TRANSCEND INFORMATION, INC. AND
SUBSIDIARIESCONSOLIDATED FINANCIAL STATEMENTS AND
INDEPENDENT AUDITORS’ REVIEW REPORTJUNE 30, 2023 AND 2022-----------------------------------------------------------------------------------------------------------------------------------For the convenience of readers and for information purpose only, the independent auditors’ review report andthe accompanying financial statements have been translated into English from the original Chinese version
prepared and used in the Republic of China. In the event of any discrepancy between the English version andthe original Chinese version or any differences in the interpretation of the two versions, the Chinese-language
independent auditors’ review report and financial statements shall prevail.

~1~

INDEPENDENT AUDITORS’ REVIEW REPORT TRANSLATED FROM CHINESE
PWCR 23000118
To the Board of Directors and Shareholders of Transcend Information, Inc.

Introduction
We have reviewed the accompanying consolidated balance sheets of Transcend Information Inc. andsubsidiaries (the “Group”) as at June 30, 2023 and 2022, and the related consolidated statements ofcomprehensive income for the three months and six months then ended, as well as the consolidated
statements of changes in equity and of cash flows for the six months then ended, and notes to theconsolidated financial statements, including a summary of significant accounting policies. Management is
responsible for the preparation and fair presentation of these consolidated financial statements inaccordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers andInternational Accounting Standard 34, “Interim Financial Reporting” that came into effect as endorsed by
the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated
financial statements based on our reviews.

Scope of review
Except as explained in the following paragraph, we conducted our reviews in accordance with the Standard
on Review Engagements 2410, “Review of Financial Information Performed by the Independent Auditorof the Entity” of the Republic of China. A review of consolidated financial statements consists of making
inquiries, primarily of persons responsible for financial and accounting matters, and applying analyticaland other review procedures. A review is substantially less in scope than an audit and consequently does
not enable us to obtain assurance that we would become aware of all significant matters that might beidentified in an audit. Accordingly, we do not express an audit opinion.

Basis for qualified conclusion
As explained in Note 4(3), the financial statements of insignificant consolidated subsidiaries were notreviewed by independent auditors. Total assets of these subsidiaries amounted to NT$2,073,194 thousand
and NT$572,423 thousand, constituting 9% and 2% of the consolidated total assets as at June 30, 2023 and2022, respectively, total liabilities amounted to NT$144,264 thousand and NT$44,023 thousand,constituting 3% and 1% of the consolidated total liabilities as at June 30, 2023 and 2022, respectively, andthe total comprehensive (loss) income amounted to (NT$77,932) thousand, (NT$40,485) thousand,~2~

(NT$57,794) thousand and NT$61,417 thousand, constituting (18%), (4%), (8%) and 3% of theconsolidated total comprehensive (loss) income for the three months and six months then ended,
respectively.

Qualified conclusion
Based on our reviews, except for the adjustments to the consolidated financial statements, if any, as might
have been determined to be necessary had the financial statements of consolidated subsidiaries beenreviewed by independent auditors as described in the Basis for qualified conclusion section above, basedon our reviews, nothing has come to our attention that causes us to believe that the accompanying
consolidated financial statements do not present fairly, in all material respects, the consolidated financial
position of the Group as at June 30, 2023 and 2022, and of its consolidated financial performance for thethree months and six months then ended and its consolidated cash flows for the six months then ended inaccordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers andInternational Accounting Standard 34, “Interim Financial Reporting” that came into effect as endorsed by
the Financial Supervisory Commission.

Chen, Ching Chang
Lin, Yi-Fan
For and on Behalf of PricewaterhouseCoopers, Taiwan
August 3, 2023----------------------------------------------------------------------------------------- -------------------------------------The accompanying consolidated financial statements are not intended to present the financial position and results of operations andcash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic ofChina. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ
from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying
consolidated financial statements and independent auditors’ review report are not intended for use by those who are not informed
about the accounting principles or Standards on Auditing of the Republic of China, and their applications in practice.
As the consolidated 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.
~3~

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETSJUNE 30, 2023, DECEMBER 31, 2022 AND JUNE 30, 2022
(Expressed in thousands of New Taiwan dollars)
Assets

Notes

June 30, 2023
AMOUNT%

December 31, 2022
AMOUNT
%4,236,983

19

8,568,219

June 30, 2022
AMOUNT

%

5,817,100

24

Current assets
Cash and cash equivalents

6(1)Financial assets at amortised cost -

6(3)

$

current$

3,187,312

15

$

38

8,611,357

40

5,424,511

23

Notes receivable, net

6(4)

10

-

867

-

-

-

Accounts receivable, net

6(4)1,294,471

6

1,217,936

6

1,575,490

7

Accounts receivable due from7

related parties, net

11

-

-

-

84

-

Other receivables

90,063

1

77,626-

98,2411

6(5)2,531,335

11

3,143,064

14

5,575,444

23

Non-current assets held for sale, net 6(6)

-

-

-

-

4,492

-

20,119-16,710-22,181-

16,741,211

75

16,254,872

75

18,517,543

78

60,290-51,463-54,079-609,9663

524,9393

570,7712

305,555

1

-

-

-

-

126,2971

136,710

1

161,7791

Inventories

Other current assets
Total current assets
Non-current assets
Financial assets at fair value through 6(2)profit or loss - non-current
Financial assets at fair value through 6(7)other comprehensive income - noncurrent
Financial assets at amortised cost -6(3)non-current
Investments accounted for using

6(8)equity method
Property, plant and equipment, net

6(9) and 8

1,533,499

7

1,580,372

7

1,587,928

7

Right-of-use assets

6(10) and 7

195,6611

196,1901

220,170

1

Investment property, net

6(12)2,586,359

12

2,593,931

12

2,599,633

11

Deferred income tax assets

6(24)111,287-

137,7741

69,328-Other non-current assets

6(13)59,049-52,191-

67,932-

5,587,963

25

5,273,570

25

5,331,620

22

22,329,174

100

21,528,442

100

23,849,163

100

Total non-current assets
Total assets$(Continued)

~4~

$

$

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETSJUNE 30, 2023, DECEMBER 31, 2022 AND JUNE 30, 2022
(Expressed in thousands of New Taiwan dollars)
Liabilities and equity

June 30, 2023
AMOUNT

Notes

December 31, 2022
AMOUNT%%

June 30, 2022
AMOUNT%

Current liabilities
Notes payable$

Accounts payable--

1,074,976

$

-

-

5

472,677

$

71

-

2

767,5624

Accounts payable - related parties

7

31,909-27,442-

42,279-Other payables

7

2,671,073

12

271,94822,804,532

12

123,7131

581,5463

511,9022

54,134-47,806-49,040-16,028-25,348-51,319-3,971,833

18

1,426,767

7

4,226,705

18

Current income tax liabilities
Lease liabilities - current

7

Other current liabilities
Total current liabilities
Non-current liabilities
Deferred income tax liabilities

6(24)337,5652

376,4472

366,411

1

Lease liabilities - non-current

7

107,852-

132,962-

133,549

1

39,478-41,730-45,376-484,8952

551,1392

545,3362

4,456,728

20

1,977,906

9

4,772,041

20

4,290,617

19

4,290,617

20

4,290,617

18

3,044,532

13

3,387,781

16

3,387,665

14

Legal reserve

5,303,693

24

5,057,967

24

5,057,967

21

Special reserve357,8172

190,5141

190,5141

5,142,350

23

6,981,474

32

6,446,640

27

Other non-current liabilities
Total non-current liabilities
Total liabilities
Equity attributable to shareholders ofparentShare capital6(15)Common stock
Capital surplus

6(16)Capital surplus
Retained earnings

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

266,563) (Total equity
Significant contingent liabilities and1) (17,872,446

80

22,329,174

100

357,817) (2) (19,550,536

91

21,528,442

100

296,281)(1)

19,077,122

80

23,849,163

100

9unrecognized contract commitments
Total liabilities and equity$$

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

~5~$

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
SIX MONTHS ENDED JUNE 30, 2023 AND 2022
(Expressed in thousands of New Taiwan dollars, except earnings per share amounts)

Items
Operating revenue
Operating costs
Gross profit
Operating expenses
Sales and marketing expenses
Administrative expenses
Research and development expenses
Expected credit impairment (loss) gain
Total operating expenses
Operating profit
Non-operating income and expenses
Interest income
Other income
Other gains and losses
Finance costs
Share of (loss) profit of associates andjoint ventures accounted for using theequity method
Total non-operating income andexpensesProfit before income tax
Income tax expense
Profit for the period

Three months ended June 30
Six months ended June 30
2023
2022
2023
2022
Notes
AMOUNT%AMOUNT%AMOUNT%AMOUNT%
6(19) and 7$ 2,469,577
100 $ 3,006,488
100 $ 5,078,378
100 $ 6,456,124
100
6(5)(23) and 7 ( 1,884,967) ( 76) ( 2,132,213) ( 71) ( 3,940,961) ( 78) ( 4,721,346) ( 73)584,61024
874,275
29
1,137,417
22
1,734,778
27
6(23)
(
205,389) (9) (212,345) (7) (413,918) (8) (428,981) (7)(
52,108) (2) (63,284) (2) (106,187) (2) (139,010) (2)(
29,641) (1) (29,527) (1) (66,463) (1) (73,907) (
1)
6(4)
(
110)
25
- (
110)
304
(
287,248) ( 12) (305,131) ( 10) (586,678) ( 11) (641,594) ( 10)297,36212
569,14419
550,73911
1,093,184
17
6(3)(20)6(7)(12)(21)
6(2)(22)
6(10)
6(8)

