Stock Code
5263

Brogent Technologies Inc.

2020
Annual Report
Notice to readersThis English-version annual report is a summary translation of the Chinese version and is not an
official document of the shareholders’ meeting. If there is any discrepancy between the English andChinese versions, the Chinese version shall prevail.

Date Printed: 31 March, 2021
Taiwan Stock Exchange Market Observation Post System: http://newmops.twse.com.tw1. Name, Title, Contact No., and Email of the Company's spokesperson
Spokesperson name: Chih-Hung Ouyang
Title: President
Telephone:(07)537-2869
Email:stock@brogent.com
Representative spokesperson: Hui-Chuang Lin
Title: Chief Financial Officer
Telephone:(07)537-2869
Email:stock@brogent.com
2. Head office address and telephone no.
Head office: Number 9, Fuxing 4th Rd., Qianzhen District, Kaohsiung City (80661) Taiwan
Telephone:(07)537-2869
3. Name, address, website, and telephone no. of stock transfer agency
Stock transfer institute: Share Administration Agency, Taishin International Bank
Address: No.96, Sec. 1, Jianguo N. Rd., Jhongshan District, Taipei City 10489, Taiwan
Website:www.taishinbank.com.tw
Telephone:(02)2504-8125
4. External auditor for most recent financial statement
External auditor: Chiu-Yen Wu, CPA
Lee-Yuan Kuo, CPA
Accounting firm: Deloitte & Touche Certified Public Accountants
Address: 3F, ChinaSteel Building, No.88, Chenggong 2nd Rd., Qianzhen Dist., Kaohsiung
City 80661, Taiwan.
Website: www.deloitte.com.tw
Telephone:(07)530-1888
5. Name of overseas trading office of listed valuable securities and method of searching for
information of valuable overseas securities: None.
6. Company website:www.brogent.com

Table of Contents
Page
I.

LETTER TO SHAREHOLDERS .......................................................................................................6

II. COMPANY PROFILE .......................................................................................................................10
1.DATE OF ESTABLISHMENT ............................................................................................................10
2.COMPANY HISTORY .........................................................................................................................10
III. CORPORATE GOVERNANCE REPORT......................................................................................15
1.ORGANIZATIONAL SYSTEM ..........................................................................................................15
2.PROFILE OF DIRECTORS, SUPERVISORS, PRESIDENT, VICE PRESIDENTS, ASSISTANT
VICE PRESIDENTS, AND DEPARTMENT AND BRANCH DIRECTORS ....................................17
3.REMUNERATIONS TO DIRECTORS, SUPERVISORS, PRESIDENT, AND VICE PRESIDENTS
IN RECENT YEARS............................................................................................................................22
4.IMPLEMENTATION OF CORPORATE GOVERNANCE ................................................................25
5.INFORMATION ON FEES TO CPA ...................................................................................................57
6.CHANGES TO CPA INFORMATION ................................................................................................58
7.THE CHAIRMAN, PRESIDENT, FINANCIAL OR ACCOUNTING MANAGER OF THE
COMPANY WHO HAD WORKED FOR THE CERTIFYING ACCOUNTING FIRM OR ITSAFFILIATED ENTERPRISE IN THE PAST YEAR : NONE.............................................................58
IV. PLACEMENT SITUATION..............................................................................................................62
1.COMPANY CAPITAL AND SHARE CAPITAL ................................................................................62
2.CORPORATE BOND (INCLUDING OVERSEAS CORPORATE BOND) ......................................69
3.ISSUANCE OF PREFERRED STOCKS ...........................................................................................71
4.ISSUANCE OF GLOBAL DEPOSITARY RECEIPTS (GDR) .........................................................71
5.EXERCISE OF EMPLOYEE STOCK OPTION PLAN (ESOP) ........................................................72
6.RESTRICTED STOCK AWARDS.......................................................................................................72
7.MERGER AND ACQUISITION..........................................................................................................72
8.ISSUANCE OF NEW SHARES FOR ACQUISITION OF SHARES OF OTHER COMPANIES ..72
9.IMPLEMENTATION OF CAPITAL ALLOCATION PLAN ..............................................................72
V. BUSINESS OVERVIEW ...................................................................................................................73
I. BUSINESS ACTIVITIES.....................................................................................................................73
II.MARKET, PRODUCTION AND SALES ...........................................................................................85
III.EMPLOYEE INFORMATION IN THE PAST 2 YEARS TO THE DATE OF THE ANNUALREPORT ...............................................................................................................................................98

IV.ENVIRONMENTAL PROTECTION EXPENDITURE INFORMATION .......................................98
V.LABOR RELATIONS ........................................................................................................................101
VI.IMPORTANT CONTRACTS...........................................................................................................104
VI. FINANCIAL OVERVIEW ..............................................................................................................105
1.CONDENSED BALANCE SHEETS AND STATEMENT OF INCOME (2016 - 2020) .................105
2.FINANCIAL ANALYSIS ................................................................................................................... 110
3.AUDIT COMMITTEE AUDIT REPORT .......................................................................................... 112
4.FINANCIAL REPORT AND CPA REVIEW REPORT ..................................................................... 112
5.INDIVIDUAL FINANCIAL REPORT REVIEWED BY CPA.......................................................... 113
6.FINANCIAL DIFFICULTIES AND CORPORATE EVENTS ENCOUNTERED BY THE
COMPANY AND AFFILIATES IN THE PAST TWO YEARS AND UP TO THE DATE OFREPORT THAT HAVE MATERIAL IMPACT ON THE FINANCIAL STATUS OF THE COMPANY:
NONE. ................................................................................................................................................ 113
VII.PRECAUTIONS OF REVIEW AND ANALYSIS OF FINANCIAL STATUS AND BUSINESSPERFORMANCE ............................................................................................................................. 114
1.FINANCIAL STATUS ....................................................................................................................... 114
2.FINANCIAL PERFORMANCE ........................................................................................................ 115
3.CASH FLOWS ................................................................................................................................... 117
4.EFFECT OF MAJOR CAPITAL SPENDING ON FINANCIAL POSITION AND BUSINESSOPERATION ...................................................................................................................................... 118
5.INVESTMENT POLICY IN THE PAST YEAR, PROFIT/LOSS ANALYSIS, IMPROVEMENT
PLAN, AND INVESTMENT PLAN FOR THE COMING YEAR ................................................... 118
6. ANALYSIS OF RISKS IN RECENT YEARS UP TO THE PUBLISHING DATE OF THE ANNUALREPORT ............................................................................................................................................. 118
7.OTHER IMPORTANT EVENTS .......................................................................................................124
VIII.IMPORTANT NOTICES ...............................................................................................................125
1.PROFILE ON AFFILIATES AND SUBSIDIARIES .........................................................................125
2.PRIVATE PLACEMENT OF CORPORATE BONDS IN THE PAST YEARS TO THE DATE OF
THE ANNUAL REPORT: ..................................................................................................................129
3.HOLDING OR DISPOSAL OF STOCKS OF THE COMPANY BY SUBSIDIARIES IN THE PASTYEAR AND UP TO THE DATE OF REPORT: .................................................................................129
4.OTHER SUPPLEMENTAL INFORMATION ...................................................................................129
IX. ITEMS OF IMPACT OF INTERESTS OF SHAREHOLDERS OR STOCK PRICE ..............129
APPENDIX ...............................................................................................................................................130

APPENDIX 1：STATEMENT OF INTERNAL CONTROL SYSTEM ..............................................130
APPENDIX 2：AUDIT COMMITTEE AUDIT REPORT ..................................................................131
APPENDIX 3：CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’REPORT .............................................................................................................................................132

I. Letter to Shareholders
Dear Shareholders,Thank you very much for supporting Brogent Group and taking time to attend 2021
annual meeting of shareholders.
In 2020, Brogent Group’s consolidated revenue amounted to NT$1.06 billion, net
income NT$502 million, and earnings per share NT$(0.88). The tourism industry inworldwide has been highly affected by the novel coronavirus (COVID-19) pandemic.
However, Brogent Group is quite optimistic about the industry in the near future. We
expect that more than 20 immersive amusement rides will be opened around the world,
and the revenue from these projects will be recognized in the second half of 2021.
Brogent Group now has a global market share of over 85% in the flying theater
market. During the novel coronavirus (COVID-19) pandemic, Brogent’s R&D team still
puts efforts on new innovation. Our latest 8K LED Dome Flying Theater i-Ride 2.0 is
made with more than 8,000 pieces of LED panel. The new LED dome screen is 10 times
brighter than the original screen with a resolution of over 8K which will help to create
more realistic flying experience.
Brogent Group’s efforts to enter the content licensing market have proven successful
with its continually growing percentage of total revenue in 2020. We will continue to promote
the idea of a turnkey solution for the customers, provid the hardware for the amusement
equipment, and increase royalty income from the content design. In the future, we will take up
the role to support the digital content transform from media base to gaming base in the theme
park industry by using new technologies such as artificial intelligence, 5G high-speed
networks, and new digital content types. This will create a new kind of product that people
can experience in both online and offline.

Although the novel coronavirus (COVID-19) pandemic has put great impact on thetheme park industry worldwide, Brogent Group believes that people will not stop looking
for fun. Therefore, the theme park market is still promising in the long run.
We thank you for your trust and commitment to Brogent Group, and look forward toa prosperous future with our shareholders.

Chairman, Chih-Hung Ouyang
6

1. Accomplishments in 2020
(1) Business Plan Implementation Outcomes in 2020
Unit: NT$1,000
Year

2019

2020

Sales revenue

2,080,441

1,062,899(1,017,542)(48.91)Gross profit

1,002,360

502,416(499,944)(49.88)Operating expenses

581,551524,940(56,611)(9.73)

Operating income

420,809(22,524)(443,333)(105.35)

Net income (loss) before tax

471,901(41,838)(513,739)(108.87)

Net income (loss)

383,810(51,758)(435,568)(113.49)

Net income attributable toshareholders of the parent

366,525(49,184)(415,709)(113.42)

Item

Change (amount)% Change(2) 2020 Budget Execution
According to the Regulations Governing the Publication of Financial Forecastsof Public Companies, the Company did not need to compile a financial forecast for
2020, and therefore this section is not disclosed.

(3) Analysis of Financial Gains and Losses and Profitability
Unit: %Year

Item
Financial structure(%)
Solvency (%)

Profitability

Debt-to-assets ratio (%)
Long-term fund to property, plant andequipment (fixed assets) ratio (%)
Current ratio (%)
Quick ratio (%)
Times interest earned
Return on assets (%)
Return on equity (%)
Paid-in capital to income before tax (%)
Net profit margin (%)
Earnings per share (NT$)

7

2019

2020

40.93

48.19

402.42467.08324.08275.272,088.88
8.60
12.63
84.65
18.45
6.57

495.03439.02(43.27)(0.55)(1.75)(7.50)(4.87)(0.88)

(4) Research and Development
To continuously enhance the Company’s competitiveness, the Company
has always actively invested in R&D efforts. In 2019 and 2020, it has
expended a total of NT$172,403 million and NT$167,313 million in R&D,
respectively accounting for 8.29% and 15.74% of the net operating income.
Brogent will continue to innovate and remain committed to research anddevelopment because these aspects of operation embody corporate
competitiveness. The Company shall continue to engage in advanced
technological R&D and innovative applications, and implement
product-centric design and research as well as systematic management tomaintain the leading position of products and technologies.

(5) Impacts of External Competitive Environment, Regulatory
Environment, and Overall Operation Environment
The Company operates its business in accordance with domestic andforeign laws and regulations and periodically notes any changes in domestic
and foreign policies and development trends, to facilitate immediate
response. The Company's employees also receive training regularly to
update them on current political and economic changes and trends; therefore,changes to laws and regulations will not exert a material impact on the
Company's business development.
Regarding external competition and the overall business environment,
because the Company has successfully expanded into overseas markets in
2020, we will continue to develop our businesses based on market
internationalization. By seeking high-quality customers, attaining productrecognition, raising product sales prices, and adopting a product composite
marketing model concurrent with mature technologies and scaled production,
the Company expects to accurately ascertain the pulse of the global market.
Thus, based on the economic recovery of European and American countries
as well as China’s entertainment market demand, Brogent will expand its
businesses into the global market, thereby enhancing its overall revenue
performance.

8(1) 2021 Operational Goals and Crucial Product Marketing
Policies
1. Continue to optimize the quality of immersive amusement park
facilities and diversify product category.
2. Expend the international market and raise the global brand awareness.
3. Deepen the design and production of digital contents and heighten
product added value.
4. Engage in industry–academic cooperation to actively cultivate
high-quality specialists in digital content.

(2) Expected Sales Volume and Criteria
The Company's operational revenues mainly come from the sales of motion
simulation entertainment facilities. According to the Regulations Governing the
Publication of Financial Forecasts of Public Companies, the Company did notneed to compile a financial forecast for 2020, and therefore this section is notdisclosed.

2. Future Corporate Development Strategy(1) Product diversification(2) Market internationalization(3) Diversification of revenue models(4) Integration of strategic partner resources9II. Company Profile
1.

Date of Establishment
October 30, 2001.

2.

Company History
Company milestones up to the date of this report:

April 2011
June 2011
September 2011
October 2011
December 2011
June 2012
September 2012
November 2012
December 2012
January 2013
February 2013
April 2013
July 2013
October 2013
October 2013
October 2013
February 2014

March 2014
April 2014

Opening of 4D Theater at Formosan Aboriginal Culture Village.
Conversion of employee stock options to 1,744,000 ordinary shares; thepaid-up capital following capital increase totaled to NT$213,560,000.
Seasoned equity offering (SEO) of NT$12,700,000; following capitalincrease, the paid-up capital totaled to NT$226,260,000.
Approved public offering of stock.
Registered on emerging stock market.
Constructed started on new research and test center at Kaohsiung Software
Park.
Passed the market listing application by the Board of Directors of theTaipei Exchange.
Public underwriting of SEO prior to listing amounted to NT$28,290,000,
and the paid-up capital following capital increase totaled to
NT$254,550,000.
Stock market launch.
Completion of the operational headquarters and R&D test center.
The i-Ride passed China’s A-grade large-scale amusement park facility
authentication and a commercial business license was received for it.
The i-Ride opened at an anime themed shopping center in Hangzhou,
China.
The new generation of i-Ride, Fly Over Canada, opened in Vancouver,
Canada.
Attended the National Palace Museum First New Media creative contest;
the Company's 3D interactive new media art gained honorable mention.
Signed a Memorandum of Understanding with Kodansha, Japan.
Surplus transfer of NT$12,727,500, and the paid-up capital following
capital increase totaled to NT$267,277,500.
Conversion of convertible corporate bond to ordinary bond totaled to
NT$7,422,770; the paid-up capital following capital increase totaled to
NT$274,700,270.
First-quarter revenue reached NT$312 million, with net profit after tax
amounting to NT$100 million, both represented record highs in Brogent's
history.
The i-Ride received the 2014 Taiwan Excellence Reward for the categoryof fashion, life, culture and creativity product.
10

May 2014
June 2014
July 2014
July 2014
September 2014
October 2014
November 2014
January 2015
January 2015
March 2015
June 2015
July 2015
November 2015
December 2015
January 2016
March 2016
April 2016
May 2016
July 2016
September 2016

Conversion of convertible corporate bond to ordinary bond totaled to
NT$15,433,990; the paid-up capital following capital increase totaled to
NT$290,134,260.
Held the Groundbreaking Ceremony for the 2nd stage of the R&D Center.
Fuji Q Highland held the Grand Opening of the i-Ride flight theater "Fuji
Airways" in Fujiyoshida, Japan.
Conversion of convertible corporate bond to ordinary bond totaled to
NT$18,753,440; the paid-up capital following capital increase totaled to
NT$308,887,700.
Capital reserve transfer of NT$27,470,020; the paid-up capital following
capital increase totaled to NT$336,357,720.
Signed the "Attack on Titan" IP licensing contract with Kodansha Ltd.
Conversion of convertible corporate bond to ordinary bond totaled to
NT$442,070; the paid-up capital following capital increase totaled to
NT$336,799,790.
Seasoned equity offering (SEO) of NT$60,000,000; following capitalincrease, the paid-up capital totaled to NT$396,799,770.
Signed another MOU with Kodansha Ltd. to establish marketingcompanies for peripheral products.
Awarded the Potential Mittelstand Enterprise for the 3rd Taiwan
Mittelstand Award held by the Industrial Development Bureau, Ministry of
Economic Affairs (MOEA).
Seasoned equity offering (SEO) of NT$10,300,000, following capitalincrease, the paid-up capital totaled to NT$407,099,770.
Surplus transfer of NT$39,680,000, following capital increase, the paid-up
capital totaled to NT$446,779,770.
Awarded government subsidies under the international market
development program by the Bureau of Foreign Trade, Ministry of
Economic Affairs.
The grand opening of i-Ride flight theater themed “Attack on Titan”
was held in Shan-Shun World, Toufen Township, Miaoli County, Taiwan.
Grand opening of the 2nd stage Office Building.
Grand opening of the 4D motion simulating theater in the famous
European safari “Zoo Emmen”in Netherlands.
New launch of i-Ride flight theater “FlyOver America”in Mall of
America, Minnesota, U.S.A.
The Joint Research and Development Center between Brogent andNational Sun Yat-Sen University was established.
The Research and Development Center of Somatosensory Content
between Brogent and Southern Taiwan University of Science andTechnology was established.
The Lord Mayor of Brisbane, Australia, Graham Quirk, visited Brogent
with the Brisbane delegation and experienced i-Ride flight theater.
11

December 2016
March 2017
March 2017
April 2017
June 2017
September 2017
October 2017
November 2017
November 2017
December 2017
December 2017
January 2018
January 2018
May 2018
June 2018
July 2018
July 2018
July 2018
August 2018
August 2018
September 2018
September 2018
October 2018

Awarded the Enterprise with Outstanding Contribution by Export
Processing Zone, M.O.E.
Feng Tang, Minister without Portfolio of Executive Yuan, came to Brogent
to experience i-Ride flight theater.
Activated the filming project “Flying Over Australia” with Cutting Edge, aleading Australian filmmaker.
The Flying Theater of Spain’s famous theme park officially opened
The Flying Theater “Voletarium” of Germany’s prestigious Europa Park
officially opened.
Won Europe’s Best New Ride of the European Star Awards 2017.
The Flying Theater “This is Holland” of Netherland officially opened in
Amsterdam.
Brognet’s i-Ride Experience Center officially opened in Kaohsiung
Software Park.
Brogent’s new VR product “Q-Ride” launched in IAAPA Attractions Expoin Orlando, Florida, U.S.A.
Dentsu Japan invested in Brogent’s subsidiary “Brogent JapanEntertainment.”
Vice President Chien-Jen Chen visited i-Ride Experience Center ofBrogent.
Brogent is the first TÜ V SÜ D client in Asia to have passed its challenging
test with i-Ride Flying Theater.
Taipei City Mayor Wen-Je Ko visited the Flying Theater “This is Holland”
in Amsterdam.
Brogent unveiled its new VR and motion simulation gaming product at the2018 Vision Get Wild Exhibition.
Brogent’s VR gaming products were presented at Computex Taipei 2018.
Brogent’s VR gaming tournament, Lightning Wings, kicked off its
regional preliminary contest at Kaohsiung Beer Rock Festival.
Brogent’s first carousel officially opened at KW2 (Kaohsiung Port
Warehouse No.2)
The Flying Theater of Abu Dhabi’s renowned theme park officiallyopened.
The Flying Theater “FLYOVER CHINA” of Beijing Shijingshan
Amusement Park officially opened.
Brogent’s VR gaming tournament, Lightning Wings, held its regional
preliminary contest in Taichung.
Tom Tate, Mayor of the City of Gold Coast, Australia, visited Brogent
with City of Gold Coast delegation and experienced i-Ride flight theater.
Won Media-based Attraction of the Year of the Park World ExcellenceAwards 2018 Europe.
Brogent’s VR gaming tournament, Lightning Wings, held its regional
preliminary contest in Taipei.
12

November 2018
November 2018
December 2018
December 2018
January 2019
February 2019
March 2019
May 2019

July 2019
July 2019
August 2019
September 2019
September 2019
October 2019
December 2019
February 2020
April 2020
May 2020
July 2020
July 2020

Brogent’s hexaRide VR and the first original VR film “Ghost in the Shell”
made its debut at Diver City Plaza in Odaiba, Tokyo.
Brogent’s VR gaming tournament, Lightning Wings, held its
championship game in Kaohsiung Arena.
Brogent introduced “Art-Zoo Inflatable Park” from Singapore opened at
Kaohsiung Harbor Pier 7.
hexaRide 's second original VR film “Attack on Titan” premiered at DiverCity Plaza in Odaiba, Tokyo.
The Flying Theater “i-Ride Taipei” of Taipei Nan Shan Plaza officiallyopened.
Brogent’s VR gaming simulation ride “Lightning Wings” was invited to2019 Mobile World Congress in Barcelona.
The Flying Theater “THE LEGO® MOVIE™ Masters of Flight”
officially opened in Legoland Florida Resort.
Brogent presented Q-Ride, VR gaming simulation ride “Lightning Wings”
and the newly developed racing simulator at the 2019 Vision Get Wild
Exhibition.
Brogent Group collaborated with American Institute in Taiwan (AIT) to
premiere “Discover America” in the celebration of US-Taiwan Travel
Year.
Brogent’s new racing simulator made its world debut at 2019 Asia Pacific
Cities Summit in Brisbane, Australia.
The Flying Theater “Sky Voyager” of Australia’s biggest theme park
Dreamworld officially opened on the Gold Coast.
The second Flying Theater of Beijing Shijingshan Amusement Park
officially opened.
Brogent’s flying theater won the ” Best Dark Rides” of the 2019 European
Star Award.
The Flying Theater “FlyOver Iceland” of Iceland officially opened inReykjavík .
Brogent received ” 2019 Chinese Outstanding 3D/Motion Theatre
Suppliers” of the Asia Attraction Gold Crown.
Brogent Group cooperated with the American company Positron to inventa new single-person ride simulator: Voyager. Voyager was invited to
exhibit at Festival de Cannes.
Brogent was ranked within the TOP 300 High-Growth Companies for the
Asia-Pacific region by the Financial Times.
Brogent signed a priority sales contract with Sansei Technologies, Inc.
forming a strategic partnership with the Japanese based company.
Brogent held a press conference with the Australian Office Taipei and theCanadian Trade Office to celebrate “FlyOver Canada” and “Discover
Australia” at i-Ride Taipei in Breeze Nan Shan.
Launched new game based real-time controlled simulator esports series at
IAAPA Virtual Expo Asia.
13

August 2020
October 2020
October 2020
November 2020
November 2020

The first 5G VR esports game “Land” debuted at Brogent Group’s
headquarters.
Brogent Technologies was the winner of Asiamoney’s Asia’s Outstanding
Companies Poll 2020 in the sector of Software & Internet Services.
Exhibited at CAE in Beijing, returning to normal in the region after the
pandemic impact.
Won the “Corporate Sustainability Award” at the Global Corporate
Sustainability Forum (GCSF) held by Taiwan Corporate SustainabilityAwards (TCSA) and Global Corporate Sustainability Award (GCSA).
Won the “Queensland-Taiwan Business Excellence Award” from theAustralia New Zealand Chamber of Commerce in Taipei.

14

III. Corporate Governance Report
1. Organizational System(1) Organizational Profile(2) Business Activities of Each Major Division
Major Divisions

Primary Duties

Chairman's Office

Supervise the execution of the corporate internal audit.

Audit Office

A.Inspect and evaluate whether internal control systems are sound andprovide recommendations for analysis and evaluations.
B.Plan, implement, and improve internal auditing systems; requests
operational procedures to comply with laws, regulations, and articles ofincorporation and assist in increasing business performance.

President's Office

A.Plan the corporate mid-term and long-term business strategy, as well as
the new business direction and market deployment.
B.Control and evaluate the operation results of subsidiaries.

Manufacuring Plant

A.Assembling products
B.Build up database for Products and Machine
C.Quality affairs and Factory Service

15

Major Divisions

Primary Duties

A.Plan and implement marketing strategies.
B.Achieve company-defined business goals and join overseas exhibitions.
C.Handle general tasks (product presentation, proposal, quotation,negotiation, payment collection, and payment notification) anddetermine customer's status in contract compliance.
Sales & Marketing Center
D.Coordinate and communicate with marketing business and technicalteams.
E.After sales service execute and management.
F.Develop potential China area business opportunities.
G.Develop China area potential customers.
Product Development
CenterA.Design and develop new technology and products.
B. Develop new interactive game.

Project Center

A.Supervise the construction projects.
B.Control product quality and communicate with customers when
implementing projects.

Technology Center

A.Design, develop and produce hardware structures such as six-axis
platforms, steel structures and dynamic structures such as elevators.
B.Organize relative information for certification and prepare operating
maintenance handbook.

Finance Center

A.Formulate financial plans, business strategy, treasury and risk
management.
B.Manage and operate accounting, budgeting, tax, stock affairs andprovide analysis reports to assist decision-making.

Administration Center

A.Organization design and plan. Human resources management system
executing including recruiting, training and salaries management. Carryout performance evaluations and devise welfare policies
B.Drafting and reviewing commercial contracts, providing negotiation
strategies and analysis of legal risks. Assist legal dispute conducting
and discussing risk preventing strategies.
C.Product/technology patent and trademark management.
D.Purchasing and supplier management.
E.Assist in executing and promoting general affairs and raw material
management.

IT Department

A.Develop and maintain computer networks and application systems.
B.Maintain and manage computer hardware, peripheral equipment, andinformation files.
C.Plan and execute system safety.
D.Hardware and software resources management.

International Business
A.Develop potential international business opportunities.
Development Department B.Create future business models.

16

2. Profile of Directors, Supervisors, President, Vice Presidents, Assistant Vice Presidents, and Department andBranch Directors(1) Directors and Supervisors
1. Directors and Supervisors
March 30, 2021; Unit: Shares; %Title

Nationality
or place ofregistration

Name

Date
electedTerm

Date firstelectedNumber of shares
held when elected
Numberof shares

Chairman
& CEO

ROC

Chih-Hung
Ouyang2020.05.28

ROC

ROC

Shareholding
Percentage

Number of shares held in
the name of others

Number ofsharesNumber ofsharesShareholding
Percentage

8.52%

3,807,191

6.70%

101,187

0.18%

－

－

2,150,271

3.86%

2,150,271

3.78%

－

－

－

－

Chin-Huo
Huang-

2020.05.28

3
2011.10.05 1,149,442
years

0.00%

2.06%

30,4201,149,442

0.05%

2.02%

－

252,971

－

0.45%

17

－

－

Education/work experience

Shareholding
Percentage

3
2020.05.28
2016.05.31
years
Representative
Chih-Chuan
Chen

Director

Number ofsharesShares held by spouseand minor children

3
2011.10.05 3,807,191
years

Chang chun
Investment Co.
Ltd.

Director

Shareholding
Percentage

Number of shares
currently held－－

Other positions

Other officer, director
or supervisor who isthe spouse or a relative
within the second
Note
degreeTitle

Name

Relationship

1.Electrical Engineering, National Sun
Yat-sen University
2.R&D Engineer, Acer Incorporated
3.Project Manager, Ai West Co. Ltd.
4.President, Micro Sova

1.President, Brogent Techonologies
Inc.
2.Chairman, Fu Wu Investment Ltd.
None. None.
3.Chairman, Brogent Global Inc.
4.Chairman, Brogent Mechanical
Inc.

None.

1. M.B.A., National Taiwan University
2 Vice President, Investment
Administration Division, RT-Mart
International

1.Vice President, Investment
Administration Division, RT-Mart
International
2. Juridical Person Director
Representative of MEGAGROWTH VENTURE CAPITAL
CO., LTD.
3.Juridical Person Director
Representative of Gogoro Inc
4.Juridical Person Director
None. None.
Representative of Diamond
Biotechnology Investment Co.,Ltd.
5.Juridical Person Director
Representative of Diamond
Capital Management Co., Ltd.
6.Juridical Person Director
Representative of MIHOINTERNATIONAL COSMETIC
CO., LTD

None.

1.Chang Hua Industrial Vocational HighSchool
2.Director, SANFU Motors Industrial
Corp.
3.Director, Chun Ying Metal IndustrialCo., Ltd.

Chairman, Fu Ying Metal Industrial
None. None.
Co., Ltd.

None.

Note
1

Nationality
or place ofregistration

Title

Name

Date
electedTerm

Date firstelectedNumber of shares
held when elected
Numberof shares

Direcor

ROC

Chun-Hao
Cheng

2020.05.28

3
2016.05.31
years

158,483

Shareholding
Percentage

0.28%

Number of shares
currently held
Number ofshares158,483

Shareholding
Percentage

0.28%

Shares held by spouseand minor children

Number of shares held in
the name of others

Number ofsharesNumber ofshares－Shareholding
Percentage－－

Education/work experience

Other positions

Shareholding
Percentage－

Other officer, director
or supervisor who isthe spouse or a relative
within the second
Note
degreeTitle

1.Ph.D in Business Studies, Meiji
University
2.Supervisor, Taiwan Water Corporation
3.Associate Professor, Department of
Finance, I-Shou University
4.Associate Professor, Graduate Instituteof Hospitality Management, NKUHT

Name

RelationshipNone. None.

None.

None None.

None.

None. None.

None.

None. None.

None.

1 Vice director, ZHI
CHENG Co-located CPA Firm.
2..Independent Director，Independe
nt Director

ROC

Lewis Lee3
2020.05.28
2020.05.28
years

－

－

－

－

－

－

－

－

1.National Chengchi University,
Department of Accounting.
2. Partner, PwC, Taiwan.

SOFT-WORLD
INTERNATIONALCORPORATION
3.Independent Director，POYA International Co., Ltd.
4. Independent Director，
ALL RING TECH CO., LTD.

Independe
nt Director

ROC

Independe
nt Director

ROC

Chih-Poung
Liou

2020.05.28

Jih-Ching Chiu 2020.05.28

3
2020.05.28
years

－

3
2020.05.28
years

－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

1. LL. M., University of Tokyo (Japan)
2. Managing Partner, Stellex Law Firm.

1. Ph.D., CSIE, Chiao-Tung University,
2. Associate Professor, National Sun
Yat-sen University

1 Managing Partner, Stellex Law
Firm.
2..Independent Director，
JIH SUN FINANCIAL
HOLDING CO., LTD

Associate Professor, National Sun
Yat-sen University

Note 1:Where the chairperson of the board of directors and the general manager or person of an equivalent post (the highest level manager) of a company are the same person, spouses, or relatives within the firstdegree of kinship, an
explanation shall be given of the reason for, reasonableness, necessitythereof, and the measures adopted in response thereto(i.g. increase the positions of independent directors or there should be more than half of directors who are not
employees or managers in the same time):
The reason why the company’s chairperson and general manager is the same person is to improve operation efficiency and execution of decision making, however, in order to strengthen the independence of board of directors, we have been
actively cultivating suitable personnel for this position. In addition, the chairperson works closely with each director on the communication of company operation status and policy to carry out thegovernance of the company. In the future, thecompany may plan to increase positions of independent directors to improve the competency of board of directorsand strengthen function of supervision. Currently we have actual measures as below:
1. Three of current independent directors haveexpertise in finanace and accounting, legal and industry economy relatively, which allows efficient supervision competency.
2. The company will arrange training courses from Securities and Future Insitute and other external facilities for each director toimprove the operation efficiency of board of directors.
3. Independent directors can fully involve discussion and provide suggestions for reference on each functional committee to carry out the governance of the company.
4.No more than half members of the board of directors are employees or managers.

18

2. Director and Supervisor Expertise and Independence
Has at least 5 years of work experience and meets one of the

Meet the independence criteria (Note 1)

Number offollowing professional qualifications

Criteria
Nameother public

An instructor or higher A judge, public

Has work

position in a department prosecutor, attorney,

experience inof commerce, law,accountant, or othercommerce, law,finance, accounting or

professional or

finance, orother department

technical specialist

accounting or a

related to the business

related to the needs ofprofession

needs of the Company

the Company who hasnecessary for thein a public or private

passed a national

business of thejunior college or

examination andCompany

university

received a certificatecompanies inwhich theDirector also
serves as an
Independent
1

2

3

4

5

6

7

8

9

10

11

12

Director

thereforChih-Hung Ouyang



























None.

Chang chun Investment
Co. Ltd
Representative:
Chih-Chuan Chen

























-

None.

Chin-Huo Huang



























None.





-





















None.

Chun-Hao Cheng



Lewis Lee





























3

Chih-Poung Liou





























1



























None.

Jih-Ching Chiu



Note : Directors, during the two years before being elected and during the term of office, meet any of the following situations, pleasetick the appropriate corresponding boxes:(1) Not an employee of the company or any of its affiliates;(2) Not a director or supervisor of the company or any of its affiliates;(3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person underothers’ names, in an aggregate amount of one percent or more of the total number of issued shares of the company or ranks as one of its top ten
shareholders;(4) Not a spouse, relative within second degree of kinship, or lineal relative within third degree of kinship of any of the persons in the preceding
three paragraphs. Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of theofficer in the preceding 1 subparagraph, or of any of the abovepersons in the preceding subparagraphs 2 and 3;(5) Not a director, supervisor, or employee of a corporate/institutional shareholder that directly holds five percent or more of the total number ofissued shares of the company, ranks as of its top five shareholders, or has representative director(s) serving on the company’s board based on
Article 27 of the Company Law.

(6) Not a director, supervisor, or employee of a company of which the majority of board seats or voting shares is controlled by a company that also
controls the same of the company;(7) Not a director, supervisor, or employee of a company of which the chairman or CEO (or equivalent) themselves or their spouse also serve as thecompany’s chairman or CEO (or equivalent);(8) Not a director, supervisor, officer, or shareholder holding five percent or more of the shares of a specified company or institution that has afinancial or business relationship with the company;(9) Other than serving as a compensation committee member of the company, not a professional individual who, or an owner, partner, director,
supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial, legal, financial, accounting
services or consultation to the company or to any affiliate of the company, or a spouse thereof, andthe service provided is an “audit service” or a “non-audit service which total compensation within the recent two years exceeds NTD500,000”;(10) Not having a marital relationship or a relative within the second degree of kinship to any other director of the company.
(11) Not been a person of any conditions defined in Article 30 of the Company Law; and(12) Not a governmental, juridical person or its representative as defined in Aticle 27 of the Companyt Law.
.

- 19 -

(2) Profile of President, Vice Presidents, Assistant Vice Presidents, and Department Directors
March 30, 2021; Unit: Shares; %Title

Nationality

Name

Date
appointed

Shares held

Shares held by
spouse and children

Shareholding
SharesShareholding
SharesPercentage

Chairman& CEO

Chief Financial
Officer

Vice President

ROC

ROC

ROC

Chih-Hung
OuyangSui-ChuanLin

Teng-HungLai

2001.102013.01

2010.113,807,191

214,781

27,856

6.70%

0.38%

0.05%

Shares held in
the name ofothers28,457-

Other positions

Shareholding

Title

SharesPercentage

101,187

Education/work experience

0.18%

0.05%

-

Other officer, director orsupervisor who is the
spouse or a relative within Notesecond degree
Name Relationship

Percentage

-

-

-

-

Electrical Engineering, National Sun
Yat-sen University
R&D Engineer, Acer Incorporated
Project Manager, Ai West Co. Ltd.
President, Micro Sova

Chairman, Fu Wu
Investment Ltd.
Chairman, Brogent Global
Inc.

