ltd. (Memhiro)

Main Business
Activities
Investment holdings

MemhiroPte. Ltd.

Transcend Information
Europe B.V.
(Transcend Europe)

Wholesale and import ofcomputer memory
modules and peripheralproducts

100

100

Transcend Information
Trading GmbH
(Transcend Germany)

Wholesale and import ofcomputer memory
modules and peripheralproducts

100

100

Transcend Information(Shanghai), Ltd.
(Transcend Shanghai)

Manufacture and sales ofcomputer memory
modules, storage products
and disks, and lease of
self-owned buildings

100

100

Transtech Trading(Shanghai) Co., Ltd.
(Transtech Shanghai)

Wholesale, agent, importand export and retail ofcomputer memory modules,
storage products andcomputer components

100

100

Transcend Information(Hong Kong), Ltd.
(Transcend Hong
Kong)

Wholesale and import ofcomputer memory modules
and peripheral products

100

100

Description

C. Subsidiaries not included in the consolidated financial statements: None.
D. Adjustment for subsidiaries with different balance sheet dates: None.
E. Significant restrictions: None.
F. Subsidiaries that have non-controlling interests that are material to the Group: None.
(4)Foreign currency translation
Items included in the financial statements of each of the Group’s entities are measured using thecurrency of the primary economic environment in which the entity operates (the “functional
currency”). The consolidated financial statements are presented in New Taiwan dollars, which is theCompany’s functional and the Group’s presentation currency.
A. Foreign currency transactions and balances(a) Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions or valuation where items are remeasured.
Foreign exchange gains and losses resulting from the settlement of such transactions arerecognized in profit or loss in the period in which they arise.
-137-

(b) Monetary assets and liabilities denominated in foreign currencies at the period end are
retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences
arising upon re-translation at the balance sheet date are recognized in profit or loss.
(c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value
through profit or loss are re-translated at the exchange rates prevailing at the balance sheet
date; their translation differences are recognized in profit or loss. Non-monetary assets andliabilities denominated in foreign currencies held at fair value through other comprehensive
income are re-translated at the exchange rates prevailing at the balance sheet date; theirtranslation differences are recognized in other comprehensive income. However,non-monetary assets and liabilities denominated in foreign currencies that are not measured
at fair value are translated using the historical exchange rates at the dates of the initialtransactions.
(d) All other foreign exchange gains and losses based on the nature of those transactions arepresented in the statement of comprehensive income within‘other gains and losses’.
B. Translation of foreign operations
The operating results and financial position of all the group entities that have a functional
currency different from the presentation currency are translated into the presentation currency as
follows:(a) Assets and liabilities for each balance sheet presented are translated at the closing exchange
rate at the date of that balance sheet;(b) Income and expenses for each statement of comprehensive income are translated at averageexchange rates of that period; and(c) All resulting exchange differences are recognized in other comprehensive income.
(5)Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they areclassified as non-current assets:(a) Assets arising from operating activities that are expected to be realized, or are intended to be
sold or consumed within the normal operating cycle;(b) Assets held mainly for trading purposes;(c) Assets that are expected to be realized within twelve months from the balance sheet date;(d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are
to be exchanged or used to settle liabilities more than twelve months after the balance sheet
date.

-138-

B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise
they are classified as non-current liabilities:(a) Liabilities that are expected to be settled within the normal operating cycle;(b) Liabilities arising mainly from trading activities;(c) Liabilities that are to be settled within twelve months from the balance sheet date;(d) Liabilities for which the repayment date cannot be extended unconditionally to more thantwelve months after the balance sheet date. Terms of a liability that could, at the option of thecounterparty, result in its settlement by the issue of equity instruments do not affect its
classification.
(6)Cash equivalents
Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
(7)Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured atamortised cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss arerecognized and derecognized using trade date accounting.
C. At initial recognition, the Group measures the financial liabilities at fair value. All relatedtransaction costs are recognized in profit or loss. The Group subsequently measures thesefinancial liabilities at fair value with any gain or loss recognized in profit or loss.
(8)Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity securities
which are not held for trading, and for which the Group has made an irrevocable election at
initial recognition to recognize changes in fair value in other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through othercomprehensive income are recognized and derecognized using trade date accounting.
(Irrevocable election is separately classified, and needs to be disclosed when there is various
election).
C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs.
The Group subsequently measures the financial assets at fair value:
The changes in fair value of equity investments that were recognized in other comprehensive
income are reclassified to retained earnings and are not reclassified to profit or loss following thederecognition of the investment. Dividends are recognized as revenue when the right to receive
payment is established, future economic benefits associated with the dividend will flow to theGroup and the amount of the dividend can be measured reliably.

-139-

(9)Financial assets at amortised cost
A. Financial assets at amortised cost are those that meet all of the following criteria:(a) The objective of the Group’s business model is achieved by collecting contractual cash
flows.
(b) The assets’ contractual cash flows represent solely payments of principal and interest.
B. On a regular way purchase or sale basis, financial assets at amortised cost are recognized andderecognized using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs.
Interest income from these financial assets is included in finance income using the effective
interest method. A gain or loss is recognized in profit or loss when the asset is derecognized or
impaired.
(10)Accounts and notes receivable
A. Accounts and notes receivable entitle the Group a legal right to receive consideration in
exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently
measured at initial invoice amount as the effect of discounting is immaterial.
(11)Financial assets impairment
For debt instruments measured at fair value through other comprehensive income and financial
assets at amortised cost including accounts receivable that have a significant financing component,
at each reporting date, the Group recognizes the impairment provision for 12 months expectedcredit losses if there has not been a significant increase in credit risk since initial recognition orrecognizes the impairment provision for the lifetime expected credit losses (ECLs) if such credit
risk has increased since initial recognition after taking into consideration all reasonable andverifiable information that includes forecasts. On the other hand, for accounts receivable orcontract assets that do not contain a significant financing component, the Group recognizes theimpairment provision for lifetime ECLs.
(12)Derecognition of financial assets
The Group derecognizes a financial asset when the contractual rights to receive the cash flows
from the financial asset expire.
(13)Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined using theweighted-average method. The cost of finished goods and work in progress comprises raw
materials, direct labour, other direct costs and related production overheads (allocated based on-140-actual operating capacity). It excludes borrowing costs. The item by item approach is used inapplying the lower of cost and net realizable value. Net realizable value is the estimated selling
price in the ordinary course of business, less the estimated cost of completion and applicablevariable selling expenses.
(14)Non-current assets (or disposal groups) held for saleNon-current assets (or disposal groups) are classified as assets held for sale when their carrying
amount is to be recovered principally through a sale transaction rather than through continuing use,
and a sale is considered highly probable. They are stated at the lower of carrying amount and fairvalue less costs to sell.
(15)Investments accounted for using equity method / associates
A. Associates are all entities over which the Group has significant influence but not control. In
general, it is presumed that the investor has significant influence, if an investor holds, directly
or indirectly 20 percent or more of the voting power of the investee. Investments in associates
are accounted for using the equity method and are initially recognized at cost.
B. The Group’s share of its associates’ post-acquisition profits or losses is recognized in profit orloss, and its share of post-acquisition movements in other comprehensive income is recognizedin other comprehensive income. When the Group’s share of losses in an associate equals or
exceeds its interest in the associate, including any other unsecured receivables, the Group does
not recognize further losses, unless it has incurred legal or constructive obligations or madepayments on behalf of the associate.
C. When changes in an associate’s equity do not arise from profit or loss or other comprehensive
income of the associate and such changes do not affect the Group’s ownership percentage ofthe associate, the Group recognizes change in ownership interests in the associate in ‘capitalsurplus’ in proportion to its ownership.
D. Unrealized gains on transactions between the Group and its associates are eliminated to theextent of the Group’s interest in the associates. Unrealized losses are also eliminated unless thetransaction provides evidence of an impairment of the asset transferred. Accounting policies ofassociates have been adjusted where necessary to ensure consistency with the policies adopted
by the Group.
E. In the case that an associate issues new shares and the Group does not subscribe or acquire newshares proportionately, which results in a change in the Group’s ownership percentage of theassociate but maintains significant influence on the associate, then ‘capital surplus’ and‘investments accounted for under the equity method’ shall be adjusted for the increase or
decrease of its share of equity interest. If the above condition causes a decrease in the Group’s
ownership percentage of the associate, in addition to the above adjustment, the amounts
previously recognized in other comprehensive income in relation to the associate arereclassified to profit or loss proportionately on the same basis as would be required if the-141-relevant assets or liabilities were disposed of.
F. When the Group disposes its investment in an associate and loses significant influence overthis associate, the amounts previously recognized in other comprehensive income in relation to
the associate, are reclassified to profit or loss, on the same basis as would be required if therelevant assets or liabilities were disposed of. If it retains significant influence over thisassociate, the amounts previously recognized in other comprehensive income in relation to theassociate are reclassified to profit or loss proportionately in accordance with theaforementioned approach.
(16)Property, plant and equipment
A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during
the construction period are capitalized.
B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured reliably. The carrying amountof the replaced part is derecognized. All other repairs and maintenance are charged to profit orloss during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model and are
depreciated using the straight-line method to allocate their cost over their estimated useful lives.
Each part of an item of property, plant, and equipment with a cost that is significant in relation
to the total cost of the item must be depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if
appropriate, at each financial year-end. If expectations for the assets’ residual values and useful
lives differ from previous estimates or the patterns of consumption of the assets’ future
economic benefits embodied in the assets have changed significantly, any change is accounted
for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting
Estimates and Errors’, from the date of the change. The estimated useful lives of property, plantand equipment are as follows:
Buildings and structures
Machinery and equipment
Transportation equipment
Office equipment and others

8 ~ 50 years
2 ~ 10 years
3 ~ 5 years
2 ~ 5 years(17)Leasing arrangements (lessee) - right-of-use assets / lease liabilities
A. Leases are recognized as a right-of-use asset and a corresponding lease liability at the date at
which the leased asset is available for use by the Group. For short-term leases or leases of
low-value assets, lease payments are recognized as an expense on a straight-line basis over thelease term.

-142-

B. Lease liabilities include the net present value of the remaining lease payments at thecommencement date, discounted using the incremental borrowing interest rate. Lease payments
are comprised of the following:(a) Fixed payments, less any lease incentives receivable; and(b) Variable lease payments that depend on an index or a rate.
The Group subsequently measures the lease liability at amortized cost using the interest method
and recognizes interest expense over the lease term. The lease liability is remeasured and theamount of remeasurement is recognized as an adjustment to the right-of-use asset when there
are changes in the lease term or lease payments and such changes do not arise from contract
modifications.
C. At the commencement date, the right-of-use asset is stated at cost comprising the amount of theinitial measurement of lease liability.
The right-of-use asset is measured subsequently using the cost model and is depreciated fromthe commencement date to the earlier of the end of the asset’s useful life or the end of the lease
term. When the lease liability is remeasured, the amount of remeasurement is recognized as an
adjustment to the right-of-use asset.
(18)Investment property
An investment property is stated initially at its cost and measured subsequently using the costmodel. Except for land, investment property is depreciated on a straight-line basis over its
estimated useful life of 10 ~ 55 years.
(19)Impairment of non-financial assets
The Group assesses at each balance sheet date the recoverable amounts of those assets where there
is an indication that they are impaired. An impairment loss is recognized for the amount by which
the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higherof an asset’s fair value less costs to sell or value in use. When the circumstances or reasons forrecognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment
loss is reversed. The increased carrying amount due to reversal should not be more than what the
depreciated or amortised historical cost would have been if the impairment had not beenrecognized.
(20)Notes and accounts payable
Notes and accounts payable are obligations to pay for goods or services that have been acquired in
the ordinary course of business from suppliers. They are recognized initially at fair value andsubsequently measured at amortised cost using the effective interest method. However, short-term
accounts payable without bearing interest are subsequently measured at initial invoice amount as
the effect of discounting is immaterial.
-143-

(21)Employee benefits
A. Short-term employee benefits
Short-term employee benefits are measured at the undiscounted amount of the benefits
expected to be paid in respect of service rendered by employees in a period and should berecognized as expense in that period when the employees render service.
B. Pensions(a) Defined contribution plans
For defined contribution plans, the contributions are recognized as pension expenses when
they are due on an accrual basis. Prepaid contributions are recognized as an asset to theextent of a cash refund or a reduction in the future payments.
(b) Defined benefit plansi.

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

ii. Remeasurements arising on defined benefit plans are recognized in othercomprehensive income in the period in which they arise and are recorded as retained
earnings.
iii. Past service costs are recognized immediately in profit or loss.
C. Employees’ compensation and directors’ and supervisors’ remuneration
Employees’ compensation and directors’ and supervisors’ remuneration are recognized as
expense and liability, provided that such recognition is required under legal or constructive
obligation and those amounts can be reliably estimated. Any difference between the resolved
amounts and the subsequently actual distributed amounts is accounted for as changes in
estimates.
(22)Income tax
A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit
or loss, except to the extent that it relates to items recognized in other comprehensive income
or items recognized directly in equity, in which cases the tax is recognized in other-144-

comprehensive income or equity.
B. The current income tax expense is calculated on the basis of the tax laws enacted or
substantively enacted at the balance sheet date in the countries where the Company and its
subsidiaries operate and generate taxable income. Management periodically evaluates positions
taken in tax returns with respect to situations in accordance with applicable tax regulations. It
establishes provisions where appropriate based on the amounts expected to be paid to the tax
authorities. An additional tax is levied on the unappropriated retained earnings and is recorded
as income tax expense in the year the stockholders resolve to retain the earnings.
C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the
consolidated balance sheet. Deferred tax is determined using tax rates (and laws) that havebeen enacted or substantially enacted by the balance sheet date and are expected to apply when
the related deferred tax asset is realized or the deferred tax liability is settled.
D. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit
will be available against which the temporary differences can be utilized. At each balance sheet
date, unrecognized and recognized deferred tax assets are reassessed.
E. Current income tax assets and liabilities are offset and the net amount reported in the balance
sheet when there is a legally enforceable right to offset the recognized amounts and there is anintention to settle on a net basis or realize the asset and settle the liability simultaneously.
Deferred tax assets and liabilities are offset on the balance sheet when the entity has the legally
enforceable right to offset current tax assets against current tax liabilities and they are levied by
the same taxation authority on either the same entity or different entities that intend to settle on
a net basis or realize the asset and settle the liability simultaneously.
F. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting
from acquisitions of equipment or technology and research and development expenditures tothe extent that it is possible that future taxable profit will be available against which the unused
tax credits can be utilized.
(23)Share capital
A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.
B. Where the Company repurchases the Company’s shares that have been issued, theconsideration paid, excluding any directly attributable incremental costs (net of income taxes)
is deducted from equity attributable to the Company’s equity holders.
(24)Dividends
Dividends are recorded in the Company’s financial statements in the period in which they are
resolved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock
dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shareson the effective date of new shares issuance.

-145-

(25)Revenue recognition
A. Sales of goods(a) The Group manufactures and sells computer software and hardware, computer peripheral
equipment, and computer component products. When the right of control is transferred tothe customer, sales revenue is recognized. Delivery occurs when the products have been
shipped to the specific location, the risks of obsolescence and loss have been transferred tothe customer, and either the customer has accepted the products in accordance with thesales contract, or the Group has objective evidence that all criteria for acceptance have beensatisfied.
(b) Sales revenue is recognized based on contract price, net of sales returns, volume discounts
and estimated sales discounts. The goods are often sold with volume discounts based on
aggregate sales over a one-month period. Sales discounts and allowances are estimated andprovided for based on customer contracts, and revenue is only recognized to the extent that
it is highly probable that a significant reversal will not occur. The estimation is subject to anassessment at each reporting date and recognized as allowance for sales discounts. No
element of financing is deemed present as the sales are made with a credit term of 30-60
days after monthly billing, which is consistent with market practice.
(c) A receivable is recognized when the goods are delivered as this is the point in time that theconsideration is unconditional because only the passage of time is required before thepayment is due.
B. Incremental costs of obtaining a contract
Given that the contractual period lasts less than one year, the Group recognizes the incremental
costs of obtaining a contract as an expense when incurred although the Group expects torecover those costs.
(26)Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to theChief Operating Decision-Maker. The Group’s Chief Operating Decision-Maker, who is
responsible for allocating resources and assessing performance of the operating segments, hasbeen identified as the Chairmen of the Board of Directors that makes strategic decisions.
5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF
ASSUMPTION UNCERTAINTY
The preparation of these consolidated financial statements requires management to make criticaljudgements in applying the Group’s accounting policies and make critical assumptions and estimatesconcerning future events. Assumptions and estimates may differ from the actual results and arecontinually evaluated and adjusted based on historical experience and other factors. Such assumptions
and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year; and the related information is addressed below:-146-

(1)Critical judgements in applying the Group’s accounting policies
Investment property
The Group uses a portion of the property for its own use and another portion to earn rentals or forcapital appreciation. When these portions cannot be sold separately and cannot be leased out
separately under a finance lease, the property is classified as investment property only if the own
use portion accounts for an insignificant portion of the property.
(2)Critical accounting estimates and assumptions
Valuation of inventories
As inventories are stated at the lower of cost and net realizable value, the Group must determine thenet realizable value of inventories on balance sheet date using judgements and estimates. Due to therapid technology innovation, the Group evaluates the amounts of normal inventory consumption,
obsolete inventories or inventories without market selling value on balance sheet date, and writes
down the cost of inventories to the net realizable value. The valuation of inventories is based onrecent market price and demand of products in the future specific period, thus there might besignificant changes in the valuation.
As of December 31, 2021, the carrying amount of inventories was $5,774,825.
6. DETAILS OF SIGNIFICANT ACCOUNTS(1)Cash and cash equivalents
December 31, 2021$
217
1,931,009
86,880$2,018,106

Cash on hand and petty cash
Checking accounts and demand deposits
Time deposits

December 31, 2020$
844
736,008$
736,852

A. The aforementioned time deposits pertain to high liquidity investments with maturity within
three months.
B. 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.
C. The Group has no cash and cash equivalents pledged to others.

-147-

(2)Financial assets at fair value through profit or loss
Items

December 31, 2021

Current items:
Financial assets mandatorily measured atfair value through profit or loss
Beneficiary certificates
Valuation adjustments$$

Non-current items:
Financial assets mandatorily measured atfair value through profit or loss
Beneficiary certificates
Valuation adjustments$$

December 31, 2020

1,501,948 $
4,647
1,506,595 $3,501,229
9,769
3,510,998

100,976 $
10,623
111,599 $611,063
133,859
744,922

A. Amounts recognized in profit or loss in relation to financial assets at fair value through profit orloss are listed below:
Years ended December 31,
2021
2020
Financial assets mandatorily measured at fairvalue through profit or loss
Beneficiary certificates
Financial products
Non-hedging derivatives$$

84,375 $497
84,872 $145,108
859
1,775
147,742

B. The Group has no financial assets at fair value through profit or loss pledged to others.
(3)Financial assets at amortised cost

Items

December 31, 2021

Current items:
Time deposits with original maturity of morethan three months$

December 31, 2020

5,567,177 $

5,659,889

A. Amounts recognized in profit or loss in relation to financial assets at amortised cost are listed
below:

Interest income
Gain on disposal

$
$
-148-

Years ended December 31,
2021
2020
24,813 $65,622
17,21024,813 $82,832

B. The Group has no financial assets at amortised cost pledged to others as collateral.
C. The Group used the forecastability of Taiwan Institute of Economic Research boom observation
report to adjust historical and timely information to assess the default possibility of debt
instruments on December 31, 2021 and 2020, and considered guarantee for repurchaseagreement held by the Group to estimate expected credit loss. The Group does not expect
material credit loss after assessment.
D. The Group transacts time deposits with reputable domestic and foreign banks. The Group’s
counterparties have good credit quality, and the impairment loss is assessed using a 12-month
expected credit loss approach.
(4)Notes and accounts receivable
December 31, 2021
December 31, 2020$
2,499 $
759$
1,623,284 $1,438,764(800) (
4,310)$
1,622,484 $1,434,454

Notes receivable
Accounts receivable
Less: Loss allowance

A. As of December 31, 2021 and 2020, the estimated sales discounts and allowances were $63,361
and $93,140, respectively. Since the sales discounts and allowances met the requirements foroffset of financial liabilities and financial assets, the net amounts were shown under accounts
receivable.
B. The ageing analysis of accounts receivable and notes receivable is as follows:

December 31, 2021
Accounts receivable
Notes receivable$
1,347,477 $
2,499
258,288
11,418406
5,695$
1,623,284 $2,499

Not past due
Up to 30 days
31 to 90 days
91 to 180 days
Over 180 days

December 31, 2020
Accounts receivable
Notes receivable$
1,177,490 $
759
237,151
8,835
406
14,882$
1,438,764 $759

Not past due
Up to 30 days
31 to 90 days
91 to 180 days
Over 180 days

-149-

The above ageing analysis was based on past due date.
C. The Group has credit insurance that covers accounts receivable from major customers. Should
bad debts occur, the Group will receive 90% of the losses resulting from non-payment.
D. As of December 31, 2021 and 2020, notes receivable and accounts receivable were all fromcontracts with customers. As of January 1, 2020, the balance of notes receivable and accounts
receivable from contracts with customers amounted to $1,487,056.
E. As at December 31, 2021 and 2020, without taking into account any collateral held or othercredit enhancements, the maximum exposure to credit risk in respect of the amount that best
represents the Group’s notes receivable were $2,499 and $759, respectively; the maximum
exposure to credit risk in respect of the amount that best represents the Group’s accounts
receivable were $1,622,484 and $1,434,454, respectively.
F. The Group classifies customers’ accounts receivable in accordance with the credit rating of thecustomer. The Group applies the simplified approach to estimate expected credit loss under theprovision matrix basis.
G. The Group wrote-off the financial assets, which cannot reasonably be expected to be recovered,after initiating recourse procedures. However, the Group will continue executing the recourse
procedures to secure their rights. On December 31, 2021 and 2020, the Group has no written-off
financial assets that are still under recourse procedures.
H. The Group used forecastability, historical and timely information to assess the loss rate ofaccounts receivable. On December 31, 2021 and 2020, the provision matrix is as follows:Notpast due
December 31, 2021
Expected loss rate
Total book value

0.002%~0.496% 0.015%~36%$
1,347,477 $
270,112Not
past due

December 31, 2020
Expected loss rate
Total book value

1-180 days
past due1-180 days
past due

0.003%~0.386% 0.018%~41%$
1,177,490 $
246,392-150-

Over 180 days
past due
25%~100%
$
5,695

Total

$

Over 180 days
past due
25%~100%$
14,882

1,623,284

Total

$

1,438,764

I. The balance of allowance for loss and movements are as follows:

At January 1
Provision for impairment
Write-offs
Reclassified to overdue receivables
Effect of exchange rate changes
At December 31

2021
Accounts receivable
Notes receivable$
4,310 $
567
(
903)
(
3,132)
(
42)
$
800 $
-

At January 1
Provision for impairment
Write-offs
Reclassified to overdue receivables
Reclassified to other income
Effect of exchange rate changes
At December 31

2020
Accounts receivable
Notes receivable$
5,471 $
893
(
616)
(
178)
(
1,134)(
126)$
4,310 $-

J. The Group does not hold any collateral as security.
(5)Inventories

Raw materials
Work in progress
Finished goods$$

Raw materials
Work in progress
Finished goods$$

December 31, 2021
Allowance for
Costvaluation loss
4,555,175 ($
48,311) $604,979 (438)
667,191 (
3,771)
5,827,345 ($
52,520) $Book value
4,506,864
604,541
663,420
5,774,825

December 31, 2020
Allowance for
Costvaluation loss
2,161,744 ($
28,593) $487,023 (1,023)
576,861 (5,546)
3,225,628 ($35,162) $Book value
2,133,151
486,000
571,315
3,190,466-151-

A. The cost of inventories recognized as expense for the year:
Years ended December 31,
2021
2020
Cost of goods sold
Loss on decline in market value of inventory$$

10,121,771
17,358
10,139,129$$

8,970,221
6,379
8,976,600

B. No inventories were pledged to others.
(6)Non-current assets held for sale
December 31, 2021$
143,596
16,380$159,976

Buildings and structures held for sale
Right-of-use assets held for sale - land

December 31, 2020$$-

A. On November 26, 2021, the Board of Directors of the Group’s overseas second-tier subsidiary,Transcend Information (Shanghai), Ltd., resolved to sell its buildings in response to the land
expropriation and the related assets were transferred to non-current assets held for sale. Refer toNote 11 for related transactions.
B. The carrying amount of non-current assets held for sale was lower than the fair value less costs
to sell based on the assessment. Thus, no impairment has occurred.
(7)Non-current financial assets at fair value through other comprehensive income

Items

December 31, 2021

Non-current items:
Equity instruments
Listed stocks
Others$Valuation adjustments$

December 31, 2020

621,034 $
1,125
622,159
7,417
629,576 $

105,480
1,125
106,605
4,395
111,000

A. The Group has elected to classify equity investments that are considered to be strategic
investments as financial assets at fair value through other comprehensive income. The fair valueof such investments amounted to $629,576 and $111,000 as at December 31, 2021 and 2020,
respectively.
B. For the year ended December 31, 2021, the Group disposed equity investments whose fair value
was $54,426, and the cumulative gain on disposal was transferred to retained earnings in theamount of $8,804. There was no such transaction for the year ended December 31, 2020.

-152-

C. Amounts recognized in profit or loss and other comprehensive income in relation to the financial
assets at fair value through other comprehensive income are listed below:
Years ended December 31,
2021
2020
Equity instruments at fair value throughother comprehensive income
Fair value change recognized in othercomprehensive income (loss)
Cumulative gain reclassified to retained
earnings due to derecognition$

11,826 ($

$

8,804

$

-

Dividend income recognized in profit or loss
Held at end of year
Derecognized during the year$

6,787 $
6,787 $

3,834
3,834

$

3,164)

D. The Group has no financial assets at fair value through other comprehensive income pledged toothers as collateral.
(8)Investments accounted for using equity method
Investee Company

December 31, 2021$
148,514

Taiwan IC Packaging Corp.

December 31, 2020$
95,724

A. The basic information of the associate that is material to the Group is as follows:

AssociatenameTaiwan IC
Packaging Corp.