6(24)

Other comprehensive income (loss)
Components of other comprehensive
income (loss) that will not bereclassified to profit or loss
Unrealized gain (loss) on financial
6(7)(18)
assets at fair value through othercomprehensive income
Share of other comprehensive income
6(8)(loss) of associates and joint ventures
accounted for using the equity method
Components of other comprehensive
income (loss) that will be reclassified
to profit or loss
Financial statements translation
6(18)differences of foreign operations
Income tax related to components of
6(18)(24)other comprehensive income that will bereclassified to profit or loss
Other comprehensive income (loss) forthe period(

107,561
19,751
137,884
857)

4
1
5
- (

(

4,356)-

12,45011,641
1,083,296
364)

1
36
- (

198,004
35,212
76,431
1,639)

41- (21,71322,194
1,512,622
546)

24
-

4,900

- (

11,937)-

13,485-$259,983
557,345
157,833) (399,51210
1,111,923
22
1,681,067
6) (535,816) (16 $ 1,145,251

37
56
18) (
38 $

296,071846,810
214,933) (631,877

5
1,569,468
16
2,662,652
4) (737,957) (12 $ 1,924,695

24
41
11)
30

$

34,1671 ($4) $85,027

2 ($123,665) (

2)

219)

-

(

-

(

110,413) (

-

-

-

1,524

- (

2,360)- (40,051) (

1)

7,784

-

19,807

-

472

-

8,011

- (

1,557)- (3,961)-$

32,2791 ($5) $92,7782 ($Total comprehensive income$

431,79117$ 1,002,798

33$

724,655

14$ 1,816,657

28

Net profit attributable to:Shareholders of parent$

399,51216$ 1,145,251

38$

631,87712$ 1,924,695

30

Comprehensive income attributable to:Shareholders of parent$

431,79117$ 1,002,798

33$

724,655

14$ 1,816,657

28

Earnings per share (in dollars)
Basic earnings per share
Diluted earnings per share

142,453) (108,038) (

2)

6(25)
$

0.93

$

2.67

$

1.47

$

4.49

$

0.93

$

2.67

$

1.47

$

4.48

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

~6~

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN EQUITYSIX MONTHS ENDED JUNE 30, 2023 AND 2022
(Expressed in thousands of New Taiwan dollars)
Equity attributable to shareholders of the parent
Retained Earnings

Capital Reserves

Common stock

Additional paid-in
capitalDonated assets
received

Net assets frommergerLegal reserve

Special reserve

Unappropriatedretained earnings

Other Equity Interest
Unrealised gains(losses) fromfinancial assets
Financialmeasured at fairstatements
value throughtranslation
other
differences ofcomprehensive
foreign operations
incomeBalance at January 1, 2022

$ 4,290,617$ 3,691,432$$

35,128$ 4,803,503$

117,244$ 7,083,072($

Net income for the period

-

-

-

-

-

-

1,924,695

-

-

-

-

-

-

-

-

-

-

-

-

Legal reserve

-

-

-

-

254,464-(

254,464 )--Cash dividends

-

-

-

-

-

-

(

2,231,121 )--Special reserve

-

-

-

-

-

73,270(73,270 )--Cash payment from capital surplus

-

-

-

-

-

-

-

Notes

Total equity

Six months ended June 30, 2022

Other comprehensive income (loss) for the period

6(7)(18)

Total comprehensive income (loss)
Appropriations and distribution of 2021 earnings

4,354

(

197,932 )

$

-

219 )
1,924,476

7,417$ 19,834,835-

1,924,695

15,846(123,665 ) (15,846(123,665 )108,038 )
1,816,6576(17)Net loss on disposal of financial assets at fair value through 6(7)other comprehensive income(

343,249 )-(2,053 )

2,231,121 )(

343,249 )

-

-

-

-

-

-

2,053

$ 4,290,617$ 3,348,183

$

4,354

$

35,128$ 5,057,967$

190,514$ 6,446,640($

182,086 ) ($114,195 )$ 19,077,122

Balance at January 1, 2023

$ 4,290,617$ 3,348,183

$

4,470

$

35,128$ 5,057,967$

190,514$ 6,981,474($

197,218 ) ($160,599 )$ 19,550,536

Net income for the period

-

-

-

-

-

-

631,877

-

-

-

-

-

-

-

-

1,524

6,227

85,027

92,778

-

-

-

-

-

-

633,401

6,227

85,027

724,655

Legal reserve

-

-

-

-

245,726-(

245,726 )--Cash dividends

-

-

-

-

-

-

(

2,059,496 )--Special reserve

-

-

-

-

-

167,303(

167,303 )--Cash payment from capital surplus

-

-

-

-

-

-

-

-

35,128$ 5,303,693

357,817$ 5,142,350

Balance at June 30, 2022

-

-

(

-

Six months ended June 30, 2023

Other comprehensive income for the period

6(7)(18)

Total comprehensive income
Appropriations and distribution of 2022 earnings

Balance at June 30, 2023

631,877

6(17)$ 4,290,617(

343,249 )$ 3,004,934

$

4,470

$

$

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

~7~

($

190,991 ) ($75,572 )(2,059,496 )(

343,249 )$ 17,872,446

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSSIX MONTHS ENDED JUNE 30, 2023 AND 2022
(Expressed in thousands of New Taiwan dollars)
Six months ended June 30
Notes
CASH FLOWS FROM OPERATING ACTIVITIESProfit before tax
Adjustments
Adjustments to reconcile profit (loss)
Net (gain) loss 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 impairment loss (gain)
Gain on disposal of non-current assets held for sale
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 at fair value through profit or loss
Notes receivable
Accounts receivable
Accounts receivable - related parties
Other receivables
Inventories
Other current assets
Changes in operating liabilities
Notes payable
Accounts payable
Accounts payable - related parties
Other payables
Other current liabilities
Other non-current liabilities
Cash inflow generated from operations
Dividends received
Interest received
Income tax paid
Net cash flows from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of financial assets at fair value through profit orloss - non-current
Proceeds from disposal of financial assets at amortised cost
Acquisition of financial assets at amortised cost
Proceeds from disposal of financial assets at fair value through othercomprehensive income
Acquisition of financial assets at fair value through other comprehensive
incomeProceeds from disposal of non-current assets held for sale
Proceeds from disposal of property, plant and equipment
Acquisition of property, plant and equipment
Acquisition of investment property
Increase in other non-current assets
Net cash flows (used in) from investing activities
CASH FLOWS FROM FINANCING ACTIVITIESPayment of lease liabilities
Net cash flows used in financing activities
Effect of exchange rate changes
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

2023

$

6(2)(22)
6(8)
6(4)
6(22)
6(22)
6(23)
6(20)
6(10)
6(7)(21)2022

846,810($

8,827 )
11,937110
281,912
198,004 )
1,639
6,741 )((

857
76,664 )11 )8,682 )
611,729
3,409 )((((

602,299
4,467
3,620 )
9,320 )
2,252 )
1,844,232
6,741
194,249
686,718 )
1,358,504

(
(
(

(

5,261,230
5,518,582 )(2,662,652

5,649
(
(
(

13,485 )304 )1,329,173 )438
105,683
21,713 )546
2,310 )((

1,517,311
2,499
47,31084 )62,475
199,3818,736 )((

71
597,273 )9,962 )
56,006 )37,287 )
1,820 )
2,525,862
2,310
20,762607,248 )1,941,686

(
(
(
(
(

(

41,1552,450,000
2,303,391 )

(

6(7)
-

6(26)
6(12)

(
(
(
(
(

$

6,756 )
9,770 )
273,878 )(

44,346 )44,346 )9,391
1,049,671
3,187,312
4,236,983((

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

~8~

6,179
71,040 )1,801,712
162
6,216 )
2,973 )
16,319 )1,899,269

(
(
(

$

46,694 )46,694 )
4,733
3,798,994
2,018,106
5,817,100

TRANSCEND INFORMATION, INC. AND SUBSIDIARIESNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 2023 AND 2022
(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 FINANCIAL STATEMENTS AND
PROCEDURES FOR AUTHORIZATION
These consolidated financial statements were authorized for issuance by the Board of Directors on
August 3, 2023.
3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS(1) Effect of the adoption of new issuances of or amendments to International Financial ReportingStandards (“IFRS”) that came into effect as endorsed by the Financial Supervisory Commission(“FSC”)New standards, interpretations and amendments endorsed by the FSC and became effective from2023 are as follows:

New Standards, Interpretations and Amendments
Amendments to IAS 1, ‘Disclosure of accounting policies’
Amendments to IAS 8, ‘Definition of accounting estimates’
Amendments to IAS 12, ‘Deferred tax related to assets and liabilities
arising from a single transaction’

Effective dateby International
AccountingStandards Board
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.
(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by
the Group
None.
~9~

(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’

Amendments to IFRS 16,‘Lease liability in a sale and leaseback’
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, ‘Non-current liabilities with covenants’
Amendments to IAS 7 and IFRS 7, ‘Supplier finance arrangements’
Amendments to IAS 12, ‘International tax reform - pillar two model
rules’

Effective dateby International
AccountingStandards Board
To be determinedby International
AccountingStandards Board
January 1, 2024
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2024
January 1, 2024
January 1, 2024
May 23, 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 adopted are consistent with Note 4 in the consolidated financial
statements for the year ended December 31, 2022, except for the compliance statement, basis ofpreparation and basis of consolidation as set out below. These policies have been consistently applied to
all the periods presented, unless otherwise stated.
(1) Compliance statement
A. The consolidated financial statements of the Group have been prepared in accordance with the“Regulations Governing the Preparation of Financial Reports by Securities Issuers” and theInternational Accounting Standard 34, ‘Interim financial reporting’ that came into effect as
endorsed by the FSC.
B. These consolidated financial statements are to be read in conjunction with the consolidated
financial statements for the year ended December 31, 2022.