-

-

-

1

-

Master Graduate from the Departmentof Finance, National Sun Yat-sen
University
Supervisor, Brogent Global
Finance Office at Chienmei
Inc.
Construction Development Corp.
Finance Department Manager atBrogent Technology

-

-

-

-

-

Masters in the Department ofComputer Science and Engineering at
National Chung-Hsing University
Technical Chief Officer at Meihsing
Technology
President of Liang Chuan Co. Ltd.

None

-

-

-

-

None

-

-

-

-

Chief Engineer& Sr. Director

ROC

Yi-ChungHuang

2015.08

24,333

0.04%

-

-

-

-

PhD, Electrical Engineering, National
Sun Yat-sen University
Chang Gu Construction Inc.
Manager, KungYuanInternational
Technology

Sr. Director

ROC

Szu-ChengChen

2020.04

6,830

0.01%

-

-

-

-

CAPCO, manager of HR and PR
Fu Jen Catholic University, Instituteof Chemistry

None

-

-

-

-

-

University of Missouri, Rolla
General Manager of Brogent
Mechanical Inc.
Vice President of Sunny Enterprise
Co. Ltd.

None

-

-

-

-

Vice President

ROC

Jyh-Jong
Hwang

2020.08

27,000

0.05%

-

-

-

Note 1:Where the chairperson of the board of directors and the general manager or person of an equivalent post (the highest level manager) of a company are the same person, spouses, or relatives within the firstdegree ofkinship, an explanation shall be given of the reason for, reasonableness, necessitythereof, and the measures adopted in response thereto(i.g. increase the positions of independent directors or there should be more than half of- 20 -

directors who are not employees or managers in the same time):
The reason why the company’s chairperson and general manager is the same person is to improve operation efficiency and execution of decision making, however, in order to strengthen the independence of board of directors,
we have been actively cultivating suitable personnel for this position. In addition, the chairperson works closely with each director on the communication of company operation status and policy to carry out thegovernance ofthe company. In the future, the company may plan to increase positions of independent directors to improve the competency of board of directorsand strengthen function of supervision. Currently we have actual measures as
below:
1. Three of current independent directors haveexpertise in finanace and accounting, legal and industry economy relatively, which allows efficient supervision competency.
2. The company will arrange training courses from Securities and Future Insitute and other external facilities for each director toimprove the operation efficiency of board of directors.
3. Independent directors can fully involve discussion and provide suggestions for reference on each functional committee to carry out the governance of the company.
4.No more than half members of the board of directors are employees or managers.

- 21 -

3. Remunerations to Directors, Supervisors, President, and Vice Presidents in recent years(1) Remunerations to Directors (including Independent Directors) in the most recent year (2020)
Unit: NT$ 1,000
Remuneration

Relevant Remuneration Received by Directors Who are Also Employees

Ratio of Total
Remuneration Salary, Bonuses,
Bonus toBase
Severance Pay(A+B+C+D) to Net
Severance Pay (B)Allowances (D)and Allowances
Directors (C)Income (%)
Compensation
(F)
(E)
(A)

Title

Profit Sharing- Employee
Bonus (G)Ratio of Total
Compensation
Exercisable
New Restricted (A+B+C+D+E+F+
Employee Stock Employee Shares G) to Net Income(%)
Options (H)
(I)

Name

Director

Chang chun
Investment Co. Ltd.
Representative:
Chih-Chuan Chen

－

－

－

－

－

－

60

60 (0.12)(0.12)－－－

DirectorChin-Huo Huang

－

－

－

－

－

－

72

72 (0.15)(0.15)－－－

Director

Chun-Hao Cheng

－

－

－

－

－

－

60

60 (0.12)(0.12)

－

2,480

－

Independent
Director

Lewis Lee

434

434

－

－

－

－

146

146 (1.18)(1.18)－－－

Independent
Director

Chih-Poung Liou

434

434

－

－

－

－

146

146 (1.18)(1.18)－－

Independent
Director

Jih-Ching Chiu

434

434

－

－

－

－

146

146 (1.18)(1.18)

－

－

－

－

－

－

－

－

－

(6.57)(8.77)

None.

－

－

－

－

－

－

－

－

－

(0.12)(0.12)

None.

－

－

－

－

－

－

－

－

－

(0.15)(0.15)

None.

－

－

－

－

－

－

－

－

(0.12)(5.37)

None.

－

－

－

－

－

－

－

－

－

(1.18)(1.18)

None.

－

－

－

－

－

－

－

－

－

－

(1.18)(1.18)

None.

－

－

－

－

－

－

－

－

－

－

(1.18)(1.18)

None.

－

－

－

－

－

(0.42)(0.42)

None.

－

－

－

－

－

(0.39)(0.39)

None.

240

240

99

brogent－

brogent

brogent

Companies in the consolidated
financial statements

4,000

brogent

2,920

Companies in the consolidated
financial statements(0.15)

brogent

72 (0.15)

Companies in the consolidated
financial statements

72

brogent－

Companies in the
consolidated financial
statements

brogent－

Companies in the consolidated
financial statements

Companies in the consolidated
financial statements－

Companies in the consolidated
financial statements

brogent－

brogent

Companies in the consolidated
financial statements－

Companies in the consolidated
financial statements

brogent－

Companies in the consolidated
financial statements

All companies in the consolidated
financial statements

Chih-Hung Ouyang

brogent

Chairman& CEO

Cash Stock Cash Stockbonus bonus bonus bonus

Former
－
－
－
－
－
－
－
－
－
－
150
150 －
56
56 (0.42)(0.42)
Independent Chin-Wen Chuang
Director
Former
－
－
－
－
－
－
－
－
－
－
150
150 －
44
44 (0.39)(0.39)
Independent Shun-Jen Cheng
Director＊The compensation content disclosed in this table differs from the income concept of the Income Act; therefore, this table serves to disclose information rather than for tax purposes.

- 22 -

Compensation Paid to
Directors from an
Invested Company
Other than the
Company’s
Subsidiary(2) Remunerations to Supervisors in the most recent year (2020)
Unit: NT$ 1,000
Ratio of Total
Remuneration(A+B+C) to Net
Income (%)

Remuneration

Title

FormerSupervisor
FormerSupervisor
FormerSupervisor

Name

Yung-Liang Huang

Compensation Paid
to Supervisors from
Allowances (C)an Invested
Company OtherAll companies
All companies
All companies
All companies
than the Company’s
Brogent in consolidated Brogent in consolidated Brogent in consolidated Brogent in consolidated
Subsidiary

Base Compensation(A)

Bonus to
Supervisors (B)statements

statements－－

statements

statements

－

－

36

36 (0.07)(0.07)None.

Yi-Hsiang Huang

150

150

－

－

36

36 (0.38)(0.38)

None.

Ken-Huang Lin

150

150

－

－

30

30 (0.37)(0.37)

None.

*The compensation content disclosed in this table differs from the income concept of the Income Act; therefore, this table serves
to disclose information rather than for tax purposes.

(3) Remunerations to President, and Vice Presidents in the last year (2020)
Unit: NT$1,000

Title

Name

Chairman Chih-Hung

Ratio of total A,
SharesShares obtained Remuneratio
Pension
Bonus and special
B, C, and D to
subscribablethrough
Salary (A)Employee bonus (D)(B)
allowance (C)after-tax income under employee restricted stock n received
from parent(%)
stock options
award
All companies
companyor
Brogent
in consolidated
All companies
All companies
All
All
All
All companies
statements
inincompanies incompanies incompanies in Investees
Brogent
Brogent
Brogent in consolidated
Brogent
Brogent
Brogent
consolidated
consolidated
consolidated
consolidated
consolidated
statements
Cash Stock Cash Stockother thanstatements
statements
statements
statements
statements
bonus bonus bonus bonus
subsidiaries
2,400

3,480

240

240

520

520

-

-

-

-

(6.42)(8.62)

-

-

-

-

None.

Vice
Teng-Hung
President Lai

1,862

1,862

108

108

435

435

-

-

-

-

(4.89)(4.89)

-

-

-

-

None.

Vice
Jyh-Jong
President Hwang

1,134

2,156

54

108

170

351

-

-

-

-

(2.76)(5.32)

-

-

-

-

None.

& CEO

Ouyang＊The compensation content disclosed in this table differs from the income concept of the Income Act; therefore,
this table serves to disclose information rather than for tax purposes.

- 23 -

(4) Managerial officers with the top five highest remuneration amounts in a company(2020):
Unit: NT$1,000

Title

Name

Chairman

Chih-Hung& CEO

OuyangVice
President

Teng-Hung

Vice
President

Jyh-Jong

Chief
Financial
Officer

Lai

Hwang
Sui-Chuan
Lin

Chief
Yi-Chung
Engineer &Sr. Director Huang

Ratio of total A,
SharesShares obtained
Pension
Bonus and special
B, C, and D to
subscribablethroughRemuneratio
Salary (A)Employee bonus (D)(B)
allowance (C)after-tax income under employee restricted stock n received
from parent(%)
stock options
award
All companies
company or
Brogent
in consolidated
All companies
All companies
All
All
All
Investees
All companies
statements
inincompanies incompanies incompanies inBrogent
Brogent
Brogent in consolidated
Brogent
Brogent
Brogent
other thanconsolidated
consolidated
consolidated
consolidated
consolidated
statements
Cash Stock Cash Stockstatements
statements
statements
statements
statements subsidiaries
bonus

bonus

bonus bonus

2,400

3,480

240

240

520

520

-

-

-

-

(6.42)(8.62)

-

-

-

-

None

1,862

1,862

108

108

435

435

-

-

-

-

(4.89)(4.89)

-

-

-

-

None

1,134

2,156

54

108

170

351

-

-

-

-

(2.76)(5.32)

-

-

-

-

None

1,985

1,985

108

108

447

447

-

-

-

-

(5.16)(5.16)

-

-

-

-

None

1,862

1,862

108

108

396

396

-

-

-

-

(4.81)(4.81)

-

-

-

-

None

(5) Manager name and distribution situation regarding employee bonus in the last year
(2020):
Unit: NT$1,000
Title

Managerial
officer

Name

Chairman & CEO

Chih-Hung Ouyang

Vice President

Teng-Hung Lai

Vice President

Jyh-Jong Hwang

Chief Financial Officer

Sui-Chuan Lin

Chief Engineer& Sr. Director

Yi-Chung Huang

Sr. Director

Szu-ChengChen

Stock
bonus

Cash
bonus

Total

Total amount as a percentage of earnings
(%)

-

-

-

-

- 24 -

4. Implementation of corporate governance(1)Operations of the Board of Directors
1. In 2020, a total of 10 (A) meetings of the Board of Directors were held in the mostrecent year. The attendance was as follows:
Title
Chairman

Name
Attendance inAttendance rate (%)
By proxy
Note(Note 1)
person (B)[B/A](Note 2)
Reelected on 2020.05.28，
Chih-Hung Ouyang
100.00
10
Shall attend 10 tmies.

Director

Changchun
Investment Co. Ltd.
Representative:
Chih-Chuan Chen

8

2

80.00

Reelected on 2020.05.28，
Shall attend 10 tmies.

DirectorChin-Huo Huang

10-100.00

Director

Chun-Hao Cheng

8

1

80.00

Reelected on 2020.05.28，
Shall attend 10 tmies.
Reelected on 2020.05.28，
Shall attend 10 tmies.

Director

Chung-Ming
Huang

-

5

-

Removed on 2020.05.28,
Shall attend 5 tmies.

Chin-Wen Chuang

5-100.00

Removed on 2020.05.28,
Shall attend 5 tmies.

Shun-Jen Cheng

4

-

80.00

Removed on 2020.05.28,
Shall attend 5 tmies.

Lewis Lee5-

100.00Elected on,2020.05.28,
Shall attend 5 tmies.

Chih-Poung Liou

5-

100.00Elected on,2020.05.28,
Shall attend 5 tmies.

Jih-Ching Chiu

5-100.00Elected on,2020.05.28,
Shall attend 5 tmies.

Independent
Director
Independent
Director
Independent
Director
Independent
Director
Independent
Director

Other matters that require reporting:
1.

2.

Matters stipulated in Article 14-3 of the Securities and Exchange Act and resolutions adopted by the Board of
Directors, to which an Independent Director has a dissenting or qualified opinion that is on record or statedin a written statement,shall describe the date of the board meeting, term of the board, agenda items, opinionsof Independent Directors, and actions taken by the company in response to the opinion of the Independent
Directors: Please see Important resolutions adopted in Board of Directors' meeting.
Regarding Directors who recuse themselves from discussion or voting on an agenda item in which they havean interest, their names, agenda items, reason for recusal, and voting on an agenda item shall be stated:
Please refer to the Opinions from all the directors in the record of Board of Directors’ Meetings.
i). The 21th Board of Directors’ meeting of the 6th Session on January13, 2020
1. Name of director: Chih-Hung Ouyang
2. Content of the proposal: 2019 Year-End bonus Recommendations for Chairman and managers.
3. Reasons for recusal and the participation in the voting：Director Ch i h - H u n g O u ya n g recused the meeting due t o conflict of interest and avoided the discussion
and resolution. The proposal as proposed was unanimously approved by all attending directors.
ii). The 23th Board of Directors’ meeting of the 6th Session on March 9, 2020
1. Name of director: Chih-Hung Ouyang
2. Content of the proposal: remuneration adjustment of managers.
3. Reasons for recusal and the participation in the voting：Director Ch i h - H u n g O u ya n g recused the meeting due t o conflict of interest and avoided the discussion
and resolution. The proposal as proposed was unanimously approved by all attending directors.
iii). The 1st Board of Directors’ meeting of the 7th Session on June 19, 2020
1. Name of director: Lewis Lee、Chih-Poung Liou、Jih-Ching Chiu
- 25 -

Title

3.

4.

Name
(Note 1)

Attendance inAttendance rate (%)
By proxy
person (B)[B/A](Note 2)

Note

2. Content of the proposal: Appointment of remuneration committee.
3. Reasons for recusal and the participation in the voting：
Independent director Lewis Lee、Chih-Poung Liou、Jih-Ching Chiu recused the meeting due t o conflict ofinterest and avoided the discussion and resolution. The proposal as proposed was unanimously approved by
all attending directors.
iv). The 2nd Board of Directors’ meeting of the 7th Session on July 8, 2020
1. Name of director: Ch i h - H u n g O u ya n g 、 Chih-Chuan Chen、C h i n -H uo H ua n g 、 Chun-Hao Cheng
2. Content of the proposal: Remuneration Distribution of Employees, Directors, and Supervisors..
3. Reasons for recusal and the participation in the voting：Director C hi h - H u n g O u ya n g、 Chih-Chuan Chen、C h in - H uo H ua n g、 Chun-Hao Cheng recused themeeting due t o conflict of interest and avoided the discussion and resolution. The proposal as proposed wasunanimously approved by all attending directors.
Director Chih-Hung Ouyang recused the meeting due to conflict of interest and avoided thediscussion and resolution. The version of proposal was unanimously approved by all attending
directors.
An evaluation of the goals set for strengthening the functions of the Board (e.g., setting up an auditing
committee and enhancing information transparency) and implementation status during the current andimmediately preceding fiscal years.
(1) The operation of the Board of the Company complies with laws and regulations, the Articles ofIncorporation, and the Exercise of Powers of the resolutions in shareholders' meetings. All Directors
adhere to the principle of good faith and duty of care in addition to possessing the expertise, skills, andliteracy required for exercising their powers, in order to maximize benefits for all of their shareholders.
(2) To establish a favorable governing system for the Company's Board of Directors, a sound supervisionfunction, and strengthened management mechanism, the Company formulated the Board of Director
Meeting Agenda Regulations in accordance with Article 26-3 of the Securities and Exchange Act,
including agenda items, execution of operations, matters that should be recorded in meeting minutes,
announcements, and other matters that should be adhered to, and the aforementioned shall be handled inaccordance with the formulated regulations.
(3) In addition to regularly conducting self-examination of the operation of the Board of Directors andreinforcing the functions of the Board, the Company requires its internal auditors to produce auditing
reports that describe the Board operations in order to conform with government regulations.
(4) Establish a Remuneration Committee to assist the Board of Directors in executing its duties.
Note 1: Directors and Supervisors who are also legal persons shall disclose the name of corporate shareholders
and their representatives.
Note 2:(1) For Directors or Supervisors who resigned from their position prior to the end of the financial year,
the date of their resignation shall be noted in the Note column. Their actual attendance rate (%) shallbe calculated according to the frequency they attended meetings of the Board during their tenure andtheir attendance in person.
(2) For changes to Directors or Supervisors before the end of the financial year, the new and old
Directors or Supervisors shall be listed and Directors or Supervisors who are old or new and the dateof their reelection and changes shall be noted in the Note column. Their actual attendance rate (%)
shall be calculated according to the frequency they attended meetings of the Board during their tenure
and their attendance in person.

- 26 -

2. Evaluation performance of Operations of the Board of Directors

Frequency ofevaluation(Note 1)Once a year

Evaluation period(Note 2)2020.01.01~
2020.12.31

Scope of evaluation(Note 3)

Board of Directors
and individual board
menberMethod ofevaluation(Note 4)

Content of evaluation(Note 5)

Self-evaluation/
Remunerationcommittee

Including the situation of attending
the board meeting, understanding
and articipating in the discussion of
the proposal before the meeting, thesituation of interacting with the
management team, the situation ofobserving laws and codes ofpractice, the improvement ofcorporate governance, thecontinuous study of courses related
to corporate governance, thesituation of understanding thecompany and the management teamand the industry , Other projects
designated by the competentauthority or the board of directors,
etc.

Note1: For example, once a year.
Note2: For example, the performance period during 1/1/2019~12/31/2019.
Note3: Performance of Board of Directors, individual member and functional committe.
Note4:Methods of evaluations: the internal evaluation of the board, self-evaluation by individualboard members, peer evaluation, and evaluation by appointed external professional
institutions, experts, or other appropriate methods.
Note5：Content of evaluation at least should include below following:(1) Performance of Board of Directors：Participation in the operation of the company, improvement of
the quality of the board of directors' decision making, composition and structure of the board of
directors, election and continuing education of the directors and internal control.
(2) The criteria for evaluating the performance of the board members：alignment of the goals andmissions of the company, awareness of the duties of a director, participation in the operation of thecompany, management of internal relationship and communication, the director's professionalism
and continuing education and internal control.
(3)

Performance of functional committees should cover：Awareness of the duties of the functional
committee, improvement of quality of decisions made by the functional committee, makeup of thefunctional committee and election of its members and internal control.

- 27 -

(2)State of operations of the audit committee or attendance ofSupervisors in board meetings: The Company does not have anaudit committee set up. Attendance of Supervisors in board
meetings:
1.Operation Status of Audit Committee
The audit committee of the company consists of three independent directors. The
audit committee is designed to assist the board of directors in fulfilling the quality
and integrity of the company in supervising the accounting, auditing, financial
reporting process and financial control. The main considerations include auditing offinancial statements and accounting policies and procedures, internal control systems
and related policies and procedures, raising funds or issuing securities, legal
compliance, information security, corporate risk management, qualifications,
independence and performance assessment of CPA, appointment, dismissal or
remuneration of CPA and self-assessment questionnaire of audit committee
assessment appraisal.
The Audit Committee has held 5 meetings in the most recent year, the attendance of the
independent directors is as follows:
Attendance in Attendance rate
Title
Name
Note
person(%)
Independent
director
Independent
director
Independent
director

Lewis Lee5

100.00

Shall attended 5 times.

Chih-PoungLiou

5100.00

Shall attended 5 times.

Jih-Ching Chiu

5100.00

Shall attended 5 times.

Other items to be recorded:
1.The operation of the Audit Committee shall state the board meeting’s date, period,
content of the proposal, resolution of Audit Committee and the company's opinion on
resolution of Audit Committee if any of the following circumstances occurs.
(i). Matterslisted in Article 14-5 of the Securities and Exchange Act
1. The 1st Board of Directors’ meeting of the 7th Session on June 19,2020, reviewed the proposalof this company’s “replacement of the CPA firm, certified CPA and CPA independence
assessment”. After review of the 1st Audit Committee meeting of the 1st Session on June
19,2020, the proposal as proposed was unanimously approved by the all attending independent
directors. The treatment of this company to the opinion of audit committee: Report to Board of
Directors. Resolution of board of directors: the proposal as proposed was unanimously
approved by all attending directors.
2. The 2nd Board of Directors’ meeting of the 7th Session on July 8,2020, reviewed proposal of
the company’s third and forth domestic unsecured convertible bonds. After review of the 2nd
Audit Committee meeting of the 1st Session on July 8,2020, the proposal as proposed wasunanimously approved by the all attending independent directors. The treatment of thiscompany to the opinion of audit committee: Report to Board of Directors. Resolution of boardof directors: the proposal as proposed was unanimously approved by all attending directors.
- 28 -

TitleName

Attendance in Attendance rate
person(%)

Note

3. The 4th Board of Directors’ meeting of the 7thSession on November 10,2020, reviewed the
proposal of this company’s “Change 2020 annual audit plan ”. After review of the 4st Audit
Committee meeting of the 1st Session on November 10,2020, the proposal as proposed wasunanimously approved by the all attending independent directors. The treatment of thiscompany to the opinion of audit committee: Report to Board of Directors. Resolution of boardof directors: the proposal as proposed was unanimously approved by all attending directors.
4. The 5th Board of Directors’ meeting of the 7thSession on December 16,2020, reviewed the
proposal of this company’s “2021 annual audit plan ”. After review of the 5st Audit Committee
meeting of the 1st Session on December 16,2020, the proposal as proposed was unanimously
approved by the all attending independent directors. The treatment of this company to theopinion of audit committee: Report to Board of Directors. Resolution of board of directors: theproposal as proposed was unanimously approved by all attending directors.
5. The 5th Board of Directors’ meeting of the 7thSession on December 16,2020, reviewed the
proposal of this company’s “The revision of the company's reinvestment business management
measures. ” After review of the 5st Audit Committee meeting of the 1st Session on December
16,2020, the proposal as proposed was unanimously approved by the all attending independent
directors. The treatment of this company to the opinion of audit committee: Report to Board of
Directors. Resolution of board of directors: the proposal as proposed was unanimously
approved by all attending directors.
(ii). Except the foregoing matters, other resolution not be approved by the audit committee but
approved by more than two thirds of all directors: None.
2. For the Independent Director’s recusal to the proposal with interest, the name of the independent
director, the content of the proposal, the reasons for recusal and the participation in the voting shall be
stated: none.
3. Communication between independent directors and internal audit supervisors and CPA (shall include
important matters,methods and results of communication on the company's financial and businessconditions).
(i). The audit supervisor submits an audit plan report to the independent directors in the monthfollowing the completion of the audit items. The independent directors have no objections.
(ii). The independent director has no objection to the audit report of the audit supervisor.
(iii). The audit supervisor will report the audit plan for the next y ear before the end of each fiscal
year, and report it to the board of directors for resolution after being approved by the audit
committee.
(iv). The Company has provided contact telephone numbers and email addresses between independent
directors The Company has provided contact telephone numbers and email addresses between
independent directors (members of th(members of the Audit Committee) and internal audit
supervisors for direct contact and communication each other. e Audit Committee) and internal- 29 -

TitleName

Attendance in Attendance rate
person(%)

Note

audit supervisors for direct contact and communication each other. The audit supervisors of thecompany shall sit in each audit report of the board of directors and consult the The audit
supervisors of the company shall sit in each audit report of the board of directors and consult theindependent directors (members of the audit comindependent directors (members of the audit
committee).mittee).
(v). The company's annual internal control effectiveness assessment and internal control statement
shall be submitted to The company's annual internal control effectiveness assessment and internal
control statement shall be submitted to the Audit Committee for reviethe Audit Committee forrevieww..
(vi). The annual financial report and semiThe annual financial report and semi--annual financial reportof the company shall be submitted toannual financial report of the company shall be submitted tothe board of the board of directors for resolution after approval by more than onedirectors forresolution after approval by more than one--half of all members of the audit committee. Prior tothe half of all members of the audit committee. Prior to the review of the financial report, theAudit Committee will discuss and communicate with the CPA in advance about review of thefinancial report, the Audit Committee will discuss and communicate with the CPA in advanceabout the results of ththe results of the audit.e audit.

- 30 -

2.In 2020, a total of 10 (A) meetings of the Board of Directors were held in the mostrecent year. The Supervisor attendance was as follows:
Title
Supervisor
Supervisor
Supervisor

Name
Yung-Liang
Huang
Yi-Hsiang
Huang
Ken-Huang
Lin

Attendance in Attendance rate (%)
person(Note)

Note

5100.00

Removed on 2020.05.28,
Shall attended 5 times.

5100.00

Removed on 2020.05.28,
Shall attended 5 times.

4

80.00

Removed on 2020.05.28,
Shall attended 5 times.

1. Composition and responsibility of Supervisors:(1) Communication between Supervisors and Company's employees and shareholders:Supervisors communicate with employees and shareholders through the company
spokesperson. This communication channel has been effective in past years, thereby
facilitating supervisory functions.
(2) Communication between Supervisors and the Company's internal Audit Manager and
CPA (e.g., items, methods, and outcomes of communicating company financial status
and business conditions): The Company invites its Supervisors to attend board
meetings; therefore, the Company reports the financial statement and businessconditions of the Company during the board meetings or designates the Audit Manager
to report the evaluation results of internal audits. All Supervisors may express theiropinions during the meetings. Moreover, the financial statements approved by the CPA
are submitted to the Supervisors for approval. If Supervisors voice their opinion whenreviewing the financial statements, such opinion shall be either first explained by the
CPA or be communicated to the CPA.
2. If a Supervisor voices an opinion in the Board of Directors meeting, the date of the board
meeting, term of the board, agenda items, resolutions adopted by the board, and actions
taken by the company in response to the opinion of the Supervisor shall be described:
None.
Note:
＊For Independent Directors who resigned from their position prior to the end of the financial year, the date of
their resignation shall be noted in the Note column. Their actual attendance rate (%) shall be calculated
according to the frequency they attended meetings of the Board during their tenure and their attendance inperson.
＊For changes to Independent Directors before the end of the financial year, the new and old Independent
Directors shall be listed and Independent Directors who are old or new and the date of their reelection andchanges shall be noted in the Note column. Their actual attendance rate (%) shall be calculated according to
the frequency they attended meetings of the audit committee during their tenure and their attendance inperson.

- 31 -

(3)Corporate governance implementation status and deviations from Corporate Governance Best-PracticePrinciples for TWSE/TPEx Listed Companies and reasons
State of Operations (Note 1)
Assessed areas

1. Does the company establish and disclose its
corporate governance principles in accordancewith the Corporate Governance Best-PracticePrinciples for TWSE/TPEx Listed Companies?
2. Shareholding structure & shareholders' rights(1) Does the company establish internal operatingprocedures for handling shareholder
suggestions, questions, complaints orlitigation and handled related mattersaccordingly?
(2) Does the company have a list of major
shareholders that have actual control over theCompany and a list of ultimate owners of
those major shareholders?
(3) Does the company establish and implement
risk management and firewall systems
between the Company and its affiliates?
(4) Does the company establish internal rules
against insiders trading with undisclosed
information?
3. Composition and responsibilities of the Boardof Directors(1) Does the Board of Directors develop andimplement a diversified policy for thecomposition of its members?

Yes

V

No

Summary
Handled in accordance with Corporate GovernanceBest-Practice Principles for TWSE/GTSM Listed
Companies.

(1) The Company has stock affairs specialists and astock affairs proxy agency to assist withhandling such affairs.

V

V

Deviations from Corporate
Governance Best-PracticePrinciples for TWSE/TPEx
Listed Companies andreasons
No discrepancy.

No discrepancy.

(2) Yes, according to the shareholders' registry
provided by the stock affairs proxy agency, andwe regularly report changes to the stock rights of
our Directors, Supervisors, and managerial
officers.
(3) The Companyhas set up internal rules in the
Company’s Internal Control System and AffiliatedCorporations Management.
(4) The Company's operation is conducted according to
the extent of internal control.

(1) The Company has set up 3 seats for Independent No discrepancy.
Directors.
(2) The Company has established a Remuneration- 32 -

State of Operations (Note 1)
Assessed areas

Yes

Summary
Committee and proposed recommendations
regarding the remunerations to its Directors,
Supervisors, and managerial officers.

(2) Does the company voluntarily establish otherfunctional committees in addition to
remuneration committee and audit committee?
(3) Has the Company established methodology forevaluating the performance of its Board of
Directors, on an annual basis, reported theresults of performance to the Board of
Directors, and use the results as reference fordirectors’ remuneration and renewal?
(4) Does the company regularly evaluate theindependence of CPAs?
4. Does the Company appoint competent andappropriate corporate governance personnel andcorporate governance officer to be in charge ofcorporate governance affairs (including but notlimited to furnishing information required forbusiness execution by directors, assisting
directors’compliance of law, handling mattersrelated to board meetings and shareholders’meetings according to law, and recording
minutes of board meetings and shareholders’meetings)?

No

Deviations from Corporate
Governance Best-PracticePrinciples for TWSE/TPEx
Listed Companies andreasons(3) The Company currently has no method forevaluating the performance of the Board of
Directors.
(4) The Company regularly evaluates theindependence of CPAs. The Company's CPAs
are hired by the Board of Directors at least once
per year, and they have no interest relationshipwith the Company and are strictly independent.
We arrange specific officers in charge of corporate
No discrepancy.
governance affairsV- 33 -

State of Operations (Note 1)

Assessed areas

5. Does the company establish a communication
channel and build a designated section on its
website for stakeholders, and properly respondto corporate social responsibility issues ofconcern to the stakeholders?
6. Does the company designate a professional
shareholder service agency to deal withshareholder affairs?
7. Information disclosure(1) Does the company establish a corporatewebsite to disclose information regarding thecompany's financial, business and corporate
governance status?
(2) Does the company have other information
disclosure channels (e.g., maintaining an
English-language website, appointing
responsible people to handle informationcollection and disclosure, creating a
spokesperson system, webcasting investor
conference on the company website)?
(3) Does the Company announce and report theannual financial statements within two months
after the end of the fiscal year, and announce
and report the first, second, and third quarter
financial statements as well as the operating
status of each month before the prescribeddeadline?

Yes

V

V

Deviations from Corporate
Governance Best-PracticePrinciples for TWSE/TPEx
No
Summary
Listed Companies andreasons
The Company has a spokesperson and representative No discrepancy.
spokesperson who act as the communication channel
for the Company.

The Company commissions the stock affairs agency No discrepancy.
department of Taishin International Bank to handle
shareholder affairs.
(1) Web address: www.brogent.com; the Company No discrepancy.
has designated personnel to collect and disclose
Company information.
(2) Spokesperson: President Chih-Hung Ouyang;investors can also access the Company's
information regarding the company's financial,business and corporate governance status from
the Market Observation Post System.
(3) Handle within the prescribed time limit.

V- 34 -

State of Operations (Note 1)
Assessed areas

Yes

8. Is there any other important information tofacilitate a better understanding of thecompany’s corporate governance practices(including but not limited to employee rights,
employee wellness, investor relations, supplier
relations, rights of stakeholders, continuing
education of Directors and Supervisors, theimplementation of risk management policies
and risk evaluation standards, theimplementation of customer relations policies,
and purchasing insurance for Directors andSupervisors)?

V

No

Summary(1) Employee rights protection and employee caremeasures adopted by the Company: The
Company provides equal employment
opportunities, offers employee group insurance,
arranges health check ups regularly, andestablishes legal employee welfare committee toprotect employee rights. Furthermore, we
comply with law in enrolling every employee inlabor and health insurance and disburse pension
reserve funds to them. The Company establishes
appropriate channels for employees to file theircomplaint and values the importance of
employee training.
(2) The Company's relationship with its investors:
The Company holds shareholder meetings
according to law every year and adequately gives
its shareholders the chance to raise questions andmake proposals. In addition, we also have set up
spokespersons and representative spokespersonin accordance with law and designate them tohandle matters between the Company and its
investors. Moreover, the Company announcesand reports any information that should be
disclosed as required by the competentauthorities. Thus, information that potentiallyinfluences investor decisions is provided inreal-time.
(3) The Company maintains a smoothcommunication channel with its suppliers and- 35 -

Deviations from Corporate
Governance Best-PracticePrinciples for TWSE/TPEx
Listed Companies andreasons
No discrepancy.

State of Operations (Note 1)
Assessed areas

Yes

No

Summary

Deviations from Corporate
Governance Best-PracticePrinciples for TWSE/TPEx
Listed Companies andreasons

stakeholders, including partner banks, othercreditors, employees, and clients.
(4) Continuing education of Directors andSupervisors: The members of the Company's
Board of Directors possess professional
backgrounds and practical experience in business
management; they occasionally attend relevant
educational courses. The continuing education
status of the Board of Directors in 2019 and2020 to the print date of the Prospectuses are
displayed in the following table.
(5) Implementation status of risk management
policies and standard risk measures: The
Company emphasizes the importance of risk
management, complies with relevant laws andregulations in executing various policies, andestablishes internal auditors who ensure that theexecution of relevant policies conforms toregulations.
(6) Accountability insurance for Directors andSupervisors: The Company has purchased
relevant accountability insurance for its
Directors, Supervisors, and managerial officers.
9.Please provide explanations for the improvement made according to the results of the corporate governance evaluation by the Corporate
Governance Center of Taiwan Stock Exchange during the most recent year, and details on the priority issues and measures for the areas yet to be
improved (not applicable to the companies not evaluated).
In 2020, the company’s corporate governance focus on improving the interests of shareholders. The company will continue to strengthen the- 36 -

State of Operations (Note 1)

Deviations from Corporate
Governance Best-PracticeAssessed areas
Principles for TWSE/TPEx
Yes NoSummary
Listed Companies andreasons
structure and operation of the Board of Directors, reinforce the function of the Board of Directors and enhance the quality of disclosure for nonfinancial information to strengthen the corporate governance information.

- 37 -

The Continuing Education Status of Directors and Supervisors in 2020 and 2021 to the date of this Annual Report
Title
Chairman
Chairman

Director

Director

Name
Chih-Hung
OuyangOrganizer
Taiwan Corporate Governance
Association

Chih-Hung
OuyangTaiwan Corporate Governance
Association

Changchun
Investment Co. Ltd.
Representative:
Chih-Chuang Chen
Changchun
Investment Co. Ltd.
Representative:
Chih-Chuang Chen

Course name
Corporate Social Responsibility and Sustainable
CompetitivenessHow should corporations preemptively prepare for theneed of compliance management in a world of digitaltransformation.

Hours
3 hours
3 hours

Taiwan Inverstor Relations
Institute

The current status and future of intellectual property
rights protection related to pharmaceuticals in Taiwan.