Principal
place ofbusiness
TaiwanShareholding ratio
December
December31, 2021
31, 2020
12.52%
12.74%Nature ofrelationship
Note

Method ofmeasurement
Equity method

Note: Taiwan IC Packaging Corp. is engaged in IC packaging and testing and is the upstream
supplier in the IT and semiconductor industries. In order to reach synergy of vertical
integration, Taiwan IC Packaging Corp. processes the raw materials provided by theGroup into relevant semi-finished goods.
B. The Group held a 12.52% equity interest in Taiwan IC Packaging Corp., and is the company’s
largest single shareholder. However, the Group does not hold the majority of the voting power
during the shareholders’ meeting of Taiwan IC Packaging Corp. and the Group has no seat in the
Board of Directors of Taiwan IC Packaging Corp., which indicate that the Group has no control
ability to direct the relevant activities of Taiwan IC Packaging Corp. In addition, the Company’schairman is the same with Taiwan IC Packaging Corp.; hence, the Group has significant
influence over Taiwan IC Packaging Corp.
-153-

C. The summarized financial information of the associate that is material to the Group is asfollows:
Balance sheet
Taiwan IC Packaging Corp.
December 31, 2021
December 31, 2020$
1,408,762 $
942,5071,219,160
1,224,429(
374,580) (327,211)(83,523) (85,765)$2,169,819 $
1,753,960

Current assets
Non-current assets
Current liabilities
Non-current liabilities
Total net assets
Share in associate’s net assets
Net equity differences$($

271,661 $
123,147) (148,514 $

223,480
127,756)
95,724

Statement of comprehensive income

A
Revenue
Gain (loss) for the year from continuing
operations
Total comprehensive income (loss)
Dividends received from associates

$
$
$
$

Taiwan IC Packaging Corp.
Years ended December 31,
2021
2020
1,944,950 $
1,210,125
411,645 ($
409,917 ($- $11,040)9,466)-

D. Share of profit (loss) of associates accounted for using the equity method is as follows:

Investee Company
Taiwan IC Packaging Corp.

$

Years ended December 31,
2021
2020
52,590 ($1,299)

E. The Group’s investment in Taiwan IC Packaging Corporation has quoted market price. The fairvalue of Taiwan IC Packaging Corporation was $446,724 and $239,053 as of December 31,
2021 and 2020, respectively.

-154-

(9)Property, plant and equipment
2021
Land
At January 1
Cost
Accumulated depreciation$$

Opening net book amount as at January 1 $Additions (including transfers)
Disposals
Transfers to non-current assets held forsale
Depreciation charge
Net exchange differences(
Closing net book amount as at$
December 31
At December 31
Cost
Accumulated depreciation$$

Buildings andstructures
Machinery

VehiclesOfficeequipment

OthersTotal

725,983 $ 2,601,967 $- ( 1,257,196) (725,983 $ 1,344,771 $

418,357 $
243,085) (175,272 $

26,892 $12,767) (14,125 $28,116 $21,134) (6,982 $

52,518 $ 3,853,833
37,327) ( 1,571,509)
15,191 $ 2,282,324

725,983 $ 1,344,771 $
500-

175,272 $
2,710-

14,125 $1,216- (6,982 $
7,731
8)

15,191 $ 2,282,324
3,177
15,334
- (
8)

- (
- (
13,847) (143,596)
106,069) (14,457) (63,254) (57) (4,328) (69) (3,490) (364) (- (6,085) (21) (712,136 $ 1,081,149 $

114,671 $

10,944 $10,851$

12,262 $ 1,942,013

712,136 $ 2,227,274 $- ( 1,146,125) (712,136 $ 1,081,149 $383,459 $268,788) (114,671 $

27,859 $16,915) (10,944 $32,077 $21,226) (10,851 $48,096 $ 3,430,901
35,834) ( 1,488,888)
12,262 $ 1,942,013-155-

143,596)
183,226)
28,815)2020
Land
At January 1
Cost
Accumulated depreciation

At December 31
Cost
Accumulated depreciation

VehiclesMachinery

Officeequipment

OthersTotal

727,072 $ 2,582,168 $- ( 1,144,423) (727,072 $ 1,437,745 $

479,560 $
245,826) (233,734 $

25,696 $
8,675) (17,021 $

30,700 $23,730) (6,970 $

58,042 $ 3,903,238
42,430) ( 1,465,084)
15,612 $ 2,438,154(

727,072 $ 1,437,745 $
5,830
- (
105,764) (- (6,960 (
1,089)

233,734 $
13,616
2,098)
69,921) (59) (17,021 $
1,348
4,197) (47)

6,970 $
2,396
2,464) (80

15,612 $ 2,438,154
29,7006,510
2,098)- (189,314)
6,968) (
5,882
37

$

725,983$

725,983 $ 2,601,967 $- ( 1,257,196) (725,983 $ 1,344,771 $$$Opening net book amount as at January 1
Additions (including transfers)
Disposals
Depreciation charge
Net exchange differences
Closing net book amount as at
December 31

Buildings andstructures$$$ 1,344,771$

175,272$

418,357 $
243,085) (175,272 $

14,125$26,892 $12,767) (14,125 $6,982

28,116 $21,134) (6,982 $

A. The relevant assets of the Group recognized as property, plant and equipment are all for self-use.
B. Information about the property, plant and equipment that were pledged to others as collateral is provided in Note 8.

-156-

$

15,191$ 2,282,324

52,518 $ 3,853,833
37,327) ( 1,571,509)
15,191 $ 2,282,324

(10)Leasing arrangements-lessee
A. The Group leases various assets including land, buildings, and business vehicles. Rental
contracts are typically made for periods of 1 to 11 years. Lease terms are negotiated on an
individual basis and contain a wide range of different terms and conditions. The leaseagreements do not impose covenants, but leased assets may not be used as security forborrowing purposes.
B. The carrying amounts of right-of-use assets and the depreciation charge are as follows:Land
Buildings
Transportation equipment (business vehicles)

Land
Buildings
Transportation equipment (business vehicles)

December 31, 2021
Carrying amount$
82,013
41,158883$
124,054

December 31, 2020
Carrying amount$
138,189
47,034
1,856$
187,079

Years ended December 31,
2021
2020
Depreciation charge
Depreciation charge$
39,117 $39,08018,23816,045845
726$
58,200 $55,851

C. For the years ended December 31, 2021 and 2020, the additions to right-of-use assets were
$15,494 and $1,200, respectively.
D. Information on profit or loss in relation to lease contracts is as follows:
Years ended December 31,
2021
2020
Items affecting profit or loss
Interest expense on lease liabilities
Expense on short-term lease contracts
Expense on leases of low-value assets

$

1,248
8,534
1,455

$

2,038
11,514
1,510

E. For the years ended December 31, 2021 and 2020, the Group’s total cash outflow for leases
were $66,094 and $67,483, respectively.
F. On November 26, 2021, the Board of Directors of the Group’s overseas second-tier subsidiary,Transcend Information (Shanghai), Ltd., approved a resolution on land expropriation. Refer toNote 6(6) for details of right-of-use assets transferred to non-current assets held for sale, and-157-

Note 11 for related transactions.
(11)Leasing arrangements-lessor
A. The Group leases various assets including land and buildings. Rental contracts are typicallymade for periods of 1 to 3 years. Lease terms are negotiated on an individual basis and containa wide range of different terms and conditions. To protect the lessor’s ownership rights on theleased assets, leased assets may not be used as security for borrowing purposes.
B. For the years ended December 31, 2021 and 2020, the Group recognized rent income in theamount of $37,253 and $38,721, respectively, based on the operating lease agreement, which
does not include variable lease payments.
C. The maturity analysis of the lease payments under the operating leases is as follows:
December 31, 2021
2022 $
38,9252023
26,7572024
16,806
2025
9,406
9,406
2026
$
101,300

December 31, 20202021 $
23,725
2022
3,900
2023
400
2024
2025
$
28,025-158-

(12)Investment property
2021
Buildings andstructuresLand
At January 1
Cost
Accumulated depreciation$

2,268,726 $- (2,268,726 $

459,716 $116,016) (343,700 $2,728,442
116,016)
2,612,426$

2,268,726 $- (- (343,700 $2,409
12,380) (367) (

2,612,426
2,409
12,380)367)$

2,268,726

333,362$

2,602,088$

2,268,726 $- (2,268,726 $

461,381 $128,019) (333,362 $2,730,107
128,019)2,602,088$
Opening net book amount as atJanuary 1
Additions (including transfers)
Depreciation charge
Net exchange differences
Closing net book amount as at
December 31
At December 31
Cost
Accumulated depreciation

Total

$

-159-

$

2020
Buildings andstructuresLand
At January 1
Cost
Accumulated depreciation$

2,268,726 $- (2,268,726 $

446,392 $
104,826) (341,566 $2,715,118
104,826)
2,610,292$

2,268,726 $- (-341,566 $13,498
12,107) (743

2,610,292
13,498
12,107)743$

2,268,726

343,700$

2,612,426$

2,268,726 $- (2,268,726 $

459,716 $116,016) (343,700 $2,728,442
116,016)
2,612,426$
Opening net book amount as atJanuary 1
Additions (including transfers)
Depreciation charge
Net exchange differences
Closing net book amount as at
December 31
At December 31
Cost
Accumulated depreciation

Total

$

$

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

Rental income from investment property
Direct operating expenses arising frominvestment property that generated rental
incomeDirect operating expenses arising frominvestment property that did not generaterental income$

Years ended December 31,
2021
2020
37,253 $38,721$

11,679$11,399

$

701

$

708

B. The fair value of the investment property held by the Group was $5,702,362 and $5,380,484 asof December 31, 2021 and 2020, respectively, which was based on the transaction prices ofsimilar properties in the same area.
C. No investment property was pledged to others.

-160-

(13)Other non-current assets

Guarantee deposits paid
Prepayment for business facilities
Others

December 31, 2021

December 31, 2020

$

$

$

31,414
12,416
15,51559,345$32,823
14,58847,411(14)Pensions
A. Defined benefit plan(a) The Company has 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 tocontinue to be subject to the pension mechanism under the Act. Under the defined benefit
plan, two units are accrued for each year of service for the first 15 years and one unit foreach 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 thelast 6 months prior to retirement. The Company contributes monthly an amount equal to 2%of the employees’ monthly salaries and wages to the retirement fund deposited with the
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 thepension calculated by the aforementioned method to the employees expected to qualify for
retirement in the following year, the Company will make contributions to cover the deficit
by next March.
(b) The amounts recognized in the balance sheet are as follows:
December 31, 2021
December 31, 2020
Present value of defined benefit obligations $38,857 $43,239(25,454) (26,678)Fair value of plan assets$
13,403 $16,561
Net defined benefit liability-161-

(c) Movements in net defined benefit liabilities are as follows:
Present value of
defined benefit
obligations
2021
Balance at January 1
Current service cost
Interest expense (income)Remeasurements:
Return on plan assets(excluding amounts included
in interest income or expense)
Change in demographic
assumptions
Change in financial
assumptions
Experience adjustments
Pension fund contribution
Paid pension
Balance at December 31$

43,239 ($608
151 (43,998 (26,678) $96)
26,774)

16,561608
55
17,224- (369) (

369)

1,941

-

1,941

(

1,836)- (1,836)((

2,080)
1,975) (- (369) (

2,080)
2,344)($- (3,166)
38,857 ($1,477) (3,166
25,454) $1,477)
13,403Present value of
defined benefit
obligations
2020
Balance at January 1
Current service cost
Interest expense (income)$Remeasurements:
Return on plan assets(excluding amounts included
in interest income or expense)
Change in demographic
assumptions
Change in financial
assumptions
Experience adjustments
Pension fund contribution
Paid pension
Balance at December 31

Net defined
benefitliability

Fair value ofplan assets($

Net defined
benefitliability

Fair value ofplan assets

40,765 ($431
326 (41,522 (24,411) $200)
24,611)

16,354431
126
16,911- (802) (

802)

105

-

105

527

-

527

1,242
1,874 (

802)

1,242
1,072

- (
157)
43,239 ($1,422) (157
26,678) $1,422)
16,561(d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined-162-benefit pension plan in accordance with the Fund’s annual investment and utilisation planand the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor
Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit indomestic or foreign financial institutions, investment in domestic or foreign listed,over-the-counter, or private placement equity securities, investment in domestic or foreign
real estate securitisation products, etc.). With regard to the utilisation of the Fund, its
minimum earnings in the annual distributions on the final financial statements shall be noless than the earnings attainable from the amounts accrued from two-year time deposits
with the interest rates offered by local banks. If the earnings is less than aforementioned
rates, government shall make payment for the deficit after being authorised by theRegulator. The Company has no right to participate in managing and operating that fundand hence the Company is unable to disclose the classification of plan assets fair value inaccordance with IAS 19 paragraph 142. The composition of fair value of plan assets as ofDecember 31, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilisation
Report announced by the government.
(e) The principal actuarial assumptions used were as follows:

Years ended December 31,
2021
2020
0.750%
0.350%
1.625%
1.625%

Discount rate
Future salary increases

Future mortality rate was estimated based on the 6th Taiwan Standard Ordinary Experience
Mortality Table.
Because the main actuarial assumption changed, the present value of defined benefit
obligation is affected. The analysis was as follows:

Discount rate
Increase
Decrease
0.25%
0.25%
December 31, 2021
Effect on present value of
defined benefit obligation
December 31, 2020
Effect on present value of
defined benefit obligation

Future salary increases
Increase
Decrease
0.25%
0.25%

($

1,158) $1,208 $

1,170 ($

1,127)($

1,306) $1,364 $

1,315 ($

1,267)The sensitivity analysis above is based on one assumption which changed while the otherconditions remain unchanged. In practice, more than one assumption may change all at-163-

once. The method of analysing sensitivity and the method of calculating net pension
liability in the balance sheet are the same.
The methods and types of assumptions used in preparing the sensitivity analysis did notchange compared to the previous period.
(f) Expected contributions to the defined benefit pension plan of the Company for the year
ending December 31, 2021 amount to $1,474.
(g) As of December 31, 2021, the weighted average duration of the retirement plan is 12.4
years.
B. Defined contribution plans(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 employeeswith R.O.C. nationality. Under the New Plan, the Company contributes monthly an amountbased on 6% of the employees’ monthly salaries and wages to the employees’ individual
pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly
or in lump sum upon termination of employment.
(b) Transcend Shanghai, Transtech Shanghai and Transcend Hong Kong have defined
contribution plans. Monthly contributions to an independent fund administered by thegovernment in accordance with the pension regulations in the People’s Republic of China(PRC) are based on a certain percentage of employees' monthly salaries and wages, ranging
from 12.5% to 20%. Other than the monthly contributions, the Group has no further
obligations.
(c) Transcend Japan, Transcend Korea, Transcend USA, Transcend Europe and Transcend
Germany have defined contribution plans. Monthly contributions are based on a certain
percentage of employees’ monthly salaries and wages and are recognized as pension costs
accordingly. Other than the monthly contributions, the Group has no further obligations.
(d) The pension costs under the defined contribution pension plans of the Group for the years
ended December 31, 2021 and 2020 were $41,055 and $41,061, respectively.
(15)Share capital
A. As of December 31, 2021, the Company’s authorized capital was $5,000,000, consisting of 500
million shares of ordinary stock (including 25 million shares reserved for employee stock
options), and the paid-in capital was $4,290,617 with par value of $10 per share. All proceedsfrom shares issued have been collected.
Movements in the number of the Company’s ordinary shares (shares in thousands) outstanding-164-are as follows:
2021
429,062- (429,062

At January 1
Purchase of treasury shares (retired)At December 31

2020
429,248
186)
429,062

B. Treasury shares(a) To enhance the Company’s credit rating and stockholders’ equity, on November 7, 2019, theBoard of Directors resolved to repurchase and retire 3 million ordinary shares. The
repurchase period is from November 8, 2019 to January 7, 2020, and the price ranged
between $49 and $97 (in dollars) per share. The details are as follows:

Name of company
holding the shares
Reason for reacquisition
The Company
Enhance the Company’s
credit rating andstockholders’ equity

Numbers of shares(in thousands)
Carrying amount
1,700 $
130,621On March 5, 2020, the Board of Directors during its meeting resolved to retire treasury
shares for capital reduction with the effective date set on March 31, 2020. The registration
was completed on April 15, 2020.
(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 andoutstanding shares and the amount bought back should not exceed the sum of retained
earnings, paid-in capital in excess of par value and realized 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 to enhance theCompany’s credit rating and the stockholders’ equity should be retired within six months ofacquisition.
(16)Capital surplus
Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of parvalue on issuance of common stocks and donations can be used to cover accumulated deficit or toissue new stocks or cash to shareholders in proportion to their share ownership, provided that theCompany has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requiresthat the amount of capital surplus to be capitalized mentioned above should not exceed 10% of thepaid-in capital each year. Capital surplus shall not be used to cover accumulated deficit unless the-165-

legal reserve is insufficient.
(17)Retained earnings
A. In accordance with the Company’s Articles of Incorporation, the current year’s earnings, if any,
shall first be used to pay all taxes and to offset prior years’ operating losses and then 10% of
the remaining amount shall be set aside as legal reserve. The Company shall also set aside
special reserve in accordance with the regulations. On the premise that there is no effect on the
Company’s normal operations and no violation of regulations, the Company shall reserve
certain amount for maintaining stability of dividends. The remainder, if any, is the distributableearnings to be appropriated as resolved by stockholders at the stockholders’ meeting. The
Board of Directors is authorized by the shareholders to resolve the appropriation of cash
dividends and cash payment from capital surplus by a resolution adopted by a majority vote atits meeting attended by two-thirds of the total number of directors, which will then be reported
to the shareholders.
B. The Company distributes dividends taking into consideration the Company’s economic
environment, growth phases, future demands for funds, long-term financial planning and the
cash flow needs of stockholders. Cash dividends shall account for at least 5% of the total
dividends distributed.
C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders inproportion 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 theirshare 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. 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 includedin the distributable earnings.
E. (a) The cash appropriation of earnings and cash payment from capital surplus for the years
ended December 31, 2020 and 2019 have been resolved at the shareholders’ meeting on
August 26, 2021 and June 19, 2020, respectively. Details are summarized below:-166-

Year ended December 31, 2020
Year ended December 31, 2019
Dividends per
Dividends per
Amountshare (in dollars)
Amountshare (in dollars)$
119,625$
172,897

Legal reserve(Reversal of) special(
reserve
Cash dividends$

13,658)1,094,107 $
1,200,074$$

Cash payment
per share(in dollars)

AmountCash payment from
capital surplus

2.55

214,531 $0.50 $

69,3301,544,622
1,786,849$

3.60

Cash payment
per share(in dollars)

Amount386,156$

0.90

Actual distribution of retained earnings for 2020 and 2019 was in agreement with theamounts resolved at the stockholders’ meeting.
(b) The appropriations of earnings and capital surplus for the year ended December 31, 2021 asproposed by the Board of Directors on March 3, 2022 are as follows:

Legal reserve
Special reserve
Cash dividends
Total

$

$

$

Cash payment from capital surplus

Year ended December 31, 2021
Dividends per share
Amount(in dollars)
254,464
73,2702,231,121 $5.20
2,558,855

Amount343,249

Cash dividends
per share (in dollars)$

0.80

Aforementioned proposal for the appropriations of 2021 earnings and capital surplus have
not yet been resolved by the stockholders.

-167-

(18)Other equity items

At January 1
Revaluation - gross
Revaluation transferred toretained earnings - grossCurrency translationdifferences
Effect from income tax
At December 31$

2021
Exchangedifferences
Unrealized
on translation ofgain or loss
foreign financial
on valuation
statements
4,395 ($
121,639) ($11,826-(8,804)$- (7,417 ($

-168-

Total
117,244)
11,826- (8,804)

95,365) (19,072
197,932) ($95,365)
19,072
190,515)

At January 1
Revaluation - grossCurrency translationdifferences
Effect from income tax
At December 31

$
(

2020
Exchangedifferences
Unrealized
on translation ofgain or loss
foreign financial
on valuation
statements
7,559 ($
138,461) ($3,164)- (- (4,395 ($$

21,027
4,205) (121,639) ($Total
130,902)3,164)
21,027
4,205)
117,244)(19)Operating revenue$

Sales revenue

Years ended December 31,
2021
2020
14,314,815 $
11,446,696

A. Disaggregation of revenue from contracts with customers
The Group derives revenue from the transfer of goods at a point in time in the following
geographical regions:Year ended
December 31, 2021
Revenue from externalcustomer contracts

Year ended
December 31, 2020
Revenue from externalcustomer contracts

Electronic products
America
EuropeTaiwanAsia$ 3,400,049$ 5,221,283

TaiwanAsia$ 2,521,695$ 4,075,807$ 1,759,042$ 3,155,301

Others$Electronic products
America
Europe$ 1,163,131$ 2,822,582

779,140

Others$863,481

Total$ 14,314,815

Total$ 11,446,696

B. The delay of the Group’s sales orders has a knock-on effect on the overall revenue due to
Covid-19 in the first half of 2020. However, there is no significant impact to the scope andprice of the service contracts as the Group negotiated with customers and continuously invests
in the manufacture of products for the subsequent shipments.
C. Contract assets and liabilities
The Group has no revenue-related contract assets and liabilities.

-169-

(20)Interest income

Interest income from bank deposits
Interest income from financial assets measured
at amortised cost
Other interest income$$

Years ended December 31,
2021
2020
1,467 $
24,813
52,837
79,117 $

3,114
65,622
5,216
73,952(21)Other income$

Rental income

Years ended December 31,
2021
2020
37,253 $38,721(22)Other gains and losses
Years ended December 31,
2021
2020
Gain (loss) on disposal of property, plant andequipment
Net currency exchange loss
Net gain on financial assets and liabilities at fairvalue through profit or loss
Dividend income
Royalty refund
Others$(12 ($14,506) (2,098)
54,016)($84,872
6,787
8,017)
69,148 $

147,742
3,834
62,738
5,699
163,899(23)Expenses by nature

Wages and salaries
Labor and health insurance fees
Pension costs
Other personnel expenses
Depreciation on property, plant and equipment(including investment property and right-of-use
assets)-170-$

Years ended December 31,
2021
2020
1,167,733 $
1,104,801
122,002114,392
41,71841,61853,91053,914

253,806

257,272

A. In accordance with the Articles of Incorporation of the Company, a ratio of distributable profitof the current year, after covering accumulated losses, shall be distributed as employees’
compensation and directors’ remuneration. The ratio shall not be lower than 1% for employees’
compensation and shall not be higher than 0.2% for directors’ and supervisors’ remuneration.
B. For the years ended December 31, 2021 and 2020, employees’ compensation was accrued at$32,691 and $15,225, respectively; while directors’ remuneration was accrued at $4,577 and$2,131, respectively. The aforementioned amounts were recognized in salary expenses.
The employees’ compensation and directors’ remuneration were estimated and accrued basedon 1% and 0.2% of distributable profit of current period for the year ended December 31, 2021.
The employees’ compensation and directors’ remuneration resolved by the Board of Directors
were $31,542 and $3,200, respectively, and the employees’ compensation will be distributed in
the form of cash.
The difference between employees’ compensation and directors’ remuneration as resolved by
the Board of Directors and the amounts recognized in the 2020 financial statements by $438
and $29, respectively, has been adjusted in profit or loss for 2021.
Information about employees’ compensation and directors’ remuneration of the Company asapproved at the meeting of Board of Directors and resolved by the stockholders at their meeting
will be posted in the “Market Observation Post System” at the website of the Taiwan Stock
Exchange.
(24)Income tax
A. Income tax expense(a) Components of income tax expense:

Years ended December 31,
2021
2020

A
Current tax:
Current tax on profits for the year
Prior year income tax (overestimation)
underestimation
Total current tax
Deferred tax:
Origination and reversal of temporary
differences
Total deferred tax
Income tax expense$

603,473(

10,386)
593,087

28,866290,246

2,273
2,273
595,360 $

14,40014,400304,646$$

261,380(b) The income tax relating to components of other comprehensive income is as follows:-171-Years ended December 31,
2021
2020
Exchange differences on translation offoreign financial statements($

19,072) $4,205

B. Reconciliation between income tax expense and accounting profit

Income tax calculated by applying statutory
rate to the profit before tax
Effects from tax exemption and items
disallowed by tax regulation
Prior year income tax (overestimation)
underestimation
Effect from investment tax credits
Income tax expense$

Years ended December 31,
2021
2020
640,025 $
296,358(

33,620) (19,985)(($

10,386)659) (
595,360 $

28,866593)
304,646

C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:

At January 1
Deferred income tax assets
Amount of allowance for bad debts
that exceed the limit for tax purpose
Pension provision amount in excess
of appropriation amountRoyalty fees
Accrued hard drive recycling fees
Unused compensated absences
Unrealized sales discounts andallowances
Unrealized gross profit from sales
Unrealized loss on market value
decline and obsolete andslow-moving inventories
Currency translation differences
Others
Total

$

$

2021
Recognized inothercomprehensive
Recognized in
profit or loss
incomeAt December 31

2,282 ($

1,932) $-5,137 (
4,342 (
1,336 (

163)
2,171)
1,794
171)

-

4,974
2,171
1,794
1,165

16,108 (2,692 (

6,572)
540)

-

9,536
2,152

7,092
2,483
41,472 ($

3,470
1,103
5,182) $11,065
11,065

10,562
11,065
3,586
47,355

-172-

$

$

350

At January 1
Deferred income tax liabilities
Unrealized exchange gain
Currency translation differences
Net gain on investment accounted forusing equity method
OthersTotal($(

2,774) $8,007)

1,845
-

(
(
($

128,821)98)
139,700) $

1,059
5
2,909

At January 1
Deferred income tax assets
Amount of allowance for bad debts
that exceed the limit for tax purpose
Unrealized exchange loss
Pension provision amount in excess
of appropriation amountRoyalty fees
Unused compensated absences
Unrealized sales discounts andallowances
Unrealized gross profit from sales
Unrealized loss on market value
decline and obsolete andslow-moving inventories
Others
Total
Deferred income tax liabilities
Unrealized exchange gain
Currency translation differences
Net gain on investment accounted
for using equity method
OthersTotal

2021
Recognized inothercomprehensive
Recognized in
profit or loss
income$2,740 ($$$At December 31

($
8,007

929)
-

(
(
8,007 ($

127,762)93)
128,784)

2020
Recognized inothercomprehensive
Recognized in
profit or loss
income458) $At December 31
-

$

2,282

30,166 (30,166)--

5,310 (
2,025 (

173)
4,342
689)

-

5,137
4,342
1,336

19,982 (
6,138 (

3,874)
3,446)-

16,108
2,692

$

5,805
3,693 (
75,859 ($1,287
1,210)
34,387) $

-

$

7,092
2,483
41,472$((- ($3,802)
151,574)

2,774) $(22,753- ($4,205) (- (2,774)
8,007)
128,821)

(
($

106)
155,482) $8
19,987 ($- (4,205) ($98)
139,700)

D. The Company’s income tax returns through 2019 have been assessed and approved by the Tax
Authority.

-173-

(25)Earnings per share
Year ended December 31, 2021
Weighted-averagecommon shares
Earnings
outstanding
per share
Profit after tax(in thousands)(in dollars)
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
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all
dilutive potential ordinary
shares$2,533,294

429,062$2,533,294

429,062-485

2,533,294

429,547

$

$

5.90

$

5.90

Year ended December 31, 2020
Weighted-averagecommon shares
Earnings
outstanding
per share
Profit after tax(in thousands)(in dollars)
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
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all
dilutive potential ordinary
shares$1,197,735