~10~

(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 International Financial ReportingStandards, International Accounting Standards, IFRIC, and SIC Internationals that came into
effect as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use ofcertain critical accounting estimates. It also requires management to exercise its judgement in theprocess of applying the Group’s accounting policies. The areas involving a higher degree ofjudgement or complexity, or areas where assumptions and estimates are significant to theconsolidated financial statements are disclosed in Note 5.
(3) Basis of consolidation
A. Basis for preparation of consolidated financial statements:
Basis for preparation of these consolidated financial statements is the same as that for the
preparation of the consolidated financial statements as of and for the year ended December 31,
2022.
B. Subsidiaries included in the consolidated financial statements:

Name ofInvestor

Name of
Subsidiary

Transcend
Saffire Investment
Information, Ltd. (Saffire)
Inc.
Transcend Japan
Inc. (Transcend
Japan)
Transcend
Information Inc.
(Transcend USA)
Transcend Korea
Inc. (Transcend
Korea)

Main Business
Activities

Ownership (%)
June
DecemberJune
30, 2023
31, 2022
30, 2022

Description

Investment
holdings

100

100

100

Import andwholesale ofcomputer memory
modules

100

100

100

Import andwholesale ofcomputer memory
modules
Import andwholesale ofcomputer memory
modules

100

100

100

Note 1

100

100

100

"

~11~

Name ofInvestor
SaffireInvestment
Ltd.
MemhiroPte. Ltd.

Name of
SubsidiaryMemhiro Pte. Ltd.
(Memhiro)

Main Business
Activities
Investment
holdings

Transcend
Import andInformation Europe wholesale ofB.V. (Transcendcomputer memory
Europe)modules
Transcend
Import andInformation Trading wholesale ofGmbH (Transcend computer memory
Germany)
modules
Transcend
Manufacture andInformation
sales of blank(Shanghai), Ltd.
medium such as(Transcendmemory expansion
Shanghai)cards and external
storage devices,and other disk
drives and leaseof self-ownedbuildings
Transtech Trading Wholesale, agent,(Shanghai) Co., Ltd. import and export,(Transtech
retail and related
Shanghai)services of
expansion memory
modules, external
storage devices
and related
storage equipment
and components
Transcend
Import andInformation (Hongwholesale ofKong), Ltd.
computer memory(Transcend HongmodulesKong)

June
30, 2023
100

Ownership (%)
DecemberJune
31, 2022
30, 2022
100
100

Description

100

100

100

Note 1

100

100

100

"

100

100

100

Note 2

100

100

100

Note 1

100

100

100

"

Note 1: The financial statements of insignificant subsidiary as of and for the six months ended
June 30, 2023 and 2022 were not reviewed by independent auditors.
Note 2: The financial statements as of and for the six months ended June 30, 2023 were notreviewed by independent auditors.
C. Subsidiaries not included in the consolidated financial statements: None.
D. Adjustment for subsidiaries with different balance sheet dates: None.
E. Significant restrictions: None.

~12~

F. Subsidiaries that have non-controlling interests that are material to the Group: None.
(4) 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.
5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTIONUNCERTAINTY
There was no significant change during this period. Refer to Note 5 in the consolidated financial
statements for the year ended December 31, 2022 for related information.
6. DETAILS OF SIGNIFICANT ACCOUNTS(1) Cash and cash equivalents

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

June 30, 2023$
394

December 31, 2022$
173

June 30, 2022$
212

1,981,104
2,255,485
4,236,983

2,519,575
667,564
3,187,312

1,804,415
4,012,473
5,817,100$$$

A. The aforementioned time deposits pertain to high liquidity investments with maturity within threemonths.
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.

~13~(2) Financial assets at fair value through profit or loss
Items
June 30, 2023
December 31, 2022
June 30, 2022
Non-current items:
Financial assets
mandatorily measured
at fair value throughprofit or loss
Beneficiary$
61,481 $61,481 $61,481
certificates
1,191) (10,018) (7,402)
Valuation adjustments ($60,290 $51,463 $54,079A. Amounts recognized in profit or loss in relation to financial assets at fair value through profit orloss are listed below:
Three months ended June 30,
2023
2022
Financial assets mandatorily measured at fairvalue through profit or loss
Beneficiary certificates
Financial products$$

3,503 ($
3,503 ($

9,720)
7,021
2,699)

Six months ended June 30,
2023
2022
Financial assets mandatorily measured at fairvalue through profit or loss
Beneficiary certificates
Financial products$$

8,827 ($
8,827 ($

14,646)
8,997
5,649)

B. The Group 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 withoriginal maturity ofmore than threemonthsNon-current items:
Corporate bonds

June 30, 2023

December 31, 2022

June 30, 2022$

8,568,219$

8,611,357$

5,424,511$

305,555

$

-

$

-

~14~

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

Three months ended June 30,
2023
2022
$

Interest income$

Interest income

94,463$9,885

Six months ended June 30,
2023
2022
179,353 $
16,463

B. The Group has no financial assets at amortised cost pledged to others as collateral.
C. The Group transacts time deposits with reputable domestic and foreign banks. The issuers ofordinary corporate bonds which the Group invested are well-known domestic and foreign
enterprises. The Group’s counterparties have good credit quality, so the Group expects that theprobability of counterparty default is remote. The impairment loss is assessed using a 12-month
expected credit loss approach.
(4) Notes and accounts receivable
June 30, 2023
Notes receivable
Accounts receivable
Less: Loss allowance$$

December 31, 2022
June 30, 2022
10 $
867 $
1,295,110 $
1,218,446 $
1,575,974
639) (
510) (
484)$

1,294,471($

1,217,936$

1,575,490

A. As of June 30, 2023, December 31, 2022 and June 30, 2022, the estimated sales discounts andallowances were $104,650, $92,122 and $61,528, respectively. Since the sales discounts andallowances met the requirements for offset 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:

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

June 30, 2023$
1,172,917
105,498
8,935
2,920
4,850
$
1,295,120

December 31, 2022$
962,635
238,088
8,809
5,776
4,005
$
1,219,313

June 30, 2022$
1,401,461
138,700
29,239
3,761
2,813
$
1,575,974

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~15~

debts occur, the Group will receive 90% of the losses resulting from non-payment.
D. As of June 30, 2023, December 31, 2022 and June 30, 2022, notes receivable and accounts
receivable were all from contracts with customers. As of January 1, 2022, the balance of notes
receivable and accounts receivable from contracts with customers amounted to $1,625,783.
E. As at June 30, 2023, December 31, 2022 and June 30, 2022, without taking into account any
collateral held or other credit enhancements, the maximum exposure to credit risk in respect of
the amount that best represents the Group’s notes receivable were $10, $867 and $0, respectively;
the maximum exposure to credit risk in respect of the amount that best represents the Group’s
accounts receivable were $1,294,471, $1,217,936 and $1,575,490, 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 June 30, 2023, December 31, 2022 and June 30, 2022, theGroup 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 of accounts
receivable. As of June 30, 2023, December 31, 2022 and June 30, 2022, the provision matrix is asfollows:
Not
past dueJune 30, 2023
Expected loss rate
Total book value

0.002%~0.37% 0.013%~31%$
1,172,907 $
117,353
Not
past due

December 31, 2022
Expected loss rate
Total book value

1-180 days
past due

0.003%~0.523% 0.017%~38%$
961,768 $
252,673Not
past dueJune 30, 2022
Expected loss rate
Total book value

1-180 days
past due1-180 days
past due

0.003%~0.526% 0.017%~37%$
1,401,461 $
171,700~16~

Over 180 days
past due$

25%~100%
4,850

Total

$

Over 180 days
past due
25%~100%
$
4,005

Total

$

Over 180 days
past due
25%~100%$
2,813

1,295,110

1,218,446

Total

$

1,575,974

I. The balance of allowance for loss and movements are as follows:
2023

2022

At January 1
Provision for impairment
Reversal of impairment
Effect of exchange rate changes

$

510 $
110
- (
19 (

800
304)
12)

At June 30

$

639

$

484

June 30, 2023
Allowance for
Costvaluation loss
1,935,013 ($314,083) $567,850 (3,942)
358,724 (
12,227)2,861,587 ($
330,252) $Book value
1,620,930
563,908
346,497
2,531,335

December 31, 2022
Allowance for
Costvaluation loss
2,743,592 ($446,816) $285,227 (6,256)
601,619 (
34,302)

Book value
2,296,776
278,971567,317

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$$

3,630,438 ($487,374) $3,143,064

June 30, 2022

Raw materials
Work in progress
Finished goods$$

Allowance for
Costvaluation loss
4,522,141 ($
151,544) $542,793 (1,093)
669,299 (
6,152)
5,734,233 ($
158,789) $~17~