3 hours

Taiwan Corporate Governance
Association

Exploring the responsibility of Directors and Supervisors
for illegal cases from securities market

3 hours

Corporate Social Responsibility and Sustainable
CompetitivenessHow should corporations preemptively prepare for theneed of compliance management in a world of digitaltransformation.
Corporate Social Responsibility and Sustainable
CompetitivenessHow should corporations preemptively prepare for theneed of compliance management in a world of digitaltransformation.
Corporate Social Responsibility and Sustainable
CompetitivenessHow should corporations preemptively prepare for theneed of compliance management in a world of digitaltransformation.
Practical operation, control mechanism and case sharingof related party transactions

DirectorChin-Huo Huang

Taiwan Corporate Governance
Association

DirectorChin-Huo Huang

Taiwan Corporate Governance
Association

Director

Chun-Hao Cheng

Taiwan Corporate Governance
Association

Director

Chun-Hao Cheng

Taiwan Corporate Governance
Association

Independent
Director

Lewis Lee

Taiwan Corporate Governance
Association

Independent
Director

Lewis Lee

Taiwan Corporate Governance
Association

Independent
Director

Chih-Poung Liou

Indenpend Director
Association Taiwan- 38 -

3 hours
3 hours
3 hours
3 hours
3 hours
3 hours
3 hours

The Continuing Education Status of Directors and Supervisors in 2020 and 2021 to the date of this Annual Report
Title
Independent
Director
Independent
Director
Independent
Director
Independent
Director
Independent
Director

Name
Chih-Poung Liou
Jih-Ching Chiu

Organizer

Course nameTaiwan Corporate Governance
Association
Taiwan Corporate Governance
Association

Money laundering regulations, patterns and pre-crimes(such as insider trading)Corporate Social Responsibility and Sustainable
CompetitivenessHow should corporations preemptively prepare for theneed of compliance management in a world of digitaltransformation.
2020 Corporate Jurisprudence and Corporate Integrity
Directors and Supervisors Promotion Conference.
Looking for new growth momentum in the 2020 strategic
turning year.

Jih-Ching Chiu

Taiwan Corporate Governance
Association

Jih-Ching Chiu

Taiwan Stock Exchange/
Taipei Exchange

Jih-Ching Chiu

Taiwan Institute of Directors- 39 -Hours
3 hours
3 hours
3 hours
3 hours
3 hours

(4) If the company has established a remuneration committee, it shall disclose thecomposition, duties, and operation of the committee
1. Members of the Compensation Committee
Criteria

Position

Name

Has at least 5 years of work experience andMeet the independence criteria (Note 1)
meets one of the following professional
qualifications
An instructor
A judge,
Have workor higher
publicexperience in
Number of
position in the prosecutor,
commerce,other public
epartment of
attorney,law, finance,companies
commerce, accountant, or or accounting
in which thelaw, finance,otheror a profession
memberaccounting or professional or necessary foralso serves
othertechnical
the business of
as adepartment
specialist
the Company
1 2 3 4 5 6 7 8 9 10 member ofrelated to the related to thetheirbusiness needs needs of thecompensatiof theCompany whoonCompany in a has passed acommittee
public ornational
private junior examinationcollege or
and received auniversity
certificate
thereforIndependent
Director

Lewis Lee

Independent
Director

Chih-Poung
Liou

Independent
Director

Jih-Ching
Chiu

Independent
Director

Ching-Wen
Chuang

Independent
Director

Shun-Jen
Cheng

External
committee
memberRong-Da
Liang







         

3

Note

Electedon,2020.05.28

         

1Electedon,2020.05.28

-         -Electedon,2020.05.28

-         -

Removed on
2020.05.28

-         

3Removed on
2020.05.28

-         -

Removed on
2020.05.28

Note 1: Compensation Committee Members, during the two years before being elected or during the term of office, meet a any of thefollowing situations, please tick the appropriate corresponding boxes:
1. Not an employee of the company or any of its affiliates;
2. Not a director or supervisor of the company or any of its affiliates.;
3. Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by
the person under others’ names, in an aggregate amount of one percent or more of the total number of issued shares of thecompany or ranks as one of its top ten shareholders;
4. Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of theofficer in the preceding 1 subparagraph, or of any of the above persons in the preceding subparagraphs 2 and 3;
5. Not a director, supervisor, or employee of a corporate/institutional shareholder that directly holds five percent or more of thetotal number of issued shares of the company, ranks as of its top five shareholders, or has representative director(s) serving on thecompany’s board based on Article 27 of the Company Law.
6. Not a director, supervisor, or employee of a company of which the majority of board seats or voting shares is controlled by acompany that also controls the same of the company;
7. Not a director, supervisor, or employee of a company of which the chairman or CEO (or equivalent) themselves or their spousealso serve as the company’s chairman or CEO (or equivalent);
8. Not a director, supervisor, officer, or shareholder holding five percent or more of the shares of a specified company or institutionthat has a financial or business relationship with the company;
9. Other than serving as a compensation committee member of the company, not a professional individual who, or an owner,
partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial,legal, financial, accounting services or consultation to the company or to any affiliate of the company, or aspouse thereof, and theservice provided is an “audit service” or a “non-audit service which total compensation within the recent two years exceeds
NTD500,000”
10. Not been a person of any conditions defined in Article 30 of the Company Law.

- 40 -

2. State of operations of the compensation committee(A) The Compensation Committee comprises 3 members.
Current term of office: June 19, 2020–May 27, 2023; a total of 3 (A) meetings of theCompensation Committee were held in the most recent year. The members'
qualifications and attendance were as follows:
Title

Name

Attendance inperson(B)

By proxy Attendance rate (%)
Frequency
(B/A)

Note

ConvenorLewis Lee
Independent Director,

10

100.00Elected on,2020.06.19,
Shall attended 1 times.

Independent Director, Chih-Poung Liou

10

100.00Elected on2020.06.19
Shall attended 1 times.

Independent Director, Jih-Ching Chiu

10100.00Elected on,22020.06.19,
Shall attended 1 times.

20

100.00

Removed on 2020.05.28,
Shall attended 2 times

Independent Director, Shun-Jen Cheng

20

100.00

Removed on 2020.05.28,
Shall attended 2 times

Committee
member-External
committee member

20

100.00

Removed on 2020.05.28,
Shall attended 2 times

Independent Director,

Ching-Wen
ChuangRong-Da Liang

Other matters that require reporting:
1. If the Board of Directors did not adopt or revised the recommendations of the compensation committee, describe thedate of the board meeting, term of the board, agenda item, resolutions adopted by the board, and actions taken by thecompany in response to the opinion of the compensation committee (if the remunerations approved by the Board of
Directors are better than those recommended by the compensation committee, describe the difference and reasons):
None.
2. If with respect to any resolution of the compensation committee, any member has a dissenting or qualified opinion
that is on record or stated in a written statement, describe the date of committee meeting, term of the committee,
agenda item, opinions of all members, and actions taken by the company in response to the opinion of members:None.

- 41 -

(5) Implementation of corporate social responsibility and deviations from corporate social responsibility
Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
State of Operations (Note 1)
Assessed areas

Yes

1. Does the Company follow materiality principle toconduct risk assessment for environmental, socialand corporate governance topics related to company
operation, and establish risk management related
policy or strategy?
V

2. Does the company establish a dedicated or
concurrent unit in charge of promoting CSR withsenior management authorized by the board to take V
charge of proposing CSR policies and reporting to
the board?
3. Environmental issue(1) Does the company establish a proper environmental
management system based on the characteristics of
the industry?
(2) Does the company endeavor to improve theVefficiency of resource utilization and use recycledmaterials which have a low impact on theenvironment?
(3) Does the Company evaluate current and futureNo

Summary (Note 2)

Departure from Corporate Social
Responsibility Best PracticePrinciples for TWSE/GTSM
listed companies and reasons(1) The Company has established Corporate Social No discrepancy.
Responsibility Best Practice Principles andexamined its implementation effectiveness.
(2) The Company has established the Ethical Codeof Conducts for Directors, Supervisors, andManagerial Officers.
(3) The Company has established Work Rules
Guideline for Salary Management andGuideline for Performance Management, whichclearly specifies relevant effective rewarding
and punishment systems.
The departments related to the social responsibility No discrepancy.
of the Company all handle relevant mattersaccording to their duties.

(1) Yes the company has set up environmental
No discrepancy.
management and discloses relevant information
on its website.
(2) The Company generally endeavor to increase theefficiency of resource utilization and use
environmentally friendly materials as much as
possible to reduce the impact on theenvironment.

- 42 -

State of Operations (Note 1)
Assessed areas

Yes

climate change potential risks and opportunities
and take measures related to climate related
topics?
(4) Does the Company collect data for greenhouse gas
emissions, water usage and waste quantity in thepast two years, and set energy conservation,
greenhouse gas emissions reduction, water usage
reduction and other waste management policies?

4. Social issue(1) Does the Company set policies and procedures incompliance with regulations and internationallyrecognized human rights principles?
(2) Has the Company established appropriately
managed employee welfare measures (include
salary and compensation, leave and others), andlink operational performance or achievements with
employee salary and compensation?
(3) Does the Company provide employees with a safeand healthy working environment, with regularsafety and health training?
(4) Has the Company established effective careerNo

Summary (Note 2)

Departure from Corporate Social
Responsibility Best PracticePrinciples for TWSE/GTSM
listed companies and reasons(3) For the potential risks and opportunities casuedby climate change from now on, Brogent has
especially isured to amortize the property
damage. We are aggressively devoted ourselves
to researching and developing the indoor
amusement (training) facilities and hopefully
we can create commercial opportunities under
the influence of extreme weather.
(4) The company regularly monitors the air qualityof the office environment, uses LED lighting
and solar power generation devices, and installs
energy-saving central air-conditioning control
systems and full heat exchangers to effectively
maintain air quality and energy-saving andcarbon-reduction purposes, and exposes energy
use on the company's website With an overview
of greenhouse gas emissions.

V(1) The company follows international principles, No discrepancy.
respects internationally recognized basic humanrights, including caring for vulnerable groups,
prohibiting child labor, eliminating employment
and employment discrimination, etc., andabides by labor-related laws and regulations
where the company is located.
(2) The Company adheres to the labor regulations in
the Labor Standards Act to protect employees'
legal rights. In addition, the Company disburses
pension fund and labor welfare fund inaccordance with law. Concurrently, the- 43 -

State of Operations (Note 1)
Assessed areas
development training plans?
(5) Does the Company’s product and service comply
with related regulations and international rules forcustomers’ health and safety, privacy, sales,
labelling and set polices to protect consumers’
rights and consumer appeal procedures?
(6) Does the Company set supplier management policy
and request suppliers to comply with related
standards on the topics of environmental,
occupational safety and health or labor right, andtheir implementation status?

Yes

No

Summary (Note 2)Company and its employees have alsoestablished employee welfare committee andhold employer–employee meetings to
implement various welfare activities andcoordinate employer–employee relationship,
thereby promoting matters related to employer–
employee cooperation.
(3) The Company endeavors to provide a safe andhealthy working environment and provide
employees with regular safety and healthtraining.
(4) The company's training plan is based onsupervisors / general employees, taking regulartraining / unscheduled training, and dependingon the content of each department, in order toeffectively train employees' related capabilities.
(5) The company has a customer service department
dedicated to handling consumer rights
protection and appeals.
Company products are designed andmanufactured in accordance with standard
regulations of various countries. These products
have also been certified by the following:
China: GB-8408 Amusement Device Safety
Code(Amusement device satety Cood)Europe: EN-13814(Fairground and amusementpark machinery and Structure-Safety)
USA and Canada: ASTM-F2291 (Standard
Practice for Design of Amusement and
Devices)- 44 -

Departure from Corporate Social
Responsibility Best PracticePrinciples for TWSE/GTSM
listed companies and reasons

State of Operations (Note 1)
Assessed areas

Yes

No

Summary (Note 2)

Departure from Corporate Social
Responsibility Best PracticePrinciples for TWSE/GTSM
listed companies and reasons(6) YES, a list of supplier evaluation standards wasadded. The Company upholds the principle ofethical corporate management and collectively
cooperate with the suppliers in development
projects to facilitate coexistence and collective
prosperity.
The company has prepared corporate social
responsibility reports with reference to
No discrepancy.
internationally-prepared reporting standards or
guidelines.

5. Does the Company refer to international reporting
rules or guidelines to publish CSR Report to disclose
non-financial information of the Company? Has theVsaid Report acquire 3rd certification party
verification or statement of assurance?
6. If the Company has established the corporate social responsibility principles based on "Corporate Social Responsibility Best Practice Principles for
TWSE/TPEx Listed Companies", please describe any discrepancy between the principles and their implementation: Not applicable
7. Other important information to facilitate a better understanding of the company’s corporate social responsibility practices:
The Company discloses relevant information regarding its corporate social responsibility on its website, annual report, the prospectuses, and CSR report.
Note 1: If companies select "Yes" in the Summary column, please specify the relevant policy,strategy and the result of implementation, and if companies
select "No" in the Summary column, please explain the reason and describe future improvements or relevant management guidelines and goals.
Note 2: For companies that have compiled CSR reports, the summary may specify the CSR reporting method and page numbers.
Note 3: Principle of materiality may refer to the significant impact on the rights and interests of stakeholders while companies are advised to promulgate
their own corporate social responsibility principles in accordance with the Principles to manage their economic, environmental and social risks andimpact.

- 45 -

(6) Implementation of ethical corporate management and deviations from ethical corporate managemen
Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
State of Operations (Note 1)

Assessed areas

1. Establishment of ethical corporate management policy
and approaches(1) Does the company have a clear ethical corporate
management policy approved by its Board of Directors,
and bylaws and publicly available documents
addressing its corporate conduct and ethics policy andmeasures, and commitment regarding implementationof such policy from the Board of Directors and the top
management team?
(2) Whether the company has established an assessment
mechanism for the risk of unethical conduct; regularly
analyzes and evaluates within a business context, thebusiness activities with a higher risk of unethicalconduct; has formulated a program to prevent unethicalconduct with a scope no less than the activitiesprescribed in paragraph 2, Article 7 of the EthicalCorporate Management Best Practice Principles for
TWSE/GTSM Listed Companies?
(3) Whether the company has established relevant policies
that are duly enforced to prevent unethical conduct,
provided implementation procedures, guidelines,
consequences of violation and complaint procedures,and periodically reviews and revises such policies?

Yes

V

Departure from "EthicalCorporate Management
Best Practice Principles forNo
Summary
TWSE/GTSM Listed
Companies" and reasons(1) The Company strictly adheres to the laws and No discrepancy.
regulations stipulated in the Company Act,
Securities and Exchange Act, Business Entity
Accounting Act, and other regulations for listed
and OTC companies. The Company has
formulated internal control systems according
to regulations, established internal auditing
office,andensuredtheeffective
implementation of relevant operations, torealize the fundamental concepts of ethicalcorporate management.
(2) The Company has formulated Ethical Corporate
Management Principle according to the EthicalCorporate Management Best Practice Principles
for TWSE/GTSM Listed Companies andpromoted the importance of ethical code of
conduct, educating each employee on thecompany's core value and compliance systems.
The Company regularly offers training
programs.
(3) The Company requires its Directors,
Supervisors, managerial officers, andemployees to refrain from engaging in bribery
or providing illegal political donations during a- 46 -

State of Operations (Note 1)
Assessed areas

Yes

No

Summary

Departure from "EthicalCorporate Management
Best Practice Principles for
TWSE/GTSM Listed
Companies" and reasonsbusiness activity. The Company stipulates thatthey may not directly or indirectly provide orreceive unreasonable gifts, treatments, or otherimproper benefits to prevent employees frompursuing personal interests at the expense of
the company's rights and interests.
2. Implementation of ethical corporate management(1) Does the company evaluate the ethical records of parties
it does business with and stipulate ethical conduct
clauses in business contracts?
(2) Whether the company has set up a unit which isdedicated to promoting the company’s ethical standards
and regularly (at least once a year) reports directly to theBoard of Directors on its ethical corporate management
policy and relevant matters, and program to prevent
unethical conduct and monitor its implementation?
(3) Does the company establish policies to prevent conflictsof interest, provide appropriate channels for filingrelated complaints and implement the policies
accordingly?
(4) To implement relevant policies on ethical conducts, has
the company established effective accounting andinternal control systems, audit plans based on theassessment of unethical conduct, and have its ethicalconduct program audited by internal auditors or CPA

V(1) The Company's clients and suppliers are mostly No discrepancy.
well-known
companies
whose
ethicalmanagement information is easily accessible.
When signing a business contract, the contract
also incorporates regulations regarding ethicalmanagement.
(2) The Company invites Supervisors to attend themeeting of the Board of Directors, thereby
maximizing the supervisory functions ofSupervisors.
(3) The Company has an Internal Material
Information Processing Operating Procedure,
specifying
that
Directors,
Supervisors,
managerial offices, and employees may not leakinternal material information to others, inquire
the company's internal material informationfrom others, or collate unpublished internalmaterial information of companies that are
irrelevant to their job duties. They are also
prohibited from leaking the company's- 47 -

State of Operations (Note 1)
Assessed areas

Yes

periodically?

Summary
unpublished internal material information toothers.
(4) To implement ethical management, theCompany has established effective accounting
system and internal control system, and hasinternal auditors regularly check the situation
regarding compliance with the aforementioned
systems. To implement ethical management, theCompany has established effective accounting
system and internal control system, and hasinternal auditors regularly check the situation
regarding compliance with the aforementioned
systems.
(5) The Company promotes the concepts of
ethical management in Director andSupervisor training and managerial
meetings.

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

3. Operation of whistleblowing system(1) Does the company establish concrete whistleblowing
and reward system and have a convenient reporting
channel in place, and assign an appropriate person tocommunicate with the accused?
(2) Whether the company has established standard
operation procedures for investigating the complaints
received, follow-up measures after investigation arecompleted, and ensuring such complaints are handled ina confidential manner?
(3) Does the company provide proper whistleblower

No

Departure from "EthicalCorporate Management
Best Practice Principles for
TWSE/GTSM Listed
Companies" and reasons(1) The Company has established whistleblowing No discrepancy.
channels and developed relevant punishment
systems and reporting mechanisms.
V(2) Yes.
(3) The Company adopts an anonymous reporting
policy.

- 48 -

State of Operations (Note 1)
Assessed areas

Yes

No

Summary

Departure from "EthicalCorporate Management
Best Practice Principles for
TWSE/GTSM Listed
Companies" and reasonsprotection?
4. Enhancing information disclosure
Does the company disclose information regarding the
The Company has set up a website for disclosing
No discrepancy.
company's ethical corporate management principles andV
corporate governance information.
implementation status on its website and the Market
Observation Post System?
5. If the company has established Ethical Corporate Management Principles in accordance with the "Ethical Corporate Management Best PracticePrinciples for TWSE/TPEx Listed Companies", describe any discrepancy between the principles and their implementation: None.
6. Other important information to facilitate a better understanding of the company's implementation of ethical corporate management: (e.g., inspect andrevise existing ethical management principles) None

Note 1: The operating condition shall be described in the Summary column regardless of whether "Yes" or "No" is selected.

- 49 -

(7) If the company has established corporate governance principles andrelated guidelines, disclose the means of accessing this information:
The Company has not formulated corporate governance principles but
has disclosed rules pertaining to corporate governance on the Market
Observation Post System, such as: Ethical Corporate Management
Principles and Remuneration Committee Organization Rules.
(8) Other significant information which may improve the understanding ofcorporate governance and operation: None.
(9) The following matters pertaining to the implementation status ofinternal control systems should be disclosed:
1. Statement on Internal Control: (Please refer to Appendix 1).
2.The Company engages an accountant to examine its internal control system, disclose the
CPA examination report: None.

(10) Penalty on the Company and its personnel or punishment imposed by
the Company on personnel in violation of internal control systemregulations, major deficiencies and improvement in the past year and
up to the date of report: None.
(11) Important resolutions adopted in shareholders meeting and Board of
Directors' meeting in the past year and up to the date of report.

1. Shareholder’s Meeting
Date of themeeting

Key issues in summary

Outcome of resolution

2020.05.28 Reporting Items
All items passed and executed as(Share(1) 2019 Business Report scheduled.
holders’ (2) 2019 Supervisor’s Audit
regular Reportmeeting) (3) 2019 Report on
Remuneration Distributionof Employees, Directors,
and Supervisors.
(4) Amendment to“Guidelines for the
Adoption of Codes of
Ethical Conduct for
Directors and Managers”.
(5) Amendment to “EthicalCorporate Management
Best Practice Principles”.
- 50 -

Facts of implementation

Date of themeeting

Key issues in summary

Outcome of resolution

Facts of implementation

Passed Items(1) 2019 Business Report
and Financial Statements

The balloting outcome including Reports and statements
votes exercised through electronic distributed to shareholders
voting: 41,511,535 pro votes ,according to relevant laws andaccounting for 99.98% of theregulations
aggregate total votes; 524 con
votes, 0 invalid vote, abstention/
Non-voting votes: 7,490 votes. The
present issue is duly resolved
exactly as proposed.

(2) 2019 Earnings
Distribution Proposal.

The balloting outcome including Dividend base date scheduled
votes exercised through electronic on Augest 1, 2020, ex-dividend
voting: 41,511,535 pro votes ,date on July 24, 2020, the bookaccounting for 99.98% of theclosure date on July 27, 2020.
aggregate total votes; 1,784 con
According to Article 165 of thevotes, 0 invalid vote, abstention/ Company's Articles ofNon-voting votes: 6,230 votes. The Incorporation, the book closure
present issue is duly resolved
period is from July 28, 2020 toexactly as proposed.
Augest 0, 2020. Cash dividend
payday is August 21, 2020.

Matters for Discussion I(1) Amendment of the
Article of Incorporation.

The balloting outcome including
votes exercised through electronic The issue had been duly
voting: 41,509,955 pro votes ,completed in enforcement
accounting for 99.97% of theexactly as amended.
aggregate total votes; 524 con
votes, 0 invalid vote, abstention/
Non-voting votes:9,070 votes. The
present issue is duly resolved
exactly as proposed.

(2) Amendment to Rules of The balloting outcome including The issue had been duly
Procedure for Shareholders votes exercised through electronic completed in enforcement
Meetings.
voting: 41,509,948 pro votes ,exactly as amended.
accounting for 99.97% of theaggregate total votes;531 con votes,
0 invalid vote, abstention/
Non-voting votes: 9,070 votes. The
present issue is duly resolved
exactly as proposed.

(3) Amendment to
The balloting outcome including The issue had been duly
Procedures for Election of votes exercised through electronic completed in enforcement
Directors and Supervisors. voting: 41,509,956 pro votes ,exactly as amended.
accounting for 99.97% of theaggregate total votes; 524 con
votes, 0 invalid vote, abstention/
Non-voting votes: 9,069 votes. The
present issue is duly resolved
exactly as proposed.

- 51 -

Date of themeeting

Key issues in summary

Outcome of resolution

Facts of implementation(4) Amendment to
The balloting outcome including The issue had been duly
Procedures for Acquisition votes exercised through electronic completed in enforcement
and Disposal of Assets
voting: 41,509,953 pro votes ,exactly as amended.
accounting for 99.97% of theaggregate total votes; 524 con
votes, 0 invalid vote, abstention/
Non-voting votes: 9,072 votes. The
present issue is duly resolved
exactly as proposed.
(5) Amendment to Handling The balloting outcome including The issue had been duly
Procedures for Loaning
votes exercised through electronic completed in enforcement
Funds.
voting: 41,509,953 pro votes ,exactly as amended.
accounting for 99.97% of theaggregate total votes; 527 con
votes, 0 invalid vote, abstention/
Non-voting votes: 9,069 votes. The
present issue is duly resolved
exactly as proposed.
(6) Amendment to
The balloting outcome including The issue had been duly
Operational Procedures for votes exercised through electronic completed in enforcement
Loaning of Company
voting: 41,509,953 pro votes ,exactly as amended.
Funds” and “Operational accounting for 99.97% of theProcedures for
aggregate total votes; 527 conEndorsements andvotes, 0 invalid vote, abstention/
Guarantees:
Non-voting votes: 9,069votes. The
present issue is duly resolved
exactly as proposed.
Votes
The comprehensive
reelection of Directors.

All items passed and executed as Executed as resolved, thescheduled.
company has announced on
The list of elected Directs:
MOPS .
Chih-Hung Ouyang elected
71,080,477 votes、
Chih-Chuan Chen(TheRepresentative of Changchun Investment Co. Ltd.) elected
66,430,359 votes、
Chin-Huo Huang elected
61,550,148 votes、
Chun-Hao Cheng elected
60,965,530 voes.
The list of elected Independent
Directs:
Lewis Lee elected 6,493,923
votes、
Chih-Poung Liou elected 6,443,365
votes、
Jih-Ching Chiu elected 6,420,747
votes.

- 52 -

Date of themeeting

Key issues in summary

Outcome of resolution

Facts of implementation

Matters for Discussion-II The balloting outcome including The issue had been duly
The proposal for lifting the votes exercised through electronic completed in enforcementban on competition between voting: 41,106,795 pro votes ,exactly as amended.
newly elected Directors and accounting for 99.00% of thetheir representatives.
aggregate total votes; 1,651con
votes, 0 invalid vote, abstention/
Non-voting votes: 411,103 votes.
The present issue is duly resolved
exactly as proposed.

2.Board of Directors’ Meeting
Date

Proposal

2020.01.13

Approved the Year-End Bonus Disbursement Principle and Manager Year-End Bonus.
Approved the Evaluation plan of the independence of CPAs.
Approved the Authorization of Grant Thorton as 2020 Auditor for the Company’s financial
report.
Approved the Financing application plan.

Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.02.10
Opinions from all the
independent directors
and the company’s
response to such
opinions

Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the amended plan of the 3rd stage investment in the Kaoshsiung Software Park.
Approved the Financing application plan.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the 2019 Statement on Internal Control.
Approved the 2019 Director and Employee Bonus Plan.
Approved the 2019 Business Report and Financial Statements.
Approved the 2019 Earnings Distribution Plan.
Approved the Audit Committee Charter.
Approved the Amendments of the Article of Incorporation.
Approved the Amendments of Rules of Procedure for Shareholders Meetings.
Approved the Amendments of Election Procedure for Directors and Supervisors.

2020.03.09

Approved the Amendments to the clauses of the Procedures for Acquisition and Disposal of
Assets.
Approved the Amendments to Operational Procedures for Endorsements and Guarantees.
Approved the Amendments to Operational Procedures for Loaning of Company Funds.
Approved the Amendments to Guidelines for the Adoption of Codes of Ethical Conduct for
Directors and Managers.
Approved the Amendment to the Rules and Procedures of Board of Directors Meetings.
Approved the Amendments to Ethical Corporate Management Best Practice Principles.
Approved the Proposal of Authorized amount of Loans by The Company to its Subsidiaries.
Approved the Liability Insurance Renewal Plan for the Directors, Supervisors and Managers.
Approved the manager promotion plan.
Approved the Dissolution of Business Strife Limitation Clause of Managers.
Approved the Adjument of the Manager Remuberation.
Passed the re-election of the Board of Directors.
Passed the Dissolution of Business Strife Limitation Clause of New Director and Its
Representative.
Approved the proposed calling of 2020general shareholders' meeting.

- 53 -

Date
Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.04.15
Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.05.12
Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.05.28
Opinions from all the
independent directors
and the company’s
response to such
opinions

2020.06.19

Opinions from all the
independent directors
and the company’s
response to such
opinions

2020.07.08

Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.08.12
Opinions from all the
independent directors
and the company’s
response to such
opinions
2020.11.10

ProposalOpinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved independent directors are nominated by candidates.
Approved the Proposal of The Company to obtain 100% shares of BROGENTMECHANICAL INC.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the 2020 First Quarter Financial Report.
Opinion from independent directors: An Independent Director - Shun-Jen Cheng objected todismissal of Chairman and waived his voting power of election of new Chairman.
The company’s response to such opinions: Making a timely announcement of that material
information in accordance with the relevant laws and regulations.
Resolution: Approval of a majority of the directors present at a directors meeting.
Approved the appointment of the company chairman.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approving the capital injection to Brogent Hong Kong Limited.
Approved to change Chartered Public Accountant due to the internal reorganization of the
CPA firm.
Approve the replacement of certified public accountants, certified public accountants andindependent assessments.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the Resolution on determining the ex-dividend date and payable date for year
2020.
Approved the 2019 Director and Employee Remuneration Plan.
Approved the company’s proposed issuance of the third domestic unsecured conversion
corporate bond and the fourth domestic unsecured conversion corporate bond.
Approved the appointment of senior managers of the company.
Approved the proposal to lift the ban on competition among managers.
Approved the company's audit supervisor change.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the 2020 Second Quarter Financial Report
Approved the merger of the company's subsidiaries, pass the merger contract, and set themerger benchmark date.
Approved the company's 2020 annual audit plan change.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the company's 2020 annual audit plan change.
Approved the company audit report signing procedure.
Approved the company's foreign exchange risk hedging operation.
Approved the Financing application plan.

- 54 -

Date
Opinions from all the
independent directors
and the company’s
response to such
opinions

2020.12.16

Opinions from all the
independent directors
and the company’s
response to such
opinions
2021.01.20
Opinions from all the
independent directors
and the company’s
response to such
opinions

2021.03.10

Opinions from all the
independent directors
and the company’s
response to such
opinions

ProposalOpinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the 2021 Operation Budget Plan.
Approved the 2021 Audit Plan.
Approved the revision of the internal control system.
Approved the revision of the company's reinvestment business management measures.
Approved the intangible assets acquired .
Approved the Financing application plan.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Amendment to "Directors, supervisors, managers' compensation management method"
Approved the Year-End Bonus Disbursement Principle and Manager Year-End Bonus.
Approved the Evaluation plan of the independence of CPAs.
Approved the Financing application plan.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present
Approved the 2020 Statement on Internal Control.
Approved the 2020Business Report and Financial Statements.
Approved the Chart of 2020 Deficit Compensation
Approved the Adjument of the Manager Remuberation.
Approved the company’s "Employee Stock Ownership Meeting" manager's deposit amount proposal.
Approved the Proposal of Authorized amount of Loans by The Company to its Subsidiaries.
Approved the Liability Insurance Renewal Plan for the Directors and Managers.
Approved the proposed calling of 2021 general shareholders' meeting.
Opinion from independent directors: none
The company’s response to such opinions: none
Resolution: unanimous consent from all the directors present(12) Dissenting or qualified opinion of Directors or Supervisors against an
important resolution passed by the Board of Directors that is on
record or stated in a written statement in the past year and up to thedate of report: None.

- 55 -

(13) Resignation and dismissal of managerial officers related to thefinancial report (including Chairman, President, Chief Accounting
Officer, Chief Financial Officer, Chief R&D Officer and Audit
Manager) in the past year and up to the date of report:
Title

Name

Director of
Hui-Ping Li
Audit Office

Date ofappointment

Date ofdischarge

Cause

2008.03.03

2020.08.01

Job adjustment- 56 -

5. Information on fees to CPA(1) Audit Fee
Unit: NT$1,000
Non-audit Fee
Name ofaccounting firm

CPA

Grant Thornton
TaiwanYao Ting Li

Deloitte & Touche
Certified Public
Accountants
TaiwanChiu-Yen Wu

Audit
Fee

Systemof
DesignCompany
Registration

Human
Resource

OthersSubtotal

809

-

-

-

-

-

4,100

-

-

-

Yi Shun Chang

Lee-Yuan Kuo

370

370

PeriodCovered by
CPA’s Audit

Remarks

2020/01/01
2020/03/31

Business andmanagementneeds

2020/01/01
2020/12/31

Business andmanagement
needs(2) When nonaudit fees paid to affiliates, CPA firm, and CPA equal
more than one-fourth of the audit fee, the audit and nonaudit feesamount and nonaudit service content shall be disclosed: None.
(3) If the company changes accounting firm and the amount of audit
fee paid in the year of change is less than that in the year before:
None..
(4) If the audit fee is more than 15% less than that paid in the previous
year: None.

- 57 -

6. Changes to CPA information(1) Concerning former CPA:
Date of Change

Approved by Board of Directors on June 19, 2020

Reasons and Explanation of
Changes

To meet long-term strategic development and management needs.
ClientState whether the Appointment is
Terminated or Rejected by theConsignor or CPAs

The Opinions other than
Unmodified Opinion Issued in theLast Two Years and the Reasonsfor the Said Opinions

StatusCPA

Appointment terminatedautomaticallyAppointment rejected(discontinued)

Consignor
V

None

Accounting principle or practiceDisclosure of financial statements

Yes

Auditing scope or procedures

Is there any disagreement in
opinion with the issuer

Supplementary Disclosure(Disclosures Specified in Article
10.6.1.4~7 of the Standards)

OthersNov

Explanation

NA

None

(2) Concerning succeeding CPA :Deloitte & Touche Certified Public Accountants
TaiwanAccounting Firm

Chiu-Yen Wu
Lee-Yuan Kuo
Approved by Board of Directors on June
19, 2020

CPA
Date of Engagement
Prior to the Formal Engagement, Any Inquiry or Consultation on
the Accounting Treatment or Accounting Principles for Specific
Transactions, and the Type of Audit Opinion that Might beRendered on the Financial
Written Opinions from the Successor CPAs that are Different fromthe Former CPA’s Opinions

None

None

(3) Previous CPA response to items in Article 10.6.1 and 10.6.2.3 of
the Criteria: None.
7. The Chairman, President, financial or accounting manager of thecompany who had worked for the certifying accounting firm or its
affiliated enterprise in the past year : None.

- 58 -

8. Share transfer by Directors, Supervisors, managers and shareholders
holding more than 10% interests and changes to share pledging by
them in the past year and up to the date of report(1) Changes to the share rights of Directors, Supervisors, managerial
officers, and major shareholders
2020
Title

Name

Current year up to March 30

Increase (decrease) Increase (decrease) Increase (decrease) Increase (decrease)in shares heldin pledged sharesin shares heldin pledged shares

Chairman & CEO

Chih-Hung Ouyang-(1,300,000)-

Director

Changchun
Investment Co. Ltd.

-

-

-

-

Director Representative Chih-Chuan Chen

-

-

-

-

DirectorChin-Huo Huang

-

-

-

-

Director

Chun-Hao Cheng

-

-

-

-

Independent Director

Lewis Lee

-

-

-

-

Independent Director

Chih-Poung Liou

-

-

-

-

Independent Director

Jih-Ching Chiu

-

-

-

-

Vice President

Teng-Hung Lai

-

-

-

-

Vice President

Jyh-Jong Hwang

-

-

-

-

Chief Engineer &Sr. Director

Yi-Chung Huang

-

4,000

-

-

Chief Financial Officer Sui-Chuan Lin-

50,000--Sr. Director

-

-

-

Szu-Cheng Chen-

1,800,000(2) Information on relative person of share transfer as related party: None.
(3) Information on relative person of share pledging as related party:None.

- 59 -

9. Information on relationship between any of the top ten shareholders(related party, spouse, or kinship within the second degree)
March 30, 2021; Unit: Shares; %Shareholding
Name

SharesShares held by spouseand children

Shareholding
SharesPercentage

Titles, names and relationships
between top 10 shareholders
Total shareholding by(related party, spouse, orNotenominee arrangement
kinship within the second
degree).

Shareholding
Shareholding
SharesPercentage
Percentage

Name

Relationship-

3,807,191

6.70%

101,187

0.18%

-

-

Fu Wu
Investment
Ltd.