429,064$

1,197,735

429,064-366

1,197,735

429,430

$

-174-

$

2.79

$

2.79

7. RELATED PARTY TRANSACTIONS(1)Names of related parties and relationshipNames of related parties
Taiwan IC Packaging Corporation
Won Chin Investment Inc. (Won Chin)
Cheng Chuan Technology Development Inc.
(Cheng Chuan)

Relationship with the Group
Associate accounted for using equity method
Other related party
Other related party(2)Significant transactions and balances with related parties
A. Operating revenue
Years ended December 31,
2021
2020
Sales of goods
Associates accounted for using the equity
method

$

1,393

$

2,016

The sales prices charged to related parties are approximate to those charged to third parties. The
credit term to Taiwan IC Packaging Corporation is 30 days after receipt of goods. The credit
term to third parties is 30 to 60 days after monthly billings.
B. Purchases
Years ended December 31,
2021
2020
Purchases of goods
Associates accounted for using the equity
method$235,161$

231,335

The purchase prices charged by related parties are approximate to those charged by third parties.
The payment term from Taiwan IC Packaging Corporation is 30 days after monthly billings. The
payment term from third parties is 30 to 45 days after monthly billings.
C. Payables to related parties
December 31, 2021

December 31, 2020$$

Accounts payable:
Associates accounted for using equity method

52,241

37,416

The payables to related parties arise mainly from purchase transactions and are due 30 days after
the date of purchase. The payables bear no interest.
-175-

D. Leasing arrangements - lessee
The Company signed a land lease contract with its related party, Won Chin and Cheng Chuan, tobuild a new plant on the leased land with a lease term of 3 years from June 12, 2019 to June 11,2022. The annual rental payment is $37,058 (excluding tax), which was determined based on the
average rent of land near the leased land shown in the appraisal report issued by Sinyi Real
Estate Appraisers Firm. Rent was paid on the contract date and becomes payable on the samedate each following year until the end of the lease. As of December 31, 2021 and 2020, thebalance of related right-of-use assets amounted to $15,263 and $51,893 while lease liabilities
amounted to $0 and $36,815, respectively.
(3)Key management compensation$

Salaries and other employee benefits

Years ended December 31,
2021
2020
44,300 $35,811

8. PLEDGED ASSETSThe Group’s assets pledged as collateral are as follows:

Pledged assets
Property, plant andequipment

Book value
December 31, 2021
December 31, 2020$
127,675 $
148,671

Pledge purpose
Collateral for general credit
limit granted by financial
institutions

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACTCOMMITMENTS
As of December 31, 2021, except for the provision of endorsements and guarantees mentioned in Note13(1) B, there are no other significant commitments.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
(1) Information on distribution of 2021 earnings and cash dividends from capital surplus is provided
in Note 6(17) E(b).
(2) To cooperate with the government’s expropriation policy, the Group’s second-tier subsidiary,Transcend Information (Shanghai), Ltd., entered into a compensation agreement with Shanghai-176-

Minhang Export Processing Zone Development Co., Ltd. on November 26, 2021 with respect toland use right and buildings for staff dormitory in Fengxian District, Shanghai (shown as
non-current assets held for sale of $159,976). The compensation amounted to RMB 125 million.
As of March 3, 2022, 90% of the compensation has been collected, and the remaining 10% will becollected after the transfer is completed.
(3) On February 18, 2022, the Board of Directors of the Group’s second-tier subsidiary, Transcend
Information (Shanghai), Ltd., approved to sell land use right and factory buildings in Fengxian
District, Shanghai to Shanghai Fengpu Construction Development Co., Ltd. The contract price is
expected to be RMB 392 million.
12. OTHERS(1)Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue asa going concern in order to provide returns for shareholders and to maintain an optimal capital
structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group
may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue newshares or sell assets to reduce debt. The Group’s own funds are currently sufficient, daily
operations can create stable cash inflows, and there are no significant capital expenditure plans inthe short term. Except for obtaining loans to reduce the exchange rate exposure, the Group has
sufficient funds to cover its own needs. Debt financing is not necessary.
(2)Financial instruments
A. Financial instruments by category

Financial assets
Financial assets mandatorily measured atfair value through profit or loss
Financial assets at fair value through othercomprehensive income
Financial assets at amortised cost
Cash and cash equivalents
Financial assets at amortised cost
Notes receivable
Accounts receivable (including relatedparties)
Other receivables
Refundable deposits

December 31, 2021

December 31, 2020

$

$

$
-177-

1,618,194

4,255,920

629,576

111,000

2,018,106
5,567,177
2,499

736,852
5,659,889
759

1,622,484
108,850
31,414
11,598,300

1,434,454
71,351
32,823
12,303,048$

Financial liabilities
Accounts payable (including related parties)

December 31, 2021

December 31, 2020$$

Other payables

1,417,076
286,168

Lease liabilities

1,171,682
246,635$

1,703,244$

1,418,317$

42,950$85,715

B. Financial risk management policies
Risk management is carried out by a central treasury department (Group treasury) underpolicies approved by the Board of Directors. Group treasury identifies, evaluates and hedges
financial risks in close cooperation with the Group’s operating units. The Board provides
written principles for overall risk management, as well as written policies covering specificareas and matters, such as foreign exchange risk, interest rate risk, credit risk, use of derivative
financial instruments and non-derivative financial instruments, and investment of excess
liquidity.
C. Significant financial risks and degrees of financial risks(a) Market risk
Foreign exchange riski.

The Group operates internationally and is exposed to exchange rate risk arising fromthe transactions of the Company and its subsidiaries used in various functional
currency, primarily with respect to the USD. Exchange rate risk arises from futurecommercial transactions and recognized assets and liabilities.

ii.

The Group’s businesses involve some non-functional currency operations (theCompany’s functional currency: NTD; the subsidiaries’ functional currencies: JPY,
KRW, USD, EUR, GBP and RMB, etc.). The information on assets and liabilities
denominated in foreign currencies whose values would be materially affected by theexchange rate fluctuations is as follows:

Financial assets

Financial liabilities

December 31, 2021
Foreign
Foreign Currency
AmountExchange rate
Currency
104,11227.68
USD：NTD $28,2604.344
RMB：NTD
1,492
31.32
EUR：NTD
90,3340.241
JPY：NTD
1,887
1.1909
GBD：EUR
1,712
0.8838
USD：EUR
41,90027.68
USD：NTD $-178-

Book value$ 2,881,820
122,761
46,72921,72570,38547,388$ 1,159,792

Financial assets

Financial liabilities

Foreign
Currency
USD：NTD
EUR：NTDRMB：NTD
JPY：NTD
USD：EUR
USD：HKD
USD：JPY
GBP：EUR
USD：NTD

December 31, 2020
Foreign Currency
AmountExchange rate
Book value$
24,57928.48 $
700,010
3,551
35.02
124,356
9,070
4.377039,699122,026
0.276333,7164,859
0.8132
138,384817
7.753923,268395
103.0764
11,250972
1.110837,811$35,42528.48 $ 1,008,904

The information on total exchange (loss) gain, including realized and unrealized,
arising from significant foreign exchange variation on the monetary items held by theGroup for the years ended December 31, 2021 and 2020 is provided in Note 6(22).
Sensitivity analysis relating to foreign exchange rate risks is primarily for financial
reporting period-end date of foreign currency monetary item. If the New Taiwan dollar
exchange rate to the U.S. dollar increases or decreases by 1%, the Group’s net income
will decrease or increase by $17,220 and $3,089 for the years ended December 31,
2021 and 2020, respectively.
Price riski.

The Group is exposed to equity securities price risk because of investments held by theGroup and classified on the balance sheet as financial assets at fair value through profit
or loss and other comprehensive income. The Group is not exposed to commodity pricerisk. To manage its price risk arising from investments in equity securities, the Group
diversifies its portfolio.

ii.

The Group’s investments in listed and unlisted equity securities and financial
instruments 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 theseequity securities had increased/decreased by 1% with all other variables held constant,post-tax profit for the years ended December 31, 2021 and 2020 would haveincreased/decreased by $16,182 and $42,559, respectively, as a result of gains/losses
on equity securities classified as at fair value through profit or loss. Other componentsof equity would have increased/decreased by $6,296 and $1,110, respectively, as aresult of other comprehensive income classified as equity investment at fair value
through other comprehensive income.
-179-

Cash flow and fair value interest rate riski.

The Group’s principal interest-bearing assets are cash and cash equivalents andfinancial assets at amortised cost. Cash and cash equivalents are due within twelve
months. Financial assets at amortised cost are maintained at fixed rates. Therefore, it isassessed that there is no significant cash flow interest rate risk.

ii.

The Group has not used any financial instruments to hedge its interest rate risk.

(b) Credit riski.

Credit risk refers to the risk of financial loss to the Group arising from default by theclients 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 theagreed terms, and the contract cash flows of debt instruments stated at amortised cost.

ii.

The Group manages its credit risk taking into consideration the entire group’s concern.
According to the Group’s credit policy, each local entity in the Group is responsible formanaging and analyzing the credit risk for each of their new clients before standard
payment and delivery terms and conditions are offered. To control internal risk, theGroup assesses the credit quality of the customers, taking into account their financial
position, past experience and other factors. Individual risk limits are set based oninternal or external ratings in accordance with limits set by the Board of Directors. The
utilisation of credit limits is regularly monitored.

iii. The Group determines that the default occurs when the contract payments are past due
over 180 days.
iv. The Group adopts the following assumptions under IFRS 9 to assess whether there has
been a significant increase in credit risk on that instrument since initial recognition:(i) If the contract payments were past due over 30 days based on the terms, there has
been a significant increase in credit risk on that instrument since initial recognition.
(ii) For investments in bonds that are traded over the counter, if any external credit
rating agency rates these bonds as investment grade, the credit risk of thesefinancial assets is low.
v.

If the credit rating grade of an investment target degrades two scales, there has been asignificant increase in credit risk on that instrument since initial recognition.

vi. The following indicators are used to determine whether the credit impairment of debt
instruments has occurred:(i) It becomes probable that the issuer will enter bankruptcy or other financial-180-

reorganization due to their financial difficulties;(ii) The disappearance of an active market for that financial asset because of financial
difficulties;(iii) Default or delinquency in interest or principal repayments;(iv) Adverse changes in national or regional economic conditions that are expected tocause a default.
vii. For details of credit risk in relation to accounts receivable and notes receivable, pleaserefer to Note 6(4).
(c) Liquidity riski.

Cash flow forecasting is performed in the operating entities of the Group andaggregated by Group treasury. Group treasury monitors rolling forecasts of the Group’s
liquidity requirements to ensure it has sufficient cash to meet operational needs.

ii.

Surplus cash held by the operating entities over and above balance required forworking capital management are transferred to the Group treasury. Group treasury
invests surplus cash in interest bearing current accounts, time deposits, monetary funds
and financial instruments, choosing instruments with appropriate maturities or
sufficient liquidity to provide sufficient headroom as determined by theabovementioned forecasts. As at December 31, 2021 and 2020, the Group held money
market position of $9,091,878 and $9,907,739, respectively, that are expected toreadily generate cash inflows for managing liquidity risk.

iii. The Group’s non-derivative financial liabilities are analysed based on the remaining
period at the balance sheet date to the contractual maturity date and all the Group’s
financial liabilities expire within one year.
(3)Fair value information
A. The different levels that the inputs to valuation techniques are used to measure fair value offinancial and non-financial instruments have been defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that theentity can access at the measurement date. A market is regarded as active where amarket in which transactions for the asset or liability take place with sufficientfrequency and volume to provide pricing information on an ongoing basis. The fairvalue of the Group’s investment in listed stocks and beneficiary certificates is
included in Level 1.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the-181-asset or liability, either directly or indirectly. The fair value of the Group’s
investment in non-hedging derivatives is included in Level 2.
Level 3: Unobservable inputs for the asset or liability. The fair value of the Group’s
investment in equity investment without active market, financial products andinvestment property is included in Level 3.
B. Fair value information of investment property at cost is provided in Note 6(12).
C. Financial instruments not measured at fair value
Except for those listed in the table below, the carrying amounts of cash and cash equivalents,
financial assets at amortised cost, notes receivable, accounts receivable, other receivables,
accounts payable and other payables are approximate to their fair values.
D. The related information on 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 are as
follows:
December 31, 2021
AssetsRecurring fair value measurements
Financial assets at fair value throughprofit or loss
Beneficiary certificates
Financial assets at fair value throughother comprehensive income
Equity securities

December 31, 2020
AssetsRecurring fair value measurements
Financial assets at fair value throughprofit or loss
Beneficiary certificates
Financial assets at fair value throughother comprehensive income
Equity securities

Level 1

Level 2

$ 1,618,194$

628,451$ 2,246,645$ 4,255,920

109,875$ 4,365,795

-182-

Total

- $

- $ 1,618,194

-

-

- $

$

Level 1

Level 3

Level 2

1,125
1,125
Level 3

$

- $

$

- $

629,576$ 2,247,770
Total- $ 4,255,920

1,125
1,125

111,000$ 4,366,920

E. The fair value of financial instruments traded in active markets is based on quoted market
prices at the balance sheet date. A market is regarded as active if quoted prices are readily andregularly available from an exchange, dealer, broker, industry group, pricing service, or
regulatory agency, and those prices represent actual and regularly occurring market transactions
on an arm’s length basis. The quoted market price used for financial assets held by the Group is
the closing price. These instruments are included in Level 1. Instruments included in Level 1
comprise primarily listed stocks classified as financial assets at fair value through othercomprehensive income and beneficiary certificates classified as financial assets at fair value
through profit or loss.
F. For the years ended December 31, 2021 and 2020, there was no transfer between Level 1 andLevel 2.
G. If one or more of the significant inputs is not based on observable market data, the instrument
is included in level 3.
H. The financial products purchased for the years ended December 31, 2021 and 2020 werecategorised to Level 3.
I. Finance segment is in charge of valuation procedures for fair value measurements being
categorised within Level 3, which is to verify independent fair value of financial instruments.
Such assessment is to ensure the valuation results are reasonable by applying independent
information to make results close to current market conditions and frequently review the fairvalue.
J. The qualitative information of significant unobservable inputs to valuation model used in Level
3 fair value measurement is as follows: financial products are income investments, and thejudgements of their valuation technique and significant unobservable inputs are based on the
cash flow of individual contract.
(4)Other matter
Due to the strong demand in the industrial chain and the use of its products in diverse applications
this year, the Group’s orders from domestic and foreign customers were not impacted by the
COVID-19 pandemic. The operation and production headquarters in Taiwan have activated therelevant contingency mechanisms, adopted high-standard COVID-19 preventive measures andmonitored employees’ health condition on a daily basis. Overall, in 2021, the pandemic had no
significant impact on the Group’s operations and financial performance and did not cause any
suspension of work and production. Also, the Group has delivered good sales and profit
performance.

-183-13. SUPPLEMENTARY DISCLOSURES(1)Significant transactions information
A. Loans to others: None.
B. Provision of endorsements and guarantees to others: Please refer to table 1.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates
and joint ventures): Please refer to table 2.
D. Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million
or 20% of the Company’s paid-in capital: Please refer to table 3.
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 relate parties reaching NT$100 million or 20% of theCompany’s paid-in capital or more: Please refer to table 4.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more:
Please refer to table 5.
I. Trading in derivative instruments undertaken during the reporting periods: None.
J. Significant inter-company transactions during the reporting periods: Please refer to table 6.
(2)Information on investees
Names, locations and other information of investee companies (not including investees in
Mainland China):Please refer to table 7.
(3)Information on investments in Mainland China
A. Basic information: Please refer to table 8.
B. Significant transactions, either directly or indirectly through a third area, with investee
companies in the Mainland Area: Please refer to table 6.
(4)Major shareholders information
Major shareholders information: Please refer to table 9.
14. SEGMENT INFORMATION(1)General information
The Group operates business only in a single industry. The Chairman of the Board of Directors-184-who allocates resources and assesses performance of the Group as a whole, has identified that theGroup has only one reportable operating segment.
(2)Segment information
The segment information provided to the Chief Operating Decision-Maker for the reportablesegments is as follows:$$

Segment revenue
Segment income

Years ended December 31,
2021
2020
14,314,815 $
11,446,696
2,533,294 $1,197,735(3)Reconciliation for segment income (loss)
Sales between segments are carried out at arm’s length. The revenue from external customers
reported to the Chief Operating Decision-Maker is measured in a manner consistent with that in
the statement of comprehensive income.
(4)Information on products and services
All external customer revenue comes from sale of electronic products. Please refer to Note 6(19)Afor details.
(5)Geographical information
For details of geographical information of the Group’s revenue, please refer to Note 6(19)A. The
information on the Group’s non-current assets is as follows:
December 31, 2021
Non-current assets$
4,052,455
726,026
64,56644,429$4,887,476

TaiwanAsia
America
Europe
Total(6)Major customer information
None.

-185-

December 31, 2020
Non-current assets$
4,185,560
812,348
78,32053,012$
5,129,240

T ranscend Information, Inc. and Subsidiaries
Provision of endorsements and guarantees to others
Year ended December 31, 2021
T able 1

Expressed in thousands of NT D
(Except as otherwise indicated)
Maximum

Ratio of

Party being

Limit onoutstanding

Outstanding

endorsed/guaranteed

endorsements/

endorsement/

endorsement/

Provision of

accumulated
Amount ofendorsements/ Provision ofendorsement/

Ceiling on total

Provision ofguarantees by endorsements/ endorsements/

Relationship withguarantees

guarantee

guarantee

Actualamount ofparentguarantees by

guarantees tothe endorser/

provided for aamount as ofamount at

amount drawn

guarantees

net asset value ofendorsements

company tosubsidiary to

the party inthe endorser//guarantees

subsidiaryparentMainlandguarantor company provided (Note 7)(Note 8)company

China

Footnote

2

Y

-

-

-

endorsements/ guarantee amount to

NumberEndorser/Company

guarantor

single party

December 31,

December 31,

down

secured with(Note 1)guarantor

name(Note 2)

(Note 3)2021 (Note 4)2021 (Note 5)(Note 6)collateral0

T ranscend
T aiwan

T ranscend
Japan Inc.

2

$ 3,966,967$
543200$481,000 $(JPY $2,000,000) (JPY $2,000,000)(In thousands)

-

-

$

7,933,934(In thousands)

Note 1: T he numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:(a) T he Company is ‘0’.
(b) T he subsidiaries are numbered in order starting from ‘1’.
Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following seven categories; fill in the number of category each case belongs to:(a) Having business relationship(b) T he endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.
(c) T he endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company.
(d) T he endorser/guarantor parent company owns directly and indirectly more than 90% voting shares of the endorsed/guaranteed company.
(e) Mutual guarantee of the trade made by the endorsed/guaranteed company or joint contractor as required under the construction contract.
(f) Due to joint venture, all shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.
(g) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.
Note 3: Not exceeding 20% of the Company’s net asset value. ($19,834,835*20%=$3,966,967)
Note 4: T he maximum outstanding endorsement/guarantee amount during and as of December 31, 2021 is JPY$2,000,000 (In thousands).
Note 5: T he amount was approved by the Board of Directors.
Note 6: T he actual amount of endorsement drawn down is $0.
Note 7: Not exceeding 40% of the Company’s net asset value.( $19,834,835*40%=$7,933,934)
Note 8: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary.

-186-

T ranscend Information, Inc. and Subsidiaries
Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)
December 31, 2021
T able 2

Expressed in thousands of NT D
(Except as otherwise indicated)
As of December 31, 2021
Marketable securities

Relationship with the

General

Number ofBook value

Ownership(Note 1)securities issuer (Note 2)

ledger accountshares(Note 3)(%)

T rendForce Corportaion-

Non-current financial
assets at fair value through othercomprehensive income

Fubon Financial Holding Co., Ltd.
Preferred Shares B-"

T aiwan Semiconductor
Manufacturing Co., Ltd.

-"ASUST ek Computer Inc.

-

Fubon Financial Holding Co., Ltd.

-

Cathay Financial Holding Co. Ltd.

-

Securities held by
T ranscend T aiwan

Footnote
Fair value(Note 4)

StocksAU Optronics Corporation-

Innolux Corporation-

Formosa Plastics Corporation-

60,816

$

1,125

1

1,758,000

110,930

380,000

$

1,125

-

-

110,930-

233,700-

233,700-

410,000

154,160-

154,160-

1,067,016

81,413-

81,413-200,000

12,500-12,500-200,000

4,580

-

4,580

-

200,000

3,920

-

3,920

-

27,248-27,248-$ 1,506,595-$ 1,506,595

-

$

-

$

-

"
"
"
"
"
"
262,000$

629,576

Beneficiary certificates
T aishin 1699 Money Market Fund-

Current financial assets
at fair value throughprofit or loss

Yuanta T aiwan T op 50 ET F-

Non-current financial assets
at fair value throughprofit or loss

110,142,508

767,000

111,599

111,599

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities within the scope of IFRS 9 ‘Financial instruments’.
Note 2: Leave the column blank if the issuer of marketable securities is non-related party.
Note 3: Fill in the amount after adjusted at fair value and deducted by accumulated impairment for the marketable securities measured at fair value; fill in the acquisition cost or amortised cost deducted by accumulated impairment for themarketable securities not measured at fair value.
Note 4: The number of shares of securities and their amounts pledged as security or pledged for loans and their restrictions on use under some agreements should be stated in the footnote if the securities presented herein have such conditions.

-187-

T ranscend Information, Inc. and Subsidiaries
Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in capitalYear ended December 31, 2021
Expressed in thousands of NT D

T able 3(Except as otherwise indicated)

Marketable
Investor
T ranscend
T aiwanGeneralRelationship

Balance as at

Addition

Disposal

Balance as atwithJanuary 1, 2021

（Note 3）（Note 3）

December 31, 2021

securities

ledgerCounterparty

the investor

Number（Note 1）account（Note 2）

（Note 2）of shares

Amountof shares

Amountof shares

Selling priceBook value

T aishin 1699
Money Market
Fund

Current
financial assets
at fair value
through profit
or loss--

257,293,248$ 3,501,229

109,792,580$ 1,500,000

256,943,320$ 3,511,865$ 3,499,281

Yuanta T aiwan
High-yield
LeadingCompany FundB

Non-current
financial assets
at fair value
through profit
or loss--

50,000,000

500,000--

50,000,000

680,350

500,000

NumberNumber$Gain onNumberdisposalof shares

Amount12,584

110,142,508$ 1,501,948

180,350--

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities.
Note 2: Fill in the columns the counterparty and relationship if securities are accounted for under the equity method; otherwise leave the columns blank.
Note 3: Aggregate purchases and sales amounts should be calculated separately at their market values to verify whether they individually reach NT $300 million or 20% of paid-in capital or more.
Note 4: Paid-in capital referred to herein is the paid-in capital of parent company. In the case that shares were issued with no par value or a par value other than NT $10 per share, the 20 % of paid-in capital shall be replaced by 10% of
equity attributable to owners of the parent in the calculation.

-188-

T ranscend Information, Inc. and Subsidiaries
Purchases or sales of goods from or to related parties reaching NT $100 million or 20% of paid-in capital or moreYear ended December 31, 2021
T able 4

Expressed in thousands of NT D
(Except as otherwise indicated)
Differences in transaction terms compared to
T ransaction

Purchaser/seller

Counterparty

T ranscend T aiwan T ranstech T rading(Shanghai) Co., Ltd.

third party transactions (Note 1)

Percentage

Percentage ofof total sales

total notes/accounts

Relationship with theSalescounterparty(purchases)

AmountSales$ 1,196,974

9

Subsidiary of Memhiro

Notes/accounts receivable (payable)(purchases)

Credit term

Unit price

Credit term

120 days after No significant 30 to 60 days after monthly
monthly billings
difference billings to third parties

Balance$receivable (payable)

Footnote

132,276

9-"

T ranscend Japan Inc.

T he Company’s
subsidiary"

710,838

5

"

"

"

78,741

6-"

T ranscend Information,Inc.

T he Company’s
subsidiary"

627,401

5

"

"

"

13,312

1-"

T ranscend Information
Europe B.V.

Subsidiary of Memhiro"

594,935

4

"

"

"

27,6582-"

T ranscend Korea Inc.

T he Company’s
subsidiary"387,849

3

"

"

"

10,834

1-"

T ranscend Information
T rading GmbH

Subsidiary of Memhiro"

378,089

3

"

"

"

7,563

1

-

"

T ranscend Information(H.K) Ltd.

Subsidiary of Memhiro"

298,392

2

"

"

"

5,346

T ranscend
Information
Europe B.V.

T ranscend Information
T rading GmbH

Controlled by the same
ultimate parent company"

138,60920

30 days after
delivery"

7 to 60 days after delivery to
third parties

602

1

-

Associate accounted forusing equity method(Purchase)

235,161)(2)

30 days aftermonthly billings"

30 to 45 days after monthly (billings to third parties

52,241)(3)-

T ranscend T aiwan T aiwan IC Packaging
Corporation(

Note 1: T he Company’s sales to subsidiaries were equivalent to subsidiaries' purchases from the Company; accordingly, the Company did not disclose the information on subsidiaries’ purchases from the Company.

-189-

-

-

T ranscend Information, Inc. and Subsidiaries
Receivables from related parties reaching NT $100 million or 20% of paid-in capital or moreYear ended December 31, 2021
T able 5

Expressed in thousands of NT D
(Except as otherwise indicated)

Overdue receivables

Balance as at
Relationship

December 31,

with the counterparty

2021

Creditor

Counterparty

T ranscend T aiwan

T ranstech T rading (Shanghai) Co., Ltd.

Subsidiary of Memhiro

T ranscend T aiwan

Ultimate parent company

T ranscend Information(Shanghai), Ltd.

$T urnover rate

Amount132,276

7.87

408,198

-

-190-

$

Amount collected

Action taken--

408,198-$

subsequent to the

Allowance forbalance sheet date

doubtful accounts

132,276---

T ranscend Information, Inc. and Subsidiaries
Significant inter-company transactions during the reporting year
Year ended December 31, 2021
T able 6

Expressed in thousands of NT D
(Except as otherwise indicated)
T ransaction

NumberRelationship

General ledger

Percentage of consolidated total operating(Note 1)Company nameCounterparty(Note 2)

account

AmountT ransaction terms

0

T ranscend T aiwan

T ranstech T rading (Shanghai) Co., Ltd.

1

Sales

$ 1,196,974

T here is no significant
difference in unit pricefrom those to third parties.

8

"

"

T ranscend Japan Inc.

""

710,838

"

5

"

"

T ranscend Information, Inc.

""

627,401

"

4

"

"

T ranscend Information Europe B.V.

""

594,935

"

4

"

"

T ranscend Korea Inc.

""

387,849

"

3

"

"

T ranscend Information T rading GmbH""

378,089

"

3

"

"

T ranscend Information (H.K) Ltd.

""298,392

"

2

"

"

T ranscend Information (Shanghai), Ltd.