Book value
4,370,597
541,700
663,147
5,575,444

A. The cost of inventories recognized as expense for the period:

Three months ended June 30,
2023
2022
Cost of goods sold$(Gain on reversal of) loss on decline in market(
value of inventory$$
Cost of goods sold(Gain on reversal of) loss on decline in market(
value of inventory$

1,969,168$

2,090,634

84,201)
1,884,967 $

41,5792,132,213

Six months ended June 30,
2023
2022
4,098,083 $
4,615,077
157,122)3,940,961 $

106,269
4,721,346

The gain on reversal of decline in market value of inventory for the three months and six months
ended June 30, 2023 arose from the clearance of inventories which were previously provided withallowance and the recovery in the net realizable value of certain inventories.
B. No inventories were pledged to others.
(6) Non-current assets held for sale

June 30, 2023
Machinery held for sale
Vehicles held for sale
Office equipment held
for sale
Other equipment held
for sale$$-

December 31, 2022$-

June 30, 2022
$
2,198
18

-

-

237

-

-

2,039
4,492

$

$

A. On November 26, 2021, the Board of Directors of the Group’s overseas second-tier subsidiary,Transcend Shanghai, resolved to sell its buildings in response to the land expropriation. The
related assets transferred to non-current assets held for sale amounting to $159,976 were all
disposed in 2022.
B. On February 18, 2022, the Board of Directors of the Group’s overseas second-tier subsidiary,Transcend Shanghai, resolved to sell land use rights, buildings and ancillary structures located inFengxian District, Shanghai. The related assets transferred to non-current assets held for saleamounting to $371,429 were all disposed in 2022.
C. The carrying amount of non-current assets held for sale was lower than the fair value less costs tosell based on the assessment. Thus, no impairment has occurred.
~18~

(7) Financial assets at fair value through other comprehensive income - non-current
Items
Non-current items:
Equity instruments
Listed stocks
OthersJune 30, 2023

December 31, 2022

June 30, 2022$

684,413 $
1,125
685,538
75,572) (684,413 $
1,125
685,538
160,599) (683,841
1,125
684,966
114,195)$

609,966

524,939

570,771

Valuation adjustments ($$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 $609,966, $524,939 and $570,771 as at June 30, 2023, December
31, 2022 and June 30, 2022, respectively.
B. For the three months and six months ended June 30, 2022, the Group disposed equity investments
whose fair value was $6,179, and the cumulative loss on disposal was transferred to retained
earnings in the amount of ($2,053) and ($2,053), respectively. For the three months and six months
ended June 30, 2023, there were no related transactions.
C. Amounts recognized in profit or loss in relation to the financial assets at fair value through othercomprehensive income are listed below:

Three months ended June 30,2023
Equity instruments at fair value throughother comprehensive income
Fair value change recognized in othercomprehensive income (loss)
Cumulative loss reclassified to retained
earnings due to derecognition
Dividend income recognized in profit or loss
held at end of period

2022

$

34,167 ($110,413)$- ($2,053)

$

5,586

$

1,155

Six months ended June 30,
2023
2022
Equity instruments at fair value throughother comprehensive income
Fair value change recognized in othercomprehensive income (loss)
Cumulative loss reclassified to retained
earnings due to derecognition
Dividend income recognized in profit or loss
held at end of period

~19~

$

85,027 ($123,665)$- ($2,053)

$

6,741

$

2,310

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
Taiwan IC Packaging
Corporation

June 30, 2023$

December 31, 2022

126,297$

June 30, 2022

136,710$

161,779

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

AssociatenameTaiwan IC
Packaging Corporation

Principal
place ofbusiness
TaiwanShareholding ratio
June
30, 2023
12.50%

December31, 202212.50%

June
30, 202212.50%Nature of
Method ofrelationship measurement
Note
Equity method

Note: Taiwan IC Packaging Corporation 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 Corporation processes the raw materials
provided by the Group into relevant semi-finished goods.
B. The Group held a 12.5% equity interest in Taiwan IC Packaging Corporation, 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 Corporation and the Group does notserve as corporate director of Taiwan IC Packaging Corporation, which indicate that the Group
has no control ability to direct the relevant activities of Taiwan IC Packaging Corporation. In
addition, the Company’s chairman is the same with Taiwan IC Packaging Corporation; hence, theGroup has significant influence over Taiwan IC Packaging Corporation.
C. The summarized financial information of the associate that is material to the Group is as follows:
Balance sheet

Taiwan IC Packaging Corporation
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Total net assets
Share in associate’s
net assets
Net equity differences

June 30, 2023
December 31, 2022
June 30, 2022$
1,100,269 $
1,218,268 $
1,485,138
1,163,612
1,151,953
1,174,468(
236,090) (167,786) (463,185)(
74,200) (75,327) (72,650)$1,953,591 $
2,127,108 $
2,123,771$

244,199$

117,902) (126,297 $

(

~20~

$

265,889$

265,472

129,179) (136,710 $103,693)
161,779

Statement of comprehensive income

Taiwan IC Packaging Corporation
Three months ended June 30,
2023

A
Revenue(Loss) profit for the period from continuing
operations
Total comprehensive (loss) income
Dividends received from associatesA
Revenue(Loss) profit for the period from continuing
operations
Total comprehensive (loss) income
Dividends received from associates

2022

$

215,526$

361,945($($$

34,853) $34,853) $- $39,24939,249
-

$
($
($
$

Taiwan IC Packaging Corporation
Six months ended June 30,
2023
2022
381,442 $747,180
95,509) $95,509) $- $109,583
109,583-

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

Investee Company
Taiwan IC Packaging Corporation

Investee Company
Taiwan IC Packaging Corporation($

Three months ended June 30,
2023
2022
4,356) $4,900($

Six months ended June 30,
2023
2022
10,413) $13,266

E. The Group’s investment in Taiwan IC Packaging Corporation has quoted market price. The fairvalue of Taiwan IC Packaging Corporation was $301,510, $242,305 and $250,129 as of June 30,
2023, December 31, 2022 and June 30, 2022, respectively.

~21~

(9) Property, plant and equipment

Land
At January 1
Cost
Accumulated depreciation$$

At January 1
Additions (including transfers)
Disposals
Depreciation charge
Net exchange differences$(

At June 30$

At June 30
Cost
Accumulated depreciation$$

Buildings and Machinery andstructures
equipment

2023
Transportationequipment

Officeequipment

OthersTotal

711,572 $ 1,204,122 $- (450,034) (711,572 $ 754,088 $

345,956 $
250,796) (95,160 $28,079 $21,649) (6,430 $

30,619 $22,396) (8,223 $

20,663 $ 2,341,011
15,764) (760,639)
4,899 $ 1,580,372

711,572 $- (6,075) (705,497 $754,088 $
1,672
15,664) (2,351)
737,745 $

95,160 $
5,005
25,735) (1 (74,431 $

6,430 $
- (2,048) (1)
4,381 $

8,223 $
1,758
2)
2,221) (6
7,764 $

4,899 $ 1,580,372
1,233
9,668
- (
2)
2,451) (48,119)- (8,420)
3,681 $ 1,533,499

705,497 $ 1,189,690 $- (451,945) (705,497 $ 737,745 $

279,296 $204,865) (74,431 $28,082 $23,701) (4,381 $

31,735 $23,971) (7,764 $

19,795 $ 2,254,095
16,114) (720,596)
3,681 $ 1,533,499

~22~

Land
At January 1
Cost
Accumulated depreciation$$$

At January 1
Additions (including transfers)
Disposals
Transfers to non-current assets held
for sale
Depreciation charge
Net exchange differences(

At June 30$

At June 30
Cost
Accumulated depreciation$$

Buildings and Machinery andstructures
equipment

2022
Transportationequipment

Officeequipment

OthersTotal

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

712,136-

114,671 $
10,624
121)

10,944-$

10,851 $595- (12,262 $ 1,942,013
800
13,948479) (
600)

288,128) (35,164) (3,786
763,572 $2,198) (29,739) (96
93,333 $18) (2,257) (19
8,688 $

237) (
2,000) (35
9,244 $

2,039) (292,620)
3,050) (72,210)56 (
2,603)
7,550 $ 1,587,928

705,541 $ 1,313,397 $- (549,825) (705,541 $ 763,572 $

331,780 $
238,447) (93,333 $27,887 $19,199) (8,688 $

29,828 $
20,584) (9,244 $

23,246 $ 2,431,679
15,696) (843,751)
7,550 $ 1,587,928$ 1,081,149 $
1,929
- (

- (
- (
6,595)
705,541 $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.

~23~

(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 lease agreements
do not impose covenants, but leased assets may not be used as security for borrowing purposes.
B. The carrying amounts of right-of-use assets and the depreciation charge are as follows:Land
Buildings
Transportationequipment (businessvehicles)June 30, 2023
Carrying amount$
147,084
46,083

December 31, 2022
Carrying amount$
165,858
28,506

June 30, 2022
Carrying amount$
184,633
35,021

2,494
195,661

1,826
196,190516
220,170$

Land
Buildings
Transportation equipment (business vehicles)

Land
Buildings
Transportation equipment (business vehicles)$$

Three months ended June 30,
2023
2022
Depreciation charge Depreciation charge$
9,387 $
9,236
4,865
3,987
216
179
$
14,468 $13,402Six months ended June 30,
2023
2022
Depreciation charge Depreciation charge$
18,774 $18,915
8,086
7,842
382
359
$
27,242 $27,116

C. For the three months and six months ended June 30, 2023 and 2022, the additions to right-of-use
assets were $879, $188,845, $27,386 and $194,436, respectively. Details are provided in Note
7(2)F.