Legal
representative-

Fu Wu Investment Ltd.
3,060,282
Representative:
Chih-Hung Ouyang

5.38%

-

-

-

-

Chih-Hung Legal
Ouyangrepresentative

-

5.27%

-

-

-

-

-

-

-

5.12%

-

-

-

-

-

-

-

4.38%

-

-

-

-

-

-

-

3.78%

-

-

-

-

-

-

-

Chih-Hung Ouyang

Profit Power
2,997,400
Management
Consulting Limited
Ruentex Industries
Ltd.
2,910,310
Representative:
Chih-Fan Wang
Ruentex Development
Co. Ltd.
2,489,060
Representative:
Chang-Cheng Chien
Changchun Investment
Co. Ltd.
2,150,271
Representative:
Yin, Yen-Liang
Shu-Huei Liang

1,627,059

2.86%

-

-

-

-

-

-

-

Dahausen Co., Ltd.
Representative:
Sen-Hao Cheng

1,558,888

2.74%

-

-

-

-

-

-

-

Yung-Liang Huang

1,323,586

2.33%

-

-

Chin-Huo Huang

1,149,442

2.02%

252,971

0.45%

-

-

-

-

-

- 60 -

10. The shareholding of the Company, Director, Supervisor, management
and an enterprise that is directly or indirectly controlled by theCompany in the invested company, and consolidate the shareholding
percentage:
Unit: Shares; %Investee Company

Investor Company
SharesShareholding
Percentage

Director, Supervisor,
Manger anddirector
indirect investment
Shareholding
SharesPercentage

Total
SharesShareholding
Percentage

Brogent Global
Inc.
Brogent Hong
Kong Limited
Dili Jie Holdings
LimitedBrogent Rides(Shanghai)
LimitedBrogent Creative(Shanghai)
LimitedBrogent JapanEntertainment
Joint-Stock
Corporation
Jetway Holdings
LimitedGarlay Holdings
LimitedhexaRide the first
LLP
Holey Holdings
LimitedJetmay Holdings
Limited36,214,332

100%

-

-

36,214,332

100%

-

100%

-

-

-

100%

-

100%

-

-

-

100%

-

-

-

100%

-

100%

-

-

-

100%

-

100%

-

-

-

-

-

100%

-

100%

-

-

-

100%

-

100%

-

-

-

90.01%-

90.01%

-

-

-

100%

-

100%

-

-

-

100%

-

100%

Ou Wei Limited

-

-

-

100%

-

100%

-

-

-

100%

-

100%

-

-

-

100%

-

100%

Hai Wei Culture
Creative andDevelopment(Shanghai)
LimitedStarlite Design &Planning Limited

700- 61 -

700

40%

40%

IV. Placement Situation
1.

Company capital and share capital(1) Sources of capital property other than cash is paid by subscribers
1. Type of stock
March 31, 2021; Unit: Shares
Authorized capital
Type of stock

Shares issued and outstanding

Unissued shares

56,831,797

Ordinary shares

Note

Total

33,168,203

90,000,000

OTC shares

2. Sources of capital
March 31, 2021;
Authorized capital
Issue
Year/month priceAmount(NTD) Shares

Paid-in capital
SharesAmount

Unit: 1,000 shares; NT$1,000

Note
Sources of capital property
other than cash is paid bysubscribers

2001.1010

5,000

50,0001,500

15,000 Cash set up

2002.07

10

5,000

50,0005,000

50,0002003.1010

6,000

60,0006,000

2004.0910

12,000120,000

8,106

Capital increase of
NT$35,000,000
Capital increase of
60,000
NT$10,000,000
Capital increase of
81,060
NT$21,060,000- 62 -

Subscriptions paidwith property otherthan cash
None.
None.
None.
None.

OthersApproval by Kaoshifu Jianergongzi Letter No.
09007412400
Approval by Kaoshifu Jianergongzi Letter No.
09109112601
Approval by Kaoshifu Jianergongzi Letter No.
09205920530
Approval by Kaoshifu Jianergongzi Letter No.
09300940610

Authorized capital
Issue
Year/month priceAmount(NTD) Shares

Paid-in capital
Shares2005.03

10

12,000120,000

9,610

2005.0510

12,896

128,960

12,896

2006.0810

20,000200,000

17,442

2010.03

10

20,000200,000

19,612

2011.0610

30,000300,000

21,3562011.0910

30,000300,000

22,6262012.1010

30,000300,000

25,4552013.1010

30,000300,000

26,727.75

2014.0210

30,000300,000

27,470.02

2014.05

10

30,000300,000

29,013.43

2014.0710

50,000500,000

30,888.77

Note

Sources of capital property Subscriptions paid
other than cash is paid bywith property other
Otherssubscribers
than cash
Capital increase of
Approval by Kaoshifu Jianergongzi Letter No.
96,100None.
NT$15,040,000
09400391490
Capital increase of
Approval by Kaoshifu Jianergongzi Letter No.
128,960
None.
NT$32,860,000
09400469250
Capital increase of
Approval by Kaoshifu Jianergongzi Letter No.
174,420
None.
NT$45,460,000
09500652270
Capital increase of
Approval by Kaoshifu Jianergongzi Letter No.
196,120
None.
NT$21,700,000
09900452210
Stock option conversion ofApproval by Kaoshifu Siweijingshanggongzi
213,560
None.
NT$17,440,000
Letter No. 10001224680
Capital increase of
Approval by Kaoshifu Siweijingshanggongzi
226,260
None.
NT$12,700,000
Letter No. 10001356410
Capital increase of
Approval by Jingguangzhengfazi Letter No.
254,550
None.
NT$28,290,000
1010048593
Dividends and bonuses ofApproval by Jingjiasanshangzi Letter No.
267,277
None.
NT$12,727,500
10200112100
First domestic conversion of
convertible corporate bond of
NT$1,274,400
Approval by Jingjiasanshangzi Letter No.
274,700
None.
10300015650
Second domestic conversionof convertible corporate bondof NT$6,148,300
First domestic conversion of
convertible corporate bond of
NT$9,103,500
Approval by Jingjiasanshangzi Letter No.
290,134
None.
10300054610
Second domestic conversionof convertible corporate bondof NT$6,660,500
First domestic conversion of
convertible corporate bond of
NT$10,350,100
Approval by Jingjiasanshangzi Letter No.
308,887
None.
Second domestic conversion of
10300090820
convertible corporate bond of
NT$8,403,400

Amount- 63 -

Authorized capital
Issue
Year/month priceAmount(NTD) Shares

Paid-in capital
Shares2014.0910

50,000500,000

33,635.77

2014.10

10

50,000500,000

33,679.98

2015.01

10

50,000500,000

39,679.98

2015.0610

50,000500,000

40,709.98

2015.0710

50,000500,000

44,677.98

2018.0810

90,000900,000

53,526.77

2018.0910

90,000900,000

53,092.77

2019.0810

90,000900,000

55,747.41

2021.03

10

90,000900,000

56,831,79

Note

Sources of capital property Subscriptions paid
other than cash is paid bywith property other
Otherssubscribers
than cash
Capital reserve transfer
Approval by Jingjiasanshangzi Letter No.
None.
336,357 increase NT$27,470,000
10300104170
First domestic conversion ofApproval by Jingjiasanshangzi Letter No.
None.
336,799 convertible corporate bond of
10300137580
NT$442,100
Capital increase of
Approval by Jingjiasanshangzi Letter No.
None.
396,799 NT$60,000,000
10400008080
Capital increase of
Approval by Jingjiasanshangzi Letter No.
None407,099 NT$10,300,000
10400066620
Stock dividends
Approval by Jingjiasanshangzi Letter No.
None446,779 NT$39,702,000
10400074690
Stock dividends
Approval by Jingjiasanshangzi Letter No.
None535,267 NT$88,487,000
1070008434
Retirement of treasury shares
Approval by Jingjiasanshangzi Letter No.
None
530,928 NT$4,340,000
1070009969
Capital reserve transfer
Approval by Jingjiasanshangzi Letter No.
None
557,474 increase NT$26,546,000
1080008464
As of 2021.03.30, CB 3 and CB 4 had converted 1,084,387 shares, and the change registration has
568,317
not yet been processed.

Amount- 64 -

(2) Shareholder structure
March 30, 2021

Shareholder
structurequantity

Government Financial
institution institutions

Number of
Shareholders
No. of shares
held
Shareholding
percentage (%)-

Foreign
Individual institutions
investors
andforeigners

Otherjuristic
persons

12

131

9,889

45

Total

10,077

1,155,470 15,206,273 34,301,154 6,168,900 56,831,797
2.03%

26.76%

60.36%

10.85%

100.00%(3) Dispersion of equity ownership
Ordinary shares
SharesNumber ofshareholders

Shares held

March 30, 2021
Shareholding
percentage (%)

1~ 9996,246

241,6290.43%

1,000~ 5,000

2,908

5,558,252

9.78%

5,001~ 10,000

420

3,134,714

5.52%

10,001~ 15,000

150

1,876,038

3.30%

15,001~ 20,00082

1,455,119

2.56%

20,001~ 30,000

82

2,047,141

3.60%

30,001~ 40,000

48

1,698,734

2.99%

40,001~ 50,000

28

1,251,575

2.20%

50,001~ 100,000

55

3,822,314

6.73%

100,001~ 200,000

26

3,604,600

6.34%

200,001~ 400,000

12

3,262,097

5.74%

400,001~ 600,000

62,757,744

4.85%

600,001~ 800,000

3

2,036,401

3.58%

-

0.00%

800,001~1,000,000->1,000,001

11

24,085,439

42.38%

Total

10,077

56,831,797

100.00%- 65 -

(4) List of major shareholder (shareholders holding more than 5%of shares or top ten shareholders)Name of major shareholder
Chih-Hung Ouyang

March 30, 2021
SharesShareholding percentage
No. of shares held(%)
3,807,191

6.70%

Fu Wu Investment Ltd.

3,060,282

5.38%

Profit Power Management Consulting Limited

2,997,400

5.27%

Ruentex Industries Ltd.

2,910,310

5.12%

Ruentex Development Co. Ltd.

2,489,060

4.38%

Changchun Investment Co. Ltd.

2,150,271

3.78%

Shu-Huei Liang

1,627,059

2.86%

Dahausen Co., Ltd.

1,558,888

2.74%

Yung-Liang Huang

1,323,586

2.33%

Chin-Huo Huang

1,149,442

2.02%

(5)

Market Price, Net Worth, Earnings, and Dividends in the
Past Two Years
Year

Unit: NT$1,000
Current year up
to March 31,
2021

2019

2020

239.00189.00145.50164.00

86.80

98.00

195.00120.36113.0553.24
47.64
55,747
6.57

47.47
Note 155,747(0.88)(Note 2)
(Note 2)
(Note 2)
(Note 2)

6.57

(Note 1)

(Note 2)

5.6
29.68

N/A (Note 1)
N/A (Note 1)
N/A (Note 1)
N/A (Note 1)
N/A (Note 1)-

Return analysis Price/dividend ratio

34.82

N/A (Note 1)-

Cash dividend yield

0.0287

N/A (Note 1)-

Item
Maximum
Market price per
Minimum
share
Average
Net Value per
share
Earnings per
share

Dividends per
share

Befor distribution
After distribution
Weighted average shares
Earnings per share
Retroactive adjustment for
Earnings per share
Cash dividend
Bonus By Retained earnings
shares By Paid-in Capital
Accumulated unpaid dividend
Price/earnings ratio

Note1:The 2020 Deficit Compensation plan has not been resolved in the shareholders' meeting.
Note2:The year to date March 31, 2021 financial results has not yet been reviewed by CPA..

- 66 -

(6) Dividend policy and implementation status
1. Dividend policy
When allocating the net profits for each fiscal year, the Company shallfirst offset its losses in previous years and set aside a legal capital reserve at
10% of the profits left over, until the legal capital reserve has equaled thetotal capital of the Company; the remaining balance and unappropriatedearnings for the year shall be adjusted. Then, set aside special capital reservein accordance with relevant laws or regulations or as requested by theauthorities in charge and to satisfy business needs of the Company. And theBoard shall propose a distribution plan for any balance remaining, and suchbalance shall be distributed in accordance with the resolution of theshareholders’ meeting.
The Company is situated in a changing industrial environment, wherein
the company life cycle is at a stable growth stage. Considering the Company's
capital requirement for continuous expansion and business operations, as well
as long-term financial planning to satisfy shareholders’ needs for cash flow,
the Company's dividend policy was based on the residual dividend policy inthe relevant laws and regulations of the Company Act. The future capitalrequirement is measured according to the future capital budget plan of theCompany; then, set aside the capital required for earnings financing, and theremaining earnings shall be distributed by way of cash or stock dividend.
Particularly, cash dividend may not exceed 10% of the total dividend.

2. Dividend distribution to be proposed to the shareholders’meeting:
The Company's 2020 Deficit Compensation plan was approved by the Board on
March 10, 2021. Shareholders' meeting has not yet been held.

(7) Effect of the proposed stock dividends (to be adopted by the
Shareholders' Meeting) on the operating performance andearnings per share:
N/A.

(8) Employee bonus and remuneration to Directors andSupervisors
1. Dividend Policy for terms stated in the Articles of- 67 -

Incorporation regarding employees' bonus and Directors'
and Supervisors' remuneration:
The company suffered a loss in 2020, so the amount of remunerationfor employees and directors has not been estimated.

2. Basis for estimating the amount of employee bonuses
and remuneration to Directors/Supervisors, basis forcalculating the number of shares to be distributed as
stock bonuses, and the accounting treatment of thediscrepancy, if any, between the actual distributed
amount and the estimated amount, for the current
period:N/A.

3. Earnings distribution proposal has passed the Boardof Directors but not the resolution of theshareholders' meeting:
The company suffered losses in 2020 and therefore did not estimate theamount of compensation for employees and directors. The company’s
in 2020 was a loss-appropriation proposal, which was approved by theboard of directors on March 10, 2021. This year, due to losses, it will
not be distributed due to losses. It is still subject to the resolution of theshareholders' meeting..

4. Earnings distribution proposal passed in the
resolution of the shareholders' meeting:2020 due to losses, it will not be distributed due to losses. It is still
subject to the resolution of the shareholders' meeting.

5. Describe, where applicable, the reason and handlingapproach for the difference (including the number ofshares, the monetary amount, and the face value ofshares distributed) between the actual distribution of
employee bonus and remunerations to Directors andSupervisors and the approved employee bonus andremunerations to Directors and Supervisors:
N/A.
- 68 -

(9) Buyback of Treasury Stock:
1. Execution of buyback is completed
March 31, 2021
Treasury stocks: Batch Order

1st Batch

Purpose of buy-backTransfer to employees

Timeframe of buy-back2015.07.22 to 2015.09.01

Price range

NTD 170.00 to NTD 488.00

Class, quantity of shares bought back
Value of shares bought-back (in NT$
thousands)
Shares sold/transferred
Accumulated number of company shares
held
Percentage of total company shares held(%)

1,000,000 Ordinary Shares
266,071,991
1,000,000 Ordinary Shares-

2. Execution of buyback has not been completed：
Not applicable.

2. Corporate bond (including overseas corporate bond)(1)Issued corporate bond:First domestic secured corporate bond and second domestic unsecured corporatebond have all been converted into ordinary share by the end of December 31, 2014.

(2)Information of corporate bond conversion:
First domestic secured corporate bond and second domestic unsecured corporatebond have all been converted into ordinary share by the end of December 31, 2014

- 69 -

(3) Issued exchanged corporate bond:Type
Issue date
Par value
Issue and deal location
Issue priceTotal value
Interest rate
Expiration date
Assurance institution
Trustee
Underwriting institution
Certificated laywer
Certificated CPA

Repayment

Outstanding principal
Redemption or prepayment
clauses
Limitation Clauses

Third domestic unsecured
Forth domestic unsecured
convertible bonds
convertible bonds
2020.10.12
2020.10.15
NTD$100,000
NTD$100,000
TPEX
TPEX
Issued by par value
Issued by par value
NTD$700,000,000
NTD$500,000,000
0%0%
5 year
4 yearExpiration date：2025.10.12
Expiration date：2024.10.15
None
None
Taishin International Bank Co.,
Taishin International Bank Co.,
Ltd.
Ltd.
Taishin Securities Co., Ltd
Taishin Securities Co., Ltd
Lawyer, Chiu Lifei
Lawyer, Chiu Lifei
Deloitte Taiwan
Deloitte Taiwan
CPA, Chiu-Yen Wu / Lee-Yuan Kuo CPA, Chiu-Yen Wu / Lee-Yuan Kuo
Except for the repayment by the
Except for the repayment by thecompany, sell of the bond holders or company, sell of the bond holders
person who convert, when it comes or person who convert, when it
to expiration, the company willcomes to expiration, the company
repay per par value along withwill repay per par value along withinterest by cash.
interest by cash.
NTD$454,900,000
NTD$630,600,000 元
Please refer to Article 18 and 19 of Please refer to Article 18 and 19 of“Regulations for third domestic“Regulations for forth domestic
unsecured convertible bonds”
unsecured convertible bonds”
Please refer of “Regulations for
Please refer of “Regulations forthird domestic unsecured
forth domestic unsecured
convertible bonds”
convertible bonds”

Name of credit evaluation
institution, date and evaluation
None
None
result of bonds
The number ofordinary shares,
overseas depository As of March 30, 2021, the amount As of March 30, 2021, the amountreceipts or otherof NTD$69,400,000of the of NTD$45,100,000. of theMarketable securities
convertible bond has
been convertible bond has
been
converted (exchange
converted into 660,927 ordinary converted into 423,460 ordinaryor subscription) as of
Othershares.
sharesthe date ofrightspublication of theannual reportIssuance andPlease refer of “Regulations for
Please refer of “Regulations forconversion(exchange
third domestic unsecured
forth domestic unsecured
or subscription)
convertible bonds”
convertible bonds”
methodRegulation for issuing,
converting, exchanging or stock
subscription, possibility of
No Significant impact
dilution of equity under the terms No Significant impact
and conditions of issuance, andeffect on shareholder equity.
Name of the entrusted custodian
institution to exchange the
N/A
N/A
subject
Note 1: The handling of corporate bonds includes public and private equity corporate bonds underprocessing. Publicequity corporate bonds under processing refer to those that hav e beeneffective (approved) by the Association; private equity corporate bonds under processing- 70 -

refer to those that have been approved by the board of directors.
Note2 : The number of fields depends on the actual number of adjustments
Note3 : Listed by ov erseas corporate debtors
Note4 : Such as restricting the payment of cash dividends, foreign investment, or requiring tomaintain a certain proportion of assets, etc
Note5 : Private fundraiser and should be marked in a prominent
Note6 : For convertibl e corporate bonds, corporate bonds that are exchanged, corporate bonds thatare collectively declared or issued, or corporate bonds with options, you should disclose
the information about the converted corporate bonds, the information about the exchangeof corporate bonds, the status of the corporate bonds that are declared and the options thatare included Corporate debt information.

Type

Convertible Corporate Bonds Information
Third domestic unsecured
Forth domestic unsecured
convertible bonds
convertible bonds

Year
Item
MarketHighestprice of Lowest
theconvertible
Corporate Averagebonds
Price of conversion
Date of issued and issued
price of convers ion
Way to execute obligationof conversion

118.05100.25

As a date of
Mar.30,2021
138.50103.80104.54121.382020

2020
117.8599.90
102.54

As a date of
Mar.30,2021
136.50103.50116.49105.00106.50105.00106.50Issue new share

Issue new share

Note 1: The number of fields depends on the actual number of adjustments.
Note 2: If there are multiple trading locations for overseas corporate bonds, they are listed separately
according to trading locations.
Note 3: Deliver shares that are already issued or issue new shares.
Note 4: Information should be from the same year on the date of publication of the annual report.

(4) Adopt shelf registration method to collect and issue ordinary
corporate bond: None.
(5) Issued subscribed corporate bond: None.
(6)Private placement of corporate bonds in the past three years to
the date of the annual report: None.
3. Issuance of preferred stocks
None.
4. Issuance of global depositary receipts (GDR)
None.

- 71 -

5. Exercise of employee stock option plan (ESOP)
None.
6. Restricted stock awards
None.
7. Merger and acquisition
None.
8. Issuance of new shares for acquisition of shares of othercompanies
None.
9. Implementation of capital allocation plan
Plan

Implementation status
Expected
Expenditure
ActualBank loan
Expected
Accumulated
implementation
progress
ActualExpected
Expenditure0

R&D
expenses

Unit: NT$1,000
Ahead of schedule, behind in progress,
reasons, and improvement plans

Actual
Accumulated
Expected
implementation
progress
Actual- 72 -

As of Dec.31,2020, the planned amount andprogress of the company's planned
repayment of borrowings were 800,000
800,000 thousand yuan and 100.00%, respectively,
and the actual implementation amount and100.00% progress were 800,000 thousand yuan and
100.00%, respectively. The funds have beenused in accordance with the schedule.
100.00%Progress execution.
800,000

411,490 As of Dec. 31, 2020, it is estimated that theused funds are 25,114 thousand yuan, andthe estimated implementation progress is
25,114
6.10%. Due to the coordination of researchand development work, related expenditures
6.10% have also been adjusted accordingly. The
actual expenditure is 18,047 thousand yuan,
4.39% and the implementation progress is 4.39%.

V. Business Overview
I. Business Activities(1) Business Scope
1. Company's primary business activity
Information software
retailer

Electronic material retailer Computer installation

Information software
wholesaler

Electronic material
wholesaler

Information software
service

Information processing
serviceElectronic information
supply service

Arts service

General advertising service Sound publishing

Arts performance activity
Wholesale of cultural
education, musicalinstrument, andeducational entertainment
necessities
Retailer of cultural
education, musicalinstrument, andeducational entertainment
necessities

Automated control
equipment engineering

Machinery installation

Machinery wholesaler

Computer and businessmachinery wholesaler

Electronic retailer

Computer and businessmachinery retailer

Intellectual property

Product design

Machinery retailer

Other machinery retailer

International trade
Landscape and interior
designExcept for approved
business activities, may
engage in activities that are
not prohibited or restrictedby law

2. Company's primary products and their operating
weightU ni t: NT $ 1 ,0 0 0

2019

Product Category
Simulator rides
Royalty income
repair, maintenance, andlabor affairs
Sales revenue, and Profit
sharing of ticket sales
Net revenue

2020
OperatingOperating
Net revenue
Net revenue
weight(%)
weight(%)
1,975,221
94.94
988,901
93.04
1,194
0.06
8,344
0.79
28,3981.36

22,465

2.11

75,6283.64

43,1894.06

2,080,441

100.001,062,899

100.00- 73 -

3. The Company's products
Simulator Rides are the Company’s main product. Since moving to the Kaohsiung
Software Park in 2013, the Company has gradually placed its business focus on the
media-based attraction (MBA) industry, meaning that we combined our previously developed
3D real-time imaging and audiovisual multimedia technologies with the Stewart six-axis
motion platform and dynamic simulation techniques. Subsequently, the Company successfullycompleted the FlyOver Canada project in Vancouver, becoming the leader of the flyingtheater
industry. The Company's operating model has extended from selling hardware to digitalcontent development in recent years.
Since October 2013, we cooperate with Japan's Kodansha in integrating Kodansha's
comic characters into our simulator ride products. In the meantime we not only a flying
theater, the company also produced Attack on Titan and Ghost in the Shell movies for the
Q-Ride platform, that is operational as hexaRide in Tokyo, Japan since 2018. Starting from2015, the Company has changed its management model, from once-off selling of simulator
rides to managing it with its customers. Moreover, the Company is working with customers inplanning and developing relevant peripheral products, thereby expanding the sources ofincome, the hexaRide and the new i-Ride Taipei are the latest developments in this segment.

Picture Source: hexaRide FB

In 2020 Brogent expanded the partnership with Kodansha and produced further content
based on the Attack on Titan IP for VR environments.
Apart from that Brogent has entered a supplier relationship with Legoland parks aroundthe world. The very first m-Ride type flying theater ride opened in March 2019 in Legoland
Florida. Further installations in Legoland Billund in Denmark and Legoland California had
been scheduled for 2020, but have been postponed to spring 2021. The succesfull introductionof m-Ride flying theater opened a new market segment for this popular attraction. It will help
- 74 -

significantly to add to the global installed base of flying theaters.

Picture Source: Legoland Florida Website

2020 also marked the first international delivery of v-Ride 360 to a theme park in
Vietnam, which is another mile stone for Brogent to further diversify its product line and add
to its global footprint of project references.
In addition to providing fun experiences, Brogent’s product development team proceeds
to put more stringent requirements to improve qualityand safety. Our flying theaters have beenformally adopted by the United States UL certification and the TUV SOUTH. An introduction
to our products :Product namei-RideDescription

Images

The i-Ride, featuring a suspended
seat platform, is the only dynamic
flyingtheater on the market built ona six degrees of freedom (6DOF)
motion platform. It not only
delivers super realism and fantastic
entertainment effects, but is also
the most representative device
among all extant indoor gaming
devices.
Riders' feet hang freely, to deliver
the true sensation of flying throughthe air. The sweeping bird’s eye
perspective delivers unobstructed
realism with no blind spots. Wind,- 75 -

Product name

Description

Imagessound, light, water, and aromasheightenthesensationofconquering the air.

m-Ridem-Ride is Brogent’s new compact
flying theater and the first flying
theater system that offers a 180
degree turn of the seats with aspectacular reveal.

1) Unlimited story topics
2) Trackless or track bound andnoiseless design for self-driving
cars
d-Ride3) Flexible plan scenes according
to actual needs onsite4) Combined with interactive gamedesign, with touch, shoot, and hand
gesture control operating methods

1) The 360° massive cylinder
screen delivers heightened realism
and an unobstructed panoramicview with no blind spots
v-Ride 360

2) Passengers can walk safely andfreely, selecting their favorite
perspective3) Suitable for various themes;
with special 4D effects, users canimmerse into the video content- 76 -

Product name

Description

ImagesThe modern version of the classic
4D cinema. The electrical motion
base together with a wide range of
special effects delivers a great
experience.
v-Ride basic

1) High G-Force: Uses large-scale
motion platform that creates effects
that simulate high g-forces
2) 16:9 screen suitable for adiversity of video topics; withspecial 4D effects, a realistic
experience is created
The most advanced immersive
tunnel experience in the market
with a vehicle that can move with
six degrees of freedom.

t-Ride1) Two-sided curved screen
design, increasing visual sense ofrealism and excitement
2) Vehicle can be changed
depending on the theme, such as
traveling on the same car, and withspecial 4D effects, it's as if you're
there in person

The next step in advanced
interactivity: Gesture based 3D
GestureMagicexperience that let’s guests fightvirtual monsters.

- 77 -

Product name

Description

Q-RideBrogent’s product for the compact
indoor market and a breakthroughfor the VR market. The first
product from Brogent that uses VR
glasses instead of a traditional
screen. It comes with preinstalledride content, simulating an
underwater experience and a tour
around the world.

Esports“Lightning
Wings”Taking eSports to the next level,
Lightning Wings is a full-body
motion virtual reality gaming
system, six-degree of freedom
motion base; coupled withspecially-designed VR helmets andpilot consoles. Once the gamestarts, players in their virtual
cockpits heave feel every
maneuver in the combat. All
players commented the experienceis “so real” and “beyond their
imagination”.
Lightning Wings is a multiplayer
battle game that players can enjoy
with friends. Not only that: withlive broadcasting the audience canfeel the intensity of the game andcheer for their teams.

miRideThis product introduced as aconcept IAAPA Expo 2019 has
now officially been launched as
miRide. The first project has beendeliveredA premium entertainment
experience where everyone canbecome a race track pilot.

Images(2) Industry overview
1.

Industry's current trends and future outlook

Since moving to the Kaohsiung Software Park in 2013, the Company has graduallyplaced its business focus on the media-based attraction (MBA) industry. The following section
presents an overview of the new media entertainment industries:
In the early days, theme parks were mainly equipped with mechanical and simple electronic
facilities such as the Ferris wheel, bumper cars, carousels, and roller coasters. However, as- 78 -

new technologies emerged, consumers gradually started to entertain themselves by engaging
in experience-based consumption activities. Thus, these facilitates can no longer attract
consumers, leading to the gradual decline of the once thriving theme parks. In replace of suchtheme parks is the simulator ride equipment that combines digital contents and fantasies
well-known to adolescents. Moreover, simulator ride equipment is not only entertaining but
also educational. This trend of the experience economy is increasing in the Asian market.
In 2017 Disney bought Fox and Marvel and leveraged the IP not only for the media
business but also for it’s theme parks. Brogent in its partnership with Kodansha uses
Intellectual property like “Atack on Titan” and “Ghost in the Shell” to create experiences byleveraging world famous characters and stories that drive not only content but also ride
hardware revenue.
According to the 2019 global tourist attraction report published by the authoritative
Theme Entertainment Association (TEA), the global theme park industry has showed steady
growth in 2018. Particularly, the number of visitors to top 10 theme parks worldwide grew by
5.4% in from 2017. The annual attendace of the top 10 global theme park chains, whichequals 7% of the world population. Brogent is proceeding to use high technology and IP to tap
into this market.
2020 saw the impact of the COVID-19 pandamic in the tourism and leisure industry
worldwide. While leading markets in the theme park industry like China found a way tocontrol the situation quickly and allowed theme parks to reopen, whole regions like the US
and Europe had been forced to close most of their visitor attraction for prevention. Althoughattractions implemented control measures and were able to reopen in most of the regions, they
could only operate with capacity restrictions. This situation has delayed planned expensions
and opening of new projects in theme parks around the world.
However with vaccines becoming available now, the industry is looking to restart again
and pent-up demand of theme park audiences that where forced to stay at home over the lastyear, promise a quick return of guests to parks and a return to growth and reinvestment on theoperator site that comes with it.

- 79 -

2.

Relationship between up-, mid-, and down-stream suppliers in theindustry's supply chain
Upstream industry
Midstream industry
Integrated hardware
Hardware:
1.Precision machineryand software
industry
technologies
2.Spherical screen
3.Projector
Software:
1.Wireless embedded control
system2.Spherical projector andplayback control system
3.High-definition digitalcontent

Downstream industry
Global theme parks
Exhibition
Shopping mall
Tourist attractions
Urban experience
center

The upstream industries associated with the simulator ride equipment comprisethe hardware section, including precision machinery industry and manufacturers of
spherical screens and projectors, and the software section, including wirelessembedded control system, spherical projector and playback control systems, anddigital contents. The Company designs and integrates various software andhardware technologies according to customer needs, and then sells the products todownstream industries such as theme parks, museums, shopping mall, and urban
experience centers.

3.

Product development trends
Previous theme parks: Mainly equipped with mechanical and simple electronic

facilities such as the Ferris wheel, bumper cars, carousels, and roller coasters.
Generally, in bad weather, these theme parks must cease their operation,
substantially impacting business operations. By comparison, multimedia simulator
ride facilities can be installed indoors free from environmental influences; thus, theusage rate of theme park equipment can be enhanced, increasing the economic
benefits of theme parks. Europa-Park in Germany celebrated the opening of Brogent
i-Ride “Voletarium” attraction in June 2017, which welcomed an estimated 8
million riders until end of the 2019 season.
Moreover, simulator ride facilities have become the options for updating themeparks in European and American countries and for planning and constructing themeparks in emerging countries. In recent years, under the influence of mature digital
video technologies and Hollywood films, traditional mechanical amusement
facilities are no longer effective for attracting new-generation tourists. To satisfy- 80 -

tourists' entertainment needs and novelty, new amusement parks have successively
incorporated digital video technologies with electromechanical equipment. Thus,
tourists can not only enjoy the excitement of conventional outdoor facilities, butalso experience indoor facilities with excellent sound and lighting effects without
being influenced by weather conditions. Furthermore, the Company's simulator
rides that stimulate both sensory experiences and thrilling sensations, which are inline with the current trend of experience economy.

4.

Product competition
Media based simulator attractions deliver an immersive experience that fulfills

guests needs of all senses, that’s why they are generally preferred over roller
coasters, free fall towers, swinging ships etc. by the general public. Because thetraditional mechanical rides are comparably simple in their experience quality andoften have physical limits for riders, setup costs are high and the climate is a big
impact factor.
Traditional cinemas on the other side are not exciting enough to catch the full
attention of younger crowds. Media based simulator attractions like the flying
theater are situated in the midle between those offerings: Like in a cinema content
can be switched easily, while still offering the physical excitement of a mechanicalride in a weatherproof environment. This approach makes Brogent products
succesfull and the installed base of attractions worldwide is growing every year.
The market share in the flying theater market is an est. 85% in the premium
segment. Brogent is not simply offering the product, we are providing IP licensing,content production. Operation consultiong and can provide one stop shopping forthis kind of complex attraction, if the clients need help.
With the new “miRide” platform the Company already goes one step further
and enters the game based attraction segment (GBA), the latest product genre in
the location based entertainment industry.

(3) Overview of Technology and R&D
1.

R&D investments in recent years to the date of the annual reportYear

Unit: NT$1,000
2021Q1

2020

R&D expenses

167,313

Note

Note:The year to date March 31. 2021 financial results has not yet been reviewed by a CPA.

- 81 -

2.

Successfully developed technologies and products in recent years
Year

2011

2012

2013

2014

R&D Accomplishments
Novel modularized suspension spherical theater based on a vertical
six-axis actuating platform
Ski simulator
Tablet 3D man-machine interface (Android 3.2)
9s series software downloading tool (Android platform)
Commercial electronic games－The Legend of a Golden City
Novel special drive method
Web-shaped seat design mold
Seat cover design and production
Actuator cantilever turning gate
Suspension two-axis actuator platform stress analysis
Smart TV man-machine interface (Android 2.3)
Tablet 3D man-machine interface (Android 4.0)
9s series software downloading tool (iOS platform)
Smart TV software
Electrical gas six-axis platform design
Suspension two-axis actuator platform design and production
Completely dark ride (d-Ride) design
Balloon Ride design
Media Free Fall Design
Interactive walking theater
Joey's Aquarium (sketch-type aquarium)
Track d-Ride system

2015“Attack on Titan” i-Ride Film

2016

Q-Ridei-FUN HUB

2017

m-Ride2018

Lightning Wings

2019

V-Ride dome 304s

2020

miRide game based attraction(4) Business plan - long-term and short-term
1.Short-term development plan
(1) Marketing and product plan
A.Commit to on-going projects because successful performance is the best
marketing tool for a company. The Company has a full project pipeline and the2021 will see multiple project openings; strengthen digital content
development capacity to satisfy future market demands for videos. 2021 will
see the final season of “Attack on Titan”, an event the Company will use to
introduce further content.
- 82 -

B.Design and plan highly modularized projects, provide affordable modularized
system, and improve competitive advantage.
C. regulate outsourced vendors' production operation so that the products meetinternational standards; and continue to design products conforming tointernational environmental regulations to become a benchmark of green
enterprises. Our flying theater is already EN and ASTM certified.
D.Sales channels are relatively closed; considering the ecological layout of local
markets of various regions, the Company will adopt a cooperative model inwhich it forms a strategic alliance with its agents.
E.Participate in international exhibitions (e.g., IAAPA), keep increasing thevisibility of the company's product, and expand the range of regional buyers.
F. Increased focus on digital sales channels. One of the positive impacts of
COVID-19 is that generally customers are more open to digital communicationand implementation of projects even for B2B projects like Brogent attractions.

(2) R&D plan
A.Apply the ability to integrate six-axis actuator and other motion platform
technology with multimedia technologies, optimize d-Ride, to the NDR VR
motion chair and further expand on game based solutions to expand theCompany's product line, and satisfy customers' diversified needs.
B.Reinforce knowledge management and integrate existing data, so thattechnological resources can be shared to enhance technological capacities.