"

Accounts Payable

408,198)

120 days after monthly billings(

revenues or total assets (Note 3)((Individual transactions not exceeding 1% of the consolidated total revenue and total assets are not disclosed.)
Note 1: T he numbers filled in for the transaction company in respect of inter-company transactions are as follows:(a) Parent company is "0".
(b) Subsidiaries were numbered 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, 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 todisclose 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.):(a) Parent company to subsidiary.
(b) Subsidiary to parent company.
(c) Subsidiary to subsidiaries.
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.

-191-

2)

T ranscend Information, Inc. and Subsidiaries
Information on investees
Year ended December 31, 2021
T able 7

Expressed in thousands of NT D
(Except as otherwise indicated)

Initial investment amount

Investment income

Shares held as at December 31, 2021
Net profit (loss)

Balance as at

T ranscend T aiwan

Investee

Location

Main business activities

by the Company

for the year

for the year ended

Balance as at

December 31, December 31,
Investor

2021

2020

$ 1,202,418(loss) recognizedof the investee

ended December December 31, 2021

Ownership

31, 2021(Note 1)

Footnote

Number of shares(%)

Book value$ 1,202,418

36,600,000100$ 1,496,302 ($23,916) ($23,916)Note 2

Saffire Investment Ltd.

B.V.I.

Investment holdings

T ranscend Japan Inc.

Japan

Wholesale of computer memory
modules and peripheral products

89,103

89,1036,400

100

229,616

6,218

6,218

Note 2T ranscend Information,
Inc.

United States Wholesale of computer memoryof America
modules and peripheral products

38,592

38,592625,000

100

184,082

8,448

8,448

Note 2T ranscend Korea Inc.

Korea

Wholesale of computer memory
modules and peripheral products

6,132

6,132

40,000100

55,861

3,942

3,942

Note 2

T aiwan IC Packaging
Corp.

T aiwanPackaging of Semi-conductors

354,666

354,666

21,928,036

12.52

148,514411,645

52,590Note 5

Saffire Investment
Ltd.

Memhiro Pte Ltd.

Singapore

Investment holdings

1,156,920

1,156,920

55,132,000100

1,463,177 (

24,050) (24,050)Note 3

Memhiro Pte Ltd.

T ranscend Information
Europe B.V.

Netherlands

Wholesale of computer memory
modules and peripheral products

1,693

1,693

100

100

220,732

8,813

8,813

Note 4T ranscend Information
T rading GmbHGermany

Wholesale of computer memory
modules and peripheral products

2,288

2,288

-

100

112,428

12,251

12,251

Note 4T ranscend Information(H.K.) Ltd.

Hong Kong

Wholesale of computer memory
modules and peripheral products

7,636

7,636

2,000,000

100

29,868

4,924

4,924

Note 4Note 1: T he Company does not directly recognize the investment income (loss) except for the subsidiaries directly held.
Note 2: Subsidiary of the Company.
Note 3: Subsidiary of Saffire.
Note 4: Subsidiary of Memhiro.
Note 5: Please refer to Note 6 (8).

-192-

T able 8

T ranscend Information, Inc. and Subsidiaries

Expressed in thousands of NT D

Information on investments in Mainland China(Except as otherwise indicated)Year ended December 31, 2021
Amount remitted fromT aiwan to Mainland
Accumulated
amountMain business activities

T ranscend
Manufacture and sales ofInformation
computer memory modules,(Shanghai), Ltd. storage products and disks
and lease of self-ownedbuildings
T ranstech
T rading(Shanghai) Co.,Ltd.

Paid-in capital$

Wholesale, agent, importand export and retail ofcomputer memory modules,
storage products andcomputer components

Accumulated
Net income

Investment

back to T aiwan forof remittance fromthe year ended

remittance(loss)

Ownership

recognizedBook value ofT aiwan to

December 31, 2021

from T aiwan toof investee forheld byby the Company

investments inRemitted Mainland China as of the year ended the Company for the year ended Mainland China

methodas of January 1,

Mainlandback toDecember 31,

December 31,(direct orDecember 31,

as of December（Note 1）

2021

China

T aiwan

2021

2021

indirect)2021 (Note 2)

31, 2021

1,134,178

2

16,3102$

Investment

Ceiling onamount approved

investments in

Commission ofremittance from T aiwan to

the Ministry of

Investment

Mainland China as of

Economic Affairs

Commission of

December 31, 2021
1,134,178

1,134,178--

16,310--$1,134,178 ($

74,909)100

16,3109,550

100

1,134,178$

1,150,488

16,3101,150,488

imposed by the(MOEA)$

amountRemitted toby the Investment Mainland China

T ranscend$
Information(Shanghai), Ltd.
T ranstech
T rading(Shanghai) Co.,Ltd.
$

income (loss)

Mainland China

Accumulated amount ofCompany nameAccumulated

amount ofInvestment
Investee in
Mainland China

China/Amount remitted

MOEA
$

-

$

11,900,901

16,310-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) T hrough investing in an existing company in the third area (Memhiro Pte Ltd.), which then invested in Mainland China.
(3) Others.
Note 2: T he gain and loss on investment recognized for the year was based on the financial statements that were audited by R.O.C. parent company’s CPA.
Note 3: T he numbers in this table are expressed in New T aiwan Dollars.

-193-

($

74,909) $1,048,836

9,550

46,360of investment
incomeremitted back to
T aiwan as ofDecember 31, 2021 Footnote$

1,464,028---

T ranscend Information, Inc. and Subsidiaries
Major shareholders information
December 31, 2021
T able 9

SharesName of major shareholders

Number of shares held

Shareholding ratio

Won Chin Investment Inc.

74,783,600

17.42

Wan An T echnology Inc.

34,142,854

7.95

Cheng Chuan T echnology Development Inc.

32,971,701

7.68

Wan Min Investment Inc.

29,726,397

6.92

Wan Chuan Investment Inc.

29,505,896

6.87

-194-

6.5. Financial Statements of Parent Company Only for the Years Ended December 31, 2021 and 2020,and Independent Auditors’ Report
INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

PWCR21000371
To the Board of Directors and Shareholders of Transcend Information, Inc.
OpinionWe have audited the accompanying parent company only balance sheets of Transcend Information, Inc.
as at December 31, 2021 and 2020, and the related parent company only statements of comprehensive
income, of changes in equity and of cash flows for the years then ended, and notes to the parent
company only financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying parent company only financial statements present fairly, in allmaterial respects, the financial position of the Company as at December 31, 2021 and 2020, and its
financial performance and its cash flows for the years then ended in accordance with the Regulations
Governing the Preparation of Financial Reports by Securities Issuers.
Basis for opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of
Financial Statements by Certified Public Accountants and generally accepted auditing standards in the
Republic of China. Our responsibilities under those standards are further described in the Auditors’
responsibilities for the audit of the parent company only financial statements section of our report. We
are independent of the Company in accordance with the Norm of Professional Ethics for Certified
Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities inaccordance with these requirements. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the Company’s 2021 parent company only financial statements. These matters wereaddressed in the context of our audit of the parent company only financial statements as a whole and,in forming our opinion thereon, we do not provide a separate opinion on these matters.
-195-

Key audit matters for the Company’s 2021 parent company only financial statements are stated asfollows:
Valuation of inventories
Description
Refer to Notes 4(12), 5(2) and 6(5) to the financial statements for the information on the Company’s
inventory accounting policy, estimates and assumptions and allowance for inventory valuation losses.
The percentage of the Company’s inventories to total assets is material and the Company applies
judgements and estimates in determining the net realizable value of inventories at the balance sheet
date. The Company mainly produces DRAM and flash memory. As these products have a short life
cycle and belong to a highly competitive industry, the market prices change frequently. Since theCompany’s inventories and the allowance for inventory valuation losses are material to the financial
statements, the valuation of inventories has been identified as a key audit matter.
How our audit addressed the matter
We performed the following audit procedures in respect of the above key audit matter:
A. Obtained an understanding of the Company’s operations and industry. Assessed the reasonablenessof the policy and procedures to recognize allowance for inventory valuation losses.
B. Obtained an understanding of the Company’s inventory control procedures. Reviewed annual
inventory count plan and observed the annual physical count of inventory in order to assess theeffectiveness of internal controls over inventory.
C. Obtained relevant evaluation reports of inventory and tested the logic and accuracy of information
to assess the reasonableness of allowance for inventory valuation losses.

-196-

Estimation of allowance for sales discountDescription
In consideration of business volume, the Company provides a variety of business incentives to specificcustomers or products, and based on that, the Company can estimate the allowance for sales discountmonthly. Refer to Notes 4(23) and 6(4) to the parent company only financial statements for the
information on the estimation of allowance for sales discount.
Since the contracts are numerous and the result could affect the net revenue in the parent company
only financial statements, the estimation of allowance for sales discount has been identified as a key
audit matter.
How our audit addressed the matter
We performed the following audit procedures in respect of the above key audit matter:
A. Obtained an understanding of the Company’s operations, industry and the procedures to recognize
allowance for sales discount.
B. Obtained an understanding of the Company’s sales procedures and interviewed management toassess the appropriateness of sales allowance contracts and internal control over estimation ofallowance.
C. Obtained the evaluation list of allowance for sales discount, and tested material sales allowance
contracts and recalculated it to assess the reasonableness of allowance determined by the Company.
Responsibilities of management and those charged with governance for the parent company only
financial statements
Management is responsible for the preparation and fair presentation of the parent company only
financial statements in accordance with the Regulations Governing the Preparation of Financial
Reports by Securities Issuers and for such internal control as management determines is necessary toenable the preparation of parent company only financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the parent company only financial statements, management is responsible for assessing
the Company’s ability to continue as a going concern, disclosing, as applicable, matters related togoing concern and using the going concern basis of accounting unless management either intends toliquidate 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 theCompany’s financial reporting process.
-197-

Auditors’ responsibilities for the audit of the parent company only financial statements
Our objectives are to obtain reasonable assurance about whether the parent company only financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to issue
an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with the generally accepted auditing standards inthe Republic of China will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these parent
company only financial statements.
As part of an audit in accordance with the generally accepted auditing standards in the Republic ofChina, we exercise professional judgement and maintain professional skepticism throughout the audit.
We also:A.

Identify and assess the risks of material misstatement of the parent company only financial
statements, whether due to fraud or error, design and perform audit procedures responsive to thoserisks, 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.

B.

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.

C.

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

D.

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

E.

Evaluate the overall presentation, structure and content of the parent company only financial
statements, including the disclosures, and whether the parent company only financial statements
represent the underlying transactions and events in a manner that achieves fair presentation.
-198-

F.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the Company to express an opinion on the parent company only
financial statements. We are responsible for the direction, supervision and performance of thegroup 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 ininternal 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 andother 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 thatwere of most significance in the audit of the parent company only financial statements of the current
period and are therefore the key audit matters. We describe these matters in our auditors’ report unlesslaw 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 theadverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.

Lin, Chun-Yao

Chen, Chin-Chang

For and on behalf of PricewaterhouseCoopers, Taiwan
March 3, 2022----------------------------------------------------------------------------------------------------------------------------- -------------------The accompanying parent company only financial statements are not intended to present the financial position and resultsof 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 ofsuch financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic ofChina. Accordingly, the accompanying parent company only financial statements and independent auditors’ report are notintended 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 thetranslation.

-199-

TRANSCEND INFORMATION, INC.
PARENT COMPANY ONLY BALANCE SHEETSDECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)
Assets

December 31, 2021
AMOUNT%

Notes

December 31, 2020
AMOUNT%

Current Assets
Cash and cash equivalents

6(1)Financial assets at fair value through profit or

6(2)

$

loss - current

1,659,848

7

1,506,595$

399,5742

73,510,998

17

Current financial assets at amortised cost, net

6(3)5,480,400

24

5,450,000

26

Notes receivable, net

6(4)

2,499

-

759

-

Accounts receivable, net

6(4)1,137,589

5

810,6484

Accounts receivable due from related parties,

7

net

275,7291

404,360

2

Other receivables

105,235-

70,135-5,614,563

25

3,075,423

14

1,160

-

916

-

15,783,618

69

13,722,813

65

111,599

1

744,9224

629,5763

111,000

1

Investments accounted for using equity method 6(7)2,114,375

92,156,258

10

Property, plant and equipment, net

6(8)1,435,144

7

1,540,175

8

Right-of-use assets

6(9) and 7

15,263-51,893-

Investment property, net

6(11)2,560,275

11

2,566,019

12

Deferred tax assets

6(23)38,943-29,125-

Other non-current assets

6(12)41,774-27,473-

6,946,949

31

7,226,865

35

22,730,567

100

20,949,678

100

Inventories, net

6(5)Other current assets
Total Current Assets
Non-current Assets
Non-current financial assets at fair value

6(2)through profit or loss
Non-current financial assets at fair value

6(6)through other comprehensive income

Total Non-current Assets
Total Assets$(Continued)

-200-

$

TRANSCEND INFORMATION, INC.
PARENT COMPANY ONLY BALANCE SHEETSDECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)
Liabilities and Equity

December 31, 2021
AMOUNT%

Notes

December 31, 2020
AMOUNT%

Current Liabilities
Accounts payable$

Accounts payable - related parties

7

Other payables
Other payables - related parties

7

Current tax liabilities
Current lease liabilities

7

Other current liabilities
Total Current Liabilities

1,363,844

6

460,531$

1,132,016

6

2

450,7062

252,3671

206,9641

17,431-

17,564-

583,7143

245,884

1--

36,815-68,268-24,572-2,746,155

12

2,114,521

10

Non-current Liabilities
Deferred tax liabilities

6(23)128,7771

139,689

1

Other non-current liabilities

6(13)20,800-23,442-

149,5771

163,1311

2,895,732

13

2,277,652

11

4,290,617

19

4,290,617

21

3,730,914

16

3,945,369

19

Legal reserve

4,803,503

21

4,683,878

22

Special reserve

117,2441

130,9021

7,083,072

31

5,738,504

27

Total Non-current Liabilities
Total Liabilities
EquityShare capital6(14)Common stock
Capital surplus

6(15)Capital surplus
Retained earnings

6(16)Unappropriated retained earnings
Other equity interest6(17)Other equity interest(

190,515) (Total Equity
Significant contingent liabilities and1) (19,834,835

87

22,730,567

100

117,244) (1)

18,672,026

89

20,949,678

100

9unrecognized contract commitments
Significant events after the balance sheet date
Total Liabilities and Equity

11
$

$

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

-201-

TRANSCEND INFORMATION, INC.
PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOMEYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars, except for earnings per share amount)

Items
Notes
Operating Revenue
6(18) and 7
Operating Costs
6(5)(22) and 7
Gross Profit
Unrealized profit from sales
Realized profit from sales
Realized Gross Profit
Operating Expenses
6(22)Sales and marketing expenses
Administrative expenses
Research and development expenses
Impairment loss determined in accordance
6(4)with IFRS 9
Total operating expenses
Operating Profit
Non-operating Income and Expenses
Interest income
6(19)Other income
6(20)Other gains and losses
6(21) and 7
Net gain from derecognizing financial assets 6(3)measured at amortized cost
Finance costs
6(9)Share of profit (loss) of subsidiaries,
6(7)associates and joint ventures accounted forusing the equity method
Total non-operating income and expenses
Profit before Income Tax
Income tax expense
6(23)Profit for the Year
Other Comprehensive Income (Loss)
Components of other comprehensive
income (loss) that will not be reclassified to
profit or loss
Gains (losses) on remeasurements of defined 6(13)benefit plans
Unrealized gain (loss) on financial assets at
6(6)(17)
fair value through other comprehensive
incomeShare of other comprehensive income (loss) of
associates and joint ventures accounted forusing equity method
Components of other comprehensive
income (loss) that will be reclassified to
profit or loss
Exchange differences on translation of foreign 6(7)(17)
financial statements
Income tax related to components of other6(17)(23)comprehensive income that will bereclassified to profit or loss
Other Comprehensive (Loss) Income for theYear
Total Comprehensive Income
Earnings Per Share (in dollars)
Basic earnings per share
Diluted earnings per share$((

Year ended December 31
2021
2020
AMOUNT%AMOUNT
13,747,158
100 $
10,937,519
10,166,903) (74) (8,963,964) (3,580,255
26
1,973,555
10,106)- (16,106)
16,10625,422
3,586,255
26
1,982,871

%
100
82)
18
18

(
(
(

340,797) (209,337) (151,458) (

2) (
2) (
1) (

296,598) (236,753) (133,356) (

3)
2)
1)

(
(

1,382)
702,974) (2,883,281

- (
5) (
21

1,029)
667,736) (1,315,135

6)
1277,31837,25372,068

1-

71,17438,721
134,937

1
1- (17,210823)-$

47,282
233,678
3,116,959
583,665) (2,533,294

- (
1
22
4) (
18 $

115,062) (146,157
1,461,292
263,557) (1,197,735

1)
1
13
2)
11

$

2,344

- ($

1,072)-

11,826- (3,164)

-

200

- (

411)

-

95,365)-21,027-

19,072- (4,205)-

12,175
1,209,910

11

243)

(

(

(

($
$

61,923)2,471,371

18

$
$

5.90
5.90

$
$

6(24)
$
$

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

-202-

2.79
2.79

TRANSCEND INFORMATION, INC.
PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITYYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan dollars)
Capital Reserves

Notes
Year ended December 31, 2020
Balance at January 1, 2020
Net income for the year
Other comprehensive income (loss)
Total comprehensive income (loss)
Appropriations and distribution of 2019
earnings
Legal reserve
Cash dividends
Special reserve
Cash payment from capital surplus
Expired unclaimed dividends recognized
as capital surplus
Purchase of treasury stock
Cancellation of treasury stock
Balance at December 31, 2020

6(6)(17)

Common stock$ 4,307,617-

Additional paid-in
capitalDonated assets
received

Net assets frommergerLegal reserve

Special reserve

Unappropriatedretained earnings

Other Equity Interest
Unrealized gain or
Exchangeloss on financial
differences on
assets at fair valuetranslation ofthrough otherforeign financial
comprehensive
statements
income

$

$

$

$

$

$

($

4,307,541
-

4,185
-

Retained Earnings

35,128-4,510,981-

61,572-(

6,427,300
1,197,735
1,483 )
1,196,252

138,461 )
16,822
16,822

$
(
(

7,559
3,164 )
3,164 )

Treasury shares($

116,574 )-Total equity$ 19,406,848
1,197,735
12,175
1,209,910

6(16)

6(16)

6(14)

Year ended December 31, 2021
Balance at January 1, 2021
Net income for the year
Other comprehensive income (loss)
6(6)(17)
Total comprehensive income (loss)
Appropriations and distribution of 2020 6(16)earnings
Legal reserve
Cash dividends
Reversal of special reserve
Cash payment from capital surplus
6(16)Net gain on disposal of financial assets at 6(6)(17)
fair value through other comprehensive
incomeExpired unclaimed dividends recognized
as capital surplus
Balance at December 31, 2021(
17,000 )$ 4,290,617$ 4,290,617--(

386,156 )--

172,897-

69,330-($15,422 )3,905,963

93
4,278

35,1284,683,878

130,902$($ 4,290,617

3,905,963-$$

214,531 )-$3,691,432

$

4,278
-

$
$

35,128-$$4,683,878---

119,625
-

-

-

-

76
4,354

$

35,128$4,803,503

$
$

(

(
(
(

(
$

130,902-$13,658 )-((

172,897 )1,544,622 )
69,330 )98,199 )5,738,504
5,738,504
2,533,294
2,544
2,535,838

117,244$($((

121,639 )76,293 )76,293 )

-

8,804

-

7,083,072

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

-203-

($

121,639 )

119,625 )1,094,107 )
13,658
-

-

$

-

($

197,932 )

-

$
$

4,395
4,395
11,826
11,826-($$

14,047 )
130,621-((

1,544,622 )
386,156 )93
14,047 )$ 18,672,026($ 18,672,026
2,533,294(
61,923 )2,471,371--(

8,804 )

-

-

$

7,417

-

76
$ 19,834,835$((

1,094,107 )
214,531 )TRANSCEND INFORMATION, INC.
PARENT COMPANY ONLY STATEMENTS OF CASH FLOWSYEARS ENDED DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars)Year ended December 31
Notes

2021

2020

CASH FLOWS FROM OPERATING ACTIVITIESProfit before tax
Adjustments
Adjustments to reconcile profit (loss)
Unrealized profit from sales
Realized profit from sales
Net gain on financial assets at fair value through profit or loss
Share of profit or loss of associates and joint ventures accounted forusing the equity method
Expected credit loss
Depreciation
Interest income
Interest expense
Dividend income
Loss on disposal of property, plant and equipment
Changes in operating assets and liabilities
Changes in operating assets
Financial assets mandatorily measured at fair value through profit orloss
Notes receivable
Accounts receivable
Accounts receivable - related parties
Other receivables
Inventories
Other current assets
Changes in operating liabilities
Accounts payable
Accounts payable - related parties
Other payables
Other payables - related parties
Other current liabilities
Other non-current liabilities
Cash inflow (outflow) generated from operations
Dividends received
Interest received
Income tax paid
Net cash flows from (used in) operating activities$

6(2)(21)6(7)10,106
16,106 )84,375 )

(
(
(

6(4)
6(22)
6(19)
6(9)
6(6)(21)6(21)3,116,959

47,282 )
1,382
164,70277,318 )243
6,787 )-((

2,011,865
1,740 )
328,323 )
128,631
39,148 )2,539,140 )
244 )

(
(
(
(
(

231,828
9,825
45,403133 )43,696298 )
2,623,746
6,787
81,366
247,493 )2,464,406

(
(

(

$

1,461,292

16,10625,422 )146,883 )((

115,062
1,029
170,349
71,174 )823
3,834 )
2,098

(
(

(

992,901 )2,295
87,03050,416
27,074
1,107,527 )
4,304

(

129,7026,658 )
4,503 )
256
21,142868 )
270,792 )
3,834
80,217
66,796 )253,537 )

(
(

(
(

(
(

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of non-current financial assets at fair value throughprofit or loss
Acquisition of non-current financial assets at fair value through profit or loss
Proceeds from disposal of financial assets at amortised cost
Acquisition of financial assets at amortised cost
Proceeds from disposal of non-current financial assets at fair value throughother comprehensive income
Acquisition of non-current financial assets at fair value through othercomprehensive income
Acquisition of property, plant and equipment
Acquisition of investment property(Increase) decrease in other non-current financial assets
Net cash flows from investing activities

841,021130,785 )2,500,000
2,530,400 )((

611,063 )
6,226,353
3,800,000 )

(
(

6(6)
54,426

6(8)
6(11)

(
(
(
(

561,176 )
14,888 )2,409 )
14,301 )
141,488

((1,308,638 )
37,058 )76
1,345,620 )
1,260,274
399,574
1,659,848

23,654 )1,082 )
4,088
1,794,642((

CASH FLOWS FROM FINANCING ACTIVITIESCash dividends paid (including cash payment from capital surplus)
Repayment of lease liabilities
Expired unclaimed dividends recognized as capital surplus
Purchase of treasury stock
Net cash flows used in financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

6(16)

(

$

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

-204-

(
(
(
(
(
$

1,930,778 )
37,058 )93
37,371 )
2,005,114 )464,009 )863,583
399,574

TRANSCEND INFORMATION, INC.
NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS
DECEMBER 31, 2021 AND 2020
(Expressed in thousands of New Taiwan Dollars, except as otherwise indicated)
1. HISTORY AND ORGANIZATION
Transcend Information, Inc. (the “Company”) was incorporated under the provisions of the Company
Law of the Republic of China (R.O.C.) in August 1989. The main activities of the Company are
manufacturing, processing and sales of computer software and hardware, peripheral equipment andother computer components. The Securities and Futures Commission of the Republic of China had
approved the Company’s shares to be listed on the Taiwan Stock Exchange and the shares started
trading on May 3, 2001.
2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL
STATEMENTS AND PROCEDURES FOR AUTHORIZATION
These parent company only financial statements were authorized for issuance by the Board of Directors
on March 3, 2022.
3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS(1)Effect of the adoption of new issuances of or amendments to International Financial ReportingStandards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)
New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as
follows:

Effective date byInternational
AccountingStandards Board
January 1, 2021

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

-205-

(2)Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by
the Company
New standards, interpretations and amendments endorsed by the FSC effective from 2022 are as
follows:

New Standards, Interpretations and Amendments
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

Effective date byInternational
AccountingStandards Board
January 1, 2022
January 1, 2022
January 1, 2022
January 1, 2022

The above standards and interpretations have no significant impact to the Company’s financial
condition and financial performance based on the Company’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:

New Standards, Interpretations and Amendments
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'
Amendment to IFRS 17, 'Initial application of IFRS 17 and IFRS 9 –comparative information'
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 arisingfrom a single transaction’

Effective date byInternational
AccountingStandards Board
To be determinedby International
AccountingStandards Board
January 1, 2023
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 Company’s financial
condition and financial performance based on the Company’s assessment.

-206-

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESThe principal accounting policies applied in the preparation of these parent company only financial
statements are set out below. These policies have been consistently applied to all the periods presented,
unless otherwise stated.
(1)Compliance statement
The parent company only financial statements of the Company have been prepared in accordancewith the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
(2)Basis of preparation
A. Except for the following items, the financial statements have been prepared under the historicalcost convention:(a) Financial assets at fair value through profit or loss.
(b) Financial assets at fair value through other comprehensive income.
(c) Defined benefit liabilities recognized based on the net amount of pension fund assets lesspresent value of defined benefit obligations.
B. The preparation of financial statements in conformity with International Financial ReportingStandards, 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 theprocess of applying the Company’s accounting policies. The areas involving a higher degree ofjudgement or complexity, or areas where assumptions and estimates are significant to thefinancial statements are disclosed in Note 5.
(3)Foreign currency translation
The financial statements are presented in New Taiwan dollars, which is the Company’s functional
and the Company’s presentation currency.
A. Foreign currency transactions and balances(a) Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions or valuation where items are remeasured.
Foreign exchange gains and losses resulting from the settlement of such transactions arerecognized in profit or loss in the period in which they arise.
(b) Monetary assets and liabilities denominated in foreign currencies at the period end are
retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences
arising upon re-translation at the balance sheet date are recognized in profit or loss.