~24~

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

Three months ended June 30,
2023
2022
Items affecting profit or loss
Interest expense on lease liabilities
Expense on short-term lease contracts
Expense on leases of low-value assets

$

857
1,537
303

$

364
2,202
327

Six months ended June 30,
2023
2022
Items affecting profit or loss
Interest expense on lease liabilities
Expense on short-term lease contracts
Expense on leases of low-value assets

$

1,639
3,504
606

$

546
3,919
637

E. For the six months ended June 30, 2023 and 2022, the Group’s total cash outflow for leases were$48,456 and $51,250, respectively.
(11) Leasing arrangements - lessor
A. The Group leases various assets including land and buildings. Rental contracts are typically madefor periods of 1 to 5 years. Lease terms are negotiated on an individual basis and contain a wide
range of different terms and conditions. To protect the lessor’s ownership rights on the leased
assets, leased assets may not be used as security for borrowing purposes, or a residual value
guarantee was required.
B. For the three months and six months ended June 30, 2023 and 2022, the Group recognized rent
income in the amounts of $14,165, $10,486, $28,471 and $19,884, respectively, based on theoperating lease agreement, which does not include variable lease payments.
C. The maturity analysis of the lease receivables under the operating leases is as follows:

2023
2024
2025
2026
2027
2028

June 30, 2023$
28,45636,876
20,774
13,144815$
100,065

2023
2024
2025
2026
2027
2028

December 31, 2022$
58,97037,94322,30912,664815$
132,701

~25~

2022
2023
2024
2025
2026
2027

June 30, 2022$
29,51544,94733,803
18,965
12,664815$
140,709(12) Investment property
2023
Buildings andstructuresLand
At January 1
Cost
Accumulated depreciation$$

At January 1
Depreciation charge
Net exchange differences$

At June 30$

At June 30
Cost
Accumulated depreciation$$

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

466,845 $
141,640) (325,205 $2,735,571
141,640)
2,593,931

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

325,205 $6,551) (1,021) (317,633 $2,593,931
6,551)
1,021)
2,586,359

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

464,138 $
146,505) (317,633 $2,732,864
146,505)
2,586,359

2022
Buildings andstructuresLand
At January 1
Cost
Accumulated depreciation
At January 1$

At June 30
Cost
Accumulated depreciation

Total

$

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

461,381 $128,019) (333,362 $2,730,107
128,019)2,602,088$

2,268,726

333,362$

2,602,088$- (2,268,726 $

2,973
6,357) (929
330,907 $2,973
6,357)
929
2,599,633

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

466,456 $
135,549) (330,907 $2,735,182
135,549)2,599,633

Additions
Depreciation charge
Net exchange differences
At June 30

Total

$
$

~26~

$

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

$

3,092

$

3,038

$

175

$

175

A
$

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

Three months ended June 30,
2023
2022
14,165 $10,486Six months ended June 30,
2023
2022
28,471 $19,884

$

6,201

$

6,007

$

350

$

350

B. The fair value of the investment property held by the Group was $5,012,393, $5,047,960 and$5,756,729 as of June 30, 2023, December 31, 2022 and June 30, 2022, respectively. The
aforementioned fair values were assessed based on the transaction prices of similar properties inthe same area and are categorized within Level 3 in the fair value hierarchy.
C. No investment property was pledged to others.
(13) Other non-current assets

Guarantee deposits paid
Prepayment for businessfacilities
OthersJune 30, 2023$
33,202

December 31, 2022$
34,888June 30, 2022$
31,153

9,256
16,591
59,0492,912
14,391
52,191

21,63015,14967,932$$$(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 to continue to be~27~

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 for each additional year
thereafter, subject to a maximum of 45 units. Pension benefits are based on the number ofunits accrued and the average monthly salaries and wages of the last 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, thetrustee, under the name of the independent retirement fund committee. Also, the Company
would assess the balance in the aforementioned labor pension reserve account by December
31, every year. If the account balance is insufficient to pay the pension calculated by the
aforementioned method to the employees expected to qualify for retirement in the following
year, the Company will make contributions to cover the deficit by next March.
(b) For the aforementioned pension plan, the Group recognized pension costs of $146, $161,$293 and $322 for the three months and six months ended June 30, 2023 and 2022,
respectively.
(c) Expected contributions to the defined benefit pension plan of the Company for the year
ending December 31, 2023 amount to $1,476.
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 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.
(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 threemonths and six months ended June 30, 2023 and 2022 were $10,116, $10,320, $20,071 and$20,427, respectively.

~28~

(15) Share capital
As of June 30, 2023, 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 thepaid-in capital was $4,290,617 with par value of $10 per share. All proceeds from shares issued havebeen collected. The Company’s ordinary shares outstanding at the beginning and at the end of theperiod were 429,062 thousand shares for the six months ended June 30, 2023 and 2022.
(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 requires thatthe amount of capital surplus to be capitalized mentioned above should not exceed 10% of the paidin capital each year. Capital surplus shall not be used to cover accumulated deficit unless the 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 theremaining 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 distributable earnings
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 andcash payment from capital surplus by a resolution adopted by a majority vote at its meeting
attended by two-thirds of the total number of directors, which will then be reported to theshareholders.
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 shareholders. 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 portionin excess of 25% of the Company’s paid-in capital.

~29~

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. The appropriations of earnings and cash payment from capital surplus for the years ended
December 31, 2022 and 2021 have been resolved by the shareholders during their meeting on
June 16, 2023 and June 17, 2022, respectively. Details are summarized below:

For the year ended
December 31, 2022
Dividends per
share (in dollars)
AmountLegal reserve
Special reserve
Cash dividends$

245,726
167,3032,059,496
2,472,525$

For the year ended
December 31, 2021
Dividends per
share (in dollars)
Amount
$

$

4.80
$

254,464
73,2702,231,121
2,558,855$

Cash payment
per share
AmountCash payment from
capital surplus$

343,249

Cash payment
per share(in dollars)
$

0.80

5.20

Amount$343,249(in dollars)$

0.80

Actual distribution of retained earnings for 2021 was in agreement with the amounts resolved by
the Board of Directors. The appropriation for cash dividends from 2022 earnings and cash
payment from capital surplus had been resolved by the Board of Directors during its meeting on
March 2, 2023 and reported to the shareholders on June 16, 2023. The Group has recognized
related liabilities which were shown as other payables.
(18) Other equity items

At January 1
Revaluation adjustment
Currency translationdifferences
Effect from income tax
At June 30

($

($

2023
Exchangedifferences
Unrealized
on translation offoreign financial
gain or loss
on valuation
statements
160,599) ($197,218) ($85,027- (75,572) ($
~30~

7,784
1,557) (190,991) ($Total
357,817)85,027
7,784
1,557)
266,563)

At January 1
Revaluation adjustment
Revaluation transferred
to retained earningsgrossCurrency translationdifferences
Effect from income tax
At June 30

$
(

2022
Exchangedifferences
Unrealized
on translation ofgain or loss
foreign financial
on valuation
statements
7,417 ($
197,932) ($123,665)
- (

($

Total
190,515)
123,665)

2,053

-

2,053

- (
114,195) ($19,807
3,961) (182,086) ($19,807
3,961)
296,281)(19) Operating revenue

Sales revenue

Sales revenue$

Three months ended June 30,
2023
2022
2,469,577 $
3,006,488$

Six months ended June 30,
2023
2022
5,078,378 $
6,456,124

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:Three months ended
June 30, 2023
Revenue from external$customer contracts

Taiwan535,062

Asia$

Electronic products
America
Europe824,263$

380,701$

578,242

Others$151,309

Total$ 2,469,577

Electronic products
TaiwanSix months ended
June 30, 2023
Revenue from external$ 1,180,177
customer contracts

Asia$ 1,628,493~31~

America$

747,160

Europe$ 1,211,872

Others$

310,676

Total$ 5,078,378

Electronic products
TaiwanThree months ended
June 30, 2022
Revenue from external$ 741,293
customer contracts
TaiwanSix months ended
June 30, 2022
Revenue from external$ 1,520,834
customer contracts

Asia

$

America

901,999
Asia$

Europe508,332$

665,261

Others$Electronic products
America
Europe$ 2,017,211$ 1,090,718$ 1,442,642

189,603
Others$384,719

Total$ 3,006,488
Total$ 6,456,124

B. Contract assets and liabilities
The Group has no revenue-related contract assets and liabilities.
(20) Interest income

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

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

Three months ended June 30,
2023
2022
13,061 $
2,526
94,4639,885
37
39
107,561 $
12,450Six months ended June 30,
2023
2022
17,360 $2,715
179,353
1,291
198,004$

16,463
2,535
21,713(21) Other income

Rental income
Dividend income$$

Rental income
Dividend income

$
$

~32~

Three months ended June 30,
2023
2022
14,165 $10,486
5,586
1,155
19,751 $11,641
Six months ended June 30,
2023
2022
28,471 $19,884
6,741
2,310
35,212 $22,194