(3) Human resources and informatization plan
A.Strengthen training to enhance employee skills.
B.Recruit professional managers to improve business performance.
C.Purchase professional collaborative operating software to provide employees
around the world with a joint operating platform.

(4) Financial Plan
A.Use appropriate financial instruments and formulate contract-based sales plan
to avoid risk of currency fluctuations.
B.Strengthen project management and reduce receivables to increase the turnoverrate of receivables.
- 83 -

2.Mid- and Long-term development plan
(1)Marketing and product plan
A.Target the future demand market of Asian regions where economic growth ishigh and then advance toward the global market, thereby becominginternationally recognized primary supplier of simulator rides.
B.Seize business opportunities in replacing, renewing, or adding construction
projects in the future European and US markets and jointly work with strategic
alliance partners in market expansion.

(2)R&D plan
A.Cooperate with domestic research institutes and academic units to acquire
leading technologies.
B.Continue to develop new technologies and acquire patents.

(3)Human resources and informatization plan
A.Strengthen training to enhance employee skills.
B.Recruit professional managers to improve business performance.
C.Purchase professional collaborative operating software to provide employees
around the world with a joint operating platform.

(4)Financial Plan
A.Use various fund-sourcing channels to create optimal financial structures thatmaximize company value.
B.Issue financial instruments in a timely manner for the company to acquire
minimum capital cost.
C.Properly use financial instruments to reduce currency risks.

- 84 -

II.

Market, production and sales(1)Market analysis

1. Product sales region
Year
Sales Region
Domestic
Taiwansales
Asia
Americas
Exports
EuropeOthersSubtotal
Total

2019
Net revenue

Unit: NT$1,000
2020
Net revenue%%

63,4503.05

53,1065.00

1,366,913
356,333
292,253
1,492
2,016,991
2,080,441

65.70
17.13
14.05
0.07
96.95
100.00706,709
195,971
106,743370
1,009,793
1,062,899

66.49
18.44
10.04
0.03
95.00
100.002. Market ShareIn the market for premium flying theater solutions Brogent has a market shareof over 80%. Internationally Disney operates four similar theaters, but doesn’t sell thesolution to interested operators. Canadian supplier Dynamic Attractions offers flying
theaters as well, but is only approaching the market as a mechanical ride supplier.
They are not in the position to act as a system integrator and provide the complete
package that a real media based attraction consists of. Apart from that the platformmovement is limited to two degrees of freedom (compared to 6 DOF for the i-Ride).

3. Future market demand and supply and growth potential
The Company implemented the Content–Channel (CC) Strategy in recent years,transforming from being merely a supplier of amusement facilities to an operator ofentertainment businesses. To achieve this goal, the Company recruited strategic
investors over the past year, while adopting diversified management strategies that
integrate profit distribution models to replace the model where devices are just soldonce. The “i-Ride Experience Center” (now “i-Ride Kaohsiung”) that opened in
Kaohsiung in 2017 was the very first standalone flying theater in Taiwan and in 2019
Brogent opened a second standalone flying theater in Taipei Breeze Nanshan
shopping center, the “i-Ride Taipei”. In addition to outright selling its equipment,
Brogent has not only delivered technology but also creatively planned an experience
center exhibit, in the hopes of educating children through fun, thereby bringing
parents and children closer together. In fact that people cannot visit large theme parks- 85 -

in remote areas whenever they desire, the Company has endeavored to build theexperience center in the city where transport is convenient. The goal isto make funmore accessible.
With the delivery of multiple m-Ride projects, a v-Ride 360 the Company has
succeeded to widen the product portfolio of media based attractions and now offers
multiple offerings for different budgets and scales.
The Company is also present with projects now around the world with multiple
projects in Asia, Europe and the Americas and one installation in Australia.
.

4. Competitive Niches
A. Globally Recognized Technology
In 2021 Brogent will celebrate it’s 20th anniversary incl. a decade of experiencein the location based entertainment industry. This makes the company capable oflaunching new products to customers at the right time and rapidly responding tocustomer demand. After successfully conquering the niche of flying theater
attractions as one of the market leaders, the Company is now entering a relatively
young market of out-of-home game based attractions. The miRide racing simulator isonly the first step on this journey.
2020 has seen another mile stone in Brogent’s award history. The company has
been awarded the prestigious Thea Award, which is widely known as the Oscar of thethemed attractions industry.

- 86 -

2017 European Star Award for Best New Ride2018 Park World Award for Best Indoor Ride2019 European Star Award Best Dark Ride2019 Best Flying Theater Supplier in China
2020 26th Annual Thea Awards

B. Premium Brand Equity
Theme Parks, Museums, Exhibitions Centers and Zoos are markets with highentry barriers. Brogent works with established partners in the amusement industry
to create multiple distribution channels. All those partners rely on the technologicalknow how in system integration and certified technology that Brogent is steadily
advancing based on ongoing projects. Currently Brogent rides can be found fourcontinents.

Worldwide 40 media-based attractions in operation or under installation- 87 -

C. Product modularization lowers cost and increases competitiveness
Simulator ride facilities involve a wide range of technical aspects, covering
hardware systems (motion platform,

screens with audiovisual systems) andsoftware technologies (projector, playback, wireless embedded control, andhigh-definition digital content). Therefore, the technical teams of the Company
performed high modularization engineering analysis and planning of large complex
system frameworks based on the existing platform technologies. In addition, ourdesign, production, transportation, and assembly processes are all designed andmodularized in accordance with international standard regulations. Suchmodularization enables saving large amount of construction time and manpower,
which considerably lowers construction cost and raises the Company's
competitiveness.
D. Collaboration with international strategic partners in digital content
development
Brogent is working with several partners to supply the best solutions andtechnology in the media based simulator attractions field. For content development
the company started a cooperation with Japanese publisher Kodansha back in 2015and has already developed ride films based on Kodansha IP like “Attack on Titan”
and “Ghost in the Shell”

5. Competitive Edge, Favorable and Adverse Factors forLong-term Growth and Response Strategy(1) Favorable factors
A. Needs of emerging countries and reconstruction business opportunities in
Europe and the US
As the economy of emerging countries develop and the middle class grows,
these countries have gradually focused on the construction and development ofleisure entertainment industries, specifically large theme parks, the existence of
which can not only create domestic demand and employment opportunities, but also
promote urban tourism development. Low income level in emerging countries
render the entrance fees to theme parks in these countries incomparable to those indeveloped countries (e.g., European countries, North America, and Japan). To
effectively increase the economic benefits of amusement parks, governments ofemerging countries strictly regulated the benefits generated by amusement facilities.
In addition, because indoor amusement facilities allow customers to still enjoy- 88 -

themselves during bad weather, and because of the rapid development of digitalaudiovisual technologies in recent years, traditional mechanical amusement
facilities are less and less effective for attracting the attention of new-generation
tourists, who are now growing up with internet and social media. Therefore, whenplanning and constructing theme parks, emerging countries typically prioritize
indoor amusement facilities that feature 3D sound and lighting effects and stimulatea sense of excitement in users. To reconstruct their tourism industries and boost
their economy, European countries and the US have successively initiated tourist
attraction reform projects, building leisure facilities by restricting existing buildings
and movie theaters. These leisure facilities are based on a composite business modelcomprising department stores and hotels to attract visitors. Because simulator rides
are built according to the height restrictions of existing buildings to provide
consumers with an all-new entertainment experience, this type of facility became
the primary focus of Europe and the US in reconstructing amusement facilities.
B. Construction and formation of industry supply chain
Before the Company entered the simulator ride market, there were no vendors
investing in similar products in Taiwan. Since undertaking the “Taiwan Formosa”
project for E-DA Theme Park, the Company has adequately leveraged Taiwan'
strong R&D and production capabilities of information hardware and precision
machinery industries. With the efforts devoted by the Company's R&D personnel
and domestic vendors, Taiwan has become one of the few countries worldwide
capable of constructing simulator ride bases. Not only were the production costs ofamusement facilities lowered, but the quality of these facilities reached international
standard. Subsequently, a complete and tight supply chain in the simulator rideindustry was established. Because simulator rides are completely customized
according to customer needs, the Company's supply chain system enable the design,
motion control, or digital content of such rides to be adjusted whenever required
depending on customer needs. Thus, customer demand can be satisfied, thereby
increasing the overall competitiveness of the Company.
C. Establishing word of mouth facilitates business promotion
Distinct from general consumer electronic products, simulator rides featurelong life cycle, high degree of customization, high technical threshold, and highcost; therefore, customer repurchase and loyalty increased after establishing theword of mouth for the technology and quality of this product. Since completing“Taiwan Formosa” and “FlyOver Canada” projects, the Company has accumulated- 89 -

considerable experience, word of mouth brand equity, and popularity in thesimulator ride market. Project openings like additional “FlyOver” projects in the US
and Europe, a signature attraction at Germany’s Europa-Park and delivery ofm-Ride flying theaters to Legoland parks aground the world created additional
brand awareness. In addition, by forming strategic alliance with internationallywell-known amusement facility suppliers, Borgent has further raised its competitive
advantage over the last decade.
D. Supported by strong technology
Since its inception in 2001, Brogent has endeavored to develop audiovisual
multimedia technologies, accumulating considerable experiences in technologicaldevelopment. Thus, Brogent has establishedpartnerships with multiple

international mobile phone factories, and received Small Business Innovation
Research (SBIR) subsidies from the Ministry of Economic Affairs (MOEA)
multiple times. In 2007, Brogent was honored with the award of excellence in SBIR
from the Department of Industrial Technology, MOEA. Regarding simulator ridefacilities, Brogent has received the European Star Award three years in a row
starting 2017 a recognition not only for its technological capability but also for theexperience value that it prove to provide since the successful implementation of the“Beautiful Formosa” and “FlyOver Canada “projects. Just recently Brogent
received it’s first Thea Award from the Themed Entertainment Association, one of
the most prestigious awards in the location based entertainment industry. For
example, the unique fish eye lens designed by Brogentcan achieve the projection
effects of a spherical screen simply by installing them with a single projector. Thus,
the cost and space required for projector installation are substantially reduced, andthe stability and image quality of the projector system are considerably enhanced. A
unique selling proposition that brings operating cost advantages until today.
Brogent's self-developed automated control technology can integrate motion
platforms with video systems with increased precision. This way, riders canperceive the experience of an immersive flight. Furthermore, Brogent also
possesses the capacity to develop digital content, and customize it according tocustomer needs, thereby providing multiple choices to our customers. Therefore,
Brogentenhances the technological capacity of its research team, and therefore has
substantial room for improvement.
(2) Unfavorable factors and their response strategies
A. Closed sales channel for simulator rides, impeding business expansion- 90 -

Simulator rides are installed at location based entertainment venues like themeparks, museums, or zoos. Unlike general daily necessities, the sales channel ofsimulator rides is relatively closed, and suppliers specializing in this market are
mostly business operators who have established their status for a long time. Thus,
new vendors cannot easily directly enter this supply chain system and expand theirbusinesses.
Response strategies:
The Company fully understands the characteristics of this industry. To expand
its market and increase its market share

The Company has run a dual strategy: On

the one hand, the Company formed a strategic alliances with internationally known
suppliers of amusement facilities who have had a history of more than 60 years in
the industry. These suppliers assist the Company in expanding its market channel tosuccessfully enter the supply chain of the theme park industry and facilitate its
expansion into the global market. As a consequence Brogent has already entered theinternational theme park market (i.e. Europa-Park in Germany and Legoland
Florida in the US). On the other hand, the Company has established it’s own sales
team over the last decade that is building on the brand awareness. Products are wellreceived by the general public and the positive feedback creates good references
and a strong brand reputation.
B. Shortage of professional talent, hindering talent recruitment
Because information electronic related industries remain the dominant of thedomestic market, and domestic vendors have already established a complete supply
chain in the information hardware industry, general graduates still prefer to enter
industries relevant to information electronics. Furthermore, domestic universities
and colleges have established faculty departments associated with software design
or amusement facilities in recent years. However, talent still require additional
training, and simulator ride technologies encompass a wide variety of aspects, thus
making R&D talent recruitment and cultivation difficult.
Response measures:
Engage in industry-academia cooperation with National Chiao Tung University,
National Pinngtung University of Science and Technology, Sun Yat Sen University
and Southern Taiwan University of Science and Technology to cultivate
high-quality experts of digital content development and foster technological talentthat industries require; provide employees with favorable working environment,- 91 -

perfect employee welfare systems, and formulate reward/punishment systems aswell as employee training programs; and establish job positions according toemployees’ expertise and characteristics and provide employees with theopportunity to become a shareholder of the Company so that they could sharebusiness outcomes with the Company, thereby cohering their efforts and reducing
turnover rate.
C. Raw material price and supply stability
The hardware system of the Company's simulator rides comprises thefollowing: The raw materials of carriers, six-axis platform, and steel structures aremostly steel and iron. The prices of these raw materials may vary according tomarket supply and demand, causing price fluctuations, thereby influencing theCompany's purchasing cost and profitability.
Response strategies:
In addition to having maintained a positive and long-term cooperative
relationship with its suppliers, the Company appropriately adjusts its sources ofprocurement and disperses different purchasing vendors to seek the most optimal
price quotation. Thus, over-concentration in purchasing, thereby increasing
operating risks can be avoided.

- 92 -

(2) Major product usage and manufacturing processes
1. Main purposes
Theme park, museum, exhibition hall, shopping center, and indoor professional
experience center afford entertainment and educational training functions todiversify Brogent’s client base, provide adventurous experiences, and elicit senseof excitement.

2.

Manufacturing process
A. Small-sized Rides :Independent new product development and improvement plan

Client demand

Conduct market research, newproduct creative collection,competitors' product analysis,
technical patents and otherfeasibility studies, and produce
new product plans

Proposal and Project Approved

Integration

Motionplatform
systemInteractive
SystemIntegration

Ergonomic
Ride-cabin
DesignExperience
Journey
DesignConducted integration, troubleshooting, testing, and modification

Operation,Market Trial Tests,and Production- 93 -

Digital Content
Production andIntegration

B. Simulator rides:

Customer demand(simulator rides)

Convened productproject meeting andapproved forexecution

Hardwaretechnologies

Motionplatform
systemSoftwaretechnologies

Verticalspherical
screen system

Spherical projector
andplayback control
systemWireless
embedded control
systemConducted integration, troubleshooting, testing, and modification of pilot
machines

Machine operation test and product delivery- 94 -

High-definition
digital content

3. State of supply of chief raw materials
Primary spare parts

Supply condition

1.Stewart six-axis platform

Good, stable

2.Structure of ride carriers

Good, stable

3.Spherical screen

Good, stable

4.Servo valve, motor

Good, stable

5.Projector

Good, stable

6.Acoustic equipment

Good, stable

7.Digital content contractor

Good, stable

The hardware and software systems of the simulator rides are designed anddeveloped by the Company. Regarding the mechanical hardware parts, the Company
cooperates with its vendor and commissions contractors for assistance. The Company
and its suppliers have a stable cooperative relationship, facilitating the stable material
supply. Therefore, there were no incidences of supply interruption.
4. Major buying and selling vendors/customer information(1) Names of customers who accounted for more than 10% of the sales in the last two
years, sales as a percentage of total sales, and reasons of change.
Unit: NT$ 1,000
2019
Item

Name

Amount1
2
3
4

CHN0016
CHN0014
CHN0005-

511,067
247,752
237,608
1,084,014
2,080,441

OthersTotal

2020

Percentage
Relationshipof net sales
with issuer
(%)
24.57
11.91
11.42
52.10
100.00

None.
None.
None.
None.

Percentage
Relationshipof net sales
with issuer
(%)

Name

Amount

CHN0016
CHN0014
CHN0005
GBR

361,036
77,122
2,884
109,677
512,180

33.97
7.26
0.27
10.32
48.19

1,062,899

100.00

Others
Total

None.
None.
None.
None.

Note:The year to date March 31. 2021 financial results has not yet been reviewed by CPA.

Reasons for changes:
The Company's chief products are simulator rides. Customers who accounted
for more than 10% of the sales in 2020 are same buyers of the Company’s 2019
customer orders. The major projects were under construction and the revenues
were received according to the percentage of completiony.
To increase its market share in the global market, the Company continues towork with international vendors and Taiwanese vendors, actively vie for their- 95 -

cooperation, and devoted to seeking new client base to disperse sources ofcustomer order and maintain robust growth.

(2) Names vendors who accounted for more than 10% of the purchases in the last
two years, purchases as a percentage of total purchase, and reasons of change
Unit: NT$ 1,000
2020

2019

Item

Name

1
2
3

A0000008
OthersTotal

AmountPercentage
of total
Relationshippurchasewith issuer(%)

70,233392,998
463,231

15.16
84.84
100.00

None.

Name

A0000008- A0000072- A0000012- Others
Total

Amount190,165
63,721
61,726217,025532,637

Percentage
of total
Relationshippurchasewith issuer
(%)
35.70
11.96
11.59
40.75
100.00None.
None None -Note:The year to date March 31. 2021 financial results has not yet been reviewed by CPA.

Reasons for changes:
To develop simulator rides, the Company adequately uses the technicalstrength, flexibility, and willingness of small and medium enterprises to cooperate.
In addition, the Company plans, designs, and collects the various technical andproduction information of international companies, commissioning contractors to
manufacture our products. Furthermore, the Company cooperates with small andmedium enterprises to construct the supply chain system of simulator ride facilities.
The Company primarily procures six-axis platform, ride carriers, spherical screens,
servo valve, and projector and acoustic equipment. Except for when customers
designate their preferred suppliers, the Company's suppliers are selected according
to their quality, stability, delivery date, and price.
Overall, the changes in the primary suppliers of the Company in the past two
years were based on the project scale and job completion progression. There wereno major abnormalities.

5. Output volume and value during the most recent two years
The Company's primary business involved the R&D and sales of simulator rides.
Since 2008 when the Company started the development and selling of simulator ridefacilities, these facilities, including their hardware and software systems andautomated control system, were designed and developed by the Company. The- 96 --

mechanical body engineering part was commissioned to external contractors, and theCompany purchases the final product from the supplier and therefore is not a
manufacturing industry. Thus, the Company is not associated with output volume andvalue.

6. Sales volume and value during most recent two years
Unit: NT$1,000
2019
Primary products

Domestic sales
Quantity

2020
Exports

Value

Quantity

Simulator rides--

Others (Note)

-

Total

-

Value

Domestic sales
Quantity

Exports

Value

QuantityValue- 1,975,221

-

-

-

988,901

63,450-41,770-53,106-

20,89263,450- 2,016,991-

53,106- 1,009,793

Note: Others refer to repair and maintenance and income generated sales (gaming machines) andlabor affairs.

Reasons for changes:
The primary products simulator ride, the amount and ratio of exports arecomparable to those of 2019, and there have been no major changes. All of them aremainly for export, and there have been no major changes.

- 97 -

III. Employee Information in the Past 2 Years to the Date of theAnnual Report
End of 2019

End of 2020

Up toMarch 31, 2021

Managerial officer

23

28

32

R&D personnel

77

72

110

General employee

73

96

127

Total

173

196

269

Average age

38.4

38.7

37.8

Average years of service (year)

4.25

5.34

4.87

Ph.D

1.7

1.0

1.1

Master's

55.5

49.0

45.7

University

38.2

41.8

45.4

College

4.0

6.1

3.7

Senior high school

0.6

2.1

4.1

Year

Number of
employees

Education
distribution (%)

IV. Environmental protection expenditure information(1) The Company primarily engages digital content development and selling of simulator
rides, the production of which is entirely outsourced to external contractors.
Therefore, the Company is not associated with pollution concerns.
1. According to laws and regulations if it is required to apply for a permit for installing
anti-pollution facilities, or permit of pollution drainage, or to pay anti-pollution fees,or to organize and set up an exclusively responsible unit/office for environmental
issues, the description of the status of such applications, payment or establishment
shall be made: Not applicable.
2. Setting forth the company's investment in the major anti-pollution facilities, the use
purpose of such facilities and the possible effects to be produced: None.
3. Describe the process undertaken by the company on environmental pollution
improvement for the most recent 2 fiscal years and up to the publishing date of theannual report. If there had been any pollution dispute, its handling process shall also
be described: None.

- 98 -

4. Describe the loss (including damage compensations paid) suffered by the company
due to environmental pollution incidents occurred in the most recent 2 fiscal years
and up to the annual report publishing date, the total penalty/fine amount, as well as
disclosing its future preventive policies (including improvement measures) andpossible expenses to be incurred (including possible loss if no preventive measures
are taken, and the penalties and estimated damage compensation amount; if
reasonable estimation cannot be made, explanation on the facts why it cannot bemade shall be stated): None.
5. Explain the current condition of pollution and the impact of its improvement to the
profits, competitive position and capital expenditures of the company, as well as the
projected major environment-related capital expenses to be made for the coming 2
fiscal years: None.
(2) The 2nd stage of R&D and experience center was completed in 2016 and awared thegreen building certificate issued by Ministry of the Interior (Certification No.
GB-BC-01-00164 on 105.12.16) The related green power arrangement is explained
as followings:

1.Installation of solar power-Using the roof space to install solar electric
power generation can output electricity without any pollution, noise anddanger ; Besides, the solar panels are able to beautify the roof, resist theirradiatioh of sun, and reduce indoor temperature in summer for energy
saving and carbon reduction
2.

Installation of central air-conditioning control system-The
air-conditioning is operated by the central air-conditioning control system.
It can monitor the situation of all air-conditionings for avoiding
unnecessary waste

3. Installation of all heat exchangers-All heat exchangers, as a part of thecentral air-conditioning control system, it achieves increasing the air
convection, improving indoor air quality(reduce CO2 concentration),decreasing the electricity fee and energy loss made by air exchange
4. Build up rain storage and recycle irrigation systems-We recycle rain andstore it after filtering, in order to irrigate the plants. In this way, we can- 99 -

reuse the resource and cut down the waste of water resource
5.Use LED lightening system-All of office area and the test area of factorybuilding are equipped with LED lighting. Additionally, we have theswitch schedule to every illumination area for energy saving and carbon
reduction
6.Set up indoor air quality supervisory system-We regularly supervise theindoor pollutants, and ensure air quality with the current National andInternational Standards.
(3) Brogent is a general office building instead of the manufacturing industry in Kaohsiung
Software Technology Park. We collaborated with government policy in promoting theenergy saving measures in 2020. We were awarded a certificate of appreciation.
(4) We make effort to develop every energy saving measures aggressively. We takemeasures to use the office supplies with energy saving mark, increase the usage rate bymanaging the classification of waste, and strengthen indoor greening to improve air
quality(5) Brogent technologies INC. belongs to cultural and creative industry and our producs aremostly made by subcontractors. We enact the safe policy and irregularly execute thetraining of labor safety. Our secuity system and environment maintenance are both
responsible by the professional subcontractors. All of the fire equipments are regurly
maintained and declared by the related departments; In addition, the access control isrestricted by the identification card. For safety, everyone has to swipe the identification
card to get in each entrance.

- 100 -

V. Labor Relations
1. Set forth all employee benefits, continuing education, training, retirement systems, andthe status of their implementation, as well as the status of agreements between laborand management, and all measures aimed at preserving the rights and interests of
employees:(1) Employee welfare measures and implementation status
The Company offers the following welfare to its employees: labor and healthinsurance, employee group insurance, business travel accident insurance, employee
health examination, holiday bonus, year-end bonus, and allowances for marriage, funeral,
sick leave, bereavement, maternal leave subsidies and maternity as well as year-end
party.
In addition, the Company has also set up an Employee Welfare Committee that
handles employees' various welfare affairs, including annual employee travel benefit,
three-festival bonuses (Dragon Boat Festival, Moon Festival, and Chinese New Year),birthday bonus, seasonal gatherings, family days, Sports day, Christmas Party, club
activities and emergency relief.
(2) Employee training & development, and status of their implementation
To enhance employee quality and their work efficiency and quality, theCompany requires all its new recruits to receive orientation training to create asmoother transition into this company and their new position. During their period of
employment, the Company integrates online / internal / external resources anddesigns diversified development programs based on business objectives and thenature of the individual’s job, Online Courses offer flexibility; Internal training
courses entail exchanging internal professional technologies and improving employee
productivity; external courses depend on company requirements. Employees may bedispatched to attend external seminars and courses. Thus, the Company's employees
are provided with opportunities to receive professional training. Actual training
attendance is registered and managed with the hope of fostering professional talentand effectively nurture and utilize talent.
(3) Employee recognitionandstatus of implementation
The Company sponsors various internal award programs to recognize bothindividual and at a team level. Such as “Bo Le” team competition is designed forencouraging those teams who demonstrate the value of teamwork; “idea proposal”- 101 -

award is consistant with the Company’s value “Creativeness: To innovate byboundless thinking, create brand new immersive and emotive experiences”; Excellent
Instructor Award: praises the outstanding performance and contribution of internal
instructors in training courses for employees.; Service Award: recognition andappreciation of senior employees and their long-term commitment and dedication.
Apart from corporate-wide awards, employees continued to be recognized as
the Model Labor Award since 2019.
(4) Employee pension system and status of implementation
The Company regulates employee pension system according to the Labor
Standard Act and Labor Pension Act, formulates Employee Retirement Regulation,and establishes labor pension account with the Central Trust of China to which alabor pension reserve equivalent to 2%~15% of employees' monthly salary iscontributed. As of July 1, 2005, when the new labor pension system was
implemented by the government, the Company asks its employees whether they wish
to adopt the new or old labor pension systems. Employees who prefer the new
pension system shall have 6% of their monthly salary contributed to their personal
pension account and shall retain their seniority status as required by the Labor
Standard Act, to ensure their living needs after they retire. Regular communication.
No employees have retired since the Company's establishment.
(5) Labor negotiations
The Company is subject to the Labor Standard Act, operating its business inaccordance with the Labor Standard Act. Generally, the Company emphasizes theimportance of employee welfares and communication with its employees; therefore,
it has maintained a harmonious relation with its employees. In addition, to maintainpositive labor relation, the Company attaches increased importance on employee
opinions, which can be communicated by the employeesvia email or anyothercommunication channel. Since its establishment, the Company has not been involvedin labor disputes. Moreover, the Company will still set up multiple communication
channels for its employees so that a more harmonious labor relationship can besustained and creates a win-win situation for the Company and employees.
(6) Measures for protecting employee rights and interests
The Company has a complete document management system that specifies
various management regulations, employee rights and obligations and their welfares,
to protect employee rights and interests.
- 102 -

(7) Preventive measures taken to ensure a safe working environment and maintainemployees' personal safety:
The Company hires designated personnel to plant flowers and trees invacant spaces surrounding the Company. By applying the practice of landscapegreening, the Company creates a comfortable, safe working environment and plans
an effective parking space. The Company constructs a safe, healthy working
environment and regularly provides employee health examination to maintainemployee physical and mental health. In addition, a Labor Safety and HealthCommittee is established to engage in promotion efforts for environmental protection
and labor safety and health. The Company also offers employee safety and healthtraining programs to help employees enhance their health and safety related
knowledge and skills.
2. Describe the loss suffered by the company due to labor disputes occurring in the mostrecent 2 fiscal years and up to the annual report publishing date, and disclose theestimated amount expected to be incurred for the present and future as well as thepreventive measures:
The Company maintains a harmonious relationship with its employees. There
were no losses incurred from incidences of labor disputes during the most recent 2
years up to the publishing date of the annual report. The Company upholds theprinciple of maintaining a reciprocal relationship and sharing profits with its
employees. There is minimum likelihood of losses due to labor disputes occurring in
the future.

- 103 -

VI. Important contracts
Nature ofcontract

Sales

Date of contract start and end

Content

Restriction
clauses

CanadaCAN0004

2020.01.16~May terminate thecontract according to agreement

Simulator rides (i-Ride)

None

United Kingdom
GBR00022020.02.27~May terminate thecontract according to agreement

Simulator rides (m-Ride)

None

TurkeyTUR00012020.04.09~May terminate thecontract according to agreement

Simulator rides (i-Ride)

None

Vietnam
VNM00012020.09.18~May terminate thecontract according to agreement

Simulator rides (mi-Ride)

None

United States
USA00112020.12.18~May terminate thecontract according to agreement

Simulator rides (i-Ride)

None

Simulator rides (i-Ride)

None

Renting of Kaohsiung
Software Park Land

None

Long-term collateral-basedloan application

None

Contracting parties

Equipment
Brogent Global Inc. 2019.01.10~2029.01.09
RentalLand
RentalLoan

Export Processing
Zone Administration, 2012.3.14 - 2032.3.13
MOEA
Taiwan Cooperative
2016.04.11 - 2031.10.13
Bank- 104 -

VI. Financial Overview
1. Condensed balance sheets and statement of income (2016 - 2020)(1) Condensed balance sheets
1. Condensed balance sheets- International Financial ReportingStandards (IFRS)- Consolidated
Unit: NT$ 1,000Year

Financial information: FY2016 - FY2020

Item

As of
March 31,
2021
2020
(Note 3)
3,172,477

2016

2017

2018

2019

2,238,894

2,203,637

2,673,862

3,056,839

804,714

951,441

1,066,459

1,045,007957,475-

149,155

120,157

166,597

232,299

183,694-

Other assets

98,081

199,667

308,893

814,435

799,366-

Total Assets

3,290,844

3,474,902

4,215,811

5,148,580

5,113,012-

307,270

313,143532,823

943,231640,872-

Distribution

417,880490,119

745,194

1,255,416 (Note 2)-

Non-current liabilities

336,388356,039

783,516

1,164,219

1,823,113-

BeforeDistribution

643,658

669,182

1,316,339

2,107,450

2,463,985-

Distribution

754,268

846,158

1,528,710

2,419,635 (Note 2)-

Equity attributable toowners of parent

2,594,050

2,746,998

2,836,176

2,967,957

2,646,269-

BeforeDistribution

446,780446,780

530,928

557,474

557,474-

Distribution

446,780535,268

557,474

557,474 (Note 2)

BeforeDistribution

2,052,669

2,053,485

2,027,723

1,968,156

Distribution

2,052,669

2,053,485

1,968,259

1,968,156 (Note 2)

BeforeDistribution

211,682

366,258

270,513457,184

93,306-

101,072

100,794

91,060144,999 (Note 2)-(1,605)(4,049)(115,476)(14,857)-(26,464)--(115,476)

7,012-

53,13658,722

63,29673,173

2,758-

2,647,186

2,805,720

2,899,472

3,041,130

2,649,027-

2,536,576

2,628,744

2,687,101

2,728,945 (Note 2)-

Current assets
Property, plant
equipment
Intangible assets

andBeforeCurrent
liabilities

Distribution
After

Total liabilities After

Capital Stock
CapitalSurplusRetainedearnings

After

After

After
Distribution

Other equity
Treasury shares
Non-controllinginterests
BeforeDistribution

Total Equity

After
Distribution

2,021,953

Note 1: Financial information from 2016 to 2020 was audited by CPA.
Note 2: The 2020 Deficit Compensation plan has not been resolved in the shareholders' meeting.
Note 3: The year to date March 31. 2021 financial results has not yet been reviewed by CPA.

- 105 ---

2. Condensed balance sheets- International Financial Reporting Standards(IFRS)- Individual
Unit: NT$ 1,000

Financial information: FY2016 - FY2020

Year

As of
March 31,
2021
2020
(Note 3)2,454,972

Item

2016

2017

2018

2019

Current assets
Property, plant
equipment
Intangible assets

1,939,408

1,881,423

1,888,931

2,832,402

617,103704,900

852,130

831,525

906,849-

146,666

117,987

102,946

85,30355,551-

437,806

543,585

1,008,906

755,674

1,089,089-

3,140,983

3,247,895

3,852,913

4,504,904

4,506,461-

322,545289,921356,515

747,403337,621-

Distribution

433,155

466,897568,886

1,059,588 (Note 2)-

Non-current liabilities

224,388

210,976

660,222789,544

1,522,571-

BeforeDistribution

546,933

500,897

1,016,737

1,536,947

1,860,192-

Distribution

657,543

677,873

1,229,108

1,849,132 (Note 2)-

Equity attributable toowners of parent

2,594,050

2,746,998

2,836,176

2,967,957

2,646,269-

BeforeDistribution

446,780446,780

530,928

557,474

557,474-

Distribution

446,780535,268

557,474

557,474 (Note 2)-

BeforeDistribution

2,052,669

2,053,485

2,027,723

1,968,156

2,021,953-

Distribution

2,052,669

2,053,485

1,968,259

1,968,156(Note 2)-

BeforeDistribution

211,682

366,258

270,513457,184

93,306-

101,072

100,794

91,060144,999 (Note 2)-

Other equity(1,605)(4,049)7,012(14,857)(26,464)-

Treasury shares
Non-controllinginterests(115,476)(115,476)

-

-

-

-

-

-

-

-

-

-

2,594,050

2,746,998

2,836,176

2,967,957

2,646,269-

2,483,440

2,570,022

2,623,805

2,655,772(Note 2)-andOther assets
Total Assets
BeforeCurrent
liabilities

Distribution
After

Total liabilities After

Capital Stock

After

CapitalSurplusRetainedearnings

After

After
Distribution

BeforeDistribution

Total Equity

After
Distribution

Note 1: Financial information from 2016 to 2020 was audited by CPA.
Note 2: The 2020 Deficit Compensation plan has not been resolved in the shareholders' meeting.
Note 3: The year to date March 31. 2021 financial results has not yet been reviewed by CPA.

- 106 -

(2) Condensed statements of income
1. Condensed statements of income- International Financial ReportingStandards (IFRS)-Consolidated (Note 1)
Unit: NT$ 1,000Year

Financial information: FY2016 - FY2020

As ofMarch 31,2021
(Note 2)

Item

2016

2017

2018

2019

2020

Sales revenue

881,670

1,514,469

1,637,438

2,080,441

1,062,899-

Gross profit
Operating income(loss)
Non-operating
income and expense
Net income (loss)
before tax
Continuing
operations
Net income
Profit and loss of
discontinuing
operations
Net income (loss)
Other comprehensive
income(net of income Tax)
Total comprehensive
incomeNet income belongs to
the parent company
Net income belongs to
non-controllinginterests
Total comprehensive
income belongs to theparent company
Total comprehensive
income belongs to thenon-controllinginterests
Earnings per share

444,937

725,335

721,242

1,002,360

502,416-

108,508

340,734

289,512420,809(22,524)-

21,076(13,171)

31,61551,092(19,314)-

129,584

327,563

321,127

471,901(41,838)-

106,112271,181258,418

383,810(51,758)

-

-

-

-

-

106,112271,181258,418

383,810(51,758)-(1,810)(2,928)

10,899(22,242)(11,734)-

104,302268,253

269,317361,568(63,492)-

101,354

265,670

257,168

366,525(49,184)

-

4,758

5,511

1,250

17,285(2,574)-99,544

262,742

268,032

344,255(61,512)

-

4,758

5,511

1,285

17,313(1,980)

-

2.30

6.00

4.84

6.57

(0.88)-

Note 1: Financial information from 2016 to 2020 was audited by CPA.
Note 2: The year to date March 31. 2021 financial results has not yet been reviewed by CPA.