-207-

(c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value
through profit or loss are re-translated at the exchange rates prevailing at the balance sheet
date; their translation differences are recognized in profit or loss. Non-monetary assets andliabilities denominated in foreign currencies held at fair value through other comprehensive
income are re-translated at the exchange rates prevailing at the balance sheet date; theirtranslation differences are recognized in other comprehensive income. However,non-monetary assets and liabilities denominated in foreign currencies that are not measured
at fair value are translated using the historical exchange rates at the dates of the initialtransactions.
(d) All other foreign exchange gains and losses based on the nature of those transactions arepresented in the statement of comprehensive income within‘other gains and losses’.
B. Translation of foreign operations
The operating results and financial position of all the group entities that have a functional
currency different from the presentation currency are translated into the presentation currency as
follows:(a) Assets and liabilities for each balance sheet presented are translated at the closing exchange
rate at the date of that balance sheet;(b) Income and expenses for each statement of comprehensive income are translated at averageexchange rates of that period; and(c) All resulting exchange differences are recognized in other comprehensive income.
(4)Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they areclassified as non-current assets:(a) Assets arising from operating activities that are expected to be realized, or are intended to be
sold or consumed within the normal operating cycle;(b) Assets held mainly for trading purposes;(c) Assets that are expected to be realized within twelve months from the balance sheet date;(d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are
to be exchanged or used to settle liabilities more than twelve months after the balance sheet
date.
B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise
they are classified as non-current liabilities:(a) Liabilities that are expected to be settled within the normal operating cycle;-208-

(b) Liabilities arising mainly from trading activities;(c) Liabilities that are to be settled within twelve months from the balance sheet date;(d) Liabilities for which the repayment date cannot be extended unconditionally to more thantwelve months after the balance sheet date. Terms of a liability that could, at the option of thecounterparty, result in its settlement by the issue of equity instruments do not affect its
classification.
(5)Cash equivalents
Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
(6)Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured atamortised cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss arerecognized and derecognized using trade date accounting.
C. At initial recognition, the Company measures the financial liabilities at fair value. All relatedtransaction costs are recognized in profit or loss. The Company subsequently measures thesefinancial liabilities at fair value with any gain or loss recognized in profit or loss.
(7)Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity securities
which are not held for trading, and for which the Company has made an irrevocable election at
initial recognition to recognize changes in fair value in other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through othercomprehensive income are recognized and derecognized using trade date accounting.
(Irrevocable election is separately classified, and needs to be disclosed when there is various
election).
C. At initial recognition, the Company measures the financial assets at fair value plus transaction
costs. The Company subsequently measures the financial assets at fair value:
The changes in fair value of equity investments that were recognized in other comprehensive
income are reclassified to retained earnings and are not reclassified to profit or loss following thederecognition of the investment. Dividends are recognized as revenue when the right to receive
payment is established, future economic benefits associated with the dividend will flow to theCompany and the amount of the dividend can be measured reliably.

-209-

(8)Financial assets at amortised cost
A. Financial assets at amortised cost are those that meet all of the following criteria:(a) The objective of the Company’s business model is achieved by collecting contractual cash
flows.
(b) The assets’ contractual cash flows represent solely payments of principal and interest.
B. On a regular way purchase or sale basis, financial assets at amortised cost are recognized andderecognized using trade date accounting.
C. At initial recognition, the Company measures the financial assets at fair value plus transaction
costs. Interest income from these financial assets is included in finance income using theeffective interest method. A gain or loss is recognized in profit or loss when the asset isderecognized or impaired.
(9)Accounts and notes receivable
A. Accounts and notes receivable entitle the Company a legal right to receive consideration in
exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently
measured at initial invoice amount as the effect of discounting is immaterial.
(10)Financial assets impairment
For debt instruments measured at fair value through other comprehensive income and financial
assets at amortised cost including accounts receivable that have a significant financing component,
at each reporting date, the Company recognizes the impairment provision for 12 months expectedcredit losses if there has not been a significant increase in credit risk since initial recognition orrecognizes the impairment provision for the lifetime expected credit losses (ECLs) if such credit
risk has increased since initial recognition after taking into consideration all reasonable andverifiable information that includes forecasts. On the other hand, for accounts receivable orcontract assets that do not contain a significant financing component, the Company recognizes theimpairment provision for lifetime ECLs.
(11)Derecognition of financial assets
The Company derecognizes a financial asset when the contractual rights to receive the cash flows
from the financial asset expire.

-210-

(12)Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined using theweighted-average method. The cost of finished goods and work in progress comprises raw
materials, direct labour, other direct costs and related production overheads (allocated based on
actual operating capacity). It excludes borrowing costs. The item by item approach is used inapplying the lower of cost and net realizable value. Net realizable value is the estimated selling
price in the ordinary course of business, less the estimated cost of completion and applicablevariable selling expenses.
(13)Investments accounted for using equity method-subsidiaries and associates
A. Subsidiaries are all entities (including structured entities) controlled by the Company. The
Company controls an entity when the Company is exposed, or has rights, to variable returns
from its involvement with the entity and has the ability to affect those returns through its powerover the entity.
B. Unrealized gains on transactions between the Company and its subsidiaries are eliminated.
Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency
with the policies adopted by the Company.
C. The Company’s share of its subsidiaries’ post-acquisition profits or losses is recognized in
profit or loss, and its share of post-acquisition movements in other comprehensive income isrecognized in other comprehensive income. When the Company’s share of losses in a
subsidiary equals or exceeds its interest in the subsidiary, the Company continues to recognize
losses proportionate to its ownership.
D. Associates are all entities over which the Company has significant influence but not control. In
general, it is presumed that the investor has significant influence, if an investor holds, directly
or indirectly 20 percent or more of the voting power of the investee. Investments in associates
are accounted for using the equity method and are initially recognized at cost.
E. The Company’s share of its associates’ post-acquisition profits or losses is recognized in profit
or loss, and its share of post-acquisition movements in other comprehensive income isrecognized in other comprehensive income. When the Company’s share of losses in an
associate equals or exceeds its interest in the associate, including any other unsecured
receivables, the Company does not recognize further losses, unless it has incurred legal orconstructive obligations or made payments on behalf of the associate.

-211-

F. When changes in an associate’s equity do not arise from profit or loss or other comprehensive
income of the associate and such changes do not affect the Company’s ownership percentage ofthe associate, the Company recognizes change in ownership interests in the associate in ‘capitalsurplus’ in proportion to its ownership.
G. Unrealized gains on transactions between the Company and its associates are eliminated to theextent of the Company’s interest in the associates. Unrealized losses are also eliminated unlessthe transaction provides evidence of an impairment of the asset transferred. Accounting policies
of associates have been adjusted where necessary to ensure consistency with the policies
adopted by the Company.
H. In the case that an associate issues new shares and the Company does not subscribe or acquire
new shares proportionately, which results in a change in the Company’s ownership percentageof the associate but maintains significant influence on the associate, then ‘capital surplus’ and‘investments accounted for under the equity method’ shall be adjusted for the increase or
decrease of its share of equity interest. If the above condition causes a decrease in the
Company’s ownership percentage of the associate, in addition to the above adjustment, theamounts previously recognized in other comprehensive income in relation to the associate arereclassified to profit or loss proportionately on the same basis as would be required if therelevant assets or liabilities were disposed of.
I. When the Company disposes its investment in an associate and loses significant influence overthis associate, the amounts previously recognized in other comprehensive income in relation to
the associate, are reclassified to profit or loss, on the same basis as would be required if therelevant assets or liabilities were disposed of. If it retains significant influence over thisassociate, the amounts previously recognized in other comprehensive income in relation to theassociate are reclassified to profit or loss proportionately in accordance with theaforementioned approach.
J. Pursuant to the “Regulations Governing the Preparation of Financial Reports by Securities
Issuers,” profit (loss) of the current period and other comprehensive income in the
non-consolidated financial statements shall equal to the amount attributable to owners of theparent in the financial statements prepared with basis for consolidation. Owners’ equity in the
non-consolidated financial statements shall equal to equity attributable to owners of the parent
in the financial statements prepared with basis for consolidation.
(14)Property, plant and equipment
A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during
the construction period are capitalized.

-212-

B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the Company and the cost of the item can be measured reliably. The carrying
amount of the replaced part is derecognized. All other repairs and maintenance are charged to
profit or loss during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model and are
depreciated using the straight-line method to allocate their cost over their estimated useful lives.
Each part of an item of property, plant, and equipment with a cost that is significant in relation
to the total cost of the item must be depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if
appropriate, at each financial year-end. If expectations for the assets’ residual values and useful
lives differ from previous estimates or the patterns of consumption of the assets’ future
economic benefits embodied in the assets have changed significantly, any change is accounted
for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting
Estimates and Errors’, from the date of the change. The estimated useful lives of property,
plant and equipment are as follows:

Buildings and structures
Machinery and equipment
Transportation equipment
Office equipment and others

8 ~ 50 years
2 ~ 10 years
3 ~ 5 years
2 ~ 5 years(15)Leasing arrangements (lessee) - right-of-use assets / lease liabilities
A. Leases are recognized as a right-of-use asset and a corresponding lease liability at the date at
which the leased asset is available for use by the Company. For short-term leases or leases of
low-value assets, lease payments are recognized as an expense on a straight-line basis over thelease term.
B. Lease liabilities include the net present value of the remaining lease payments at thecommencement date, discounted using the incremental borrowing interest rate. Lease payments
are comprised of the following:(a) Fixed payments, less any lease incentives receivable; and(b) Variable lease payments that depend on an index or a rate.
The Company subsequently measures the lease liability at amortized cost using the interest
method and recognizes interest expense over the lease term. The lease liability is remeasured
and the amount of remeasurement is recognized as an adjustment to the right-of-use asset when
there are changes in the lease term or lease payments and such changes do not arise from-213-

contract modifications.
C. At the commencement date, the right-of-use asset is stated at cost comprising the amount of theinitial measurement of lease liability.
The right-of-use asset is measured subsequently using the cost model and is depreciated fromthe commencement date to the earlier of the end of the asset’s useful life or the end of the lease
term. When the lease liability is remeasured, the amount of remeasurement is recognized as an
adjustment to the right-of-use asset.
(16)Investment property
An investment property is stated initially at its cost and measured subsequently using the costmodel. Except for land, investment property is depreciated on a straight-line basis over its
estimated useful life of 10 ~ 55 years.
(17)Impairment of non-financial assets
The Company assesses at each balance sheet date the recoverable amounts of those assets where
there is an indication that they are impaired. An impairment loss is recognized for the amount bywhich the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is thehigher of an asset’s fair value less costs to sell or value in use. When the circumstances or reasons
for recognizing impairment loss for an asset in prior years no longer exist or diminish, theimpairment loss is reversed. The increased carrying amount due to reversal should not be morethan what the depreciated or amortised historical cost would have been if the impairment had notbeen recognized.
(18)Notes and accounts payable
Notes and accounts payable are obligations to pay for goods or services that have been acquired in
the ordinary course of business from suppliers. They are recognized initially at fair value andsubsequently measured at amortised cost using the effective interest method. However, short-term
accounts payable without bearing interest are subsequently measured at initial invoice amount as
the effect of discounting is immaterial.
(19)Employee benefits
A. Short-term employee benefits
Short-term employee benefits are measured at the undiscounted amount of the benefits
expected to be paid in respect of service rendered by employees in a period and should berecognized as expense in that period when the employees render service.

-214-

B. Pensions(a) Defined contribution plan
For the defined contribution plan, the contributions are recognized as pension expenses
when they are due on an accrual basis. Prepaid contributions are recognized as an asset tothe extent of a cash refund or a reduction in the future payments.
(b) Defined benefit plani. Net obligation under a defined benefit plan is defined as the present value of an amountof pension benefits that employees will receive on retirement for their services with theCompany in current period or prior periods. The liability recognized in the balance sheet
in respect of defined benefit pension plans is the present value of the defined benefit
obligation at the balance sheet date less the fair value of plan assets. The net defined
benefit obligation is calculated annually by independent actuaries using the projected
unit credit method. The rate used to discount is determined by using interest rates ofgovernment bonds (at the balance sheet date) of a currency and term consistent with thecurrency and term of the employment benefit obligations.
ii. Remeasurements arising on defined benefit plan are recognized in other comprehensive
income in the period in which they arise and are recorded as retained earnings.
iii. Past service costs are recognized immediately in profit or loss.
C. Employees’ compensation and directors’ and supervisors’ remuneration
Employees’ compensation and directors’ and supervisors’ remuneration are recognized as
expense and liability, provided that such recognition is required under legal or constructive
obligation and those amounts can be reliably estimated. Any difference between the resolved
amounts and the subsequently actual distributed amounts is accounted for as changes in
estimates.
(20)Income tax
A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit
or loss, except to the extent that it relates to items recognized in other comprehensive income
or items recognized directly in equity, in which cases the tax is recognized in othercomprehensive income or equity.
B. The current income tax expense is calculated on the basis of the tax laws enacted or
substantively enacted at the balance sheet date in the countries where the Company and its
subsidiaries operate and generate taxable income. Management periodically evaluates positions
taken in tax returns with respect to situations in accordance with applicable tax regulations. It
establishes provisions where appropriate based on the amounts expected to be paid to the tax
authorities. An additional tax is levied on the unappropriated retained earnings and is recorded-215-

as income tax expense in the year the stockholders resolve to retain the earnings.
C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the
consolidated balance sheet. Deferred tax is determined using tax rates (and laws) that havebeen enacted or substantially enacted by the balance sheet date and are expected to apply when
the related deferred tax asset is realized or the deferred tax liability is settled.
D. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit
will be available against which the temporary differences can be utilized. At each balance sheet
date, unrecognized and recognized deferred tax assets are reassessed.
E. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting
from acquisitions of equipment or technology and research and development expenditures tothe extent that it is possible that future taxable profit will be available against which the unused
tax credits can be utilized.
(21)Share capital
A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.
B. Where the Company repurchases the Company’s shares that have been issued, theconsideration paid, excluding any directly attributable incremental costs (net of income taxes)
is deducted from equity attributable to the Company’s equity holders.
(22)Dividends
Dividends are recorded in the Company’s financial statements in the period in which they are
resolved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock
dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shareson the effective date of new shares issuance.
(23)Revenue recognition
A. Sales of goods(a) The Company manufactures and sells computer software and hardware, computer
peripheral equipment, and computer component products. When the right of control istransferred to the customer, sales revenue is recognized. Delivery occurs when the products
have been shipped to the specific location, the risks of obsolescence and loss have beentransferred to the customer, and either the customer has accepted the products in accordancewith the sales contract, or the Company has objective evidence that all criteria for
acceptance have been satisfied.

-216-

(b) Sales revenue is recognized based on the contract price, net of sales returns, volume
discounts and estimated sales discount and allowances. The goods are often sold withvolume discounts based on aggregate sales over a one-month period. Sales discounts andallowances are estimated and provided for based on customer contracts, and revenue is only
recognized to the extent that it is highly probable that a significant reversal will not occur.
The estimation is subject to an assessment at each reporting date and recognized asallowance for sales discounts. No element of financing is deemed present as the sales are
made with a credit term of 30-60 days after monthly billing, which is consistent withmarket practice.
(c) A receivable is recognized when the goods are delivered as this is the point in time that theconsideration is unconditional because only the passage of time is required before thepayment is due.
B. Incremental costs of obtaining a contract
Given that the contractual period lasts less than one year, the Company recognizes theincremental costs of obtaining a contract as an expense when incurred although the Company
expects to recover those costs.
5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF
ASSUMPTION UNCERTAINTY
The preparation of these parent company only financial statements requires management to makecritical judgements in applying the Company’s accounting policies and make critical assumptions andestimates concerning future events. Assumptions and estimates may differ from the actual results andare continually evaluated and adjusted based on historical experience and other factors. Suchassumptions and estimates have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year; and the related information is addressed
below:(1)Critical judgements in applying the Company’s accounting policies
Investment property
The Company uses a portion of the property for its own use and another portion to earn rentals orfor capital appreciation. When these portions cannot be sold separately and cannot be leased out
separately under a finance lease, the property is classified as investment property only if the own
use portion accounts for an insignificant portion of the property.
(2)Critical accounting estimates and assumptions
Valuation of inventories
As inventories are stated at the lower of cost and net realizable value, the Company must determine-217-the net realizable value of inventories on balance sheet date using judgements and estimates. Due tothe rapid technology innovation, the Company evaluates the amounts of normal inventory
consumption, obsolete inventories or inventories without market selling value on balance sheet date,
and writes down the cost of inventories to the net realizable value. The valuation of inventories isbased on recent market price and demand of products in the future specific period, thus there might
be significant changes in the valuation.
As of December 31, 2021, the carrying amount of inventories was $5,614,563.
6. DETAILS OF SIGNIFICANT ACCOUNTS(1)Cash and cash equivalents
December 31, 2021$
68
1,572,900
86,880$1,659,848

Cash on hand and petty cash
Checking accounts and demand deposits
Time deposits

December 31, 2020$
677
398,897$399,574

A. The aforementioned time deposits pertain to high liquidity investments with maturity within
three months.
B. The Company transacts with a variety of financial institutions all with high credit quality todisperse credit risk, so it expects that the probability of counterparty default is remote.
C. The Company has no cash and cash equivalents pledged to others.
(2)Financial assets at fair value through profit or loss
Items
Current items:
Financial assets mandatorily measured
at fair value through profit or loss
Beneficiary certificates
Valuation adjustments

December 31, 2021

December 31, 2020$

1,501,948
4,647
1,506,595$

100,976
10,623
111,599$$
Non-current items:
Financial assets mandatorily measured
at fair value through profit or loss
Beneficiary certificates
Valuation adjustments

$
$

-218-

$

$

3,501,229
9,769
3,510,998

611,063
133,859
744,922

A. Amounts recognized in profit or loss in relation to financial assets at fair value through profit orloss are listed below:

Beneficiary certificates
Non-hedging derivatives$$

Years ended December 31,
2021
2020
84,375 $145,108
1,775
84,375 $146,883

B. The Company has no financial assets at fair value through profit or loss pledged to others.
(3)Financial assets at amortised cost

Items
Current items:
Time deposits with original maturity of morethan three months

December 31, 2021

December 31, 2020$$

5,480,400

5,450,000

A. Amounts recognized in profit or loss in relation to financial assets at amortised cost are listed
below:

Interest income
Gain on disposal$$

Years ended December 31,
2021
2020
23,379 $63,217
17,21023,379 $80,427

B. The Company has no financial assets at amortised cost pledged to others as collateral.
C. The Company used the forecastability of Taiwan Institute of Economic Research boom
observation report to adjust historical and timely information to assess the default possibility ofdebt instruments on December 31, 2021 and 2020, and considered guarantee for repurchaseagreement held by the Company to estimate expected credit loss. The Company does not expect
material credit loss after assessment.
D. The Company transacts time deposits with reputable domestic and foreign banks. The
Company’s counterparties have good credit quality, and the impairment loss is assessed using a
12-month expected credit loss approach.

-219-

(4)Notes and accounts receivable

December 31, 2021$
2,499

Notes receivable

December 31, 2020$
759

December 31, 2021
December 31, 2020$
1,137,589 $
812,398- (1,750)$
1,137,589 $
810,648

Accounts receivable
Less: Loss allowance

A. As of December 31, 2021 and 2020, the estimated sales discounts and allowances were $31,410
and $41,562, respectively. Since the sales discounts and allowances met the requirements foroffset of financial liabilities and financial assets, the net amounts were shown under accounts
receivable.
B. The ageing analysis of accounts receivable and notes receivable is as follows:

December 31, 2021
Accounts receivable
Notes receivable$
943,522 $2,499
193,249818$
1,137,589 $2,499

Not past due
Up to 30 days
31 to 90 days
91 to 180 days
Over 180 days

December 31, 2020
Accounts receivable
Notes receivable$
678,549 $759
126,678
4,114
3,057
$
812,398 $759

Not past due
Up to 30 days
31 to 90 days
91 to 180 days
Over 180 days

The above ageing analysis was based on past due date.
C. The Company has credit insurance that covers accounts receivable from major customers.
Should bad debts occur, the Company will receive 90% of the losses resulting from
non-payment.
D. As of December 31, 2021 and 2020, notes receivable and accounts receivable were all fromcontracts with customers. As of January 1, 2020, the balance of notes receivable and accounts
receivable from contracts with customers amounted to $903,794.
-220-

E. As at December 31, 2021 and 2020, without taking into account any collateral held or othercredit enhancements, the maximum exposure to credit risk in respect of the amount that best
represents the Company’s notes receivable were $2,499 and $759, respectively; the maximum
exposure to credit risk in respect of the amount that best represents the Company’s accounts
receivable were $1,137,589 and $810,648, respectively.
F. The Company classifies customers’ accounts receivable in accordance with the credit rating of
the customer. The Company applies the simplified approach to estimate expected credit loss
under the provision matrix basis.
G. The Company wrote-off the financial assets, which cannot reasonably be expected to be
recovered, after initiating recourse procedures. However, the Company will continue executing
the recourse procedures to secure their rights. On December 31, 2021 and 2020, the Company
has no written-off financial assets that are still under recourse procedures.
H. The Company used forecastability, historical and timely information to assess the loss rate ofaccounts receivable. On December 31, 2021 and 2020, the provision matrix is as follows:Notpast due
December 31, 2021
Expected loss rate
Total book value$

0.006%
943,522Not
past due

December 31, 2020
Expected loss rate
Total book value$

0.008%
678,549

1-180 days
past dueOver 180 days
past due

0.03%~12.93%$
194,067

25%~100%

1-180 days
past due
0.04%~14.60%$
130,792

$

Total

- $

Over 180 days
past due$

25%~100%
3,057

1,137,589

Total

$

812,398

I. The balance of allowance for loss and movements are as follows:

2021
Accounts receivable
Notes receivable$
1,750 $
1,246(
3,132)136$- $-At January 1
Provision for impairment
Reclassified to overdue receivables
Effect of exchange rate changes
At December 31

-221-

2020
Accounts receivable
Notes receivable$
2,033 $
1,134
(
178)
(
1,134)(
105)$
1,750 $-At January 1
Provision for impairment
Reclassified to overdue receivables
Reclassified to other income
Effect of exchange rate changes
At December 31

J. The Company does not hold any collateral as security.
(5)Inventories

Raw materials
Work in progress
Finished goods$$

Raw materials
Work in progress
Finished goods$$

December 31, 2021
Allowance for
Costvaluation loss
4,555,175 ($
48,311) $604,979 (438)
506,929 (3,771)
5,667,083 ($
52,520) $Book value
4,506,864
604,541
503,158
5,614,563

December 31, 2020
Allowance for
Costvaluation loss
2,161,744 ($
28,593) $487,023 (1,023)
461,818 (5,546)
3,110,585 ($35,162) $Book value
2,133,151
486,000
456,272
3,075,423

A. The cost of inventories recognized as expense for the year:

Cost of goods sold
Loss on decline in market value of inventory$$

B. No inventories were pledged to others.

-222-

Years ended December 31,
2021
2020
10,149,545 $
8,957,375
17,358
6,589
10,166,903 $
8,963,964

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

Items
Non-current items:
Equity instruments
Listed stocks
Others

December 31, 2021

December 31, 2020$$

Valuation adjustments$

621,034
1,125
622,159
7,417
629,576$

105,480
1,125
106,605
4,395
111,000

A. The Company has elected to classify equity investments that are considered to be strategic
investments as financial assets at fair value through other comprehensive income. The fair valueof such investments amounted to $629,576 and $111,000 as at December 31, 2021 and 2020,
respectively.
B. For the year ended December 31, 2021, the Company disposed equity investments whose fairvalue was $54,426, and the cumulative gain on disposal was transferred to retained earnings in
the amount of $8,804. There was no such transaction for the year ended December 31, 2020.
C. Amounts recognized in profit or loss and other comprehensive income in relation to the financial
assets at fair value through other comprehensive income are listed below:

Years ended December 31,
2021
2020
Equity instruments at fair value throughother comprehensive income
Fair value change recognized in othercomprehensive income (loss)
Cumulative gains reclassified toretained earnings due to derecognition
Dividend income recognized in profit or loss
Held at end of year
Derecognized during the year$

11,826 ($3,164)$

8,804 $-$

6,787 $
6,787 $

3,834
3,834

$

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

-223-

(7)Investments accounted for using equity method

At January 1
Share of profit or loss of investments accounted
for using equity method
Decrease in unrealised profit from sales
Other comprehensive income
Changes in other equity items (Note 6(17))
At December 31
Investees
Subsidiaries:
Saffire Investment Ltd.
Transcend Japan Inc.
Transcend Information Inc.
Transcend Korea Inc.
Associates:
Taiwan IC Packaging Corp.

$

(
$

2021
2,156,258 $
47,282 (2020
2,241,388
115,062)

6,000
200 (
95,365)
2,114,375 $

9,316
411)
21,0272,156,258

December 31, 2021

December 31, 2020

$

$

$

1,496,302
229,616
184,082
55,861
148,514
2,114,375$

1,563,437
257,211
180,982
58,904
95,7242,156,258

A. Subsidiaries
Please refer to Note 4(3) in the consolidated financial statements for the year ended December
31, 2021 for the information regarding the Company’s subsidiaries.
B. Associates(a) The basic information of the associate that is material to the Company is as follows:

AssociatenameTaiwan IC
Packaging Corp.

Principal
place ofbusiness
TaiwanShareholding ratio
December December
31, 2021
31, 2020
12.52%
12.74%Nature ofrelationship
Note

Method ofmeasurement
Equity method

Note: Taiwan IC Packaging Corp. is engaged in IC packaging and testing and is the
upstream supplier in the IT and semiconductor industries. In order to reach synergy ofvertical integration, Taiwan IC Packaging Corp. processes the raw materials provided
by the Company into relevant semi-finished goods.
(b) The Company held a 12.52% equity interest in Taiwan IC Packaging Corp., and is thecompany’s largest single shareholder. However, the Company does not hold the majority ofthe voting power during the shareholders’ meeting of Taiwan IC Packaging Corp. and theCompany has no seat in the Board of Directors of Taiwan IC Packaging Corp., which-224-

indicate that the Company has no control ability to direct the relevant activities of Taiwan IC
Packaging Corp. In addition, the Company’s chairman is the same with Taiwan IC Packaging
Corp.; hence, the Company has significant influence over Taiwan IC Packaging Corp.
(c) The summarized financial information of the associate that is material to the Company is asfollows:
Balance sheet
Taiwan IC Packaging Corp.
December 31, 2021
December 31, 2020$
1,408,762 $
942,5071,219,160
1,224,429(
374,580) (327,211)(83,523) (85,765)$2,169,819 $
1,753,960

Current assets
Non-current assets
Current liabilities
Non-current liabilities
Total net assets
Share in associate’s net assets
Net equity differences$($

271,661 $
123,147) (148,514 $

223,480
127,756)
95,724

Statement of comprehensive income

A
Revenue
Gain (loss) for the year from continuing
operations
Total comprehensive income (loss)
Dividends received from associates

$
$
$
$

Taiwan IC Packaging Corp.
Years ended December 31,
2021
2020
1,944,950 $
1,210,125
411,645 ($
409,917 ($- $11,040)9,466)-(d) Share of profit (loss) of associates accounted for using the equity method is as follows:

Investee Company
Taiwan IC Packaging Corp.

$

Years ended December 31,
2021
2020
52,590 ($1,299)(e) The Company’s investment in Taiwan IC Packaging Corporation has quoted market price.
The fair value of Taiwan IC Packaging Corporation was $446,724 and $239,053 as ofDecember 31, 2021 and 2020, respectively.