(22) Other gains and losses

Net currency exchange gain
Net gain (loss) on financial assets and liabilities
at fair value through profit or loss
Gain on disposal of non-current assets held for
sale
Loss on disposals of property, plant andequipment
Others$(($Net currency exchange gain
Net gain (loss) on financial assets and liabilities
at fair value through profit or loss
Gain on disposal of non-current assets held for
sale
Loss on disposals of property, plant andequipment
Others$Three months ended June 30,
2023
2022
135,102 $100,5223,503 (

2,699)-

984,6532) (719)
137,884 $

2)
822
1,083,296

Six months ended June 30,
2023
2022
63,626 $186,0908,827 (($

5,649)-

1,329,173

2) (
3,980
76,431 $

438)
3,446
1,512,622(23) Expenses by nature

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

Three months ended June 30,
2023
2022
253,235 $272,644
30,02329,783
10,262
10,481
13,493
13,32840,890Wages and salaries
Labor and health insurance fees
Pension costs
Other personnel expenses
Depreciation charges (including investment
property and right-of-use assets)$

Six months ended June 30,
2023
2022
556,019 $
611,569
61,39061,02920,364
20,74927,44327,906
81,912~33~

47,104

105,683

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’ remuneration.
B. For the three months and six months ended June 30, 2023 and 2022, employees’ compensation
was accrued at $5,130, $14,648, $8,226 and $24,797, respectively; while no directors’
remuneration was accrued. The aforementioned amounts were recognized in salary expenses.
C. The employees’ compensation was estimated and accrued based on not less than 1% of
distributable profit of current period for the six months ended June 30, 2023. As of June 30, 2023,
no directors’ remuneration was accrued.
D. The difference between employees’ compensation and directors’ remuneration as resolved by the
Board of Directors and the amounts recognized in the 2022 financial statements by $742 and($2,300), respectively, have been adjusted in profit or loss for 2023. As of June 30, 2023, theemployees’ compensation for 2022 has been paid but the directors’ remuneration has not yet been
paid.
E. Information about employees’ compensation and directors’ remuneration of the Company asapproved at the meeting of Board of Directors at 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:
Three months ended June 30,
2023
2022
Current income tax:
Current tax on profits for the period
Prior year income tax underestimation(overestimation)
Total current income tax
Deferred income tax:
Origination and reversal of temporary
differences
Total deferred income tax

$

(
(
$

Income tax expense~34~

157,898$

401,035603 (
158,501

10,790)390,245668)
668)
157,833 $145,571
145,571535,816

Six months ended June 30,
2023
2022
Current income tax:
Current tax on profits for the period
Prior year income tax overestimation
Total current income tax
Deferred income tax:
Origination and reversal of temporary
differences
Total deferred income tax

$
(

(
(
$

Income tax expense

229,460 $575) (
228,885

535,5159,251)
526,264

13,952)
13,952)214,933 $211,693
211,693
737,957(b) The income tax relating to components of other comprehensive income is as follows:

Three months ended June 30,
2023
2022
Financial statements translationdifferences of foreign operations($

472) ($

8,011)

Six months ended June 30,
2023
2022
Financial statements translationdifferences of foreign operations

$

1,557

$

3,961

B. The Company’s income tax returns through 2021 have been assessed and approved by the Tax
Authority.

~35~(25) Earnings per share

Three months ended June 30, 2023
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$

399,512429,062

Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent$

399,512429,062-105

399,512429,167

Assumed conversion of all
dilutive potential ordinary
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent
plus assumed conversionof all dilutive potential
ordinary shares

$

$

0.93

$

0.93

Six months ended June 30, 2023
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$

631,877

429,062

Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent$

631,877

429,062-250

631,877

429,312

Assumed conversion of all
dilutive potential ordinary
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent
plus assumed conversionof all dilutive potential
ordinary shares

$

~36~

$

1.47

$

1.47

Three months ended June 30, 2022
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$

1,145,251

429,062

Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent$

1,145,251

429,062-359

1,145,251

429,421

$

2.67

$

2.67

Assumed conversion of all
dilutive potential ordinary
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent
plus assumed conversionof all dilutive potential
ordinary shares$

Six months ended June 30, 2022
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$

1,924,695

429,062

Diluted earnings per share
Profit attributable to ordinary
shareholders of the parent$

1,924,695

429,062-507

1,924,695

429,569

Assumed conversion of all
dilutive potential ordinary
sharesEmployees’ compensation
Profit attributable to ordinary
shareholders of the parent
plus assumed conversionof all dilutive potential
ordinary shares

$

~37~

$

4.49

$

4.48

(26) Supplemental cash flow information
A. Investing activities with partial cash payments$

Purchase of property, plant and equipment
Less: Transfers from prepayment for businessfacilities($

Cash paid during the period

Six months ended June 30,
2023
2022
9,668 $
13,9482,912) (6,756 $

7,732)
6,216

B. Financing activities with no cash flow effects:

Cash dividends
Cash payment from capital surplus
Less: Shown as other payables
Financing activities cash flows$($

Six months ended June 30,
2023
2022
2,059,496 $2,231,121
343,249
343,249
2,402,745) (2,574,370)- $-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

Three months ended June 30,
2023
2022
Sales of goods
Associates accounted for using the equity
method

$

303

$

250

Six months ended June 30,
2023
2022
Sales of goods
Associates accounted for using the equity
method
~38~

$

506

$

746

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

Three months ended June 30,
2023
2022
Purchases of goods
Associates accounted for using the equity
method$42,837$62,890Six months ended June 30,
2023
2022
Purchases of goods
Associates accounted for using the equity
method$78,600$135,243

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. Receivables from related parties
A
Accounts receivable:
Associates accounted
for using equity
methodJune 30, 2023$

June 30, 2022

December 31, 2022

11

$

-

$

84

The receivables from related parties arise mainly from sales transactions. The credit term to
Taiwan IC Packaging Corporation is 30 days after receipt of goods. The receivables are unsecured
in nature and bear no interest. There are no allowances for uncollectible accounts held against
receivables from related parties.
D. Payables to related parties
June 30, 2023
Accounts payable:
Associates accounted
for using equity
method$31,909June 30, 2022

December 31, 2022$

27,442$

42,279The payables to related parties arise mainly from purchase transactions and are due 30 days after
the date of purchase. The payables bear no interest.

~39~

E. Other payables

June 30, 2023
Other payables:
Associates accounted
for using equity$
methodDecember 31, 2022

-

$

4

June 30, 2022$-

Other payables to related parties arise mainly from miscellaneous purchases. The payables bearno interest.
F. Leasing arrangements - lessee
The Company renewed a land lease contract with its related party, Won Chin and Cheng Chuan,with a lease term of 5 years from June 12, 2022 to June 11, 2027. The annual rental payment is$38,484 (excluding tax), which was determined based on the appraisal results of Yungcheng Real
Estate Appraisers Firm and CCIS Real Estate Joint Appraisers Firm and renewed at $1,350 indollar per square feet/month (tax included) after having a three-party negotiation. Rent is paid on
the contract date and becomes payable on the same date each following year until the end of thelease. As of June 30, 2023, December 31, 2022 and June 30, 2022, the balance of related right-ofuse assets amounted to $147,084, $165,858 and $184,633 while lease liabilities amounted to$112,252, $149,825 and $148,763, respectively.
(3) Key management compensation

Three months ended June 30,
2023$

Salaries and other employee benefits$

Salaries and other employee benefits

2022
4,870

$

22,363Six months ended June 30,
2023
2022
11,208 $46,389

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

Pledged assets
Property, plant andequipment

June 30,2023$
111,813

Book value
December 31,
2022$
121,700~40~

June 30,
Pledge purpose
2022$
115,050 Collateral for general credit
limit granted by financial
institutions

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACTCOMMITMENTS
As of June 30, 2023, except for the provision of endorsements and guarantees mentioned in Note 13(1)B, there are no other significant commitments.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
None.
12. OTHERS(1) Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as agoing 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 in the short term.
Except for obtaining loans to reduce the exchange rate exposure, the Group has sufficient funds tocover its own needs. Debt financing is not necessary.
(2) Financial instruments
A. Financial instruments by category

June 30, 2023
Financial assets
Financial assets
mandatorily
measured atfair value throughprofit or loss
Financial assets atfair value throughothercomprehensive
income$60,290609,966~41~

December 31, 2022$

51,463524,939

June 30, 2022$

54,079570,771June 30, 2023

Financial assets at
amortised cost
Cash and cash
equivalents
Financial assets
at amortised cost
Notes receivable
Accounts
receivable(including relatedparties)
Other receivables
Refundable
deposits$$

4,236,983$

Other payables
Lease liabilities$$$

3,187,312

June 30, 2022$

5,817,100

8,873,774
10

8,611,357
867

5,424,511-

1,294,482
90,0631,217,936
77,626

1,575,574
98,241

33,202
15,198,770

34,88813,706,388

31,153
13,571,429

June 30, 2023
Financial liabilities
Financial liabilities
at amortised cost
Notes payable
Accounts payable(including relatedparties)

December 31, 2022

1,106,885

2,671,073
3,777,958
161,986$$

December 31, 2022$$$

500,119

271,948
772,067
180,768

June 30, 2022

$

$
$

71
809,8412,804,532
3,614,444
182,589

B. Financial risk management policies
There was no significant change during this period. Refer to Note 12 in the consolidated financial
statements for the year ended December 31, 2022 for related information.
C. Significant financial risks and degrees of financial risks
There was no significant change except for the following information. Refer to Note 12 in the
consolidated financial statements for the year ended December 31, 2022 for the related
information.