- 107 ---

2. Condensed statements of income- International Financial ReportingStandards (IFRS)-Individual
Unit: NT$ 1,000

Year
Item

Financial information: FY2016 - FY2020

As ofMarch 31,2021
(Note 2)

2016

2017

2018

2019

2020

Sales revenue

865,220

1,202,199

1,325,599

1,550,841

823,838-

Gross profit
Operating income(loss)
Non-operating
income and expense
Net income (loss)
before tax
Continuing
operations
Net income
Profit and loss of
discontinuing
operations
Net income (loss)
Other comprehensive
income(net of income Tax)
Total comprehensive
incomeNet income belongs to
the parent company
Net income belongs to
non-controllinginterests
Total comprehensive
income belongs to theparent company
Total comprehensive
income belongs to thenon-controllinginterests
Earnings per share

390,441

540,111551,358

757,606

395,523-

110,972

219,061

214,768

323,710(15,348)-

10,463

81,036

86,841

103,576(38,498)-

121,435

300,097

301,609427,286(53,846)-

101,354

265,670

257,168

366,525(49,184)

-

-

-

-

-

101,354

265,670

257,168

366,525(49,184)-(1,810)(2,928)

10,864(22,270)(12,328)-

99,544

262,742

268,032

344,255(61,512)-101,354

265,670

257,168

366,525(49,184)

-

-

-

-

-

99,544

262,742

268,032

344,255

-

-

-

-

-

2.30

6.00

4.84

-

-

6.57

Note 1: Financial information from 2016 to 2020 was audited by CPA.
Note 2: The year to date March 31. 2021 financial results has not yet been reviewed by CPA- 108 -

(61,512)

-

-

-

-

(0.88)-

3. The 2016 - 2020 Names of auditors and audit opinions
Year
2016

2017

2018

Name of accounting firm

CPA

Audit opinion

Grant Thornton Taiwan

Yi-Shun Chang,
Yu-Chieh Lo

Unqualified opinion

Grant Thornton Taiwan

Yu-Chieh Lo
HuiPing Liu

Unqualified Opionoin(Emphasis of Matter orOther Matters)

Grant Thornton Taiwan

Yu-Chieh Lo
HuiPing Liu

2019

Grant Thornton Taiwan

Yao-Ting Li
Yi-Shun Chang

2020

Deloitte & Touche Certified
Public Accountants

Chiu-Yen Wu
Lee-Yuan Kuo- 109 -

Unqualified Opionoin(Emphasis of Matter orOther Matters)
Unqualified Opionoin(Emphasis of Matter orOther Matters)
Unqualified Opionoin(Emphasis of Matter orOther Matters)

2. Financial Analysis(1) Financial analysis (2016 - 2020)
1. Financial Analysis- International Financial Reporting Standards(IFRSs)-Consolidated (Note 1)
Financial analysis (2016 - 2020)

Year
2016

Item

2017

2018

2019

2019

As of
March
31, 2021(Note 2)

Debt-to-assets ratio

19.56

19.26

31.22

40.93

48.19

-

Long-term fund to property, plant andequipment (fixed assets) ratio

370.76332.31345.35402.42467.08-Current ratio

728.64703.72501.83324.08495.03-

Solvency
Quick ratio(%)

628.81592.36433.81275.27439.02-

2,615.71

5,351.09

3,097.55 2,088.88(43.27)-2.81
129.89

5.37
67.97

5.93
61.55

6.53
55.90

3.96
92.17

-

-

-

-

-

-

-

Financial
structure(%)

Times interest earned
Receivables turnover ratio (times)
Average days of collection
Inventory turnover ratio (times)(Note 2)
Operating
Payables turnover ratio (times)
ability
Average days of sales
Property, plant and equipment (fixed
assets) turnover ratio (times)
Total assets turnover ratio (times)

3.66
-

7.33
-

10.66
-

9.81
-

5.35

-

-

1.29

1.72

1.62

1.97

1.06

-

0.27
3.43
4.02

0.45
8.17
9.95

0.43
6.94
9.21

0.44
8.60
12.63

0.21
(0.55)(1.75)

-

29.00

73.32

60.48

84.65

(7.50)-Cash flow ratio (%)

12.04
2.3
(47.92)

17.91
6.00
55.05

15.78
4.84
9.50

18.45
6.57
31.12

(4.87)(0.88)(0.19)-Cash flows Cash flow adequacy ratio (%)(24.2)(8.46)(10.12)

3.89

23.17

-

Cash reinvestment ratio (%)(9.06)

2.00(3.65)

2.34(8.20)

-

1.75

1.29

1.42

1.40

(5.76)-

Return on assets (%)
Return on equity (%)
Paid-in capital to income before tax
Profitability(%) (Note 8)
Net profit margin (%)
Earnings per share (NT$)

Operating leverage
Leverage

1.05
1.02
1.04
1.06
0.44
Reasons for changes in financial ratios in the most recent 2 years. (Can be left blank of the increase or
decrease is less than 20%)
Financial leverage

1. Solvency : Mainly issue CB to repay short-term loans.
2. Operating ability: Mainly due to the impact of covid-19, the income decreased.
3. Profitability : Mainly due to the impact of covid-19, the income decreased.
4. Cash flows: The previous period is negative, so it will not be analyzed.
5. Leverage: Mainly due to the impact of covid-19, the decrease in revenue and the occurrence of net operating loss.
Note 1: Financial information from 2016 to 2020 was audited by CPA.
Note 2: The year to date March 31. 2021 financial results has not yet been reviewed by CPA- 110 -

2. Financial Analysis- International Financial Reporting Standards(IFRSs)-Individual (Note 1)
Financial analysis (2016-2020 )

Year
2016

Item

2019

2020

15.42

26.39

34.12

41.28

-

456.72419.63410.31451.88459.71-

Current ratio

601.28648.94529.83318.76727.14-

Quick ratio

509.64563.3

455.67273.83645.29-Times interest earned

4202.538020.22 4,110.22

2,901.88(169.35)-

Receivables turnover ratio(times)Average days of collection
Inventory turnover ratio(times) (Note 2)
Payables turnover ratio
Operating (times)
ability
Average days of sales
Property, plant andequipment (fixed assets)turnover ratio (times)
Total assets turnover ratio(times)Return on assets (%)

2.78

3.22

3.23

3.97

2.86

-

131.29113.35113.0091.94

127.62

-

-

-

-

-

-

3.09
-

4.17
-

8.26

-

10.14
-

6.13

-

-

1.48

1.82

1.70

1.84

0.95

-

0.28

0.38

0.37

0.37

0.18

-

3.31
4.02

8.42
9.95

7.42
9.21

9.06
12.63

(0.74)(1.75)

-

27.18

67.17

56.18

76.65

(9.66)-Cash flow ratio (%)

11.71
2.30
(12.45)

22.10
6.00
11.83

19.40
4.84
36.86

23.63
6.57
24.66

(5.97)(0.88)
55.83-

Cash flow adequacy ratio(%)(17.94)(12.96)(8.14)

0.54

35.75

-

Cash reinvestment ratio (%)(6.47)(3.13)(1.3)(0.76)(3.04)

-

1.66

1.41

1.46

1.43

(8.41)-

Return on equity (%)
Paid-in capital to income
Profitability
before tax (%) (Note 8)
Net profit margin (%)
Earnings per share (NT$)

Cash flows

2018

17.41

Debt-to-assets ratio
Financial
structure (%) Long-term fund to property,
plant and equipment (fixed
assets) ratio
Solvency
(%)

2017

As of
March
31, 2021(Note2)

Operating leverage
Leverage

1.03
1.02
1.04
1.05
0.43
Reasons for changes in financial ratios in the most recent 2 years. (Can be left blank of the increase or
decrease is less than 20%)
Financial leverage

1. Financial structure: Mainly due to the impact of covid-19, the decrease in revenue and the occurrence of net operating loss.
2. Solvency : Mainly issue CB to repay short-term loans.
3. Operating ability: Mainly due to the impact of covid-19, the income decreased.
4. Profitability : Mainly due to the impact of covid-19, the income decreased.
5. Cash flows: The previous period is negative, so it will not be analyzed.
6. Leverage: Mainly due to the impact of covid-19, the decrease in revenue and the occurrence of net operating loss.

- 111 -

Note 1: The 2016-2020 Financial Reports of the Company have been reviewed by the CPA.
Note 2: The year to date March 31. 2021 financial results has not yet been reviewed by CPA
Note 3: The Company primarily focuses on the R&D and design of simulator rides by using its design, R&D, andsystem integration capabilities as well as the hardware equipment of outsourced vendors. Because theCompany's core value is its design, R&D, and system integration capabilities, its business characteristic differsfrom general manufacturing industries in that the Company manufactures and sells physical products.
Therefore, inventory turnover ratio is not calculated.
Note 4: The following calculation formulas shall be displayed at the end of the tables of the annual report.
1. Financial structure(1) Debt-to-asset ratio = total liabilities / total assets.
(2) Long-term fund to property, plant and equipment ratio = (total equity + non-current liabilities) / netproperty, plant and equipment.
2. Solvency(1) Current ratio = current assets / current liabilities.
(2) Quick ratio = (current assets - inventory - prepaid expense) / current liabilities.
(3) Times interest earned = net income before income tax and interest expense / current interest expense.
3. Operating ability(1) Receivable (including accounts receivable and business-related notes receivable) turnover ratio = net
operating revenue / average balance of receivable of the period (including accounts receivable andbusiness-related notes receivable).
(2) Average days of collection = 365 / receivables turnover ratio.
(3) Inventory turnover ratio = cost of goods sold / average amount of inventory.
(4) Payable (including accounts payable and business-related notes payable) turnover ratio = cost of goods
sold / average balance of payable of the period (including accounts payable and business-related notes
payable).
(5) Average days of sales = 365 / inventory turnover ratio.
(6) Property, plant and equipment turnover ratio = net sales / net average property, plant and equipment.
(7) Total assets turnover ratio = net sales / total average assets.
4. Profitability(1) Return on assets ＝ [net income + interest expense (1 - tax rate)] / average total assets.
(2) Return on equity = after-tax profit /total average equity.
(3) Net profit margin = net income / net sales.
(4) Earnings per share = (income attributable to owners of parent - dividend to preferred stock) / weighted
average of shares issued. (Note 4)
5. Cash flows(1) Cash flow ratio = new cash flows from operating activities / current liabilities.
(2) Cash flow adequacy ratio = net cash flows from operating activities in the past five years / (capital
expenditure + increase in inventory + cash dividend) in the past five years.
(3) Cash reinvestment ratio = (net cash flows from operating activities - cash dividend) / (gross margin of
property, plant and equipment + long-term investment + other non-current assets + working capital).
(Note 5)
6. Leverage:(1) Operating leverage = (net operating income - variable operating cost and expenses) / operating income(Note 6).
(2) Financial leverage = operating income / (operating income - interest expense)..

3. Audit Committee Audit Report
Refer to Appendix 2.

4. Financial Report and CPA Review Report
Refer to Appendix 3.

- 112 -

5. Individual financial report reviewed by CPA
Refer to Appendix 3 of the company’s Chinese version 2020 annual report.

6. Financial difficulties and corporate events encountered by the Company andaffiliates in the past two years and up to the date of report that have material
impact on the financial status of the Company: None.

- 113 -

Precautions of Review and Analysis of Financial
Status and Business Performance

VII.
1.

Financial status(1) Consolidated
Unit: NT$ 1,000

3,056,839

3,172,477

Variation
Amount115,638

1,045,007957,475(87,532)(8)

814,435
5,148,580

983,060
5,113,012

168,625(35,568)21(1)

943,231640,872(302,359)(32)

Non-current liabilities

1,164,219

1,823,113

658,89457

Total liabilities

2,107,450

2,463,985

356,535

17

Capital Stock557,474

557,474--

Capital Surplus

1,968,156

2,021,953

53,797

3

Retained earnings

457,184

93,306(363,878)(80)

Other equity(14,857)(26,464)(11,607)78

Non-controlling interests

73,173

2,758(70,415)(96)

3,041,130

2,649,027(392,103)

(13)

Year
Item
Current assets
Property,plantand
equipment
Other assets
Total Assets
Current liabilities

Total Euity

2019

2020

%
4

Analysis and explanation of changes:(1)The increase in other assets was mainly due to the increase in intangible assets this year.
(2)The decrease in current liabilities was due to the issuance of CB this year to repay short-term loans.
(3)The increase in non-current debt is mainly due to the issuance of CB this year, and due to the epidemic
situation, the cash level is reserved, and the remaining long-term loans have not been repaid(4)The decrease in retained earnings was mainly due to operating loss in the current period.
(5)The decrease in other equity was mainly due to the exchange differences arising on translation of foreign
operating.
(6)The decrease in non-controlling interests is mainly due to the combined recognition of hexaRide's
non-controlling interests(2) Induvidual
Unit: NT$ 1,000

2,382,402

2,454,972

Variation
Amount72,570831,525

906,849

75,3249

1,290,977
4,504,904
747,403

1,144,640
4,506,461
337,621(146,337)
1,557(409,782)

(11)
(55)

789,544

1,522,571

733,027

93

Total liabilities

1,536,947

1,860,192

323,245

21

Capital Stock557,474

557,474

-

-

Year
Item
Current assets
Property,plantand
equipment
Other assets
Total Assets
Current liabilities
Non-current liabilities

2019

2020

- 114 -%
3

1,968,156

2,021,953

Variation
Amount
53,797Retained earnings

457,184

93,306(363,878)(80)

Other equity(14,857)(26,464)(11,607)

78

-

-

-

-

2,967,957

2,646,269(321,688)

(11)

Year
Item
Capital Surplus

2019

2020

Non-controlling interests
Total Euity%
3

Analysis and explanation of changes:(1) The decrease in current liabilities was due to the issuance of CB this year to repay short-term loans.
(2) The increase in non-current debt is mainly due to the issuance of CB this year, and due to the epidemic
situation, the cash level is reserved, and the remaining long-term loans have not been repaid.
(3) The decrease in retained earnings was mainly due to operating loss in the current period.
(4) The decrease in other equity was mainly due to the exchange differences arising on translation of foreign
operating.

2. Financial performance(1) Comparative analysis of business performance- Consolidate
Unit: NT$ 1,000

Year
Item
Sales revenue
Operating cost
Unrealized Gross Profit on
Sales to Associates
Gross profit
Operating expenses
Operating income
Non-operating income andexpenseIncome (loss) before tax
Income tax expenses
Continuing operations
Net income
Other comprehensive income(net of income Tax)
Total comprehensive income
Net income belongs to theparent company
Total comprehensive income
belongs to the parent company

ChangeVariation as a(amount)
percentage (%)(1,017,542)(49)(517,598)
(48)

2019

2020

2,080,441
1,078,081

1,062,899
560,483---

1,002,360
581,551
420,809502,416
524,940(22,524)(499,944)(56,611)(443,333)

(50)
(10)
(105)

51,092(19,314)(70,406)(138)

471,901
88,091(41,838)
9,920(513,739)(78,171)

(109)
(89)

383,810(51,758)(435,568)(113)(22,242)(11,734)

10,508(47)361,568(63,492)(425,060)(118)

366,525(49,184)(415,709)(113)

344,255(61,512)(405,767)

(118)

-

Analysis and explanation of changes:(1) The decrease in operating margin was mainly due to the decrease in revenue due to the impact of COVID-19.
(2) The decrease in non-operating income and expenses was mainly due to the loss of financial asset evaluation.
(3) The decrease in income tax expenses was mainly due to the loss in the current period, which resulted inincome tax benefits.
(4)The decrease in other comprehensive income was mainly due to the exchange differences arising on translationof foreign operating.

- 115 -

(2)Comparative analysis of business performance- Individual
Unit: NT$ 1,000

Year
Item
Sales revenue
Operating cost
Unrealized Gross Profit on
Sales to Associates
Gross profit
Operating expenses
Operating income
Non-operating income andexpenseIncome (loss) before tax
Income tax expenses
Continuing operations
Net income
Other comprehensive income(net of income Tax)
Total comprehensive income
Net income belongs to theparent company
Total comprehensive income
belongs to the parent company

2019

2020

ChangeVariation as a(amount)
percentage (%)(727,003)(47)(364,920)(46)

1,550,841
793,235

823,838
428,315

18

18

-

-

757,624
433,914395,541
410,889(362,083)(23,025)(48)(5)

323,710(15,348)(339,058)(105)

103,576(38,498)(142,074)(137)

427,286
60,761(53,846)(4,662)(481,132)(65,423)

(113)
(108)

366,525(49,184)(415,709)(113)(22,270)(12,328)

9,942

(45)

344,255(61,512)(405,767)(118)

366,525(49,184)(415,709)(113)

344,255(61,512)(405,767)(118)

Analysis and explanation of changes:(1) The decrease in operating margin was mainly due to the decrease in revenue due to the impact of COVID-19.
(2) The decrease in non-operating income and expenses was mainly due to investment losses recognized by theequity method.
(3) The decrease in income tax expenses was mainly due to the loss in the current period, which resulted inincome tax benefits.
(4)The decrease in other comprehensive income was mainly due to the exchange differences arising on translationof foreign operating.

(3) Expected Sales Volume and Criteria
On the basis of current industrial environment and future market supply and demand, as well as
information relevant to R&D schedule and business development, the Company expects its
business to growth steadily in 2020.

- 116 -

3. Cash flows(1) Analysis on the cash flow changes - Consolidated
Unit: NT$ 1,000

2019

Item

2020

Changes(increase/decrease)

Net cash inflow (outflow) from operating activities

293,572(1,206)(294,778)

Net cash inflow (outflow) from investing activities(274,393)

19,492

293,885

Net cash inflow (outflow) from financing activities

116,963

76,690(40,273)

Analysis and explanation of changes:(1) In 2020, net cash outflow from operating activities mainly including net loss after tax and investment in financial
instruments.
(2) In 2020, net investment cash inflow increased primarily because of net sales of financial instruments.
(3) In 2020, the net financing cash inflow increased because of Issued CB.

(2) Analysis on the cash flow changes - Individual
Unit: NT$ 1,000

Item

Changes(increase/decrease)

2019

2020

Net cash inflow (outflow) from operating activities

184,315

188,507

4,192

Net cash inflow (outflow) from investing activities

14,066

24,372

10,306

Net cash inflow (outflow) from financing activities

47,710(11,528)(59,238)

Analysis on the cash flow changes of in these two years:(1) In 2020, The net cash inflow from operating activities was mainly due to the impact of the epidemic on the
progress of the project and the decrease in prepayments for purchases(2) In 2020, net investment cash inflow increased primarily because of net sales of financial instruments.
(3) In 2019, net cash outflow from financing activities was mainly due to the acquisition of subsidiary equity.

(3) Improvement plan for inadequate liquidity: None.
(4) Cash flow analysis for the coming year
Unit: NT$ 1,000
Cash balance,
beginning

864,341

Expected cash
flow fromoperatingactivities

75,847

Expected cash
flow frominvestment andfinancing
activities

Expected cash
surplus (deficit)+ -(290,814)

649,374

Remedial measures for expected cash deficit
Investment plan-

Financing plan-

Analysis on the cash flow for the coming year:(1) operating activities: Cash inflow increased primarily because of the change of net income and depreciation andamortization expenses do not affect cash flow income expenses.
(2) investment and financing activities: Cash outflow increased primarily because debt repayment.
(3) Remedial measures for expected cash deficit: N/A- 117 -

4. Effect of major capital spending on financial position and business operation(1) Major capital spending and sources of funds
None(2) Anticipated benefit(1) Enhance R&D testing capacity to increase corporate competitiveness(2) Integrate office and plant to raise operational efficiency(3) Improve working environment to increase employee commitment

5. Investment policy in the past year, profit/loss analysis, improvement plan,and investment plan for the coming year
(1) Investment transfer policy
The Company currently focuses its investment transfer policy on business investment related targets
and does not invest in other businesses. Related executing department handles affairs according to
the Investment Circulation regulations of its internal control system and Procedure for Processing
the Acquisition and Disposal of Assets, both of which have been reviewed and approved by the
Board of Directors.

(2) Reasons for investment profit or loss in recent years
In accordance with the Company’s business expansion and future development, Brogent’s
subsidiaries were set up in 2016 ~ 2020.
In 2020, the Company’s Operational Highlights of Subsidiaries, please item VIII. Important Notices(2) Operational Highlights of Subsidiaries.

(3) Investment plan for the next year
The Company will review and evaluate our investment plant from a long-term strategic perspective
to strengthen the channel-content management strategy and continue to strengthen our global
competitiveness.

6. Analysis of risks in recent years up to the publishing date of the annual report(1) Impact of interest rate and exchange rate changes and inflation on
Company’s profit and response measures:(A) Impact of interest rate on Company's profit and response measures
The Company uses its funds conservatively and steadily; the operation-generated funds are stored
as time deposits and current deposits. The interests earned in 2019 and 2020 were respectively- 118 -

NT$10,331 thousand and 8,943 thousand. The bank loan interest expenses were respectively
NT$23,727thousand and NT$29,202 thousand. The interest earned and ratio of expenditure as apercentage of operating income and net income before tax was low. Because the Company isincreasing its business scale and building the R&D Testing and Experience Center, it is expectedthat the Company will need more loans in NTD. The Company will remain vigilant at changes inthe banks' interest rate and maintain a good relationship with its cooperating banks so that theCompany can acquire preferential interest rate to reduce the effects of interest rate variations on the
Company operation.
(B) During recent years up to the annual report publishing date, the effects of exchange rate variations
on the Company's profit and its future response measures
The business focus of the Company is simulator rides; the downstream customers are major as well
as developers of theme parks. The simulator rides are priced in either NTD or foreign currency
depending on the region of sale. Therefore, foreign currency assets are generated. The net foreignexchange gain in 2019 and 2020 were respectively NT$(28,733) thousand and NT$(28,445)
thousand, accounting for (1.38%)、(2.68)%、(6.09)% and 67.99% of the operating income andnet profit margin before tax of 2019 and 2020. Because exchange rate changes influence the profits
of the Company, the Company's management authorities pay close attention to the exchange rate
trends and reinforce the management of risks in exchange rate fluctuations. The corresponding
measures adopted are as follows:Because of the gradual increase in export sales, the Company attempts to mitigate the effects of
exchange rate changes by setting up a foreign currency savings account to manage foreign
currencies. The Company assigns designated personnel from the finance department to sell excess
foreign currencies under optimal conditions according to the daily foreign currency balance andmonthly fund estimates, to reduce the impact of exchange rate changes on the profit.
When giving quotes to foreign customers, the business department considers the effects of
exchange rate variations on product prices and refers to the prices adjusted according to thechanging exchange rates, or negotiates a new price in NTD with the customer, thereby mitigating
the effects of exchange rate variations on the profit of the Company.
Our finance department personnel maintains a close contact with the foreign exchange departmentsof frequent interacting banks to adequately acquire market information and use such information toforecast the long- and short-term trends of the exchange rage and sell or buy in foreign currencies
in a timely manner. Thus, the effects of exchange rate variations on the profitability of theCompany can be reduced.
At the appropriate timing, the Company will have its finance department personnel to review thechanges in the foreign exchange market and consider foreign exchange fund requirements andbalances to determine whether hedging derivative financial instrument operating strategies should- 119 -

be used in accordance with the Procedure for Processing the Acquisition and Disposal of Assets,such as buying forwards in advance to avert exchange rate risks, thereby minimizing the effects of
exchange rate variations on the profit of the Company.
(C) During recent years up to the annual report publishing date, the effects of inflation on the Company's
profit and its future response measures:
The Company profits have not experienced material influence from inflation; it is predicted thatsuch effect remains limited on the Company's profits. The Company will continue to monitor the
inflation situation and adequately adjust its product prices accordingly.

(2) Policies of engaging in high-risk, high-leverage investments, lending toothers, providing endorsement and guarantee, and derivatives transactions,profit/loss analysis, and future response measures:(A) The Company has always focused on its main business activities and upheld the practicalprinciple of managing a business. Our financial policy is based on the principle of robustness
and conservativeness, and thus the Company does not engage in high-risk, high-leveraging
investment as well as derivative instrument transactions.
(B) From 2019 to 2020 and up to the annual report publishing date, the Company has not engaged
in providing endorsement and guarantee, lending to others, and derivatives transactions. If
such engagements are required in the future, it shall be executed in accordance with the"Operating Procedure for Endorsements and Guarantees," "Operating Procedure for Fund
Lending," and "Procedure for Acquisition or Disposal of Assets" and relevant transaction
information shall be announced in accordance with laws and regulations.

(3) Future R&D projects and estimated R&D expenditure:
To continuously enhance the Company’s competitiveness, the Company has always actively
invested in R&D efforts. In 2019 and 2020, it has expended a total of NT$172,403 thousand andNT$167,313 thousand in R&D, respectively accounting for 8.29% and 15.74% of the net operating
income. It is expected that a total of NT$225,164 thousand will be expended in R&D in 2021, andthe Company's future R&D projects are as follows:
Unit
Product
Development
CenterNew products under development
A.The Integration of Interactive Games(1).Interactive game combining multiplayer motion-simulation system.
(2).Sensory interactive game combining AR(augmented reality),VR(virtual reality) and MR(mixed reality) technologies(3).Immersive d-Ride interactive shooting game
B.Diversified Application- 120 -Unit

New products under development(1).Motion simulation combing 5G technology to extend control inprcise.

Technical center(2).Diversified digital contents and real-time motion simulation intergration(3).Innovative application of human somatosensory(4).Immersive mini-LED screen and mini-simulator integrated
development.
C.Product design(1).Small rides platform modular design.
(2).Thematic design for outlook of mini ride.
(3).Product appearance improvement.
D.Thematic decoration design(1).FEC(Family Entertainment Center) decoration design.
E.Digital content production(1).Aerial digital content production.
(2).VR digital content production.
(3).Interactive-game content production.
A.Vertical platform product design (v-Ride height under 2 meters)
B.Rotating carrier producing and optimization(o-Ride, m-Ride)

C.Platform-controlled technological optimization
D.Mechanical design optimization
E.Arts appearance design refinement
F.Equipment weight optimization
G.LED screen development
H.Giant 3-DOF platform producing and optimization(4) Major changes in government policies and laws at home and broad andthe impact on Company finance and business and response measures:
During recent years up to the annual report publishing date, major changes in government
policies and laws at home and broad exerted no material effect on Company finance and business.
The Company will acquire relevant information in a timely manner and formulate necessary
response measures to meet company operation requirements.

(5) Impact of recent technological and market changes during recent years up
to the annual report publishing date on the Company's finance andbusiness, and response measures:
The Company has constantly paid attention to technological and market changes anddesignated personnel to search for information regarding industry-related technologies and trend
variations to provide a reference for decision-making at the management level. The information
can facilitate adjusting operational strategies and devise response measures. Therefore, there were
no impact of recent technological and market changes on the Company's finance and business.

(6) Impact of corporate image change on risk management and response
measures:
Since its inception, the Company actively strengthens its internal management, focusing on
the management of its main business activities. In addition, it endeavors to maintain corporate- 121 -

image and compliance with relevant laws and regulations. To date, there have been no changes to
the Company's image that would cause risks to company operation. In future, the Company willcontinue to comply with and implement corporate governance requirement, and consult relevant
experts in a timely manner, to reduce the effects of such risk on the Company's finance andbusiness.

(7) Expected benefits and potential risks of merger and acquisition andresponse measures:
During recent years up to the annual report publishing date, the Company has not undertaken
merger and acquisition plans. In the future, when evaluating and implementing relevant plans, theCompany shall handle related matters according to laws and regulations and the Company's
internal management regulations.

(8) Expected benefits and potential risks of capacity expansion and response
measures:
The Company has relocated to the newly constructed R&D Testing Center in January 2013,as a response to prepare for the Company's future expansion, increase its R&D and testing
capacities, and raise its operational efficiency requirements. After relocating to the new plant, theCompany's image, ability to receive orders, and management efficiency have improved, which is
conducive to its business expansion. Because of the currently accepted and expected projects, theCompany's R&D testing capacity is inadequate. The Company has started the construction of a
R&D Testing and Experience Center in the lower half of 2014 and completed construction in 2016.
The R&D Testing and Experience Center not only facilitates determining consumers'
entertainment needs regarding simulator rides, but also improves product development, testing andproduction capacity, increases the capacity to receive more orders and market share, and magnify
the gap between the Company and its competitors in competitive advantage. The Company has
carefully evaluated the funding requirement for business expansion and properly planned the useof the funds. The Company will raise funds in a capital market to support the construction works.
However, if market fund-raising fails, the Company has a low credit limit remaining in bank loans
and thus it will apply for construction financing loans from the bank. In addition, the Company's
cash flow from operating activities should be enough to support the expansion requirement;
therefore, the Company is not subject to the risk of shortage of funds caused by the construction of
the R&D Testing and Experience Center.

(9) Risks associated with over-concentration in purchase or sale and response
measures:(A) Purchases- 122 -

The Company is a professional manufacturer of simulator rides, purchasing stocks according
to the project designs of various simulator rides. The Company also commissions manufacturers
to undergo hardware processing. In the past 2 years, purchases exceeding 15% of a single
manufacturer were made for precision mechanical products, in addition to the intensive shipments
in year 2019. Therefore, the Company is not associated with risks of overly concentrating stock
purchases.
(B) Sales
Because simulator rides involve high manufacturing cost, the Company primarily receives
income from selling simulator rides since our entry into the simulator ride market. The proportionof sales to simulator ride customers is also demonstrating an increasing trend annually. Following
the successful operation of the FlyOver Taiwan project, the Company has attracted the attention of
global amusement park and tourist attraction operators, and these operators have visited theCompany to engage in negotiations and experience the products themselves. According tocustomer demand, the Company designs and integrates upstream software and hardware systems
and technologies, selling them to downstream operators, including theme parks, museums,
shopping malls, and urban experience center. With the increasing popularity and word of mouth of
the Company as well as partnering with internationally well-known companies, the Company has
expanded from the domestic market to China, North American regions, and Euroasian regions,effectively reducing its reliance on a single customer, thereby mitigating the risk of sales
concentration.The upstream industries associated with the simulator ride equipment comprise thehardware section, including precision machinery industry and manufacturers of spherical screensand projectors, and the software section, including wireless embedded control system, sphericalprojector and playback control systems, and digital contents.

(10) Impact of mass transfer of equity by or change of directors, supervisors,or shareholders holding more than 10% interests on the Company,
associated risks and response measures:
During recent years up to the annual report publishing date, there were no mass transfers ofequity by or change of directors, supervisors, or shareholders holding more than 10% interests on
the Company.

(11) Impact of change of management rights on the Company, associatedrisk and response measures:
In 2019 and 2020 up to the annual report publishing date, there were no negative impacts
from changes in management rights.

(12) Litigation or non-litigation events(A) Disclose the litigation facts, target amount, litigation start date, main parties involved, and- 123 -

current progress regarding concluded or pending litigious, non-litigious, or administrative
litigation events, the potential effects of the outcomes on shareholder equity or security
prices during the recent two years up to the annual report publishing date: None.
(B) The outcome of concluded or pending litigious, non-litigious, or administrative litigation
events involving the director, supervisor, president, de facto responsible person, major
shareholders holding more than 10% interest, or subsidiary of the Company during therecent two years up to the annual report publishing date: Taiwan Kaohsiung District Court
Case of No. 109-Su-Zi-#502 is closed. It is not expected to have any material impact on theinterests of the Company’s shareholders or stock price.
(C) The involvement of the director, supervisor, president, and major shareholders holding morethan 10% interest in events regulated in Article 157 of the Securities and Exchange Act
during the recent two years up to the annual report publishing date, and the Company's
current progress in handling such events: None.

(13) Risks Associated with IT Security:
The Company has not found any significant information security incidents in the 2019 and 2020of the annual report. It has or may have a material adverse effect on the company's business andoperations, and has not been involved in any legal cases or regulatory investigation. survey. In
the future, we will continue to review and evaluate its information security regulations andprocedures annually to ensure its appropriateness and effectiveness to control or maintain thefunctions of important business operations such as the company's operations and accounting.

(14) Other significant risks and response measures: None.

7.Other important events: None.

- 124 -

VIII. Important Notices
1. Profile on affiliates and subsidiaries(1) Subsidiaries Iperation Report
A. Subsidiary Chart

B. Business Scope of each subsidiary
Investee Company
Brogent Global Inc.
Brogent Hong Kong
LimitedBrogent Rides(Shanghai) Limited
Brogent Creative(Shanghai) Limited
Brogent JapanEntertainment
Joint-Stock
Corporation
Dili Jie Holdings
LimitedJetway Holdings
LimitedGarlay Holdings
LimitedhexaRide the first LLP
Holey Holdings
LimitedJetmay Holdings
LimitedOu Wei Limited

Date of
Establishment

Location

Investment
Amount2015.09

Kaohsiung, Taiwan

NTD 300,000,000

2015.06

Kowloon,Hong Kong

USD 9,000,000

2015.07

Shanghai, China

USD 7,300,000

2015.09

Shanghai, China

RMB 13,000,000

2016.08

Tokyo, Japan

JPY 35,000,000

2018.01

British Virgin Islands

USD 8,900,000

2018.03

Cayman Islands.