-225-

(8)Property, plant and equipment
2021
Land
At January 1
Cost
Accumulated depreciation$$

Opening net book amount as at January 1
Additions (including transfers)
Depreciation charge
Closing net book amount as at
December 31
At December 31
Cost
Accumulated depreciation

Buildings andstructures

Officeequipment

OthersTotal

601,268 $ 1,207,688 $
467,122) (- (601,268 $ 740,566 $

389,642 $
218,558) (171,084 $

22,109 $9,315) (12,794 $4,691 $
2,812) (1,879 $

28,476 $ 2,253,874
713,699)
15,892) (12,584 $ 1,540,175

740,566 $229
45,796) (171,084 $
2,710
62,196) (12,794 $
1,216
3,736) (1,879 $
7,556
2,184) (12,584 $ 1,540,175
14,888
3,177
119,919)
6,007) ($601,268 $- ($601,268$

601,268 $ 1,207,917 $
512,918) (- (601,268 $ 694,999 $$VehiclesMachinery$694,999-226-$

111,598$

355,091 $
243,493) (111,598 $

10,274$23,325 $13,051) (10,274 $7,251$

10,485 $3,234) (7,251 $

9,754

$ 1,435,144

24,252 $ 2,222,338
787,194)
14,498) (9,754 $ 1,435,144

2020
Land
At January 1
Cost
Accumulated depreciation$$

Opening net book amount as at January 1
Additions (including transfers)
Disposals
Depreciation charge
Closing net book amount as at
December 31
At December 31
Cost
Accumulated depreciation

Buildings andstructures

OthersTotal

601,268 $ 1,209,742 $
424,360) (- (601,268 $ 785,382 $

449,670 $
221,364) (228,306 $20,761 $
5,734) (15,027 $

4,802 $
3,346) (1,456 $

34,373 $ 2,320,616
676,215)
21,411) (12,962 $ 1,644,401

785,382 $890- (45,706) (228,306 $13,616
2,098)
68,740) (15,027 $1,348
3,581) (1,456 $
1,290867) (

12,962 $ 1,644,401
23,6546,510
2,098)- (125,782)
6,888) ($601,268 $- ($601,268$

601,268 $ 1,207,688 $
467,122) (- (601,268 $ 740,566 $$VehiclesMachinery

Officeequipment$

740,566$

171,084$

389,642 $
218,558) (171,084 $

12,794

22,109 $9,315) (12,794 $The relevant assets of the Company recognized as property, plant and equipment are all for self-use.

-227-

$

1,879

$

4,691 $
2,812) (1,879 $

12,584$ 1,540,175

28,476 $ 2,253,874
713,699)
15,892) (12,584 $ 1,540,175

(9)Leasing arrangements-lessee
A. The Company’s lease asset is land. Rental contracts are typically made for 3 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 forborrowing purposes.
B. The carrying amounts of right-of-use assets and the depreciation charge are as follows:

December 31, 2021
December 31, 2020
Carrying amount
Carrying amount$
15,263 $51,893Years ended December 31,
2021
2020
Depreciation charge
Depreciation charge$
36,630 $36,628Land

Land

C. For the years ended December 31, 2021 and 2020, there were no additions to right-of-use assets.
D. Information on profit or loss in relation to lease contracts is as follows:

Years ended December 31,
2021
2020
Items affecting profit or loss
Interest expense on lease liabilities
Expense on short-term lease contracts
Expense on leases of low-value assets

$

243 $
4,984
770

823
5,207
847

E. For the years ended December 31, 2021 and 2020, the Company’s total cash outflow for leases
were $42,812 and $43,112, respectively.
(10)Leasing arrangements-lessor
A. The Company leases various assets including land and buildings. Rental contracts are typicallymade for periods of 1 to 3 years. Lease terms are negotiated on an individual basis and containa wide range of different terms and conditions. To protect the lessor’s ownership rights on theleased assets, leased assets may not be used as security for borrowing purposes, or a residual
value guarantee was required.
B. For the years ended December 31, 2021 and 2020, the Company recognized rent income in theamount of $37,253 and $38,721, respectively, based on the operating lease agreement, which
does not include variable lease payments.

-228-

C. The maturity analysis of the lease payments under the operating leases is as follows:

December 31, 2021
2022 $
38,9252023
26,7572024
16,806
2025
9,406
9,406
2026
$
101,300

December 31, 20202021 $
23,725
2022
3,900
2023
400
2024
2025
$
28,025(11)Investment property

Land
At January 1
Cost
Accumulated depreciation$

At December 31
Cost
Accumulated depreciation

Total

2,268,726 $- (2,268,726 $

365,009 $67,716) (297,293 $2,633,735
67,716)2,566,019$

2,268,726 $- (297,293 $
2,409
8,153) (2,566,019
2,409
8,153)$

2,268,726 $

291,549 $2,560,275$

2,268,726 $- (2,268,726 $

367,418 $
75,869) (291,549 $2,636,144
75,869)2,560,275$
Opening net book amount as atJanuary 1
Additions
Depreciation charge
Closing net book amount as at
December 31

2021
Buildings andstructures

$

-229-

2020
Buildings andstructuresLand
At January 1
Cost
Accumulated depreciation$

2,268,726 $- (2,268,726 $

353,247 $
61,513) (291,734 $

2,621,973
61,513)2,560,460$

2,268,726 $- $- (291,734 $
13,498 $7,939) (2,560,460
13,4987,939)$

2,268,726

297,293$2,566,019$

2,268,726 $- (2,268,726 $

365,009 $67,716) (297,293 $2,633,735
67,716)2,566,019$
Opening net book amount as atJanuary 1
Additions
Depreciation charge
Closing net book amount as at
December 31
At December 31
Cost
Accumulated depreciation

Total

$

$

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

Rental income from investment property
Direct operating expenses arising frominvestment property that generated
rental income
Direct operating expenses arising frominvestment property that did not
generate rental income$

Years ended December 31,
2021
2020
37,253 $38,721

$

7,453

$

7,231

$

701

$

708

B. The fair value of the investment property held by the Company was $5,505,217 and $5,146,932
as of December 31, 2021 and 2020, respectively, which was based on the transaction prices ofsimilar properties in the same area.
C. No investment property was pledged to others.

-230-

(12)Other non-current assets
December 31, 2021$
14,86812,416
14,490$41,774

Guarantee deposits paid
Prepayments for business facilities
Others

December 31, 2020$
14,54912,924$27,473(13)Pensions
A. Defined benefit plan(a) The Company has 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 tocontinue to be subject to the pension mechanism under the Act. Under the defined benefit
plan, two units are accrued for each year of service for the first 15 years and one unit foreach 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 thelast 6 months prior to retirement. The Company contributes monthly an amount equal to 2%of the employees’ monthly salaries and wages to the retirement fund deposited with the
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 thepension calculated by the aforementioned method to the employees expected to qualify for
retirement in the following year, the Company will make contributions to cover the deficit
by next March.
(b) The amounts recognized in the balance sheet are as follows:

December 31, 2021
December 31, 2020
Present value of defined benefit obligations $38,857 $43,239(25,454) (26,678)Fair value of plan assets$
13,403 $16,561
Net defined benefit liability-231-

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

Present value of
defined benefit
obligations
2021
Balance at January 1
Current service cost
Interest expense (income)Remeasurements:
Return on plan assets(excluding amounts included
in interest income or expense)
Change in demographic
assumptions
Change in financial assumptions
Experience adjustments
Pension fund contribution
Paid pension
Balance at December 31

$

(
(
(
(
$

$

Remeasurements:
Return on plan assets(excluding amounts included
in interest income or expense)
Change in demographic
assumptions
Change in financial assumptions
Experience adjustments
Pension fund contribution
Paid pension
Balance at December 31

(
$

-232-

Net defined
benefit liability

43,239 ($608
151 (43,998 (26,678) $96)
26,774)

16,561608
55
17,224- (369) (

369)

1,941

-

1,941

1,836)
2,080)
1,975) (- (3,166)
38,857 ($- (- (369) (
1,477) (3,166
25,454) $1,836)
2,080)
2,344)
1,477)
13,403Present value of
defined benefit
obligations
2020
Balance at January 1
Current service cost
Interest expense (income)Fair value ofplan assets

Fair value ofplan assets

Net defined
benefit liability

40,765 ($431
326 (41,522 (24,411) $200)
24,611)

16,354431
126
16,911- (802) (

802)

105

-

105

527
1,242
1,874 (
- (157)
43,239 ($802)
1,422) (157
26,678) $

527
1,242
1,072
1,422)
16,561

(d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined
benefit pension plan in accordance with the Fund’s annual investment and utilisation planand the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor
Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit indomestic or foreign financial institutions, investment in domestic or foreign listed,over-the-counter, or private placement equity securities, investment in domestic or foreign
real estate securitisation products, etc.). With regard to the utilisation of the Fund, its
minimum earnings in the annual distributions on the final financial statements shall be noless than the earnings attainable from the amounts accrued from two-year time deposits
with the interest rates offered by local banks. If the earnings is less than aforementioned
rates, government shall make payment for the deficit after being authorised by theRegulator. The Company has no right to participate in managing and operating that fundand hence the Company is unable to disclose the classification of plan assets fair value inaccordance with IAS 19 paragraph 142. The composition of fair value of plan assets as ofDecember 31, 2021 and 2020 is given in the Annual Labor Retirement Fund Utilisation
Report announced by the government.
(e) The principal actuarial assumptions used were as follows:
Years ended December 31,
2021
2020
0.750%
0.350%
1.625%
1.625%

Discount rate
Future salary increases

Future mortality rate was estimated based on the 6th Taiwan Standard Ordinary Experience
Mortality Table.
Because the main actuarial assumption changed, the present value of defined benefit
obligation is affected. The analysis was as follows:
Discount rate
Increase
Decrease
0.25%
0.25%
December 31, 2021
Effect on present value of
defined benefit obligation
December 31, 2020
Effect on present value of
defined benefit obligation

Future salary increases
Increase
Decrease
0.25%
0.25%

($

1,158) $1,208$

1,170 ($

1,127)($

1,306) $1,364$

1,315 ($

1,267)The sensitivity analysis above is based on one assumption which changed while the otherconditions remain unchanged. In practice, more than one assumption may change all at
once. The method of analysing sensitivity and the method of calculating net pension-233-

liability in the balance sheet are the same.
The methods and types of assumptions used in preparing the sensitivity analysis did notchange compared to the previous period.
(f) Expected contributions to the defined benefit pension plan of the Company for the year
ending December 31, 2022 amount to $1,474.
(g) As of December 31, 2021, the weighted average duration of the retirement plan is 12.4
years.
B. Defined contribution plan
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 lumpsum upon termination of employment.
The pension costs under the defined contribution pension plan of the Company for the years
ended December 31, 2021 and 2020 were $34,271 and $34,696, respectively.
(14)Share capital
A. As of December 31, 2021, the Company’s authorized capital was $5,000,000, consisting of 500
million shares of ordinary stock (including 25 million shares reserved for employee stock
options), and the paid-in capital was $4,290,617 with par value of $10 per share. All proceedsfrom shares issued have been collected.
Movements in the number of the Company’s ordinary shares (shares in thousands) outstanding
are as follows:
2021
At January 1
Purchase of treasury shares (retired)At December 31

2020
429,062- (429,062429,248
186)
429,062

B. Treasury shares(a) To enhance the Company’s credit rating and stockholders’ equity, on November 7, 2019, theBoard of Directors resolved to acquire and retire 3 million ordinary shares. The acquisition
period is from November 8, 2019 to January 7, 2020, and the price ranged between $49 and$97 (in dollars) per share. The details are as follows:-234-

Name of company
holding the shares
Reason for reacquisition
The Company
Enhance the Company’s
credit rating andstockholders’ equity

Numbers of shares(in thousands)
Carrying amount
1,700 $
130,621On March 5, 2020, the Board of Directors during its meeting resolved to retire treasury
shares for capital reduction with the effective date set on March 31, 2020. The registration
was completed on April 15, 2020.
(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 andoutstanding shares and the amount bought back should not exceed the sum of retained
earnings, paid-in capital in excess of par value and realized 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 to enhance theCompany’s credit rating and the stockholders’ equity should be retired within six months ofacquisition.
(15)Capital surplus
Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of parvalue on issuance of common stocks and donations can be used to cover accumulated deficit or toissue new stocks or cash to shareholders in proportion to their share ownership, provided that theCompany has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requiresthat the amount of capital surplus to be capitalized mentioned above should not exceed 10% of thepaid-in capital each year. Capital surplus shall not be used to cover accumulated deficit unless thelegal reserve is insufficient.
(16)Retained earnings
A. In accordance with the Company’s Articles of Incorporation, the current year’s earnings, if any,
shall first be used to pay all taxes and to offset prior years’ operating losses and then 10% of
the remaining amount shall be set aside as legal reserve. The Company shall also set aside
special reserve in accordance with the regulations. On the premise that there is no effect on the
Company’s normal operations and no violation of regulations, the Company shall reserve
certain amount for maintaining stability of dividends. The remainder, if any, is the distributableearnings to be appropriated as resolved by stockholders at the stockholders’ meeting. The
Board of Directors is authorized by the shareholders to resolve the appropriation of cash
dividends and cash payment from capital surplus by a resolution adopted by a majority vote atits meeting attended by two-thirds of the total number of directors, which will then be reported-235-

to the shareholders.
B. The Company distributes dividends taking into consideration the Company’s economic
environment, growth phases, future demands for funds, long-term financial planning and the
cash flow needs of stockholders. Cash dividends shall account for at least 5% of the total
dividends distributed.
C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders inproportion 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 theirshare 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. 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 includedin the distributable earnings.
E. (a) The cash appropriations of earnings and cash payment from capital surplus for the years
ended December 31, 2020 and 2019 have been resolved at the shareholders’ meeting on
August 26, 2021 and June 19, 2020, respectively. Details are summarized below:

Legal reserve(Reversal of)
special reserve
Cash dividends

Year ended December 31, 2020
Year ended December 31, 2019
Dividends per
Dividends per
Amountshare (in dollars)
Amountshare (in dollars)$
119,625$
172,897($

13,658)1,094,107 $
1,200,074

AmountCash payment from$
capital surplus

214,531

2.55$

Cash payment
per share(in dollars)$

0.50

69,3301,544,622
1,786,849

Amount$386,156$

3.60

Cash payment
per share(in dollars)$

0.90

Actual distribution of retained earnings of 2020 and 2019 is in agreement with the amounts
resolved at the stockholders’ meeting.

-236-

(b) The appropriations of earnings and capital surplus for the year ended December 31, 2021 asproposed by the Board of Directors on March 3, 2022 are as follows:

Legal reserve
Special reserve
Cash dividends
Total

$

Year ended December 31, 2021
Dividends per share
Amount(in dollars)
254,464
73,2702,231,121 $5.20
2,558,855$

Cash dividends
per share (in dollars)
$
0.80

$
$

Cash payment from capital surplus

Amount343,249

Aforementioned proposal for the appropriations of 2021 earnings and capital surplus have
not yet been resolved by the stockholders.
(17)Other equity items

At January 1
Revaluation - gross
Revaluation transferred toretained earnings- grossCurrency translation differences
Effect from income tax
At December 31

2021
Exchangedifferences
Unrealized
on translation ofgain or loss
foreign financial
on valuation
statements$
4,395 ($
121,639) ($11,826(8,804)$- (7,417 ($

-237-

Total
117,244)
11,826- (8,804)

95,365) (19,072
197,932) ($95,365)
19,072
190,515)

At January 1
Revaluation - grossCurrency translation differences
Effect from income tax
At December 31

2020
Exchangedifferences
Unrealized
on translation ofgain or loss
foreign financial
on valuation
statements$
7,559 ($
138,461) ($(3,164)- (21,027- (4,205) ($4,395 ($
121,639) ($Total
130,902)3,164)
21,027
4,205)
117,244)(18)Operating revenue$

Sales revenue

Years ended December 31,
2021
2020
13,747,158 $
10,937,519

A. Disaggregation of revenue from contracts with customers
The Company derives revenue from the transfer of goods at a point in time in the following
geographical regions:Year ended
December 31, 2021
Revenue from externalcustomer contracts

Year ended
December 31, 2020
Revenue from externalcustomer contracts

Electronic products
America
EuropeTaiwanAsia$ 3,400,049$ 4,982,120$ 1,607,361$ 2,978,488

Others$Electronic products
America
EuropeTaiwanAsia$ 2,521,695$ 3,853,319$ 1,032,850$ 2,666,174

779,140

Others$863,481

Total$ 13,747,158

Total$ 10,937,519

B. The delay of the Company’s sales orders has a knock-on effect on the overall revenue due to
Covid-19 in the first half of 2020. However, there is no significant impact to the scope andprice of the service contracts as the Company negotiated with customers and continuously
invests in the manufacture of products for the subsequent shipments.
C. Contract assets and liabilities
The Company has no revenue-related contract assets and liabilities.

-238-

(19)Interest income

Interest income from bank deposits
Interest income from financial assets measured
at amortised cost
Other interest income$$

Years ended December 31,
2021
2020
1,102 $
23,37952,83777,318$

2,741
63,217
5,216
71,174(20)Other income$

Rental income

Years ended December 31,
2021
2020
37,253 $38,721(21)Other gains and losses
0
Loss on disposal of property, plant and equipment $Net gain on financial assets and liabilities atfair value through profit or loss(
Net currency exchange loss
Dividend income
Others$Years ended December 31,
2021
2020
- ($

2,098)

84,375

146,883

26,684) (
6,787
7,590
72,068 $34,871)
3,834
21,189134,937(22)Expenses by nature

Wages and salaries
Labor and health insurance fees
Pension costs
Other personnel expenses
Directors’ remuneration
Depreciation on property, plant and equipment(including investment property)$

Years ended December 31,
2021
2020
808,487 $
767,838
72,573
69,48834,93435,25340,766
41,5989,755
7,626
164,702170,349

A. In accordance with the Articles of Incorporation of the Company, a ratio of distributable profitof the current year, after covering accumulated losses, shall be distributed as employees’
compensation and directors’ remuneration. The ratio shall not be lower than 1% for employees’
compensation and shall not be higher than 0.2% for directors’ and supervisors’ remuneration.
-239-

B. For the years ended December 31, 2021 and 2020, employees’ compensation was accrued at$32,691 and $15,225, respectively; while directors’ remuneration was accrued at $4,577 and$2,131, respectively. The aforementioned amounts were recognized in salary expenses.
The employees’ compensation and directors’ remuneration were estimated and accrued basedon 1% and 2% of distributable profit of current period for the year ended December 31, 2021.
The employees’ compensation and directors’ remuneration resolved by the Board of Directors
were $31,542 and $3,200, respectively, and the employees’ compensation will be distributed in
the form of cash.
The difference between employees’ compensation and directors’ remuneration as resolved by
the Board of Directors and the amounts recognized in the 2020 financial statements by $438
and $29, respectively, has been adjusted in profit or loss for 2021.
Information about employees’ compensation and directors’ remuneration of the Company asapproved at the meeting of Board of Directors and resolved by the stockholders at their meeting
will be posted in the “Market Observation Post System” at the website of the Taiwan Stock
Exchange.
(23)Income tax
A. Income tax expense(a) Components of income tax expense:
Years ended December 31,
2021
2020
Current tax:
Current tax on profits for the year
Prior year income tax (overestimation)
underestimation
Total current tax
Deferred tax:
Origination and reversal of temporary
differences
Total deferred tax
Income tax expense$

586,853$

252,898(

1,530)
585,323489
253,387(($

1,658)
1,658)
583,665 $10,17010,170263,557(b) The income tax relating to components of other comprehensive income is as follows:
Years ended December 31,
2021
2020
Exchange differences on translation offoreign financial statements

-240-

($

19,072) $4,205

B. Reconciliation between income tax expense and accounting profit
Years ended December 31,
2021
2020
Income tax calculated by applying statutory
rate to the profit before tax
Effects from tax exemption and items
disallowed by tax regulation
Prior year income tax (overestimation)
underestimation
Effect from investment tax credits
Income tax expense$

623,392$

292,258(

37,538) (28,597)((1,530)
659) (
583,665 $489
593)
263,557$

C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:
2021
Recognized inothercomprehensive
Recognized in
profit or loss
incomeAt January 1
Deferred income tax assets
Amount of allowance for bad debts
that exceed the limit for tax
purposePension provision amount in excess
of appropriation amountRoyalty fees
Accrued hard drive recycling fees
Unrealized sales discounts andallowances
Unrealized gross profit from sales
Unrealized loss on market value
decline and obsolete andslow-moving inventories
Currency translation differences
Total

$

At December 31

1,609 ($

1,609) $-$-5,137 (

162)

-

4,975

4,342 (

2,171)

-

2,171

-

1,794

-

1,794

8,313 (

2,031)-

6,282

2,692 (

540)

-

2,152

7,032

3,472

-

10,504$

29,125 ($1,247) $11,065
11,065$

11,06538,943($((2,774) $8,007)
128,822)

1,845
1,060

- ($
8,007
- (

929)
127,762)(($86)
139,689) $

2,905

- (
8,007 ($

86)
128,777)

Deferred income tax liabilities
Unrealized exchange gain
Currency translation differences
Net gain on investment accounted
for using equity method
Others
Total

-241-

$

$

At January 1
Deferred income tax assets
Amount of allowance for bad debts
that exceed the limit for tax
purposeUnrealized exchange loss
Pension provision amount in excess
of appropriation amountRoyalty fees
Unrealized sales discounts andallowances
Unrealized gross profit from sales
Unrealized loss on market value
decline and obsolete andslow-moving inventories
Total

$

2020
Recognized inotherRecognized in comprehensive
profit or loss
income1,857 ($

248) $-At December 31
$

1,609

30,166 (5,310 (

30,166)
173)

-

5,137

10,088 (

4,342
1,775)

-

4,342
8,313

6,138 (

3,446)

-

2,692

5,715
59,274 ($1,317
30,149) $

-

$

7,032
29,125$((- ($3,802)
151,575)

2,774) $- (22,753- ($4,205) (- (2,774)
8,007)
128,822)(($86)
155,463) $19,979 ($- (4,205) ($86)
139,689)$

Deferred income tax liabilities
Unrealized exchange gain
Currency translation differences
Net gain on investment accounted
for using equity method
OthersTotal

D. The Company’s income tax returns through 2019 have been assessed and approved by the Tax
Authority.

-242-

(24)Earnings per share
Year ended December 31, 2021
Weighted-averagecommon shares
Earnings
outstanding
per share
Profit after tax(in thousands)(in dollars)
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
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all
dilutive potential ordinary
shares$2,533,294

429,062$2,533,294

429,062-485

2,533,294

429,547

$

$

5.90

$

5.90

Year ended December 31, 2020
Weighted-averagecommon shares
Earnings
outstanding
per share
Profit after tax(in thousands)(in dollars)
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
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent plus
assumed conversion of all
dilutive potential ordinary
shares$1,197,735

429,064$

1,197,735

429,064-366

1,197,735

429,430

$

-243-

$

2.79

$

2.79

7. RELATED PARTY TRANSACTIONS(1)Names of related parties and relationshipNames of related parties

Relationship with the Group

Transcend Japan Inc.
Transcend Information Inc.
Transcend Korea Inc.
Transcend Information Europe B.V.
Transcend Information Trading GmbH
Transcend Information (H.K.) Ltd.
Transcend Information (Shanghai), Ltd.
(Transcend Shanghai)Transtech Trading (Shanghai) Co., Ltd.
Transcend Information (Hong Kong), Ltd.
Taiwan IC Packaging Corporation
Won Chin Investment Inc. (Won Chin)
Cheng Chuan Technology Development Inc.
(Cheng Chuan)

Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Associate accounted for using equity method
Other related party
Other related party(2)Significant transactions and balances with related parties
A. Operating revenue
Years ended December 31,
2021
2020
Sales of goods－Subsidiary－Associates accounted for using the equity
method$4,194,478$

1,393
4,195,871$

3,392,429$

2,016
3,394,445

The sales prices charged to related parties are approximate to those charged to third parties. The
credit term to related parties was 120 days after monthly billings, excluding the credit term of 30days after delivery to Taiwan IC Packaging Corporation, and the credit term to generalcustomers was 30 to 60 days after monthly billings.
B. Purchases
Years ended December 31,
2021
2020
Purchases of goods－Associates accounted for using the equity
method-244-$

235,161$

231,335

The purchase prices charged by related parties are approximate to those charged by third parties.
The payment term to the Company’s associate accounted for using equity method, Taiwan IC
Packaging Corporation, is 30 days after monthly billings.
C. Accounts receivable

Receivables from related parties－Subsidiary-Transcend Japan Inc.
－Subsidiary-Others

December 31, 2021

December 31, 2020$$

78,741
196,988
275,729$

139,509
264,851
404,360$

The receivables from related parties arise mainly from sale transactions. The credit term to theCompany’s associate accounted for using equity method, Taiwan IC Packaging Corporation, is
30 days after delivery. The credit term to subsidiaries is 120 days after monthly billings. The
receivables are unsecured in nature and bear no interest. There are no allowances foruncollectible accounts held against receivables from related parties.
D. Accounts payable

December 31, 2021
Payables to related parties－Subsidiary-Transcend Shanghai－Subsidiary-Others－Associates accounted for using the equity
method$$December 31, 2020

408,198 $92

411,2991,991

52,241
460,531

37,416450,706$

The payables to related parties arise mainly from purchase transactions, and information on thepayment term is provided in Note 7(2) B. The payables bear no interest.
E. Other payables
December 31, 2021

December 31, 2020

Other payables$
17,431 $
17,564－Subsidiary
Other payables to related parties arise mainly from purchase of fixed assets and miscellaneoustransactions. The other payables bear no interest.

F. Miscellaneous income
For the years ended December 31, 2021 and 2020, the expendables sold to related parties, whichwere recognized in non-operating income, amounted to $963 and $1,572, respectively.

-245-

G. Leasing arrangements - lessee
The Company signed a land lease contract with its major stockholders, Won Chin and Cheng
Chuan, to build a new plant on the leased land with a lease term of 3 years from June 12, 2019 toJune 11, 2022. The annual rental payment is $37,058 (excluding tax), which was determinedbased on the average rent of land near the leased land shown in the appraisal report issued by
Sinyi Real Estate Appraisers Firm. Rent was paid on the contract date and becomes payable on
the same date each following year until the end of the lease. As of December 31, 2021 and 2020,
the balance of related right-of-use assets amounted to $15,263 and $51,893 while lease liabilities
amounted to $0 and $36,815, respectively.
H. Endorsements and guarantees:
As of December 31, 2021 and 2020, information on the Company providing endorsements andguarantees to associates is provided in Note 13(1) B.
(3)Key management compensation$

Salaries and other employee benefits

Years ended December 31,
2021
2020
44,300 $35,811

8. PLEDGED ASSETS
None.
9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACTCOMMITMENTS
As of December 31, 2021, except for the provision of endorsements and guarantees mentioned in Note
7 and 13(1) B, there are no other significant commitments.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
Information on distribution of 2021 earnings and cash dividends from capital surplus is provided in
Note 6(16) E(b).