~42~

(a) Market risk
Foreign exchange riski.

The Group operates internationally and is exposed to exchange rate risk arising from thetransactions of the Company and its subsidiaries used in various functional currency,
primarily with respect to the USD. Exchange rate risk arises from future commercial
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 denominatedin foreign currencies whose values would be materially affected by the exchange rate
fluctuations is as follows:

Financial assets

Financial liabilities

Financial assets

Financial liabilities

Foreigncurrency
USD：NTDRMB：NTD
EUR：NTD
JPY：NTD
GBP：NTD
KRW：NTD
USD：EUR
GBP：EUR
USD：NTDRMB：NTD

Foreigncurrency
USD：NTDRMB：NTD
EUR：NTD
JPY：NTD
KRW：NTD
USD：EUR
GBP：EUR
USD：NTDRMB：NTD

June 30, 2023
Foreign currency
amount(In thousands) Exchange rate$
220,254
31.14
57,5504.282
13,44433.81
1,751,089
0.2150657
39.38
2,196,338
0.02389,636
0.92102,683
1.16$
30,06931.14
97,981
4.282
December 31, 2022
Foreign currency
amount(In thousands) Exchange rate$
254,448
30.71
23,994
4.408
5,372
32.72
474,455
0.2324
1,728,885
0.0246
5,905
0.93851,950
1.13$
13,05230.71
97,981
4.408~43~Book value$ 6,858,710
246,429454,542
376,484
25,87352,273300,065
105,657$
936,349
419,555

Book value$ 7,814,098
105,766
175,772
110,263
42,531
181,343
72,326$400,827
431,900

Financial assets

Financial liabilities

Foreigncurrency
USD：NTD
EUR：NTD
USD：EUR
GBP：EUR
USD：NTD

June 30, 2022
Foreign currency
amount(In thousands) Exchange rate
Book value$
129,36229.72 $ 3,844,639
1,531
31.05
47,5384,667
0.9571
138,703
2,916
1.1617105,180$
21,52229.72 $
639,634

iii.

The information on total exchange (loss) gain, including realized and unrealized, arisingfrom significant foreign exchange variation on the monetary items held by the Groupfor the three months and six months ended June 30, 2023 and 2022 is provided in Note6(22).

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 Group’s net income
will decrease or increase by $59,224 and $32,050 for the six months ended June 30,2023 and 2022, 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 thechange 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, other componentsof equity for the six months ended June 30, 2023 and 2022 would haveincreased/decreased by $6,100 and $5,708, 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 Group’s principal interest-bearing assets are cash and cash equivalents and financial
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 is assessedthat there is no significant cash flow interest rate risk.

~44~

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 receivables based on the agreed
terms.

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 on internalor external ratings in accordance with limits set by the Board of Directors. The utilisationof credit limits is regularly monitored.

iii. The Group determines that the default occurs when the contract payments are past due
over 180 days.
iv. If the contract payments were past due over 30 days based on the terms, there has beena significant increase in credit risk on that instrument since initial recognition.
v.

For details of credit risk in relation to accounts receivable and notes receivable, refer toNote 6(4).

(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 includedin 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 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 and investment property
is included in Level 3.
~45~

B. Fair value information of investment property at cost is provided in Note 6(12).
C. Financial instruments not measured at fair value
The carrying amounts of cash and cash equivalents, financial assets at amortised cost, notes receivable,accounts receivable (including related parties), other receivables, guarantee deposits paid, accounts
payable (including related parties) 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:

June 30, 2023
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, 2022
AssetsRecurring fair value measurements
Financial assets at fair value throughprofit or loss
Beneficiary certificates
Financial assets at fair value throughother comprehensive income
Equity securities
June 30, 2022
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$60,290$608,841
669,131

Level 2

$

-

$

-

Level 1$

51,463

Level 3

Total

$

-

$

1,125
1,125

Level 2$60,290$609,966
670,256

Level 3

Total

$

-

$

523,814$ 575,277
Level 1

$

-

1,125
$ 1,125
Level 3524,939$ 576,402
Total$

54,079

$

-

$

-

$

54,079$569,646
623,725

$

-

$

1,125
1,125

$

570,771624,850~46~

Level 2-$

51,463

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 and regularly
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 other comprehensive income andbeneficiary certificates classified as financial assets at fair value through profit or loss.
F. For the six months ended June 30, 2023 and 2022, there were no transfers between Level 1 andLevel 2.
G. If one or more of the significant inputs is not based on observable market data, the instrument isincluded in level 3.
H. The financial products purchased for the six months ended June 30, 2022 were categorised as
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.

~47~

13. SUPPLEMENTARY DISCLOSURES(1) Significant transactions information
A. Loans to others: None.
B. Provision of endorsements and guarantees to others: Refer to table 1.
C. Holding of marketable securities at the end of the period (not including subsidiaries, associates
and joint ventures): 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: None.
E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
G. Purchases or sales of goods from or to relate parties reaching NT$100 million or 20% of theCompany’s paid-in capital or more: Refer to table 3.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more:
Refer to table 4.
I. Trading in derivative instruments undertaken during the reporting periods: None.
J. Significant inter-company transactions during the reporting periods: Refer to table 5.
(2) Information on investees
Names, locations and other information of investee companies (not including investees in Mainland
China):Refer to table 6.
(3) Information on investments in Mainland China
A. Basic information: Refer to table 7.
B. Significant transactions, either directly or indirectly through a third area, with investee companies
in the Mainland Area: Refer to table 5.
(4) Major shareholders information
Major shareholders information: Refer to table 8.

~48~

14. SEGMENT INFORMATION(1) General information
The Group operates business only in a single industry. The Chairman of the Board of Directors who
allocates resources and assesses performance of the Group as a whole, has identified that the Grouphas 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

Segment revenue
Segment income$$

Three months ended June 30,
2023
2022
2,469,577 $
3,006,488
399,512 $1,145,251$$

Six months ended June 30,
2023
2022
5,078,378 $
6,456,124
631,877 $
1,924,695(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 thestatement of comprehensive income.

~49~

Transcend Information, Inc. and Subsidiaries
Provision of endorsements and guarantees to others
Six months ended June 30, 2023
Table 1

Expressed in thousands of NTD(Except as otherwise indicated)

Party being
endorsed/guaranteed

Number(Note 1)

Endorser/guarantor

0

Transcend
Information,
Inc.

Limit onendorsements/
guarantees
provided for asingle party(Note 3)

Relationship withthe endorser/
guarantor
Company name(Note 2)
Transcend
Japan Inc.

2$

3,574,489 $Maximum
outstanding
endorsement/
guarantee
amount as ofJune 30, 2023
(Note 4)

Outstanding
endorsement/
guarantee
amount atJune 30,2023 (Note 5)

461,800(JPY2,000,000)(In thousands)$
430,000(JPY2,000,000)(In thousands)

Ratio ofProvision of
accumulatedendorsements/ Provision ofProvision ofAmount ofendorsement/
Ceiling on total
guarantees by endorsements/ endorsements/
Actualendorsements/ guarantee amountamount ofparentguarantees by guarantees toamountguarantees to net asset value ofendorsements/
company tosubsidiary to
the party indrawn down secured withthe endorser/
guarantees provided
subsidiaryparentMainland(Note 6)collateralguarantor company(Note 7)(Note 8)company
China
Footnote
$

-

-

2

$

7,148,978Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:(a) The Company is ‘0’.
(b) The 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) The endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.
(c) The endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company.
(d) The 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. ($17,872,446*20%=$3,574,489)
Note 4: The maximum outstanding endorsement/guarantee amount during and as of June 30, 2023 is JPY$2,000,000 (In thousands).
Note 5: The amount was approved by the Board of Directors.
Note 6: The actual amount of endorsement drawn down is $0.
Note 7: Not exceeding 40% of the Company’s net asset value. ($17,872,446*40%=$7,148,978)Note 8: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary.

Table 1, Page 1

Y

-

-

-

Transcend Information, Inc. and Subsidiaries
Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)
June 30, 2023
Table 2

Expressed in thousands of NTD(Except as otherwise indicated)

Securities held by
Transcend Information, Inc.

Marketable securities(Note 1)
StocksTrendForce Corporation

Fubon Financial Holding Co., Ltd. Preferred Shares B
Taiwan Semiconductor Manufacturing Co., Ltd.
MediaTek Inc.
Fubon Financial Holding Co., Ltd.
Cathay Financial Holding Co. Ltd.
Yuanta Financial Holding Co., Ltd.
CTBC Financial Holding Co., Ltd
Formosa Plastics Corporation
ASUSTek Computer Inc.

Beneficiary certificates
Yuanta Taiwan Top 50 ETF

Corporate bonds
TSMC Arizona Corporation U.S. dollar-denominatedcorporate bonds
International Business Machines Corporation U.S. dollardenominated corporate bonds
Meta Platforms, Inc. U.S. dollar-denominated corporate
bonds
PAYPAL HOLDINGS, INC. U.S. dollar-denominatedcorporate bonds
Intel Corporation U.S. dollar-denominated corporate
bonds
Mercedes-Benz Finance North America LLC U.S. dollardenominated corporate bonds
Toyota Motor Credit Corporation U.S. dollardenominated corporate bonds

Relationship with thesecurities issuer (Note 2)

General ledger account

As of June 30, 2023
Book value(Note 3)
Ownership (%)

Number of shares-

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

60,816

-

"
"
"
"
"
"
"
"
"

1,758,000
420,000
40,0001,120,366
216,323
119,480
100,000
262,000
410,000

$

1,125

1

-

$

105,304
241,920
27,52068,119
9,334
2,760
2,485
22,454
128,945
609,966

Fair value$

Footnote(Note 4)

1,125-

105,304
241,920
27,52068,119
9,334
2,760
2,485
22,454
128,945--

Financial assets at fair value
through profit or loss
- non-current

467,000$

60,290-$60,290--1,850,000$

57,034-$57,034--

Financial assets at amortised cost
- non-current〞

2,250,000

69,417-

69,417--〞1,650,000

48,366-48,366--〞

1,100,000

33,622-

33,622--〞2,000,000

61,140-61,140--〞250,000

7,871

-

7,871

-

-

〞

900,000

28,105-

28,105-$

305,555

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.