USD 8,900,000

2018.03

British Virgin Islands

USD 4,300,000

2018.09

Tokyo, JapanJPY 160,000,000

2018.11British Virgin Islands

USD 4,550,000

2018.11British Virgin Islands

USD3,636,026

2019.05

Hong Kong

USD1,435,500- 125 -

Business Scope
Development and managementbusiness of self-operated outlets
Investment , holding company
and trading business
Import and export business
Development and managementbusiness of self-operated outlets
Management business anddevelopment and sales of theperipheral products of simulator
rides in Japan
Investment and holding
company business
Investment and holding
company business
Investment and holding
company business
Management business of
self-operated outlets
Investment and holding
company business
Investment and holding
company business
Reinvestment and tradingbusinessInvestee Company
Hai Wei Culture
Creative andDevelopment(Shanghai) Limited
Starlite Design &Planning Limited

Date of
Establishment

Location

Investment
AmountBusiness Scope2019.01

Shanghai, China

RMB 20,000,000

Management business of
self-operated outlets

2018.12

Richmond,Canada

CAD1,000,000

Management business of
self-operated outlets

C. Shareholders in Common of Brogent and Its Subsidiaries with Deemed Control andSubordination: None.
D. Rosters of Directors, Supervisors, and Presidents of Brogent’s Subsidiaries
Investee

Title

Name or Representative

Brogent Technologies Inc.
Representative：Pei-Chi HoBrogent Technologies Inc.
Brogent HongDirector
Representative：Chih-Hung Ouyang
Kong Limited
Brogent Technologies Inc.
Director
Representative：Chun-Hao Cheng
Brogent Technologies Inc.
Chairman
Representative：Pei-Chi HoBrogent Rides(Shanghai) Limited
Brogent Technologies Inc.
Supervisor
Representative：Pei-Kuan Lee
ChairmanBrogent Creative(Shanghai) Limited

Shares Held
SharesPercentatge
-

100%

-

100%

-

100%

-

100%

-

100%

ChairmanBrogent Technologies Inc.
Representative：Pei-Chi Ho

-

100%

Supervisor

Brogent Technologies Inc.
Representative：Pei-Kuan Lee

-

100%

36,214,332

100%

36,214,332

100%

36,214,332

100%

36,214,332

100%

800

45.71%

800

45.71%

700

40%

700

40%

Brogent Technologies Inc.
Representative：Chih-Hung Ouyang
Brogent Technologies Inc.
Director
Representative：Pei-Chi HoBrogent Global Inc.
Brogent Technologies Inc.
Director
Representative：Ming-Chi Chang
Brogent Technologies Inc.
Supervisor
Representative：Sui-Chuan Lin
Kodansha Company, Limited
Chairman
Representative：Kohei Furukawa
Kodansha Company, Limited
Director
Representative：Shohei Yoshida
Brogent Japan
Brogent Hong Kong Limited
Director
Entertainment
Representative：Chih-Hung Ouyang
Joint-Stock
Brogent Hong Kong Limited
Corporation
Director
Representative：Chun-Hao Cheng
Director
DAISAKU SONODA
Kodansha Company, Limited
Director
Representative：Hiroshi Nakada
Chairman- 126 --

800

45.71%

Investee

Title

Name or Representative

DENTSU INC.
Representative：Toru Kimpara
Kodansha Company, Limited
Supervisor
Representative：Mitusyuki Shiraishi
Brogent Hong Kong Limited
Supervisor
Representative：Sui-Chuan Lin
Brogent Technologies Inc.
Dili Jie Holdings
Chairman
Representative：Pei-Chi Ho
LimitedBrogent Technologies Inc.
Jetway Holdings
Chairman
Representative：Pei-Chi Ho
LimitedBrogent Technologies Inc.
Garlay Holdings
Chairman
Representative：Pei-Chi Ho
LimitedBrogent Hong Kong Limited
Chairman
Representative：Chun-Hao Cheng
Movic Co. Ltd.
hexaRide the first Director
Representative：Gonohe Kota
LLP
Brogent Japan Entertainment
Joint-Stock Corporation
Director
Representative：Daisaku Sonoda
Brogent Technologies Inc.
Holey Holdings
Chairman
Representative：Pei-Chi Ho
LimitedBrogent Global Inc.
Jetmay Holdings
Chairman
Representative：Pei-Kuan Lee
LimitedJetmay Holdings Limited
Starlite Design &Chairman
Representative：Pei-Kuan Lee
Planning Limited
Jetmay Holdings Limited
Hai Wei Culture
Chairman
Representative：Pei-Kuan Lee
Creative andDevelopment
Jetmay Holdings Limited
Supervisor(Shanghai) Limited
Representative：Yen-Lun Peng
Brogent Global Inc.
Ou Wei Limited
Chairman
Representative：Pei-Chi Ho

Shares Held
SharesPercentatge

Director- 127 -

250

14.29%

800

45.71%

700

40%

-

100%

-

100%

-

100%

-

88.89%

-

8.33%

-

2.78%

-

100%

-

100%

-

100%

-

100%

-

100%

-

100%

(2) Operational Highlights of Subsidiaries
Unit: NT$1,000 As of Dec. 31, 2019
ProfitNet Income(After Tax)

EPS
(NTD)

171,688(35,789)(21,932)(0.61)

263,871

118(5,889)(6,503)-

347,072

322,741

72,376

3,017

31,791-

266,102

192,760

73, 342

126(1,821)(1,051)-

25,403

12,471

4,145

8,326

4,787

865

795

-

49,63743,317

18,49324,824

6,012(21,793)(15,880)-

Dili Jie Holdings
Limited

267,955

307,117-

307,117-(18)(20,384)-

Jetway Holdings
Limited

270,020

307,104-

307,104-(184)(20,366)-

Garlay Holdings
Limited131,258

188,404-

188,404-(67)

18,225-

Holey Holdings
Limited139,753

117,779-

117,779-(64)(38,408)-

Jetmay Holdings
Limited

61,489

182,855-

182,855-(67)

21,972-

Ou Wei Limited

43,641

32,59435

32,559692(5,226)(5,111)-42,720565,217395,211

170,006

175,475

24,637

20,273-

15,054

15,4052,580

12,825

15,868(2,194)

1,766-

Investee
Brogent Global Inc.
Brogent Hong
Kong Limited
BrogentRides
Limited(Shanghai)
Brogent Creative(Shanghai) Limited
Brogent JapanEntertainment
Joint-Stock
Corporation
hexaRide the first
LLP

Hai Wei Culture
Creative andDevelopment(Shanghai) Limited
Starlite Design &Planning Limited

Total Asset

Total
Liabilities

Net Value

Revenue

362,143974,547

624,914349,633

270,727

440,279

176,408

216,650

669,81356,940Capital(3) Consolidated Financial Statements: Please refer to Appendix 3.
(4) Consolidated Report: N/A.

- 128 -

2. Private placement of corporate bonds in the past years to the date of theannual report:
N/A.
3. Holding or disposal of stocks of the Company by subsidiaries in the past year
and up to the date of report:
N/A.
4. Other supplemental information
Items of Commitment: The Company has executed or signed letter ofunderstanding regarding items of commitment to listing and trading over thecounter.

IX. Items of impact of interests of shareholders or
stock priceNone.

- 129 -

Appendix
Appendix 1：Statement of Internal Control System
Brogent Technologies Inc.
Statement of Internal Control System

Date: March 10, 2021
Based on the findings of a self-assessment, Brogent Technologies Inc. (Brogent) states the following
with regard to its internal control system during the year of 2020：
1. Brogent’s Board of Directors and Management are responsible for establishing, implementing,and maintaining an adequate internal control system. Our internal control is a process designed
to provide reasonable assurance over the effectiveness and efficiency of our operations(including profitability, performance, and safeguarding of assets), reliability, timeliness,transparency of our reporting, and compliance with applicable rulings, laws and regulations.
2. An internal control system has inherent limitations. No matter how perfectly designed, aneffective internal control system can provide only reasonable assurance of accomplishing its
stated objectives. Moreover, the effectiveness of internal control system may be subject tochanges due to extenuating circumstances beyond our control. Nevertheless, our internal control
system contains self-monitoring mechanisms, and Brogent takes immediate remedial actions in
response to any identified deficiencies.
3. Brogent evaluates the design and operating effectiveness of its internal control system based on
the criteria provided in the Regulations Governing the Establishment of Internal Control
Systems by Public Companies (herein below, the “Regulations”). The criteria adopted by theRegulations identify five key components of managerial internal control: (1) control
environment, (2) risk assessment, (3) control activities, (4) information and communication, and(5) monitoring activities.
4. Brogent has evaluated the design and operating effectiveness of its internal control system
according to the aforesaid Regulations.
5. Based on the findings of such evaluation, Brogent believes that, on December 31, 2020, it has
maintained, in all material respects, an effective internal control system (that includes thesupervision and management of our subsidiaries), to provide reasonable assurance over ouroperational effectiveness and efficiency, reliability, timeliness, transparency of reporting, andcompliance with applicable rulings, laws and regulations.
6. This Statement will be an integral part of Brogent’s Annual Report for the year 2019 andProspectus, and will be made public. Any falsehood, concealment, or other illegality in thecontent made public will entail legal liability under Articles 20, 32, 171, and 174 of the
Securities and Exchange Law.
7. This Statement has been passed by the Board of Directors in their meeting held on March 10,
2021, with the seven attending directors all affirming the content of this Statement.
Brogent Technologies Inc.
Chairman：Chih-Hung Ouyang
President：Chih-Hung Ouyang- 130 -

Appendix 2：Audit Committee Audit Report

Brogent Technologies Inc.
Audit Committee Audit Report
The Business Report, Financial statements and Deficit Compensation Statement of2020 prepared by the Board of Directors have been audited and certified
by Chiu-Yen Wu and Li-Yuan Kuo of Deloitte & Touche. After reviewing such
documents, this Audit Committee found no nonconformity, in accordance with
Article 14-4 of the Securities and Exchange Act and Article 219 of the Company
Act.
To

2021 Annual Shareholders Meeting of Brogent Technologies Inc.

Audit Committee Convener:

March 10, 2021

131

Appendix 3：Consolidated Financial Statements and Independent Auditors’ Report132Deloitte.

勤業眾信

勤業眾信聯合會計師手務所
11073台北市信鏤逼松仁路100號20樓
Deloitte & Touche
20F, Taipei Nan Shan PlazaNo 100, Songren Rd ,Xinyi Dist., Ta1pe1 11073, Taiwan
Tel :+886 (2) 2725-9988
Fax:+886 (2) 4051-6888
www.delo1tte.com.tw

INDEPENDENT AUDITORS'REPORTThe Board of Directors and Shareholders
Brogent Technologies Inc.
OpinionWe have audited the accompanying consolidated financial statements of Brogent Technologies Inc. (the,'Corporation") 皿d its subsid」aries (collectively referred to as the "Group"), which comprise the consolidatedbalance sheet as of December 31, 2020, the consolidated statements of comprehensive income, changes inequity and cash flows for the year then ended, and the notes to the consolidated financial statements, including asummary of significant accounting policies (collectively referred to as the "consolidated financial statements").
In our opinion, the accompanying consolidated financial statements referred to above present fairly, in allmaterial respects, the consolidated financial position of the Group as of December 31, 2020, and its consolidated
finai1cial performance and its consolidated cash flows for the year then ended in accordance with theRegulations Governing the Preparation of Financial Reports by Securities Issuers and Internatiohal Financial
Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IF囹C), and SIC
Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republicof China.
Basis for Opinion
We conducted our audit in accordance with the Regulations Governing Auditing and Attestation of Financial
Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China.
Our responsibilities under those standards are further described in the Auditors'Responsibilities for the Audit of
the Consolidated Financial Statements section of our report. We are independent of the Group in accordancewith The Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we havefulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of
the consolidated financial statements for the year ended December 31, 2020. These matters were addressed in
the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.
The key audit matter of the Group's consolidated financial statements for the year ended December 31, 2020 isstated as follows:
The recocrnition of construction contract revenue
Construction contract revenue, the main operating revenue of the Group, is recogi1ized over time. The Group
recognizes revenue upon satisfaction of a performance obligation based on the input method. Due to the manual
calculation and management's judgtnent, which involves critical accounting estimates, accuracy of therecognition of construction contract revenue is deemed to be a key audit matter.
133

Refer to Notes 4, 5 and 23 for accounting policy on construction contract, accounting estimates and assumptions,and details of construction revenue.
We performed the following audit procedures on the above key audit matter:
1. We understood and tested the design and operating effectiveness of the internal control relevant to theaccuracy of recognition of the construction contract revenue, including the measurement of the percentage
of completion.
2. We verified and recalculated, on a sampling basis, the accuracy of the percentage of completion, including
the related supporting documents.
3. We recalculated the sampled construction contract revenue measured by the percentage of completion, andchecked whether it was recognized correctly.
Other Matter
The consolidated financial statements of the Group and the parent company only financial statements of the
Corporation as of and for the year ended December 31, 2019 were audited by other auditors, who expressed anunmodified opinion with other matter paragraph on those statements on March 9, 2020.
We have also audited the parent company only financial statements of the Corporation as of and for the year
ended December 31, 2020 on which we have issued an unmodified opinion with other matter paragraph.
Responsibilities of Management and Those Charged with Governance for the Consolidated Financial
Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements inaccordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the
IFRS, IAS, IFRIC, and SIC endorsed and issued into effect by the Financial Supervisory Commission of the
Republic of China, and for such internal control as management determines is necessary to enable thepreparation of consolidated financial statements that are free from material misstatement, whether due to fraud
or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or
has no realistic alternative but to do so.
Those charged with governance, including the audit committee, are responsible for overseeing the Group’s
financial reporting process.
Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the auditing standards generally accepted in the Republic of China will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated financial statements.

134

As part of an audit in accordance with the auditing standards generally accepted in the Republic of China, we
exercise professional judgment and maintain professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the Group’s internal control.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimatesand related disclosures made by management.
4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, basedon the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that amaterial uncertainty exists, we are required to draw attention in our auditors’ report to the related
disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report.
However, future events or conditions may cause the Group to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or businessactivities within the Group to express an opinion on the consolidated financial statements. We areresponsible for the direction, supervision, and performance of the group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethicalrequirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were ofmost significance in the audit of the consolidated financial statements for the year ended December 31, 2020
and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determinethat a matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.

135

The engagement partners on the audit resulting in this independent auditors’ report are Chiu-Yen Wu and
Li-Yuan Kuo.

Deloitte & Touche
Taipei, Taiwan
Republic of China

March 10, 2021

Notice to Readers
The accompanying consolidated financial statements are intended only to present the consolidated financial
position, financial performance and cash flows in accordance with accounting principles and practices
generally accepted in the Republic of China and not those of any other jurisdictions. The standards, proceduresand practices to audit such consolidated financial statements are those generally applied in the Republic ofChina.
For the convenience of readers, the independent auditors’ report and the accompanying consolidated financial
statements have been translated into English from the original Chinese version prepared and used in the
Republic of China. If there is any conflict between the English version and the original Chinese version or any
difference in the interpretation of the two versions, the Chinese-language independent auditors’ report andconsolidated financial statements shall prevail.
136

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETSDECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars)

ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4 and 7)
Financial assets at amortized cost - current (Notes 4, 8 and 31)
Notes receivable (Notes 4 and 9)
Accounts receivable, net (Notes 4, 5 and 9)
Contract assets - current (Note 4, 5 and 23)
Current tax assets (Notes 4 and 25)
Inventories (Notes 4 and 10)
Prepayments
Other current assets

December 31, 2020
Amount%December 31, 2019
Amount%$$774,817
253,176
277,63771
286,738
1,035,804
24
232,958
227,425
36,953

15
5
5
6
20
5
4
1

62

3,125,603

61

283,334
50,0603,331
957,475
341,151
183,694
39,48013,537
4,599
63,874

5
1
19
7
4
1
1

297,964
65,1603,029
1,045,007
340,051
163,535
20,814
12,725
4,537
70,155

6
1
20
7
3
1
1

1,940,535

38

2,022,977

39$ 5,113,012

100$ 5,148,580

100

Total current assets
NONCURRENT ASSETS
Financial assets at fair value through profit or loss - noncurrent (Notes 4 and 7)
Financial assets at amortized cost - noncurrent (Notes 4, 8 and 31)
Investments accounted for using equity method (Notes 4 and 12)
Property, plant and equipment (Notes 4, 13 and 31)
Right-of-use assets (Notes 4 and 14)
Intangible assets (Notes 4 and 15)
Deferred tax assets (Notes 4 and 25)
Refundable deposits
Prepayments for investments
Other noncurrent assets
Total noncurrent assets
TOTAL

864,341
380,382
202,598
21,164204,919
1,119,428
20
237,987
120,941
20,697

17
8
4
4
22
5
2
-

3,172,477

LIABILITIES AND EQUITYCURRENT LIABILITIESShort-term borrowings (Notes 4, 16 and 31)
Notes payable (Notes 4 and 18)
Accounts payable (Notes 4 and 18)
Contract liabilities - current (Notes 4 and 23)
Other payables (Note 19)
Current tax liabilities (Notes 4 and 25)
Provisions - current (Note 4)
Lease liabilities - current (Notes 4 and 14)
Current portion of long-term borrowings (Notes 4, 16 and 31)
Other current liabilities$

191,340
14,001
82,383
162,783
131,159
53,952
2,328
51,032
252,626
1,627

4
2
3
2
1
1
5
-

12

943,23118

1,155,660
306,277
42,251
309,631
9,294

23
6
1
6
-

815,541
32,949306,990
8,739

16
1
6
-

Total noncurrent liabilities

1,823,113

36

1,164,219

23

Total liabilities

2,463,985

48

2,107,450

41

557,474
2,021,953

11
40

557,474
1,968,15611
38

127,421
14,857(48,972)
93,306(26,464)

3
(1)
2
(1)

90,809366,375
457,184(14,857)2
7
9-2,646,269

52

2,967,957

58

2,758

-

73,17312,649,027

52

3,041,130

59$ 5,113,012

100$ 5,148,580

100

Total current liabilities
NONCURRENT LIABILITIESBonds payable (Notes 4 and 17)
Long-term borrowings (Notes 4, 16 and 31)
Deferred tax liabilities (Notes 4 and 25)
Lease liabilities - noncurrent (Notes 4 and 14)
Net defined benefit liabilities - noncurrent (Notes 4 and 20)

EQUITY ATTRIBUTABLE TO OWNERS OF THE CORPORATION (Note 22)
Share capital
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings (accumulated deficit)
Total retained earnings
Other equity
Total equity attributable to owners of the Corporation
NON-CONTROLLING INTERESTS (Note 22)
Total equity
TOTAL

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

137

216,207
11,571
99,294
136,754
60,733
5,918
2,380
56,16150,258
1,596

4
2
3
1
1
1
-

640,872$

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

2020
Amount%2019
Amount%$ 1,062,899

100$ 2,080,441

100

OPERATING COSTS (Notes 10 and 24)

560,48353

1,094,762

53

GROSS PROFIT

502,41647

985,67947

OPERATING EXPENSES (Note 24)
Selling and marketing expenses
General and administrative expenses
Research and development expenses
Expected credit loss (Notes 9 and 23)

55,382
240,125
167,313
62,120522
16
682,691
289,170
172,403
20,6064
14
8
1

Total operating expenses

524,940

49

564,87027

OPERATING INCOME (LOSS)(22,524)(2)

420,809

20

NON-OPERATING INCOME AND EXPENSES(Note 24)
Interest income
Other income
Other gains and losses
Finance costs
Share of profit or loss of associates accounted forusing the equity method (Note 12)

8,493
38,687(38,434)(29,202)

1
4
(4)
(3)

10,331
43,17826,845(23,727)

2
1
(1)

1,142

-

(5,535)-(19,314)(2)

51,092

2(41,838)(4)

471,901

22

INCOME TAX EXPENSE (Note 25)

9,920

1

88,091

4

NET PROFIT (LOSS) FOR THE YEAR

(51,758)(5)

383,810

18

(484)

-

(501)

-

(237)

-

100

-

(10,173)(1)

NET OPERATING REVENUE (Notes 4, 5, 23 and 30)

Total non-operating income and expenses
PROFIT (LOSS) BEFORE INCOME TAXOTHER COMPREHENSIVE INCOME (Note 22)
Items that will not be reclassified subsequently to
profit or loss:
Remeasurement of defined benefit plans (Note 20)
Income tax relating to items that will not bereclassified subsequently to profit or loss (Note25)
Items that may be reclassified subsequently to profit
or loss:
Exchange differences on translation of thefinancial statements of foreign operations

138(21,883)(1)(Continued)

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

2020
AmountShare of the other comprehensive income (loss) of
associates accounted for using the equity
method

$

(840)

-

(11,734)(1)$(63,492)(6)

NET PROFIT (LOSS) ATTRIBUTABLE TO:
Owners of the Corporation
Non-controlling interests$(49,184)(2,574)$TOTAL COMPREHENSIVE INCOME (LOSS)ATTRIBUTABLE TO:
Owners of the Corporation
Non-controlling interests

EARNINGS (LOSS) PER SHARE (Note 26)
Basic
Diluted-(22,242)(1)$

361,568

17

(5)
-

$

366,525
17,28517
1(51,758)(5)$

383,810

18$(61,512)(1,980)(6)-$

344,255
17,31316
1$(63,492)(6)$

361,56817$$(0.88)(0.88)

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

139

$

%

42

Other comprehensive income (loss) for the year,
net of income tax
TOTAL COMPREHENSIVE INCOME (LOSS) FOR
THE YEAR

2019
Amount

%

$
$

6.57
6.57

(Concluded)

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars)

Equity Attributable to Owners of the Corporation

Retained Earnings

BALANCE AT JANUARY 1, 2019
Appropriation of 2018 earnings (Note 22)
Legal reserve
Special reserve
Cash dividends of ordinary shares

Share Capital

Capital Surplus

Legal Reserve

UnappropriatedSpecial Reserve
Earnings$

530,928$ 2,027,723

$

$

-

-

16,992-(4,049)-26,546-(32,918)(26,546)-

16,992----

Cash dividends from capital surplus (Note 22)
Stock dividends from capital surplus (Note 22)
Net profit in 2019
Other comprehensive income (loss) in 2019, net of income tax

BALANCE AT DECEMBER 31, 2019
Appropriation of 2019 earnings (Note 22)
Legal reserve
Special reserve
Cash dividends of ordinary shares

BALANCE AT DECEMBER 31, 2020$$

63,296$ 2,899,472-(179,453)-(179,453)(4,049)-(192,396)
366,525(401)(21,869)(179,453)(32,918)
366,525(22,270)

17,28528(179,453)(32,918)
383,810(22,242)--

366,124(21,869)

344,255

17,313

361,568

(372)

-

-

-

-

(372)

(5,167)(5,539)

-

269
-

-

-

-

-

269
-

66
(2,335)335(2,335)557,474

1,968,156

90,809-366,375(14,857)

2,967,957

73,173

3,041,130--

36,612-

14,857-(36,612)(14,857)(312,186)-(312,186)-(312,186)--

36,612-

14,857-(363,655)(49,184)(721)(11,607)(312,186)(49,184)(12,328)(2,574)594(312,186)(51,758)(11,734)

-

-

-

-

(49,905)(11,607)(61,512)(1,980)(63,492)

-

(268)

-

-

(1,787)--(1,787)(268)(68,719)
268(70,506)--265
53,800

-

-

-

-

265
53,80016-

281
53,800557,474$ 2,021,953(26,464)$ 2,646,269

2,758$ 2,649,027$

127,421

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

140$

14,857$

192,647$(16,992)
4,049(179,453)

Total comprehensive income (loss) in 2020
Difference between consideration and carrying amount of subsidiaries
acquired or disposed (Note 11)
Changes in percentage of ownership interest in subsidiaries
Additional non-controlling interest recognized on issue of employee
share options by subsidiaries (Note 27)
Equity components of issued convertible bonds$

Total Equity$ 2,836,176

Net loss in 2020
Other comprehensive income (loss) in 2020, net of income tax

4,049

Total

Non-controlling
Interests

7,012

Total comprehensive income (loss) in 2019
Difference between consideration and carrying amount of subsidiaries
acquired or disposed (Note 11)
Additional non-controlling interest recognized on issue of employee
share options by subsidiaries (Note 27)
Cash dividends distributed by the subsidiaries

73,817

Other Equity
Exchange
Differences on
Translation of
Foreign
Operations(48,972)$$

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars)

2020
CASH FLOWS FROM OPERATING ACTIVITIESIncome (loss) before income tax
Adjustments for:
Income and expenses
Depreciation expense
Amortization expense
Expected credit loss
Net (gain) loss on fair value changes of financial assets andliabilities at fair value through profit or loss
Finance cost
Interest income
Compensation cost of employee share options
Share of (profit) loss of associates accounted for using the equity
methodGain on disposal of property, plant and equipment
Loss on inventories
OthersChanges in operating assets and liabilities
Financial assets mandatorily classified as at fair value throughprofit or loss
Notes receivable
Accounts receivable
Contract assets
Inventories
Prepayments
Other current assets
Notes payable
Accounts payable
Contract liabilities
Other payables
Provisions
Other current liabilities
Net defined benefit liabilities
Cash generated from operations
Income tax paid
Net cash generated from (used in) operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at fair value through other comprehensive
incomePurchase of financial assets at amortized cost
Proceeds from sale of financial assets at amortized cost
Acquisition of investments accounted for using equity method
Increase in prepayments for investments

141$(41,838)2019$

471,901

113,739
30,841
62,120111,161
30,866
20,606

10,097
29,202(8,493)281(55,727)
23,727(10,331)335(1,142)(192)
1,456(1,505)

5,535
(554)
24,840(126,926)(21,093)
70,955(134,880)
55,556
94,511
16,256(2,430)16,911(26,029)(70,540)52(30)
71
66,950(68,156)

225,594(23)(206)(413,184)(30,742)(66,486)(5,959)2,673(23,211)
10,69824,199(1,535)74344,251(64,576)(1,206)279,675(795,765)
887,365-(138,690)(7,645)
20,138(5,539)(4,537)(Continued)

Brogent Technologies Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars)

2020
Payments for property, plant and equipment
Proceeds from disposal of property, plant and equipment
Increase in refundable deposits
Acquisition of intangible assets
Decrease (increase) in other noncurrent assets
Interest received$

Net cash generated from (used in) investing activities(48,077)
2,435
(887)
(40,291)
6,219
8,493

2019
$

(58,420)
1,249(1,006)(50,730)(39,698)
10,485

19,492(274,393)

CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Issuance of convertible bonds
Proceeds from long-term borrowings
Repayment of long-term borrowings
Repayment of the principal portion of lease liabilities
Cash dividends distributed
Acquisition of subsidiaries
Interest paid
Changes in non-controlling interest

24,8671,206,229
25,895(737,527)(34,980)(312,186)(70,506)(25,102)-

191,340
320,050(120,153)(29,378)(212,371)(16,293)(2,335)

Net cash generated from financing activities

76,690130,860

EFFECT OF EXCHANGE RATE CHANGES ON THE BALANCE OF
CASH AND CASH EQUIVALENTS HELD IN FOREIGNCURRENCIES(5,452)(21,674)

NET INCREASE IN CASH AND CASH EQUIVALENTS

89,524

114,468

CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE
YEAR

774,817660,349

CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR$

864,341

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

142$

774,817(Concluded)

Brogent Technologies Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

1. GENERAL INFORMATION
Brogent Technologies Inc. (the “Corporation”) was incorporated in October 2001. The Corporation ismainly engaged in the research, development, design, production and sales of simulator rides and its key
components and peripheral products, embedded media software, streaming media, 3D dynamic simulation
technology, internet interaction media and multiple-monitor setups.
The Corporation’s shares have been trading on the Taipei Exchange since December 2012.
The consolidated financial statements of the Corporation and its subsidiaries (collectively, the “Group”) arepresented in the Corporation’s functional currency, the New Taiwan dollar.

2. APPROVAL OF FINANCIAL STATEMENTS
The consolidated financial statements were approved by the Corporation’s board of directors on March 10,2021.

3. APPLICATION OF NEW AND AMENDED STANDARDS AND INTERPRETATIONS
a. Initial application of the amendments to the International Financial Reporting Standards (IFRS),International Accounting Standards (IAS), Interpretations of IFRS (IFRIC), and Interpretations of IAS(SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the Financial Supervisory
Commission (FSC)
Except for the following, the initial application of the IFRSs endorsed and issued into effect by the FSC
did not have any material impact on the Group’s accounting policies:
Amendment to IFRS 16 “Covid-19-Related Rent Concessions”
The Group elected to apply the practical expedient provided in the amendment to IFRS 16 with respect
to rent concessions negotiated with the lessor as a direct consequence of the COVID-19. The related
accounting policies are stated in Note 4. Prior to the application of the amendment, the Group shalldetermine whether or not the abovementioned rent concessions need to be accounted for as leasemodifications.
The Group applied the amendment from January 1, 2020. Because the abovementioned rent concessions
affect only 2020, retrospective application of the amendment has no impact on the retained earnings asof January 1, 2020.

143

b. The IFRSs endorsed by the FSC for application starting from 2021
Effective Date
Announced by IASBNew IFRSs

Amendments to IFRS 4 “Extension of the Temporary Exemption from Effective immediately upon
Applying IFRS 9”
promulgation by the IASB
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
January 1, 2021
“Interest Rate Benchmark Reform - Phase 2”
As of the date the consolidated financial statements were authorized for issue, the Group assessed thatthe application of standards and interpretations will not have material impact on the Group’s financial
position and financial performance.
c. New IFRSs in issue but not yet endorsed and issued into effect by the FSC
Effective Date
Announced by IASB (Note 1)

New IFRSs“Annual Improvements to IFRS Standards 2018-2020”
Amendments to IFRS 3 “Reference to the Conceptual Framework”
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets
between An Investor and Its Associate or Joint Venture”
IFRS 17 “Insurance Contracts”
Amendments to IFRS 17
Amendments to IAS 1 “Classification of Liabilities as Current or
Non-current”
Amendments to IAS 1 “Disclosure of Accounting Policies”
Amendments to IAS 8 “Definition of Accounting Estimates”
Amendments to IAS 16 “Property, Plant and Equipment - Proceeds
before Intended Use”
Amendments to IAS 37 “Onerous Contracts - Cost of Fulfilling aContract”

January 1, 2022 (Note 2)
January 1, 2022 (Note 3)
To be determined by IASB
January 1, 2023
January 1, 2023
January 1, 2023
January 1, 2023 (Note 6)
January 1, 2023 (Note 7)
January 1, 2022 (Note 4)
January 1, 2022 (Note 5)

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods
beginning on or after their respective effective dates.
Note 2: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges offinancial liabilities that occur on or after the annual reporting periods beginning on or afterJanuary 1, 2022.
Note 3: The amendments are applicable to business combinations for which the acquisition date is on
or after the beginning of the annual reporting period beginning on or after January 1, 2022.
Note 4: The amendments are applicable to property, plant and equipment that are brought to thelocation and condition necessary for them to be capable of operating in the manner intended
by management on or after January 1, 2021.
Note 5: The amendments are applicable to contracts for which the entity has not yet fulfilled all its
obligations on January 1, 2022.
Note 6: The amendments will be applied prospectively for annual reporting periods beginning on orafter January 1, 2023.

144

Note 7: The amendments are applicable to changes in accounting estimates and changes in accounting
policies that occur on or after the beginning of the annual reporting period beginning on orafter January 1, 2023.
Amendments to IAS 1 “Disclosure of Accounting Policies”
The amendments specify that the Group should refer to the definition of material to determine its
material accounting policy information to be disclosed. Accounting policy information is material if it
can reasonably be expected to influence decisions that the primary users of general purpose financial
statements make on the basis of those financial statements. The amendments also clarify that:
1) Accounting policy information that relates to immaterial transactions, other events or conditions isimmaterial and need not be disclosed;
2) The Group may consider the accounting policy information as material because of the nature of therelated transactions, other events or conditions, even if the amounts are immaterial; and
3) Not all accounting policy information relating to material transactions, other events or conditions isitself material.
The amendments also illustrate that accounting policy information is likely to be considered as material
to the financial statements if that information relates to material transactions, other events or conditions
and:1) The Group changed its accounting policy during the reporting period and this change resulted in amaterial change to the information in the financial statements;
2) The Group chose the accounting policy from options permitted by the standards;
3) The accounting policy was developed in accordance with IAS 8 “Accounting Policies, Changes in
Accounting Estimates and Errors” in the absence of an IFRS that specifically applies;4) The accounting policy relates to an area for which the Group is required to make significant
judgments or assumptions in applying an accounting policy, and the Group discloses those
judgments or assumptions; or5) The accounting is complex and users of the financial statements would otherwise not understandthose material transactions, other events or conditions.
Except for the above impact, as of the date the consolidated financial statements were authorized for
issue, the Group is continuously assessing the possible impact that the application of other standards
and interpretations will have on the Group’s financial position and financial performance and will
disclose the relevant impact when the assessment is completed.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESa. Statement of compliance
The consolidated financial statements have been prepared in accordance with the Regulations
Governing the Preparation of Financial Reports by Securities Issuers, and IFRSs as endorsed and issued
into effect by the FSC.

145

b. Basis of preparation
The consolidated financial statements have been prepared on the historical cost basis except for
financial instruments that are measured at fair value and net defined benefit liabilities which aremeasured at the present value of the defined benefit obligation less the fair value of plan assets.
The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which thefair value measurement inputs are observable and based on the significance of the inputs to the fairvalue measurement in its entirety, are described as follows:
1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and3) Level 3 inputs are unobservable inputs for an asset or liability.
c. Classification of current and noncurrent assets and liabilities
Current assets include:
1) Assets held primarily for the purpose of trading;2) Assets expected to be realized within 12 months after the reporting period; and
3) Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle aliability for at least 12 months after the reporting period.
Current liabilities include:1) Liabilities held primarily for the purpose of trading;2) Liabilities due to be settled within 12 months after the reporting period; and
3) Liabilities for which the Group does not have an unconditional right to defer settlement for at least
12 months after the reporting period.
Assets and liabilities that are not classified as current are classified as noncurrent.
The Group is engaged in the construction business, which has an operating cycle of over 1 year. The
normal operating cycle applies when considering the classification of the Group’s construction-related
assets and liabilities.
d. Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Corporation and theentities controlled by the Corporation (i.e., its subsidiaries). Income and expenses of subsidiaries
acquired or disposed of during the period are included in the consolidated statement of comprehensive
income from the effective date of acquisition up to the effective date of disposal, as appropriate. Whennecessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies into line with those used by the Group. All intra-group transactions, balances, income andexpenses are eliminated in full upon consolidation. Total comprehensive income of subsidiaries is
attributed to the owners of the Corporation and to the non-controlling interests even if this results in the
non-controlling interests having a deficit balance.

146Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control
over the subsidiaries are accounted for as equity transactions. The carrying amounts of the interests of
the Group and the non-controlling interests are adjusted to reflect the changes in their relative interestsin the subsidiaries. Any difference between the amount by which the non-controlling interests areadjusted and the fair value of the consideration paid or received is recognized directly in equity andattributed to the owners of the Corporation.
For details of subsidiaries about ownership and operating items refer to Note 11, Table 5 and Table 6.
e. Foreign currencies
In preparing the financial statements of each individual entity in the Group, transactions in currencies
other than the entity’s functional currency (i.e., foreign currencies) are recognized at the rates of
exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated
at the rates prevailing at that date. Exchange differences on monetary items arising from settlement ortranslation are recognized in profit or loss in the period in which they arise.
Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair value was determined. Exchange differences arisingfrom the retranslation of non-monetary items are included in profit or loss for the period.
Non-monetary items that are measured at historical cost in a foreign currency are translated using theexchange rate at the date of the transaction.
For the purpose of presenting consolidated financial statements, the functional currencies of the entities
in the Group (including subsidiaries and associates operating in other countries) that use currencies
different from the currency of the Corporation are translated into the presentation currency, the New
Taiwan dollar, as follows: Assets and liabilities are translated at the exchange rates prevailing at the endof the reporting period; and income and expense items are translated at the average exchange rates forthe period. The resulting currency translation differences are recognized in other comprehensive income(attributed to the owners of the Corporation and non-controlling interests as appropriate).
f. Inventories
Inventories consist of raw materials, work in process, finished goods and merchandise. Inventories arestated at the lower of cost or net realizable value. Inventory write-downs are made by item, except
where it may be appropriate to group similar or related items. Net realizable value is the estimatedselling price of inventories less all estimated costs of completion and costs necessary to make the sale.
Inventories are recorded at weighted-average cost.
g. Investments in associates
An associate is an entity over which the Group has significant influence and which is neither asubsidiary nor an interest in a joint venture.
The Group uses the equity method to account for its investments in associates.
Under the equity method, an investment in an associate is initially recognized at cost and adjusted
thereafter to recognize the Group’s share of the profit or loss and other comprehensive income of theassociate. The Group also recognizes the changes in the Group’s share of the equity of associates.
When the Group subscribes for additional new shares of an associate at a percentage different from its
existing ownership percentage, the resulting carrying amount of the investment differs from the amountof the Group’s proportionate interest in the associate. The Group records such a difference as an
147

adjustment to investments with the corresponding amount charged or credited to capital surplus changes in capital surplus from investments in associates accounted for using the equity method. If theGroup’s ownership interest is reduced due to its additional subscription of the new shares of theassociate, the proportionate amount of the gains or losses previously recognized in other comprehensive
income in relation to that associate is reclassified to profit or loss on the same basis as would be
required had the investee directly disposed of the related assets or liabilities. When the adjustment
should be debited to capital surplus, but the capital surplus recognized from investments accounted forusing the equity method is insufficient, the shortage is debited to retained earnings.
When the Group’s share of losses of an associate equals or exceeds its interest in that associate (which
includes any carrying amount of the investment accounted for using the equity method and long-term
interests that, in substance, form part of the Group’s net investment in the associate), the Groupdiscontinues recognizing its share of further loss, if any. Additional losses and liabilities are recognized
only to the extent that the Group has incurred legal obligations, or constructive obligations, or madepayments on behalf of that associate.
The entire carrying amount of an investment (including goodwill) is tested for impairment as a single
asset by comparing its recoverable amount with its carrying amount. Any impairment loss recognized is
not allocated to any asset, including goodwill, which forms part of the carrying amount of theinvestment. Any reversal of that impairment loss is recognized to the extent that the recoverable amountof the investment subsequently increases.
When an entity in the Group transacts with its associate, profits and losses resulting from thetransactions with the associate are recognized in the Group’ consolidated financial statements only tothe extent of the Group’s unrelated interests in the associate.
h. Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated
impairment loss.
Property, plant and equipment in the course of construction are measured at cost less any recognizedimpairment loss. Cost includes professional fee and borrowing costs eligible for capitalization. Suchassets are depreciated and classified to the appropriate categories of property, plant and equipment
when completed and ready for their intended use.
Land is not depreciated.
Depreciation of property, plant and equipment is recognized using the straight-line method. Eachsignificant component is depreciated separately. The estimated useful lives, residual values anddepreciation method are reviewed at the end of each reporting period, with the effect of any changes in
estimate accounted for on a prospective basis.
On derecognition of an item of property, plant and equipment, the difference between the sales proceeds
and the carrying amount of the asset is recognized in profit or loss.
i.