-246-

12. OTHERS(1) Capital risk management
The Company’s objectives when managing capital are to safeguard the Company’s ability tocontinue as a going concern in order to provide returns for shareholders and to maintain an optimal
capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure,
the Company may adjust the amount of dividends paid to shareholders, return capital toshareholders, issue new shares or sell assets to reduce debt. The Company’s own funds are
currently sufficient, daily operations can create stable cash inflows, and there are no significant
capital expenditure plans in the short term. Except for obtaining loans to reduce the exchange rate
exposure, the Company has sufficient funds to cover its own needs. Debt financing is notnecessary.
(2) Financial instruments
A. Financial instruments by category

Financial assets
Financial assets mandatorily measured
at fair value through profit or loss
Financial assets at fair value throughother comprehensive income
Financial assets at amortised cost
Cash and cash equivalents
Financial assets at amortised cost
Notes receivable
Accounts receivable (including relatedparties)
Other receivables
Refundable deposits

December 31, 2021

December 31, 2020

$

$

$

Financial liabilities
Financial liabilities at amortised costAccounts payable (including relatedparties)
Other payables (including relatedparties)
Lease liabilities-247-

1,618,194

4,255,920

629,576

111,000

1,659,848
5,480,400
2,499

399,5745,450,000
759

1,413,318
105,235
14,868
10,923,938

1,215,008
70,135
14,54911,516,945$

December 31, 2021

December 31, 2020$

1,824,375$

1,582,722$$

269,798
2,094,173 $- $224,528
1,807,250
36,815

B. Financial risk management policies(a) The objective of the Company’s risk management is to identify and analyse all the risks(including market risk, credit risk, liquidity risk and cash flow risk) by examining theimpact of the macroeconomics, industrial developments, market competition and theCompany’s business development so as to achieve the optimized risk position, to maintainadequate liquidity position and to centralize the management of all market risks.
(b) To manage the Company’s assets, liabilities and expenditures efficiently and reach the risk
management target in relation to decreasing the risk of exchange rate changes, theCompany’s hedging strategy is using forward foreign currency transaction or foreign
currency options. The Company operates hedging transaction based on the Company’s net
position of assets, liabilities and future cash flows estimations in order to efficiently
decrease the market price risk arising from foreign currency fluctuation.
C. Significant financial risks and degrees of financial risks(a) Market risk
Foreign exchange riski.

ii.

The Company operates internationally and is exposed to exchange rate risk arisingfrom the transactions of the Company used in various functional currency, primarily
with respect to the USD. Exchange rate risk arises from future commercial transactions
and recognized assets and liabilities.
The Company’s businesses involve some non-functional currency operations. The
information on assets and liabilities denominated in foreign currencies whose values
would be materially affected by the exchange rate fluctuations is as follows:

December 31, 2021
Foreign Currency
AmountFinancial assets
Monetary items
USD：NTDRMB：NTD
JPY：NTD
EUR：NTD
Long-term equity investment
accounted for using theequity method
USD：NTD
JPY：NTD
KRW：NTD

Exchange rate

Book value
(NTD)

$

104,786
58,710417,739
2,617

27.68
4.344
0.240531.32

2,900,476
255,036
100,466
81,964$60,708954,7442,377,021

27.68
0.24050.0235

1,680,385
229,616
55,860-248-

December 31, 2021
Foreign Currency
AmountFinancial liabilities
Monetary items
USD：NTDRMB：NTD

$

41,90097,981

Exchange rate

27.68
4.344

Book value(NTD)

1,159,792
425,629

December 31, 2020
Foreign Currency
AmountFinancial assets
Monetary items
USD：NTD
JPY：NTD
EUR：NTDRMB：NTD
KRW：NTD
Long-term equity investment
accounted for using theequity method
USD：NTD
JPY：NTD
KRW：NTD
Financial liabilities
Monetary items
USD：NTDRMB：NTD

Exchange rate

Book value
(NTD)

$

25,784
626,946
4,649
48,343
763,73928.48
0.276335.02
4.377
0.0264734,328
173,225
162,808
211,597
20,163$

61,251
930,9122,231,212

28.48
0.27630.0264

1,744,419
257,21158,904$35,42597,981

28.48
4.377

1,008,904
428,863

iii. The information on total exchange (loss) gain, including realized and unrealized arisingfrom significant foreign exchange variation on the monetary items held by theCompany for the years ended December 31, 2021 and 2020 is provided in Note 6(21).
iv. Sensitivity analysis relating to foreign exchange rate risks is primarily for financial
reporting period-end date of foreign currency monetary item. If the New Taiwan dollar
exchange rate to the U.S. dollar increases or decreases by 1%, the Company’s net
income will decrease or increase by $17,407 and $2,746 for the years ended December
31, 2021 and 2020, respectively.

-249-

Price riski.

The Company is exposed to equity securities price risk because of investments held by
the Company and classified on the balance sheet as financial assets at fair value
through profit or loss and other comprehensive income. The Company is not exposed
to commodity price risk. To manage its price risk arising from investments in equity
securities, the Company diversifies its portfolio.

ii.

The Company’s investments in listed and unlisted equity securities 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, post-tax profit for theyears ended December 31, 2021 and 2020 would have increased/decreased by $16,182
and $42,559, respectively, as a result of gains/losses on equity securities classified as atfair value through profit or loss. Other components of equity would haveincreased/decreased by $6,296 and $1,110, respectively, as a result of othercomprehensive income classified as equity investment at fair value through othercomprehensive income.

Cash flow and fair value interest rate riski.

The Company’s principal interest-bearing assets are cash and cash equivalents andfinancial assets at amortised cost. Cash and cash equivalents are due within twelve
months. Financial assets at amortised cost are maintained at fixed rates. Therefore, it isassessed that there is no significant cash flow interest rate risk.

ii.

The Company has not used any financial instruments to hedge its interest rate risk.

(b) Credit riski.

Credit risk refers to the risk of financial loss to the Company 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 basedon the agreed terms, and the contract cash flows of debt instruments stated at amortised
cost.

ii.

The Company manages its credit risk taking into consideration the entire group’s
concern. According to the Company’s credit policy, each local entity in the Company is
responsible for managing and analyzing the credit risk for each of their new clients
before standard payment and delivery terms and conditions are offered. To control
internal risk, the Company assesses the credit quality of the customers, taking into
account their financial position, past experience and other factors. Individual risk limits
are set based on internal or external ratings in accordance with limits set by the Boardof Directors. The utilisation of credit limits is regularly monitored.
-250-

iii. The Company determines that the default occurs when the contract payments are pastdue over 180 days.
iv. The Company adopts the following assumptions under IFRS 9 to assess whether there
has been a significant increase in credit risk on that instrument since initial recognition:(i) If the contract payments were past due over 30 days based on the terms, there has
been a significant increase in credit risk on that instrument since initial recognition.
(ii) For investments in bonds that are traded over the counter, if any external credit
rating agency rates these bonds as investment grade, the credit risk of thesefinancial assets is low.
v.

If the credit rating grade of an investment target degrades two scales, there has been asignificant increase in credit risk on that instrument since initial recognition.

vi. The following indicators are used to determine whether the credit impairment of debt
instruments has occurred:(i) It becomes probable that the issuer will enter bankruptcy or other financial
reorganization due to their financial difficulties;(ii) The disappearance of an active market for that financial asset because of financial
difficulties;(iii) Default or delinquency in interest or principal repayments;(iv) Adverse changes in national or regional economic conditions that are expected tocause a default.
vii. For details of credit risk in relation to accounts receivable and notes receivable, pleaserefer to Note 6(4).
viii. For details of credit risk in relation to debt instrument investments measured atamortised cost, please refer to Note 6(3).
(c) Liquidity riski.

Cash flow forecasting is performed in the operating entities of the Company andaggregated by Company treasury. Company treasury monitors rolling forecasts of theCompany’s liquidity requirements to ensure it has sufficient cash to meet operational
needs.

ii.

Surplus cash held by the operating entities over and above balance required forworking capital management are transferred to the Company treasury. Company
treasury invests surplus cash in interest bearing current accounts, time deposits andmonetary funds, choosing instruments with appropriate maturities or sufficientliquidity to provide sufficient headroom as determined by the abovementioned-251-forecasts. As at December 31, 2021 and 2020, the Company held money market
position of $8,646,843 and $9,360,572, respectively, that are expected to readily
generate cash inflows for managing liquidity risk.
iii. The Company’s non-derivative financial liabilities are analysed based on the remaining
period at the balance sheet date to the contractual maturity date and all the Company’s
financial liabilities expire within one year.
(3) Fair value information
A. The different levels that the inputs to valuation techniques are used to measure fair value offinancial and non-financial instruments have been defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that theentity can access at the measurement date. A market is regarded as active where amarket in which transactions for the asset or liability take place with sufficientfrequency and volume to provide pricing information on an ongoing basis. The fairvalue of the Company’s investment in listed stocks and beneficiary certificates is
included in Level 1.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for theasset or liability, either directly or indirectly. The fair value of the Company’s
investment in non-hedging derivatives is included in Level 2.
Level 3: Unobservable inputs for the asset or liability. The fair value of the Company’s
investment in equity investment without active market, financial products andinvestment property is included in Level 3.
B. Fair value information of investment property at cost is provided in Note 6(11).
C. Financial instruments not measured at fair value
Except for those listed in the table below, the carrying amounts of cash and cash equivalents,
financial assets at amortised cost, notes receivable, accounts receivable, other receivables,
accounts payable and other payables are approximate to their fair values.

-252-

D. The related information on 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 are as
follows:
Level 1

December 31, 2021
AssetsRecurring fair value measurements
Financial assets at fair value throughprofit or loss
Beneficiary certificates$

Level 2

1,618,194 $Level 3

- $

Total

- $

1,618,194

Financial assets at fair value throughother comprehensive income
628,451

Equity securities$
December 31, 2020
AssetsRecurring fair value measurements
Financial assets at fair value throughprofit or loss
Beneficiary certificates

2,246,645 $Level 1$4,255,920 $

-

1,125

- $

1,125 $

Level 2

Level 3

- $629,576
2,247,770
Total

- $

4,255,920

Financial assets at fair value throughother comprehensive income
109,875

Equity securities$

4,365,795 $

-

1,125

- $

1,125 $

111,000
4,366,920

E. The fair value of financial instruments traded in active markets is based on quoted market
prices at the balance sheet date. A market is regarded as active if quoted prices are readily andregularly available from an exchange, dealer, broker, industry group, pricing service, or
regulatory agency, and those prices represent actual and regularly occurring market transactions
on an arm’s length basis. The quoted market price used for financial assets held by theCompany is the closing price. These instruments are included in Level 1. Instruments includedin Level 1 comprise primarily listed stocks classified as financial assets at fair value throughother comprehensive income.
F. If one or more of the significant inputs is not based on observable market data, the instrument
is included in level 3.
G. There was no change in Level 3 financial instruments for the years ended December 31, 2021
and 2020.

-253-

(4) Other matters
Due to the strong demand in the industrial chain and the use of its products in diverse applications
this year, the Company’s orders from domestic and foreign customers were not impacted by the
COVID-19 pandemic. The operation and production headquarters in Taiwan have activated therelevant contingency mechanisms, adopted high-standard COVID-19 preventive measures andmonitored employees’ health condition on a daily basis. Overall, in 2021, the pandemic had no
significant impact on the Group’s operations and financial performance and did not cause any
suspension of work and production. Also, the Group has delivered good sales and profit
performance.
13. SUPPLEMENTARY DISCLOSURES(1)Significant transactions information
A. Loans to others: None.
B. Provision of endorsements and guarantees to others: Please refer to table 1.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates
and joint ventures): Please refer to table 2.
D. Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million
or 20% of the Company’s paid-in capital: Please refer to table 3.
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 relate parties reaching NT$100 million or 20% of theCompany’s paid-in capital or more: Please refer to table 4.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more:
Please refer to table 5.
I. Trading in derivative instruments undertaken during the reporting periods: None.
J. Significant inter-company transactions during the reporting periods: Please refer to table 6.
(2)Information on investees
Names, locations and other information of investee companies (not including investees in
Mainland China): Please refer to table 7.

-254-

(3)Information on investments in Mainland China
A. Basic information: Please refer to table 8.
B. Significant transactions, either directly or indirectly through a third area, with investee
companies in the Mainland Area: Please refer to table 6.
(4)Major shareholders information
Major shareholders information: Please refer to table 9.
14. SEGMENT INFORMATION
None.

-255-

T ranscend Information, Inc.
Provision of endorsements and guarantees to others
Year ended December 31, 2021
T able 1

Expressed in thousands of NT D
(Except as otherwise indicated)
Maximum

Ratio of

Party being

Limit onoutstanding

Outstanding

endorsed/guaranteed

endorsements/

endorsement/

endorsement/

Provision of

accumulated
Amount ofendorsements/ Provision ofendorsement/

Ceiling on total

Provision ofguarantees by endorsements/ endorsements/

Relationship withguarantees

guarantee

guarantee

Actualamount ofparentguarantees by

guarantees tothe endorser/

provided for aamount as ofamount at

amount drawn

guarantees

net asset value ofendorsements

company tosubsidiary to

the party inthe endorser//guarantees

subsidiaryparentMainlandguarantor company provided (Note 7)(Note 8)company

China

Footnote

2

Y

-

-

-

endorsements/ guarantee amount to

NumberEndorser/Company

guarantor

single party

December 31,

December 31,

down

secured with(Note 1)guarantor

name(Note 2)

(Note 3)2021 (Note 4)2021 (Note 5)(Note 6)collateral0

T ranscend
T aiwan

T ranscend
Japan Inc.

2

$ 3,966,967$
543,200$
481,000 $(JPY $2,000,000) (JPY $2,000,000)(In thousands)

-

-

$

7,933,934(In thousands)

Note 1: T he numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:(a) T he Company is ‘0’.
(b) T he subsidiaries are numbered in order starting from ‘1’.
Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following seven categories; fill in the number of category each case belongs to:(a) Having business relationship(b) T he endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.
(c) T he endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company.
(d) T he endorser/guarantor parent company owns directly and indirectly more than 90% voting shares of the endorsed/guaranteed company.
(e) Mutual guarantee of the trade made by the endorsed/guaranteed company or joint contractor as required under the construction contract.
(f) Due to joint venture, all shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.
(g) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.
Note 3: Not exceeding 20% of the Company’s net asset value. ($19,834,835*20%=$3,966,967)
Note 4: T he maximum outstanding endorsement/guarantee amount during and as of December 31, 2021 is JPY$2,000,000 (In thousands).
Note 5: T he amount was approved by the Board of Directors.
Note 6: T he actual amount of endorsement drawn down is $0.
Note 7: Not exceeding 40% of the Company’s net asset value.( $19,834,835*40%=$7,933,934)
Note 8: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary.

-256-

T ranscend Information, Inc.
Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)
December 31, 2021
T able 2

Expressed in thousands of NT D
(Except as otherwise indicated)
As of December 31, 2021
Marketable securities

Relationship with the

General

Number ofBook value

Ownership(Note 1)securities issuer (Note 2)

ledger accountshares(Note 3)(%)

T rendForce Corporation-

Non-current financial
assets at fair value through othercomprehensive income

Fubon Financial Holding Co., Ltd.
Preferred Shares B-"

T aiwan Semiconductor
Manufacturing Co., Ltd.

-"ASUST ek Computer Inc.

-

Securities held by
T ranscend T aiwan

Footnote
Fair value(Note 4)

StocksFubon Financial Holding Co., Ltd.
Cathay Financial Holding Co. Ltd.
AU Optronics Corporation
Innolux Corporation
Formosa Plastics Corporation-

60,816

$

1,125

1

1,758,000

110,930

380,000

$

1,125

-

-

110,930-

233,700-

233,700-

410,000

154,160-

154,160-

1,067,016

81,413-

81,413-200,000

12,500-12,500-200,000

4,580

-

4,580

-

200,000

3,920

-

3,920

-

27,248-27,248-$ 1,506,595-$ 1,506,595

-

$

-

$

-

"
"
"
"
"
"
262,000$

629,576

Beneficiary certificates
T aishin 1699 Money Market Fund-

Current financial assets
at fair value throughprofit or loss

Yuanta T aiwan T op 50 ET F-

Non-current financial assets
at fair value throughprofit or loss

110,142,508

767,000

111,599

111,599

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities within the scope of IFRS 9 ‘Financial instruments’.
Note 2: Leave the column blank if the issuer of marketable securities is non-related party.
Note 3: Fill in the amount after adjusted at fair value and deducted by accumulated impairment for the marketable securities measured at fair value; fill in the acquisition cost or amortised cost deducted by accumulated impairment for themarketable securities not measured at fair value.
Note 4: The number of shares of securities and their amounts pledged as security or pledged for loans and their restrictions on use under some agreements should be stated in the footnote if the securities presented herein have such conditions.

-257-

T ranscend Information, Inc.
Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in capitalYear ended December 31, 2021
T able 3

Expressed in thousands of NT D
(Except as otherwise indicated)

Marketable
Investor
T ranscend
T aiwanGeneralRelationship

Balance as at

Addition

Disposal

Balance as atwithJanuary 1, 2021

（Note 3）（Note 3）

December 31, 2021

securities

ledgerCounterparty

the investor

Number（Note 1）account（Note 2）

（Note 2）of shares

Amountof shares

Amountof shares

Selling priceBook value

T aishin 1699
Money Market
Fund

Current
financial assets
at fair value
through profit
or loss--

257,293,248$ 3,501,229

109,792,580$ 1,500,000

256,943,320$ 3,511,865$ 3,499,281

Yuanta T aiwan
High-yield
LeadingCompany FundB

Non-current
financial assets
at fair value
through profit
or loss--

50,000,000

500,000--

50,000,000

680,350

500,000

NumberNumber$Gain onNumberdisposalof shares

Amount12,584

110,142,508$ 1,501,948

180,350--

Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities.
Note 2: Fill in the columns the counterparty and relationship if securities are accounted for under the equity method; otherwise leave the columns blank.
Note 3: Aggregate purchases and sales amounts should be calculated separately at their market values to verify whether they individually reach NT $300 million or 20% of paid-in capital or more.
Note 4: Paid-in capital referred to herein is the paid-in capital of parent company. In the case that shares were issued with no par value or a par value other than NT $10 per share, the 20 % of paid-in capital shall be replaced by 10% of equity
attributable to owners of the parent in the calculation.

-258-

T ranscend Information, Inc.
Purchases or sales of goods from or to related parties reaching NT $100 million or 20% of paid-in capital or moreYear ended December 31, 2021
T able 4

Expressed in thousands of NT D
(Except as otherwise indicated)

Differences in transaction terms compared to
T ransaction

Purchaser/seller

Counterparty

T ranscend T aiwan T ranstech T rading(Shanghai) Co., Ltd.

third party transactions (Note 1)

Percentage

Percentage ofof total sales

total notes/accounts

Relationship with theSalescounterparty(purchases)

AmountSales$ 1,196,974

9

Subsidiary of Memhiro

Notes/accounts receivable (payable)(purchases)

Credit term

Unit price

Credit term

120 days after No significant 30 to 60 days after monthly
monthly billings
difference billings to third parties

Balance$receivable (payable)

Footnote

132,276

9-"

T ranscend Japan Inc.

T he Company’s
subsidiary"

710,838

5

"

"

"

78,741

6-"

T ranscend Information,Inc.

T he Company’s
subsidiary"

627,401

5

"

"

"

13,312

1-"

T ranscend Information
Europe B.V.

Subsidiary of Memhiro"

594,935

4

"

"

"

27,6582-"

T ranscend Korea Inc.

T he Company’s
subsidiary"387,849

3

"

"

"

10,834

1-"

T ranscend Information
T rading GmbH

Subsidiary of Memhiro"

378,089

3

"

"

"

7,563

1

-

"

T ranscend Information(H.K) Ltd.

Subsidiary of Memhiro"

298,392

2

"

"

"

5,346

T ranscend
Information
Europe B.V.

T ranscend Information
T rading GmbH

Controlled by the same
ultimate parent company"

138,60920

30 days after
delivery"

7 to 60 days after delivery to
third parties

602

1

-

Associate accounted forusing equity method(Purchase)

235,161)(2)

30 days aftermonthly billings"

30 to 45 days after monthly (billings to third parties

52,241)(3)-

T ranscend T aiwan T aiwan IC Packaging
Corporation(

Note 1: T he Company’s sales to subsidiaries were equivalent to subsidiaries' purchases from the Company; accordingly, the Company did not disclose the information on subsidiaries’ purchases from the Company.

-259-

-

-

T ranscend Information, Inc.
Receivables from related parties reaching NT $100 million or 20% of paid-in capital or moreYear ended December 31, 2021
T able 5

Expressed in thousands of NT D
(Except as otherwise indicated)

Overdue receivables

Balance as at
Relationship

December 31,

with the counterparty

2021

Creditor

Counterparty

T ranscend T aiwan

T ranstech T rading (Shanghai) Co., Ltd.

Subsidiary of Memhiro

T ranscend T aiwan

Ultimate parent company

T ranscend Information(Shanghai), Ltd.

$T urnover rate

Amount132,276

7.87

408,198

-

-260-

$

Amount collected

Action taken--

408,198-$

subsequent to the

Allowance forbalance sheet date

doubtful accounts

132,276---

T ranscend Information, Inc.
Significant inter-company transactions during the reporting year
Year ended December 31, 2021
T able 6

Expressed in thousands of NT D
(Except as otherwise indicated)
T ransaction
Relationship

General ledger(Note 1)

NumberCompany nameCounterparty(Note 2)

account

AmountT ransaction terms

0

T ranscend T aiwan

T ranstech T rading (Shanghai) Co., Ltd.

1

Sales

$ 1,196,974

8

"

"

T ranscend Japan Inc.

""

710,838

T here is no significant
difference in unit pricefrom those to third parties.
"""

T ranscend Information, Inc.

""

627,401

"

4

"

"

T ranscend Information Europe B.V.

""

594,935

"

4

"

"

T ranscend Korea Inc.

""

387,849

"

3

"

"

T ranscend Information T rading GmbH""

378,089

"

3

"

"

T ranscend Information (H.K) Ltd.

""298,392

"

2

"

"

T ranscend Information (Shanghai), Ltd.

"

Accounts Payable

408,198)

120 days after monthly billings

Percentage of consolidated total operating(

revenues or total assets (Note 3)

5((Individual transactions not exceeding 1% of the consolidated total revenue and total assets are not disclosed.)
Note 1: T he numbers filled in for the transaction company in respect of inter-company transactions are as follows:(a) Parent company is "0".
(b) Subsidiaries were numbered 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, 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 todisclose 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.):(a) Parent company to subsidiary.
(b) Subsidiary to parent company.
(c) Subsidiary to subsidiaries.
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.

-261-

2)

T ranscend Information, Inc.
Information on investees
Year ended December 31, 2021
T able 7

Expressed in thousands of NT D
(Except as otherwise indicated)

Initial investment amount

Investment income

Shares held as at December 31, 2021
Net profit (loss)

Balance as at

T ranscend T aiwan

Investee

Location

Main business activities

by the Company

for the year

for the year ended

Balance as at

December 31, December 31,
Investor

2021

2020

$ 1,202,418(loss) recognizedof the investee

ended December December 31, 2021

Ownership

31, 2021(Note 1)

Footnote

Number of shares(%)

Book value$ 1,202,418

36,600,000100$ 1,496,302 ($23,916) ($23,916)Note 2

Saffire Investment Ltd.

B.V.I.

Investment holdings

T ranscend Japan Inc.

Japan

Wholesale of computer memory
modules and peripheral products

89,103

89,1036,400

100

229,616

6,218

6,218

Note 2T ranscend Information,
Inc.

United States Wholesale of computer memoryof America
modules and peripheral products

38,592

38,592625,000

100

184,082

8,448

8,448

Note 2T ranscend Korea Inc.

Korea

Wholesale of computer memory
modules and peripheral products

6,132

6,132

40,000100

55,861

3,942

3,942

Note 2

T aiwan IC Packaging
Corp.

T aiwanPackaging of Semi-conductors

354,666

354,666

21,928,036

12.52

148,514411,645

52,590Note 5

Saffire Investment
Ltd.

Memhiro Pte Ltd.

Singapore

Investment holdings

1,156,920

1,156,920

55,132,000100

1,463,177 (

24,050) (24,050)Note 3

Memhiro Pte Ltd.

T ranscend Information
Europe B.V.

Netherlands

Wholesale of computer memory
modules and peripheral products

1,693

1,693

100

100

220,732

8,813

8,813

Note 4T ranscend Information
T rading GmbHGermany

Wholesale of computer memory
modules and peripheral products

2,288

2,288

-

100

112,428

12,251

12,251

Note 4T ranscend Information(H.K.) Ltd.

Hong Kong

Wholesale of computer memory
modules and peripheral products

7,636

7,636

2,000,000

100

29,868

4,924

4,924

Note 4Note 1: T he Company does not directly recognize the investment income (loss) except for the subsidiaries directly held.
Note 2: Subsidiary of the Company.
Note 3: Subsidiary of Saffire.
Note 4: Subsidiary of Memhiro.
Note 5: Please refer to Note 6 (7).

-262-

T able 8

T ranscend Information, Inc.

Expressed in thousands of NT D

Information on investments in Mainland China(Except as otherwise indicated)Year ended December 31, 2021
Amount remitted fromT aiwan to Mainland
Accumulated
amountMain business activities

T ranscend
Manufacture and sales ofInformation
computer memory modules,(Shanghai), Ltd. storage products and disks
and lease of self-ownedbuildings
T ranstech
T rading(Shanghai) Co.,Ltd.

Paid-in capital$

Wholesale, agent, importand export and retail ofcomputer memory modules,
storage products andcomputer components

Accumulated
Net income

Investment

back to T aiwan forof remittance fromthe year ended

remittance(loss)

Ownership

recognizedBook value ofT aiwan to

December 31, 2021

from T aiwan toof investee forheld byby the Company

investments inRemitted Mainland China as of the year ended the Company for the year ended Mainland China

methodas of January 1,

Mainlandback toDecember 31,

December 31,(direct orDecember 31,

as of December（Note 1）

2021

China

T aiwan

2021

2021

indirect)2021 (Note 2)

31, 2021

1,134,178

2

16,3102$

Investment

Ceiling onamount approved

investments in

Commission ofremittance from T aiwan to

the Ministry of

Investment

Mainland China as of

Economic Affairs

Commission of

December 31, 2021
1,134,178

1,134,178--

16,310--$1,134,178 ($

74,909)100

16,3109,550

100

1,134,178$

1,150,488

16,3101,150,488

imposed by the(MOEA)$

amountRemitted toby the Investment Mainland China

T ranscend$
Information(Shanghai), Ltd.
T ranstech
T rading(Shanghai) Co.,Ltd.
$

income (loss)

Mainland China

Accumulated amount ofCompany nameAccumulated

amount ofInvestment
Investee in
Mainland China

China/Amount remitted

MOEA
$

-

$

11,900,901

16,310-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) T hrough investing in an existing company in the third area (Memhiro Pte Ltd.), which then invested in Mainland China.
(3) Others.
Note 2: T he gain and loss on investment recognized for the year was based on the financial statements that were audited by R.O.C. parent company’s CPA.
Note 3: T he numbers in this table are expressed in New T aiwan Dollars.