Table 2, Page 1

Transcend 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 more
Six months ended June 30, 2023
Table 3

Expressed in thousands of NTD(Except as otherwise indicated)
Differences in transaction terms compared tothird party transactions (Note)

Transaction

Purchaser/seller
Transcend
Information, Inc.

Counterparty

Relationship with thecounterparty

Transtech Trading (Shanghai) Subsidiary of MemhiroCo., Ltd.

Sales(purchases)
Sales

Amount$Percentage
of total sales(purchases)

Credit term

305,6036

120 days aftermonthly billings

Unit priceNotes/accounts receivable (payable)

Credit term

No significant 30 to 60 days after monthly
difference billings to third parties

Balance$

Percentage of
total notes/accounts
receivable (payable)

Footnote

91,307

6-"

Transcend Japan Inc.

The Company’s subsidiary"

232,318

5

"

"

"

136,6889-"Transcend Information
Europe B.V.

Subsidiary of Memhiro"

247,368

5

"

"

"

334,857

22-"

Transcend Information Inc.

The Company’s subsidiary"

350,923

7

"

"

"

42,001

3-"

Transcend Korea Inc.

The Company’s subsidiary"

160,281

3

"

"

"

52,273

3-"

Transcend Information
Trading GmbH

Subsidiary of Memhiro"

177,784

4

"

"

"

54,943

4-

Note: The 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.

Table 3, Page 1

Transcend Information, Inc. and Subsidiaries
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
Six months ended June 30, 2023
Table 4

Expressed in thousands of NTD(Except as otherwise indicated)

Creditor
Transcend Information, Inc.
"
Transcend Information(Shanghai), Ltd.

Counterparty

Relationshipwith the counterparty

Transcend Japan Inc.

The Company’s subsidiary

Transcend Information Europe B.V.
Transcend Information, Inc.

Balance as atJune 30,
2023$

Amount collected
subsequent to thebalance sheet date

Overdue receivables
Turnover rate

AmountAction taken

136,688

3.84 $--

Subsidiary of Memhiro

334,857

2.42-

Ultimate parent company

402,372-

402,372

Table 4, Page 1$

Allowance for
doubtful accounts
32,680

-

-

-

-

-

-

-

Transcend Information, Inc. and Subsidiaries
Significant inter-company transactions during the period
Six months ended June 30, 2023
Table 5

Expressed in thousands of NTD(Except as otherwise indicated)
Transaction

Number(Note 1)Company name0

Transcend Information, Inc.

"Counterparty

Relationship(Note 2)

Transtech Trading (Shanghai) Co., Ltd.

1"

Transcend Japan Inc.

""

232,318

"

5

"

"

Transcend Information Europe B.V.

""

247,368

"

5

"

"

Transcend Information Inc.

""

350,923

"

7

"

"

Transcend Information Trading GmbH""

177,784

"

4

"

"

Transcend Korea Inc.

""

160,281

"

3

"

"

Transcend Information Europe B.V.

"

Accounts receivable

334,857

120 days after monthly billings

1

"

"

Transcend Information (Shanghai), Ltd.

"

Accounts payable

402,372)

120 days after monthly billings

1

Transcend Information Europe B.V.

Transcend Information Trading GmbH

3

Sales

64,603

There is no significant
difference in unit pricefrom those to third parties.

$(

Amount305,603

Percentage of consolidated total operating
revenues or total assets (Note 3)
6

General ledger account
Sales

Transaction terms
There is no significant
difference in unit pricefrom those to third parties.

((Individual transactions not exceeding 1% of the consolidated total revenue and total assets are not disclosed.)
Note 1: The 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.

Table 5, Page 1

2)1

Transcend Information, Inc. and Subsidiaries
Information on investees (excluding information on investments in Mainland China)
Six months ended June 30, 2023
Table 6

Expressed in thousands of NTD(Except as otherwise indicated)

Investor
Transcend
Information, Inc.

Investee

Location

Initial investment amount
Balance as at
Balance as atJune 30,
December 31,
2023
2022

Main business activities

Saffire Investment Ltd.

B.V.I.

Investment holdings

Transcend Japan Inc.

Japan

Import and wholesale ofcomputer memory modules andperipheral products

Transcend Information Inc. United Statesof America
Transcend Korea Inc.

$

216,829$

Shares held as at June 30, 2023

Number of shares Ownership (%)

216,8296,600,000

100

89,103

89,1036,400

100

Import and wholesale ofcomputer memory modules andperipheral products

38,592

38,592625,000

100

Korea

Import and wholesale ofcomputer memory modules andperipheral products

6,132

6,132

40,000100

Taiwan IC Packaging
Corporation

TaiwanPackaging of Semi-conductors

354,666

354,666

21,928,036

Saffire Investment
Ltd.

Memhiro Pte Ltd.

Singapore

Investment holdings

173,702173,702

Memhiro Pte Ltd.

Transcend Information
Europe B.V.

Netherlands

Import and wholesale ofcomputer memory modules andperipheral products

1,693Transcend Information
Trading GmbHGermany

Import and wholesale ofcomputer memory modules andperipheral products

Transcend Information(H.K.) Ltd.

Hong Kong

Import and wholesale ofcomputer memory modules andperipheral productsBook value

57,671) ($57,671)

Note 2

103,655

12,454

12,454Note 2

172,926

23,901

23,901

Note 2

1,620 (

6,115) (6,115)

Note 2

12.50

126,297 (

95,509) (11,937)Note 5

8,277,609

100

1,543,481 (

58,731) (58,731)

Note 3

1,693

100

100

244,716

1,932

1,932

Note 4

2,288

2,288

-

100

118,425 (

8,207) (8,207)

Note 4

7,636

7,636

2,000,000

100

34,081 (

1,910) (1,910)

Note 4Note 1: The Company does not directly recognize the investment (loss) income, except for the subsidiaries and associates directly held.
Note 2: Subsidiary of the Company.
Note 3: Subsidiary of Saffire.
Note 4: Subsidiary of Memhiro.
Note 5: Associate of the Company.
Table 6, Page 1$

Investment (loss)
incomeNet (loss) profit
recognizedof the investeeby the Company
for the six months for the six months
ended June 30,
ended June 30,
2023
2023 (Note 1)
Footnote

1,583,659 ($Transcend Information, Inc. and Subsidiaries
Information on investments in Mainland China
Six months ended June 30, 2023
Table 7

Expressed in thousands of NTD(Except as otherwise indicated)

Investment
methodInvestee in
Mainland China

Main business activities

Transcend
Manufacture and sales ofInformation
computer memory modules,(Shanghai), Ltd. storage products and disks,and lease of self-ownedbuildings
Transtech
Trading(Shanghai) Co.,
Ltd.

（Note 1）

Paid-in capital$

Wholesale, agent, import andexport and retail of computer
memory modules, storage
products and computercomponents

150,7872

16,3102

Accumulated amount ofremittance from Taiwan to
Mainland China as ofJune 30, 2023

Investment
Ceiling onamount approved investments inby the Investment Mainland China
Commission of
imposed by thethe Ministry of
Investment
Economic Affairs Commission of(MOEA)
MOEA$$

167,097

167,097$

Accumulated amountof remittance from
Taiwan to
Mainland China
as of January 1,
2023$

Amount remitted from
Taiwan to Mainland
China/Amount remitted backto Taiwan forthe six months ended June 30,2023
Remitted toMainlandChina

150,787-

16,310-Remitted backto Taiwan$

Accumulated
amount of remittancefrom Taiwan to
Mainland China as ofJune 30, 2023

Net lossof investee forthe six months
ended June 30,
2023

Investment loss
recognizedby the Company
for the six months
ended June 30,2023 (Note 2)

Ownership
held bythe Company(direct orindirect)Book value ofinvestments in
Accumulated amount
Mainland China of investment income
as of June 30, remitted back to Taiwan
2023
as of June 30, 2023
Footnote- $150,787 ($3,654)

100($

3,654) $516,365-

16,310 (1,618)

100(

1,618)

55,364

10,723,468

Note 1: Investment methods are classified into the following three categories; fill in the number of category each case belongs to:(1) Directly invest in a company in Mainland China.
(2) Through investing in an existing company in the third area (Memhiro Pte Ltd.), which then invested in Mainland China.
(3) Others.
Note 2: The gain and loss on investment recognized for the period was based on the financial statements that were not reviewed by independent auditors.
Note 3: The numbers in this table are expressed in New Taiwan Dollars.

Table 7, Page 1$

1,464,028---

Transcend Information, Inc. and Subsidiaries
Major shareholders information
June 30, 2023
Table 8
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

Table 8, Page 1