-263-

($

74,909) $1,048,836

9,550

46,360of investment
incomeremitted back to
T aiwan as ofDecember 31, 2021 Footnote$

1,464,028---

Transcend Information, Inc.
Major shareholders information
December 31, 2021
Table 9

SharesName of major shareholders

Number of shares held

Shareholding ratio

Won Chin Investment Inc.

74,783,600

17.42

Wan An Technology Inc.

34,142,854

7.95

Cheng Chuan Technology Development Inc.

32,971,701

7.68

Wan Min Investment Inc.

29,726,397

6.92

Wan Chuan Investment Inc.

29,505,896

6.87

-264-

6.6. The Company should disclose the financial impact to the Company if the Company and its
affiliated companies have incurred any financial or cash flow difficulties in 2021 and as ofthe date of this Annual Report.
None.
7. Review and Analysis of Financial Position, Financial Performance, and Risk Management
7.1. Analysis of Financial Position
Unit: NT$ thousands
Difference
Amount%Analysis
2,158,693
14.77(61,957)(6.51)(340,311)(14.91)

Year

2021
2020
Item
Current Assets
16,773,957
14,615,264
Funds and Investments (Note 1)
889,689
951,646
Property, Plant and Equipment
1,942,013
2,282,324
Intangible Assets
Other Assets (Note 2)
2,832,842
2,888,388(55,546)(1.92)
22,438,501
20,737,622
1,700,879
8.20
Total Assets
Current Liabilities
2,401,653
1,837,754
563,89930.68(1)
Non-current Liabilities
202,013
227,842(25,829)(11.34)2,603,666
2,065,596
538,070
26.05(1)
Total Liabilities
Capital Stock
4,290,617
4,290,617
Capital surplus
3,730,914
3,945,369(214,455)(5.44)
Retained Earnings
12,003,819
10,553,284
1,450,535
13.74
Other Adjustments(190,515)(117,244)(73,271)62.49(2)19,834,835
18,672,026
1,162,809
6.23
Total Stockholders' Equity
Analysis of Deviation over 20%:(1) It was mainly due to the inventory purchase and the increase in the profit before tax, such that accounts
payable and accrual tax liabilities increased at the end of the period.
(2) It was mainly due to the appreciation in New Taiwan Dollars, relative to other currencies, such that theexchange differences on translation of foreign financial statements increased.
Note 1: Including Investments accounted for using equity method, Non-current financial assets at fair value
through profit or loss, and Non-current financial assets at fair value through other comprehensive
income.
Note 2: Including Deferred tax assets, Investment property, Right-of-use assets and Other non-current
assets.

-265-

7.2. Analysis of Financial Performance
7.2.1. Main reasons for any material change in operating revenue, operating income and income
before tax in the most recent two years
Unit: NT$ thousands
Year
Item
Operating Revenue
Operating Costs
Gross profit
Operating Expenses
Operating Profit
Non-operating income(expenses)
Other income
Other gains and losses
Net gain from derecognizing
financial assets measured atamortised cost
Financial cost
Share of loss of associates
and joint ventures accounted
for using the equity method
Total non-operating income(expenses)
Profit before income tax
Income tax expense
Profit for the year

2021

2020

14,314,815(10,139,129)
4,175,686(1,283,892)
2,891,794

11,446,696(8,976,600)
2,470,096(1,258,160)
1,211,936

Difference
Amounts
2,868,119(1,162,529)
1,705,590(25,732)
1,679,858

116,370
69,148112,673
163,899

3,697(94,751)

3.28(57.81)-

17,210(17,210)(100.00)(1,248)(2,038)790(38.76)52,590(1,299)53,889(4,148.50)

236,860

290,445(53,585)(18.45)

3,128,654(595,360)
2,533,294

1,502,381(304,646)
1,197,735

1,626,273(290,714)
1,335,559

108.2595.43
111.51

%
25.06
12.95
69.05
2.05
138.61Analysis
(1)
(1)
(1)

(2)

(3)

(1)
(1)
(1)

Analysis of Deviation over 20% and Differnce amounts over NT$ 20,000,000:(1) It was mainly due to the increase of overall business performance of the Company, and positive outcomeof projects in 2021; consequently, the gross profit, operating profit, profit before income tax, income tax
expense and profit for the year increased correspondingly.
(2) It was mainly due to the gain and loss changes in financial assets at fair value through profit or loss, andthe royalty refund recognized in 2020; consequently, the other gains and losses in 2020 was higher.
(3) It was mainly due to that the associate, that the investments accounted for using equity method,
Taiwan IC Packaging Corporation, Inc. was out of the red in 2021, such that the Company recognized
related investment gain.

-266-

7.2.2. Sales Volume Forecast and Basis for 2022
Item
Sales Volume Forecast in 2022/Unit: thousands
FLASH+DRAM products
20,0002,500
OthersThe Company established the forecast for the possible sales volume of each type of productbased on the industry economic condition in 2022, market research and future orders.
As the COVID-19 pandamic was still severe, it has become a trend for countries to workfrom home and the home economy has continued to grow. Consequently, the increasing
demands for computers soared to record level and the prices remained high. Moreover,demands for memory also picked up. Transcend will promptly adjust the purchase andinventory stragegy and flexibly adjust the inventory level in order to gain advantageous
supply sources. The growth of 5G, AI and data center related applications will make up forthe decline in the PC market demand. As the workstation server demand is increasing andthe industrial application field grows relatively fast, the niche DRAM market share is
expected to continue to increase. In addition, since all of these applications require massive
data storage, the SSD product demand will also continue to increase. In 2022, the Company
will continue to enhance the development and market expansion for SSDs, industrial flash
memory products, external storage devices, dashcams, and wearable multimedia devices.

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7.3. Analysis of Cash Flow
7.3.1. Cash Flow Analysis for the Current Year2021
Net cash flows from operating activities 2,445,068
Net cash flows from investing activities
263,187
Net cash flows from financing activities (1,364,667)
1,343,588

Unit:NT$ thousands
2020
Increase (Decrease)(248,407)
2,693,475
1,764,408(1,501,221)(2,022,515)
657,848(506,514)
1,850,102

Regarding the change of cash flow from operating activities, the amount in 2021 increased
by approximately NT$ 2.69 billion from the amount in 2020. It was mainly due to theincrease of overall business performance of the Company, and positive outcome of projects,
such that the revenue and gross profit increased.
Regarding the change of cash flow from investing activities, the amount in 2021 decreased
by approximately NT$1.5 billion from the amount in 2020, and this was mainly due to thehigher cash inflow generated from the sale of financial assets at amortised cost in 2020.
7.3.2. Liquidity Analysis for the Coming Year and Remedy for Cash Deficit
1. Operating activities: The overall gross profit is expected to grow continuously and theoperating activities will generate net cash inflow.
2. Investing activities: The Company will continue to perform appropriate investment withidle funds in order to gain stable investment profit, and it is expected to generate net cash
inflow.
3. Financing activities: Net cash outflow primarily from cash dividend payment.
Remedy for Liquidity Shortfall: Not applicable.
7.4. The Effect Upon Financial Operations of Any Major Capital Expenditures During the Most
Recent Fiscal Year
In 2021, the Company had no major capital expenditure. Up to the end of March 2022, theconsolidated cash and short-term investment position were approximately NT$ 10.6 billion.
After the deduction of relevant cash outflow items, the capital was still sufficient; therefore,
there was no risk of capital shortage.
7.5. Reinvestment Policy for the Most Recent Fiscal Year, the Main Reasons for Profits or Losses
Generated Thereby, Improvement Plans, and Investment Plans for the Coming Year
None.

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7.6. Analysis of Risk Management
7.6.1. The Organization Structure of Risk Management
The organizational structure of risk management of the Company is as follows:
Organization nameScope of responsibility
Board of Directors(including the Audit
1. Establish risk management policy, structure and culture
Committee &2. Ensure the effectiveness of risk management mechanism
Remuneration Committee)
1. Execute risk management decision making
2. Cross-department
risk
management
interaction
andcommunication
Senior management level
3. Material risk early warning, assess potential loss, handle
follow-up strategy or report of risk mitigation and summarize
material risk event handling result
1. Monitor and periodically assess whether the risk control of all
departments is performed properly
Audit Office
2. Issue an audit report according to the audit result, and propose
improvement suggestions and follow up improvement progress
All departments ofheadquarters(Note)

1. Execute daily risk management activities
2. Execution of corporate management and risk decision making
3. Perform risk control activity assessment

Note: The authorities and responsibilities of all departments of headquarters are as follows:(1) FAD: Responsible for the Company’s financial analysis, accounting affairs, statements
preparation, difference analysis, fund management, planning of the Company’s taxes, finance,stock affairs and investments as well as monitoring of the cash flow of all subsidiaries, inorder to reduce financial risks.
(2) PUR: Responsible for understanding the quality condition and price trend of raw materials,
component parts, machine equipments and office supplies necessary for the products andoperation of the Company in order to perform price negotiation and purchase. It is also
responsible for maintaining the safety stock of the purchase items and assisting the handling ofslow-moving materials, in order to reduce risks of purchase management and slow-moving
inventory.
(3) PM & Marketing: Responsible for the Company’s reasonable pricing and fair distribution of
products, summarizing and analyzing the product information and pros/cons of each productline, and assisting the management of demands for customization, in order to reduce the riskof product planning management; responsible for matters related to the brand marketing
activities, strengthening of brand image, product and market information collection,
establishment and execution of marketing plans, contact and application of broadcast media,
planning of the Company’s website and assistance to sales activity arrangement and design,etc., in order to reduce risks related to brand marketing.
(4) Sales: Responsible for the establishment of market sales plan, development and maintenanceof customers, business management and promotion, collection and response to new business
opportunities, in order to reduce the market risks of new customer development, etc.
(5) R&D / Tech Support: Responsible for the research, development and design related matters forvarious products, research and development target estimation and management, new productresearch and development, handling and tracking of abnormalities, in order to reduce risks
related to research, development and design.
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(6) Production: Responsible for relevant works of production schedule control, product packaging,repair and shipping operation, etc., in order to reduce risk of production capacity and shipping,etc.; responsible for the manufacturing, testing, repair of products and production technologies,
improvement of manufacturing quality etc., in order to reduce risks related to production andmanufacturing.
(7) ADM: Responsible for the management of corporate legal affairs, contracts, patents andintellectual property rights, human resource management and organization development, etc.,
in order to reduce risks of legal, administration and human resource management.
(8) Information System: Responsible for planning of information system, network establishment
and maintenance and various computer software and hardware installation and configuration
management related matters, in order to reduce risks of information security.
(9) Quality Assurance: Responsible for the establishment of the Company’s quality assurance
system, promotion of ISO system and QA management system, direct internal and external
audit and certifications, in order to reduce quality management related risks.
7.6.2. Effects of Changes in Interest Rates, Foreign Exchange Rates and Inflation on Corporate
Finance, and Future Response Measures
1. Interest rate
Unit: NT$ thousands
2021
2020
Item
Amount%Amount%Interest income
79,1172.74%
73,952
6.10%
Profit from operations
2,891,794
100.00%1,211,936
100.00%
The Company has a sound financial system. If there is any bank borrowing, theCompany enhances the close contact with the bank with respect to the loan interest ratein order to understand the interest rate trend, thereby obtaining the most preferable loan
and reference for asset allocation. Regarding the short-term idle capital utilization, theCompany mostly uses the NTD time deposits, money market fund and financial
instruments with low risk as the investment targets.
2. Foreign exchange rates
Item
Exchange loss
Profit from operations

2021
Amount(14,506)
2,891,794%(0.50%)
100.00%

Unit: NT$ thousands
2020
Amount%(54,016)(4.46%)
1,211,936
100.00%

There were exchange losses in 2021 and 2020, which were mainly due to the impact of
the significant appreciation of NTD to USD.
Due to the impact on the Company’s profit of changes in exchange rate, the Company
establishes the following countermeasures:(1) The export ratio of the Company is approximately 76%, and the main currencies are
USD and EUR. On the other hand, the main currency for purchase is USD. Throughappropriate proportion among these two types of currencies and through the offsets
between accounts receivable and accounts payable, the exchange rate fluctuation
among different currencies could be canceled out, such that the exchange rate change
would then achieve a certain level of natural hedging effect for the Company.
(2) The Company will adjust the foreign exchange position depending on the exchange
rate trend, and use appropriate financial tools to perform reasonable hedging-270-

operation.
(3) The Company also considers the exchange rate factor during the sales order quotationin order to ensure the reasonable profit of the Company.
(4) The Company maintains close contact with the foreign exchange department of thefinancial institution, understands the exchange rate trend and promptly adjusts theforeign exchange position in order to hedge the foreign exchange risk.
(5) The Company complies with the provisions of the “Procedures for Acquisition and
Disposal of Assets” and determines the reasonable hedge ratio and hedging toolaccording to the foreign exchange market trend.
3. Inflation
The main businesses of the Company refer to the manufacturing and sales of computer
peripherals and storage application products, and there have been no material impacts
due to inflation. The Company periodically adjusts the pricing strategy and pays
attention to the market price change in order to prevent possible risks associated with
inflation.
7.6.3. Policies, Main Causes of Gain or Loss and Future Response Measures with Respect toHigh-risk, High-leveraged Investments, Lending or Endorsement Guarantees, andDerivatives Transactions
1. The Company did not engage in any high-risk or high-leveraged investments in 2021.
2. The Company did not engage in any financial derivatives transactions in 2021. In the
future, the Company will perform periodic assessment depending upon the operation
status of the Company and the change of the market trend in order to flexibly adjust
relevant hedging strategies.
3. Status of the Company’s loaning of funds to others in 2021: None.
4. Status of the Company’s endorsements and guarantees in 2021: The Company provides aguarantee for Transcend Japan Inc. amounting to JPY 2,000,000 thousands. Pursuant to
the Company’s ”Procedures for Endorsement and Guarantee,” the maximum limit ofguarantee up to the end of 2021 was NT$ 7,933,934 thousands.
7.6.4. Future Research & Development Projects and Corresponding Budget
1. R&D projects and current status of pending R&D projects in the most recent year
Please refer to “5.1.3. Research and Development Overview.”
2. R&D budget for further investment
Please refer to “5.1.3. Research and Development Overview.”
3. Main factors affecting success of R&D
Since the entrance barrier for consumer products is relatively low, for new productdevelopment, product launch must be made at the right time in order to seize the business
opportunity. Accordingly, for R&D, it is necessary to shorten the schedule, and the
product function must be able to satisfy the fast and diverse demands from end-users at
the same time. The Company will cultivate more senior and specialized R&D talents. In
addition, the embedded products require stable quality, and customization must be
performed according to the customer demands. The Company has established a dedicatedunit for such product lines in order to enhance the R&D strength.

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7.6.5. Effects of and Response to Changes on Important Domestic and Foreign Policies and Laws
Relating to Corporate Finance and Business
During 2021 and as of the date of publication of this annual report, changes in related laws
have not had a significant impact on our finance and operations. The Company consistently
pays close attention to any changes in local and foreign policies and makes appropriate
amendments to our systems when necessary.
7.6.6. Effects of and Response to Changes in Technology (including information security risks)
and the Industry Relating to Corporate Finance and BusinessIn 2021, the global economy recovered. In addition, due to the impact of the COVID-19
pandemic, the demand for technology transformation increased, and the overall memory
market was under the condition of demand over supply. Facing the post-pandemic era, thedevelopment of 5G, AIoT and virtual economy is expected to further increase the demand
for memories. Transcend will continue to adopt the product strategy for both channel andproject sales, to strengthen research and development energy, to improve product integrityand performance, in order to implement reasonable pricing strategy and outstanding
customer service, thereby continuously creating stable profits for the Company.
To cope with the advancement of digital technology, the Company plans to focus on theinformation security risk and the following measures have been implemented in the current
year:(1) When sales staff travel externally to visit customers, VPN is used to establish remoteconnection with the mainframe of the Company to access data, and the VPN is establishedby the headquarters information unit with the addition of personal verification mechanism,in order to ensure information security and to prevent disclosure of confidential information;(2) The internal information includes important financial information. In addition to local
backup, remote backup is changed to adopt the NAS backup, and the backups at both
locations adopt the scheduled automatic backup method, in order to reduce the risk of
information system abnormality and human error and negligence. The Company willcontinue to improve the information security measures, to strengthen employees’
information security awareness and to periodically review relevant policies and future
development direction, in order to achieve the goal of establishing a sound information
security environment.
7.6.7. The Impact of Changes on Corporate Image on Corporate Crisis Management, and theCompany’s Response Measures
Under impact of the post-pandemic era and the overall economic change, corporate
development uncertainty is increased. Nevertheless, Transcend has been dedicated to thedevelopment of embedded application products in recent years, and has improved
production and sale aspects of the business in detail. In addition to proper management of
all basic works, the Company also focuses on the key subjects of improvement of each
operation aspect and increase of operation performance and efficiency. Transcend isequipped with complete infrastructure, production line and sound financial structure. In
addition, the Company also emphasizes the customer value and customer-oriented approach.
The future development goal of the Company includes: (1) Focus on both channel andindustrial application markets; (2) Establish pre-sales dedicated unit in order to allow
customers to understand product functions and to expand the application aspect of products;and (3) Continuously enhance the integrity of embedded products, and ensure productquality. In the future, the Company will continue to exert effort on the increase of productand service quality and will also convert customer satisfaction and loyalty into stable profitof the Company.
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In addition, to cooperate with the Corporate Governance 3.0 – Sustainable Development
Blueprint promoted by the government, Transcend will also actively engage in the corporate
governance and is committed to protecting the interests of shareholders and treating all
shareholders equally, to enhance the functions of board of directors, to increase informationtransparency, and to promote sustainable development, etc., in order to improve
international competitiveness of the Company and to fulfill the obligations for all
shareholders.
For 2021 and up to the printing date of the annual report, there have been no material risk
matters affecting the corporate image
7.6.8. Expected Benefits from, Possible Risks Relating to and Response to Merger andAcquisition Plans
None.
7.6.9. Expected Benefits from, Possible Risks Relating to and Response to Factory Expansion
Plans
None.
7.6.10. Risks Relating to and Response to Excessive Concentration of Purchasing or Sales
Operations
None.
7.6.11. Effects of, Risks Relating to and Response to Large Share Transfers or Changes inShareholdings by Directors or Shareholders with over 10% Shareholdings
None.
7.6.12. Effects of, Risks Relating to and Response to the Changes in Management Rights
None.
7.6.13. Litigation or Non-litigation Matters
None.
7.6.14. Other Major Risks and Response MeasuresNone.
7.7. Other Material Matters
The valuation accounts on the Company’s assets and liabilities include Allowance for loss on
accounts receivable, Allowance for loss on decline in market value of inventory, andFinancial assets impairment, etc. And the accounting policies adopted are as follows:
1. Allowance for loss on accounts receivable
The Company classifies customers’ accounts receivable in accordance with the credit
rating of the customer. The Group applies the simplified approach to estimate expectedcredit loss under the provision matrix basis. The Company used historical and timely
information to assess the loss rate of accounts receivable.
2. Allowance for loss on decline in market value of inventory(1) Inventories are stated at the lower of cost and net realizable value. The item by item
approach is used in applying the lower of cost and net realizable value. Net realizablevalue is the estimated selling price in the ordinary course of business, less the-273-

estimated cost of completion and applicable variable selling expenses. When the net
realizable value is lower than cost, the difference is recognized as loss on decline inmarket value of inventory.
(2) When the ending inventory has not changed for more than six months, it is deemed as
slow-moving inventory and is listed in the slow-moving inventory report. And loss for
slow-moving inventory will be 100% recognized.
(3) When the ending inventory refers to products that the Company no longer
manufactured and sold, those products are deemed as slow-moving inventory and arelisted in the slow-moving inventory report. And loss for slow-moving inventory willbe 100% recognized.
3. Financial assets impairment
For debt instruments measured at fair value through other comprehensive income andfinancial assets at amortised cost including accounts receivable that have a significant
financing component, at each reporting date, the Group recognizes the impairment
provision for 12 months expected credit losses if there has not been a significant increasein credit risk since initial recognition or recognizes the impairment provision for the
lifetime expected credit losses (ECLs) if such credit risk has increased since initialrecognition after taking into consideration all reasonable and verifiable information that
includes forecasts. On the other hand, for accounts receivable or contract assets that do notcontain a significant financing component, the Group recognizes the impairment provision
for lifetime ECLs.

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8. Special Disclosure
8.1. Information of Affiliated Companies
8.1.1. Organizational Chart of Affiliated Companies-275-8.1.2. Summary of Affiliated Companies
Name
Saffire Investment
Ltd.
Memhiro Pte. Ltd.

Date of
Address
incorporationCitco Building, Wickhams Cay,
12/18/1997 P.O.BOX 662, Road Town,
Tortola, B.V.I.
60 Albert Street, #14-01 OG Albert
03/14/1998
Complex, 189969 Singapore

Transcend Japan
Inc.

12/11/1996

1-8-5,Kuramae, Taito-Ku, Tokyo,
111-0051, Japan

Transcend
Information Europe
B.V.

06/28/1995

Cairostraat 40, 3047 BC,
Rotterdam,The Netherlands

Transcend
Information Inc.

03/28/1990

1645 North Brian St. Orange, CA
92867, U.S.A.

Transcend
Flughafenstrasse 52b(AirportInformation Trading 09/29/1992
Center), 22335 Hamburg, GermanyGmbH
12F, CBS Bldg., 159-1,
Transcend Korea
07/09/2008 Mokdongseo-ro, Yangcheon-gu,
Inc.
Seoul, Korea
Transcend
Information(Shanghai), Ltd.

No.1, Central Avenue, Shanghai
Minhang Export Processing
03/25/2005
Zone,Fengxian District, Shanghai,
China.

Room403, Floor 4 ,No. 1010,
Transtech Trading
09/21/2006 Kaishiuan Road, Changning(Shanghai) Co., Ltd.
District, Shanghai, China
Transcend
Information (H.K.)
Limited

Unit 17-18, 10/F, Nan Fung Comm
01/08/2013 Centre, 19 Lam Lok Street,
Kowloon Bay, Hong Kong

-276-

Paid-in capital
1,202,418

Main scope of operationor production
Investment holding
company

Investment holding
company
Wholesale and import of89,103 computer memory
modules and peripheralproducts
Wholesale and import of
1,693 computer memory
modules and peripheralproducts
Wholesale and import of38,592 computer memory
modules and peripheralproducts
Wholesale and import of
2,288 computer memory
modules and peripheralproducts
Wholesale and import of
6,132 computer memory
modules and peripheralproducts
Manufacture and sales ofcomputer memory
1,134,178 modules, storage products
and disks. Owned realestate lease.

1,156,920

Wholesale, agent, importand export and retail of
16,310 computer memory
modules, storage products
and computer components
Wholesale and import of
7,636 computer memory
modules and peripheralproducts

8.1.3. Profile of Directors, Supervisors and General Managers of Affiliated Companies
Number of Shares
Name of
Name
Title
Represnetative
Shares%DirectorShu, Chung-Cheng
Memhiro Pte. Ltd.
55,132,000100%
Director
Wang, LiWei
Saffire Investment Ltd.
DirectorShu, Chung-Cheng 36,600,000
100%
Transcend Japan Inc.
Director
Lin,Taikin
6,400
100%
Tellier, Yoann
Transcend Information Europe B.V.
Director
100
100%
Roger Jean
Transcend Information Inc.
Director
Clarence Chan
625,000
100%
DirectorShu, Chung-Won
Transcend Information Trading GmbH
100%
GeneralShu, Chung-Won
Manager
Executive
Transcend Information (Shanghai), Ltd.
Shu, Chung-Cheng
100%
Director
Executive
Transtech Trading (Shanghai) Co., Ltd.
Shu, Chung-Cheng
100%
Director
Director
Shim Dong Hoon
Transcend Korea Inc.
40,000100%
GeneralShim Dong Hoon
Manager
Transcend Information (H.K.) Limited
DirectorShu, Chung-Cheng
2,000,000
100%

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8.1.4. Overview of Affiliated Companies’ Operations for 2021
Unit: NT$ thousands
Name

Capital

Total Assets

Total
Liabilities

Net Worth

Net Sales

Transcend Japan Inc.
Saffire Investment Ltd.
Memhiro Pte Ltd.
Transcend Information Inc.
Trnascend Information Europe B.V.
Transcend Information Trading GmbH
Transcend Information (Shanghai), Ltd.
Transtech Trading (Shanghai) Co., Ltd.
Transcend Korea Inc.
Transcend Information (H.K.) Limited

89,103
1,202,418
1,156,920
38,592
1,693
2,288
1,134,178
16,3106,132
7,636

346,707
1,501,952
1,478,429
227,221251,083
135,163
1,051,959
235,267
63,04036,280113,930
15,252
42,34530,351
22,735
3,123
188,907
6,677
6,412

232,777
1,501,952
1,463,177
184,876
220,732
112,428
1,048,836
46,36056,36329,868796,268
777,927
691,521594,3101,307,953
416,097
316,667

Profit (Loss)
Profit (Loss) Earnings perfromfor the year share (NT$)
Operations
7,830
6,218
971.64(70)(23,916)(0.65)
15,216(24,050)(0.44)
14,0208,448
13.52(7,911)
8,813
88,131.74
8,125
12,251(67,177)(74,909)
13,321
9,550
4,377
3,942
98.55
4,824
4,924
2.46

8.1.5. Consolidated Financial Statement of Affiliated Enterprises
Please refer to page 122~194 of this Annual Report.
8.1.6. Affiliation Reports
Not applicable.
8.2. Private Placement of Securities in 2021 and as of the date of this Annual ReportNone.
8.3. Status of the Company’s Common Shares Held and Disposed by Subsidiaries in 2021 and as of the date of this Annual ReportNone.
8.4. Other Necessary Supplement
None.
9.

Latest Matters with Material Impacts on Shareholders’ Interests or Security Prices Indicated in Paragraph 3 Subparagraph 2 of Article 36 of
the Securities and Exchange Act in 2021 and as of the date of this Annual Report
None.
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Transcend Information, Inc.
No. 70, XingZhong Rd., NeiHu Dist., Taipei 114, Taiwan
Tel:886-2-2792-8000 Fax:886-2-2792-3375
https://tw.transcend-info.com

Transcend Information, Inc.

Chairman: Shu, Chung-Won