Intangible assets
1) Intangible assets acquired separately
Intangible assets with finite useful lives that are acquired separately are initially measured at costand subsequently measured at cost less accumulated amortization and accumulated impairment loss.
Amortization is recognized on a straight-line basis. The estimated useful lives, residual values, andamortization methods are reviewed at the end of each reporting period, with the effect of any
changes in the estimates accounted for on a prospective basis.

1482) Internally-generated intangible assets - research and development expenditures
Expenditures on research activities are recognized as expenses in the period in which they are
incurred.
An internally-generated intangible asset arising from the development phase of an internal project isrecognized if, and only if, all of the following have been demonstrated:a) The technical feasibility of completing the intangible asset so that it will be available for use orsale;b) The intention to complete the intangible asset and use or sell it;c) The ability to use or sell the intangible asset;d) How the intangible asset will generate probable future economic benefits;e) The availability of adequate technical, financial and other resources to complete thedevelopment and to use or sell the intangible asset;f) The ability to measure reliably the expenditures attributable to the intangible asset during its
development.
The amount initially recognized for internally-generated intangible asset is the sum of theexpenditures incurred from the date when such an intangible asset first meets the recognition
criteria listed above. Subsequent to initial recognition, such intangible asset is measured on thesame basis as an intangible asset that is acquired separately.
3) Derecognition of intangible assets
On derecognition of an intangible asset, the difference between the net disposal proceeds and thecarrying amount of the asset is recognized in profit or loss.
j.

Impairment of property, plant and equipment, right-of-use asset and intangible assets
At the end of each reporting period, the Group reviews the carrying amounts of its property, plant andequipment, right-of-use asset and intangible assets, to determine whether there is any indication thatthose assets have suffered an impairment loss. If any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent of the impairment loss. When it is not possible toestimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of
the cash-generating unit to which the asset belongs. Corporate assets are allocated to the smallest groupof cash-generating units on a reasonable and consistent basis of allocation.
The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable
amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying
amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting
impairment loss recognized in profit or loss.
When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset,
cash-generating unit or assets related to contract costs is increased to the revised estimate of its
recoverable amount, but only to the extent of the carrying amount that would have been determined had
no impairment loss been recognized for the asset, cash-generating unit or assets related to contract costs
in prior years. A reversal of an impairment loss is recognized in profit or loss.

149

k. Financial instruments
Financial assets and financial liabilities are recognized when the Group becomes a party to thecontractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are
directly attributable to the acquisition or issuance of financial assets and financial liabilities (other thanfinancial assets and financial liabilities at FVTPL) are added to or deducted from the fair value of thefinancial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly
attributable to the acquisition of financial assets or financial liabilities at FVTPL are recognized
immediately in profit or loss.
1) Financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a tradedate basis.
a) Measurement categories
Financial assets are classified into the following categories: Financial assets at FVPL andfinancial assets at amortized cost.
i

Financial assets at FVTPL
Financial assets are classified as at FVTPL when such financial assets are mandatorilyclassified or designated as at FVTPL. Financial assets mandatorily classified as at FVTPL
include investments in equity instruments which are not designated as at FVTOCI.
Financial assets at FVTPL are subsequently measured at fair value, and any dividends
earned on such financial assets are recognized in other income; any remeasurement gains orlosses on such financial assets are recognized in other gains or losses. Fair value isdetermined in the manner described in Note 29.

ii Financial assets at amortized cost
Financial assets that meet the following conditions are subsequently measured at amortized
cost:i) The financial asset is held within a business model whose objective is to hold financial
assets in order to collect contractual cash flows; andii) The contractual terms of the financial asset give rise on specified dates to cash flowsthat are solely payments of principal and interest on the principal amount outstanding.
Subsequent to initial recognition, financial assets at amortized cost, including cash and cash
equivalents, financial assets at amortized cost, notes and accounts receivable, otherreceivables and refundable deposits, are measured at amortized cost, which equals the grosscarrying amount determined by the effective interest method less any impairment loss.
Exchange differences are recognized in profit or loss. Interest income is calculated byapplying the effective interest rate to the gross carrying amount of a financial asset.
A financial asset is credit impaired when one or more of the following events have occurred:i) Significant financial difficulty of the issuer or the borrower;

150ii) Breach of contract, such as a default;iii) It is becoming probable that the borrower will enter bankruptcy or undergo a financial
reorganization; oriv) The disappearance of an active market for that financial asset because of financial
difficulties.
Cash equivalents include time deposits within 3 months from the date of acquisition, which
are highly liquid, readily convertible to a known amount of cash and are subject to an
insignificant risk of changes in value. These cash equivalents are held for the purpose of
meeting short-term cash commitments.
b) Impairment of financial assets and contract assets
The Group recognizes a loss allowance for expected credit losses on financial assets at
amortized cost (including accounts receivable).
The Group always recognizes lifetime expected credit losses (ECLs) for accounts receivable.
For all other financial instruments, the Group recognizes lifetime ECLs when there has been asignificant increase in credit risk since initial recognition. If, on the other hand, the credit risk ona financial instrument has not increased significantly since initial recognition, the Groupmeasures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.
Expected credit losses reflect the weighted average of credit losses with the respective risks ofdefault occurring as the weights. Lifetime ECLs represent the expected credit losses that will
result from all possible default events over the expected life of a financial instrument. In
contrast, 12-month ECLs represent the portion of lifetime ECLs that is expected to result fromdefault events on a financial instrument that are possible within 12 months after the reportingdate.
For internal credit risk management purposes, the Group considers that a debtor would default if
internal or external information show that the debtor is unlikely to pay its creditors (without
taking into account any collateral held by the Group).
The Group recognizes an impairment gain or loss in profit or loss for all financial instrumentswith a corresponding adjustment to their carrying amount through a loss allowance account.
c) Derecognition of financial assets
The Group derecognizes a financial asset only when the contractual rights to the cash flows
from the asset expire, or when it transfers the financial asset and substantially all the risks andrewards of ownership of the asset to another party.
On derecognition of a financial asset at amortized cost in its entirety, the difference between theasset’s carrying amount and the sum of the consideration received and receivable is recognizedin profit or loss.
2) Equity instruments
Equity instruments issued by the Group are recognized at the proceeds received, net of direct issue
costs.

151

3) Financial liabilitiesa) Subsequent measurement
Financial liabilities are measured at amortized cost using the effective interest method.
b) Derecognition of financial liabilities
The difference between the carrying amount of the financial liability derecognized and theconsideration paid, including any non-cash assets transferred or liabilities assumed, isrecognized in profit or loss.
4) Convertible bonds
The component parts of compound instruments (i.e., convertible bonds) issued by the Group areclassified separately as financial liabilities and equity in accordance with the substance of thecontractual arrangements and the definitions of a financial liability and an equity instrument.
On initial recognition, the fair value of the liability component is estimated using the prevailingmarket interest rate for similar non-convertible instruments. This amount is recorded as a liability
on an amortized cost basis using the effective interest method until extinguished upon conversion or
upon the instrument’s maturity date. Any embedded derivative liability is measured at fair value.
The conversion option classified as equity is determined by deducting the amount of the liability
component from the fair value of the compound instrument as a whole. This is recognized andincluded in equity, net of income tax effects, and is not subsequently remeasured. In addition, theconversion option classified as equity will remain in equity until the conversion option is exercised;
in which case, the balance recognized in equity will be transferred to capital surplus - sharepremiums. When the conversion option remains unexercised at maturity, the balance recognized inequity will be transferred to capital surplus - share premiums.
Transaction costs that relate to the issuance of the convertible notes are allocated to the liability andequity components in proportion to the allocation of the gross proceeds. Transaction costs relating
to the equity component are recognized directly in equity. Transaction costs relating to the liability
component are included in the carrying amount of the liability component.
l.

Provisions
Provisions are measured at the best estimate of the discounted cash flows of the consideration required
to settle the present obligation at the end of the reporting period, taking into account the risks anduncertainties surrounding the obligation.

m. Revenue recognition
The Group identifies contracts with customers, allocates the transaction price to the performanceobligations and recognizes revenue when performance obligations are satisfied.
1) Construction contract revenue
In a construction contract, the Group constructs an asset that the owner controls while theconstruction is in progress; thus, the Group recognizes revenue over time. The Group measuresrevenue by the percentage of completion determined on the basis of the proportion of the number ofworking days incurred for work performed to date to the estimated total number of working days, as
there is a direct relationship between the working days incurred and the satisfied portion of theperformance obligation. Contract assets are recognized during the construction and are reclassified
to accounts receivable at the point the customer is invoiced. If the milestone payments exceed the152revenue recognized to date, then the Group recognizes contract liabilities for the difference. Certain
payments, which are retained by the customer as specified in the contract, are intended to ensurethat the Group adequately completes all of its contractual obligations. Such retention receivables arerecognized as contract assets until the Group satisfies its performance obligation.
2) Licensing revenue
The license granted by the Group provides a customer the right to access the Group’s intellectual
property as it exists throughout the license period; therefore, the related performance obligation issatisfied over time when all of the following criteria are met:a) The customer reasonably expects that the Group will undertake activities that significantly
affect the intellectual property to which the customer has rights;b) The rights granted by the license directly expose the customer to any positive or negative effectsof the Group’s activities; andc) The Group’s activities do not result in the transfer of a good or a service to the customer as theactivities occur.
If the criteria listed above are not met, the performance obligation is satisfied at a point in time, i.e.,the date the license is granted to the customer and the customer is able to use and benefit from thelicense.
Advance receipts of royalty is recognized as “contract liabilities”.
3) Sale of tickets and merchandise
Tickets, merchandise and peripheral products are sold through self-operated outlets. Based on thecontract, when tickets, merchandise and peripheral products are transferred to the customer, thecustomer takes full discretion in the determination of prices, the right of use, the primary
responsibility for sales to future customers, and assumes significant risk of ownership of the goods.
Therefore, the Group recognizes the related revenue and accounts receivable at the point in time thegoods were transferred. Advance receipts from the sale of the goods are recognized as “contract
liabilities”.
4) Service revenue
Service revenue is recognized when the Group provided maintenance service to simulator rides.
n. Leases
At the inception of a contract, the Group assesses whether the contract is, or contains, a lease.
1) The Group as lessor
Leases are classified as finance leases whenever the terms of a lease transfer substantially all therisks and rewards of ownership to the lessee. All other leases are classified as operating leases.
Lease payments from operating leases are recognized as income on a straight-line basis over theterms of the relevant leases.
2) The Group as lessee
The Group recognizes right-of-use assets and lease liabilities for all leases at the commencement
date of a lease, except for short-term leases and low-value asset leases accounted for by applying a
153

recognition exemption where lease payments are recognized as expenses on a straight-line basis
over the lease terms.
Right-of-use assets are initially measured at cost and are subsequently measured at cost lessaccumulated depreciation and impairment losses and adjusted for any remeasurement of the leaseliabilities. Right-of-use assets are presented on a separate line in the consolidated balance sheets,
except for those that meet the definition of investment properties.
Right-of-use assets are depreciated using the straight-line method from the commencement dates tothe earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.
Lease liabilities are initially measured at the present value of the lease payments. The lease
payments are discounted using the interest rate implicit in a lease, if that rate can be readily
determined. If that rate cannot be readily determined, the Group uses the lessee’s incremental
borrowing rate.
Subsequently, lease liabilities are measured at amortized cost using the effective interest method,with interest expense recognized over the lease terms. When there is a change in a lease term, theGroup remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets.
However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amountof the remeasurement is recognized in profit or loss. For a lease modification that is not accounted
for as a separate lease, the Group accounts for the remeasurement of the lease liability by (a)decreasing the carrying amount of the right-of-use asset of lease modifications that decreased thescope of the lease, and recognizing in profit or loss any gain or loss on the partial or full terminationof the lease; (b) making a corresponding adjustment to the right-of-use asset of all other leasemodifications. Lease liabilities are presented on a separate line in the consolidated balance sheets.
The Group negotiates with the lessor for rent concessions as a direct consequence of the Covid-19
to change the lease payments originally due by June 30, 2021, that results in the revised
consideration for the lease. There is no substantive change to other terms and conditions. The Groupelects to apply the practical expedient to all of these rent concessions and, therefore, does not assess
whether the rent concessions are lease modifications. Instead, the Group recognizes the reduction inlease payment in profit or loss as other operating income, in the period in which the events orconditions that trigger the concession occur, and makes a corresponding adjustment to the leaseliability.
o. Government grants
Government grants are not recognized until there is reasonable assurance that the Group will comply
with the conditions attached to them and that the grants will be received.
Government grants are recognized in profit or loss on a systematic basis over the periods in which theGroup recognizes as expenses the related costs for which the grants are intended to compensate. Grants
received with no corresponding expenses are recognized as deferred revenue.
Government grants that are receivable as compensation for expenses or losses already incurred or forthe purpose of giving immediate financial support to the Group with no future related costs arerecognized in profit or loss in the period in which they are received.
p. Employee benefits
1) Short-term employee benefits
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted
amount of the benefits expected to be paid in exchange for the related service.

1542) Retirement benefits
Payments to defined contribution retirement benefit plans are recognized as expense whenemployees have rendered services entitling them to the contributions.
Defined benefit costs (including service cost, net interest and remeasurement) under the defined
benefit retirement benefit plans are determined using the projected unit credit method. Service cost(including current service cost) and net interest on the net defined benefit liabilities (assets) arerecognized as employee benefits expense in the period in which they occur. Remeasurement,
comprising actuarial gains and losses, and the return on plan assets (excluding interest), is
recognized in other comprehensive income in the period in which it occurs. Remeasurement
recognized in other comprehensive income is reflected immediately in retained earnings and will
not be reclassified to profit or loss.
Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Group’s defined
benefit plan. Any surplus resulting from this calculation is limited to the present value of any
refunds from the plans or reductions in future contributions to the plans.
q. Share-based payment arrangements
The fair value at the grant date of the employee share options is expensed on a straight-line basis overthe vesting period, based on the Group’s best estimates of the number of shares or options that are
expected to ultimately vest, with a corresponding increase in capital surplus - employee share options.
The expense is recognized in full at the grant date if the grants are vested immediately.
r. Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
1) Current tax
Income tax payable (recoverable) is based on taxable profit (loss) for the year determined according
to the applicable tax laws of each tax jurisdiction.
According to the Income Tax Law in the ROC, an additional tax on unappropriated earnings isprovided for in the year the shareholders approve to retain earnings.
Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax
provision.
2) Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets andliabilities and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax
assets are generally recognized for all deductible temporary differences and loss carryforwards tothe extent that it is probable that taxable profits will be available against which those deductible
temporary differences and loss carryforwards can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with investments
in subsidiaries, and associates, except where the Group is able to control the reversal of thetemporary difference and it is probable that the temporary difference will not reverse in theforeseeable future. Deductible temporary differences associated with such investments and interests
are only recognized to the extent that it is probable that there will be sufficient taxable profits
against which to utilize the benefits of the temporary differences and they are expected to reverse in155the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period andreduced to the extent that it is no longer probable that sufficient taxable profits will be available toallow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also
reviewed at the end of each reporting period and recognized to the extent that it has become
probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the
period in which the liabilities are settled or the assets are realized, based on tax rates (and tax laws)that have been enacted or substantively enacted by the end of the reporting period. The
measurement of deferred tax liabilities and assets reflects the tax consequences that would follow
from the manner in which the Group expects, at the end of the reporting period, to recover or settle
the carrying amount of its assets and liabilities.
3) Current and deferred taxes
Current and deferred taxes are recognized in profit or loss, except when they relate to items that arerecognized in other comprehensive income or directly in equity, in which case, the current anddeferred taxes are also recognized in other comprehensive income or directly in equity respectively.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATIONUNCERTAINTY
In the application of the Group’s accounting policies, management is required to make judgments,
estimations and assumptions about the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical experienceand other factors that are considered relevant. Actual results may differ from these estimates.
The Group considers the economic implications of the COVID-19 when making its critical accounting
estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions toaccounting estimates are recognized in the period in which the estimates are revised if the revisions affectonly that period or in the period of the revisions and future periods if the revisions affect both current andfuture periods.
Key Sources of Estimation Uncertainty
a. Estimated impairment of financial assets
The provision for impairment of accounts receivable and contracts assets is based on assumptions aboutrisk of default and expected loss rates. The Group uses judgment in making these assumptions and inselecting the inputs to the impairment calculation, based on the Group’s historical experience, existing
market conditions as well as forward looking estimates as of the end of each reporting period. Where
the actual future cash inflows are less than expected, a material impairment loss may arise.
b. Measurement of the percentage of completion of construction contracts
Construction contract revenue is recognized by the percentage of completion method. The percentage ofcompletion of a contract is measured based on the proportion of working days incurred for work
performed to date to the estimated total working days. Since the estimated total working days may be
modified as assessed and determined by the management based on the nature and content of work, etc.
for each construction contract, the measurement of the percentage of completion and revenue may beaffected.

156

6. CASH AND CASH EQUIVALENTS
December 31
2020
Cash on handBank deposits
Cash equivalents (investments with original maturities of less than 3months)Time deposits
Repurchase agreement collateralized by bonds

7.

$

2019

978
591,015$973
452,335

205,400
66,948

321,509-$ 864,341$ 774,817

FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
December 31
2020

2019

Financial assets
Financial assets mandatorily classified as at FVTPL
Derivative financial liabilities
Redemption options and put options of convertible bonds$

Non-derivative financial assets
Mutual funds
Unquoted ordinary shares

Current
Non-current

1,860

$

-

380,382
281,474
661,856

248,751
302,389
551,140$ 663,716$ 551,140$ 380,382
283,334$ 253,176
297,964$ 663,716$ 551,140

8. FINANCIAL ASSETS AT AMORTIZED COST
December 31
2020
Time deposits with original maturities of more than 3 months
Pledged time deposits
Pledged bank deposits
Unquoted preferred shares

Current
Non-current$

46,255
169,343
2,000
35,060$6,317
302,940
33,540$ 252,658$ 342,797$ 202,598
50,060$ 277,637
65,160$ 252,658$ 342,797

Refer to Note 31 for information on financial assets at amortized cost pledged as collateral.
157

2019

9. NOTES RECEIVABLE, ACCOUNTS RECEIVABLE AND AND PAST DUE RECEIVABLE
December 31
2020

2019

Notes receivable
Operating - at amortized cost$Accounts receivable
Operating - at amortized cost
Gross carrying amountLess: Allowance for impairment loss

$ 215,783(10,864)$ 286,738-$ 204,919$ 286,738$-$

18,559(18,559)

$

-

$

-

Past due receivable (included in other non-current assets)
Operating - at amortized cost
Gross carrying amountLess: Allowance for impairment loss

21,164$71

a. Notes receivable
The aging of notes receivable as of December 31, 2020 is within 30 days. There were no past due notes
receivable and the Group did not recognize an allowance for impairment loss.
b. Accounts receivable
The average credit period is 90 days. In order to minimize credit risk, the management of the Group hasdelegated a team responsible for determining credit limits, credit approvals and other monitoringprocedures to ensure that follow-up action is taken to recover overdue debts. In addition, the Group
reviews the recoverable amount of each individual trade debt at the end of the year to ensure that
adequate allowance is made for possible irrecoverable amounts. In this regard, the management believes
the Group’s credit risk was significantly reduced.
The Group measures the loss allowance for accounts receivable at an amount equal to lifetime ECLs.
The expected credit losses on accounts receivable are estimated by reference to the past default
experience of the customer and the customer’s current financial position, as well as the industry
outlook. As the Group’s historical credit loss experience does not show significantly different loss
patterns for different customer segments, the provision for loss allowance based on past due status is notfurther distinguished according to the Group’s different customer base.
The following table details the loss allowance of accounts receivable based on the number of days pastdue from the invoice date.
December 31, 2020
1-30 Days

31-90 Days

91-180 Days

181-365Days

Over
365 days

Gross carrying amount
Loss allowance (lifetime ECLs)$

67,690-$15,632-$22,004-$

12,603(595 )$

97,854(10,269 )$ 215,783(10,864 )Amortized cost$

67,690$15,632$22,004$12,008$87,585$ 204,919

158

Total

The following table details the loss allowance of accounts receivable based on the impaired aging
analysis.
December 31, 2019
Not Past
Due

Past Due1-30 Days

Past Due31-90 Days

Past Due
91-180 Days

Past Due180 Days

Total

Gross carrying amount
Loss allowance (lifetime ECLs)$

90,478
-

$

540
-

$

3,566
-

$

38,175-$ 172,538(18,559 )$ 305,297(18,559 )Amortized cost$

90,478

$

540

$

3,566

$

38,175$ 153,979$ 286,738

The movements of the loss allowance of accounts receivable were as follows:
For the Year Ended December 31
2020
2019
Balance at January 1
Add: Impairment loss recognized on accounts receivable
Less: Amounts written off$ 18,559
10,864(18,559)$ 18,559-

Balance at December 31$ 10,864$ 18,559

10. INVENTORIES
December 31

Raw materials
Work in process
Finished goods
Merchandise

2020

2019

$ 130,333
9,300
94,9983,356$ 128,213
44,92556,6573,163$ 237,987$ 232,958

The cost of inventories recognized as loss on inventory value was $1,456 thousand for the year ended
December 31, 2020.

11. SUBSIDIARIES
Subsidiaries included in the consolidated financial statements
The subsidiaries included in the consolidated financial statements are as follows:

Investor
The Corporation

Investee
Brogent Mechanical Inc.
(Brogent Mechanical)
Brogent Creative Inc.

Brogent Hong Kong Limited(Brogent Hong Kong)

Nature of Activities
Manufacture and sales of thesimulator rides and its key
components
Development and sales of theperipheral product ofsimulator rides
Reinvestment and tradingbusiness

Proportion of Ownership (%)
December 31
2020
2019

Remark-61

Notes 1 and 2-

100

Notes 1 and 2

100

100

-

(Continued)

159

Investor

InvesteeNature of Activities

Brogent Global Inc. (Brogent
Global)Development and managementbusiness of self-operated
outlets
Reinvestment and tradingbusiness
Reinvestment and tradingbusiness
Reinvestment and tradingbusiness
Reinvestment and tradingbusiness
Import and export business

100

100

-

100

100

-

100

100

-

100

100

-

100

100

-

58

58

-

Import and export business

42

42

-

Management business of
self-operated outlets
Development and managementbusiness of self-operated
outlets
Reinvestment and tradingbusiness
Reinvestment and tradingbusiness
Management business of
self-operated outlets

89

87

-

100

100

-

100

100

-

100

100

-

100

100

-

100

100

-

Dili Jie Holdings Limited (DiliJie)
Jetway Holdings Limited(Jetway)
Garley Holdings Limited(Garley)
Holey Holdings Limited

Dili Jie
JetwayGarleyBrogent Hong Kong

Brogent Rides (Shanghai)
Limited (Brogent Rides)
Brogent Rides (Shanghai)
Limited (Brogent Rides)
hexaRide the first LLPBrogent Rides

Brogent Creative (Shanghai)
Limited (Brogent Creative)

Brogent Global

Jetmay Holdings Limited(Jetmay)
Ou Wei Limited

JetmayProportion of Ownership (%)
December 31
2020
2019

Hai Wei Culture Creative andDevelopment (Shanghai)
Limited (Hai Wei Culture
Creative)
StarLite Design & Planning
Limited (StarLite)

Management business of
self-operated outlets

Remark(Concluded)Note 1: In the second quarter of 2020, the Corporation invested $70,506 thousand and obtained 39%
equity of Brogent Mechanical from unrelated party. The difference between the invested price andbook value which amounted to $1,787 thousand was recognized as deduction of retained earnings.
In the second quarter of 2019, the Corporation invested $5,539 thousand and obtained 40% equityof Brogent Creative from unrelated party. The difference between the invested price and bookvalue which amounted to $372 thousand was recognized as deduction of capital surplus.
The above transactions were accounted for as equity transactions since the Group did not cease tohave control over these subsidiaries.
Note 2: In order to integrate the Group’s resources and to improve the operational performance andcompetitiveness, the Corporation’s board of directors resolved to merge with the Corporation its
subsidiaries Brogent Mechanical and Brogent Creative Inc. on the effective date of September 30,
2020. The Corporation is the surviving company and Brogent Mechanical and Brogent Creative
are the dissolved companies.

12. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
December 31

Investments in associates - associates that are not individuallymaterial

160

2020

2019

$ 3,331$ 3,029Aggregate information of associates that are not individually material:
December 31
The Group’s share of:
Net profit (loss)
Other comprehensive (loss) income
Total comprehensive income (loss) for the year

2020

2019

$ 1,142(840)$ (5,535)42$$ (5,493)

302

13. PROPERTY, PLANT AND EQUIPMENT
For the year ended December 31, 2020

Land

Buildings

Machinery
Equipment

139,868-$$

Transportation
Equipment

OfficeEquipment

Other
Equipment

Property
underConstruction

$

$

$

Total

Cost
Balance at January 1,2020
Additions
Disposals
Reclassification
Effect of foreign currency exchange
differences$

Balance at December 31, 2020$

139,868$

692,301$

11,413

$

1,822

$

35,525$

252,050

Balance at January 1, 2020
Depreciation expense
Disposals
Effect of foreign currency exchange
differences

$

-

$

123,80330,216(949 )

$

9,084
1,861
(4,762 )

$

955
357
(59 )

$

27,0688,150(15,844 )$

72,74530,196(17,514 )Balance at December 31, 2020

$

-

$

153,062

$

6,183

$

1,253

$

19,375$85,489$Carrying amount at December 31, 2020$

139,868$

539,239

$

5,230

$

569

$

16,150$166,561$-

686,097
7,190(949 )-

14,996
1,179(4,762 )
-

(37 )

$

-

1,881
(59 )
-

43,3058,203(15,919 )(64 )263,805
7,860(19,682 )-128,710
22,919(61,771 )$ 1,278,662
47,351(41,371 )(61,771 )

-

(34 )

$

89,858$ 1,222,837

$

-

67

Accumulated depreciation

-

(8 )

-

-

1

62

$

233,655
70,780(39,128 )-$265,362

89,858$957,475-

55

For the year ended December 31, 2019Land

Buildings

Machinery
Equipment$

667,506
2,976
15,682$

13,301
1,695-

Transportation
Equipment

OfficeEquipment

Other
Equipment

Property
underConstruction$

34,054
8,707
545

$

161,037
26,182(838 )
77,593$211,966
14,240(48 )(97,448 )

Total

Cost
Balance at January 1,2019
Additions
Disposals
Reclassification
Effect of foreign currency exchange
differences$

139,868-

Balance at December 31, 2019$

139,868$

686,097$

Balance at January 1, 2019
Depreciation expense
Disposals
Effect of foreign currency exchange
differences

$

-

$

94,74929,097-$

Balance at December 31, 2019

$

-

$

123,803

$

9,084

$

955

$

27,068$72,745$-Carrying amount at December 31, 2019$

139,868$

562,294

$

5,912

$

926

$

16,237$

191,060$

128,710

-

$

1,878
283
(280 )--(237 )

14,996

$

1,881

$

43,305$

263,805$

128,710$ 1,278,662

7,576
1,508
-

$

795
389
(229 )$

19,243
7,830-$

40,78832,224(194 )

$

-

(67 )

-

-

(1 )

(169 )$ 1,229,610
54,083(1,166 )(3,628 )Accumulated depreciation

-

(43 )

-

-

(5 )

(73 )

$

-

163,151
71,048(423 )(121 )$

233,655$ 1,045,007

The reconciliation of additions and the payments from the statements of cash flows of the above items ofproperty, plant and equipment is as follows:161

For the Year Ended December 31
2020
2019
Investing activities impacting cash and non-cash items at the same
time
Additions in property, plant and equipment
Decrease in payables for equipment$ 47,351
726$ 54,083
4,337

Cash payments for purchasing property, plant and equipment$ 48,077$ 58,420

The following items of property, plant and equipment are depreciated on a straight-line basis over theirestimated useful lives as follows:
Buildings
Main buildings
Others
Machinery equipment
Transportation equipment
Office equipment
Other equipment

50 years
8-20 years
3-10 years
5 years
3-6 years
2-15 years

The farmland located in JhongShan, Sinwu Dist. Taoyuan City is registered in the name of an individual
due to legal restrictions. The Group had obtained an agreement with the individual that the Group canregister the farmland under the Group or other individual specified by the Group without payment at any
time.
Refer to Note 31 for the carrying amount of property, plant and equipment pledged as collateral forborrowings.

14. LEASE ARRANGEMENTS
a. Right-of-use assets
December 31

Carrying amountLand
Buildings
Transportation equipment

2020

2019

$ 119,337
210,799
11,015$ 129,945
198,004
12,102$ 341,151$ 340,051

For the Year Ended December 31
2020
2019
Additions to right-of-use assets$ 45,814$

Depreciation of right-of-use assets
Land
Buildings
Transportation equipment$ 10,608
26,361
5,990$ 10,578
24,111
5,424$ 42,959$ 40,113

162

9,776

Except for the additions and depreciation expense above, the right-of-use assets have no major subleaseor modification during 2020 and 2019.
b. Lease liabilities
December 31

Carrying amountCurrent
Noncurrent

2020

2019

$ 56,161$ 309,631$ 51,032$ 306,990

Range of discount rates for lease liabilities was as follows:
December 31

Land (%)
Buildings (%)
Transportation equipment (%)

2020

2019

1.71
1.71-1.80
1.71-1.87

1.71
1.71-1.80
1.71-1.87

c. Material lease activities and terms
The Group leases land and buildings for the use of business space and self-operated outlets with leaseterms of 10 to 20 years. The lease contract for land specifies that lease payments will be adjusted on thebasis of changes in announced land value and price. Lease contracts for self-operating outlets containvariable payments which are determined at a specific percentage of sales generated from theself-operating outlets. The Group does not have bargain purchase option to acquire the leasehold landand buildings at the end of the lease terms.
Because of the market conditions severely affected by COVID-19 in 2020, the Group negotiated withthe lessor for rent concessions for land lease. The lessor agreed to provide unconditional 20% rent
reduction from May 1 to October 31, 2020. The Group recognized in profit or loss the impact of rent
concessions of $1,194 thousand (presented in other income) for the year ended December 31, 2020.
d. Other lease information
For the Year Ended December 31
2020
2019
Expenses relating to short-term leases
Expenses relating to low-value asset leases
Total cash outflow for leases$ 7,744$31$ 49,205163$ 23,619$
86$ 59,567

15. OTHER INTANGIBLE ASSETSFor the year ended December 31, 2020
Computer
Software

Franchise

Film

Total

4,350
3,862
(212 )$ 15,732
59(14,368 )$ 158,765
41,754-$ 261,127
52,264(60,248 )-(2 )(1,420 )(1,367 )PatentCost
Balance at January 1, 2020
AdditionsWrite-off
Effect of foreign currency
exchange differences$ 82,280
6,589(45,668 )Balance at December 31, 2020

$ 43,256

$

8,000

$

1,421

$ 199,099$ 251,776

Balance at January 1, 2020
Amortization expense
Write-off
Effect of foreign currency
exchange differences$ 62,445
10,397(45,668 )

$

589
399
(212 )$ 14,727130(14,368 )$ 19,831
19,915-$ 97,592
30,841(60,248 )--(153 )(103 )

Balance at December 31, 2020

$ 27,224

$

776

$

489

$ 39,593$ 68,082

Carrying amount at December 31,
2020$ 16,032

$

7,224

$

932

$ 159,506$ 183,694$

55

Accumulated amortization50

For the year ended December 31, 2019
Computer
SoftwarePatentFranchise

Film

Total

3,274
1,076

$ 15,735-$ 59,822
98,957$ 153,433
107,858

-

(3 )

(14 )

(164 )

Cost
Balance at January 1, 2019
Additions
Effect of foreign currency
exchange differences$ 74,602
7,825

Balance at December 31, 2019

$ 82,280$

4,350$ 15,732$ 158,765$ 261,127

Balance at January 1, 2019
Amortization expense
Effect of foreign currency
exchange differences$ 49,659
12,843$317
272$ 14,209
520

$

2,719
17,231$ 66,904
30,866-(2 )(119 )(178 )

Balance at December 31, 2019

$ 62,445$

589$ 14,727$ 19,831$ 97,592

Carrying amount at December 31,
2019$ 19,835

$

3,761

$

$ 138,934$ 163,535$(147 )

Accumulated amortization

(57 )

164

1,005

The above intangible assets are amortized on a straight-line basis over their estimated useful lives asfollows:
Computer software
PatentFranchiseFilm

1-5 years
1-19 years
1-10 years
5-10 years

16. BORROWINGSa. Short-term borrowings
December 31

Secured borrowings (Note 31)
Bank loans
Unsecured borrowings
Bank credit borrowings

Interest rate (%)

2020

2019

$ 134,540$ 116,340

81,66775,000$ 216,207$ 191,340

0.4-1.58

1.05-1.77

b. Long-term borrowings
December 31
2020

2019

Secured borrowings (Note 31)
Bank loans - repayable before January 2032$

264,140$

968,167

Unsecured borrowings
Bank loans - repayable before May 2032
Loans from the government - repayable before December 2022
(Note)
Less: Current portionLong-term borrowings$

Interest rate (%)
Note:

91,500100,000

895
356,535(50,258)

1,068,167(252,626)

306,277$

1.50-1.73

The subsidiary StarLite obtained an interest-free loan from the local government.

165

815,541
1.05-1.91

17. BONDS PAYABLE - December 31, 2020

3rd domestic unsecured convertiblebonds
4th domestic unsecured convertible
bonds
Total issued this year
Amortized
Balance at year end

Total Face
Value Issued

Discount on
Bonds Payable

AccruedPremiums$$$

700,000
500,000
1,200,000-$ 1,200,000(28,301)(19,300)(47,601)
2,143$(45,458)

$

-

Total

$

671,699

1,118

480,700
1,152,399
3,261

1,118

$ 1,155,660

a. On October 12, 2020, the Corporation issued its 3rd domestic five-year unsecured zero-coupon
convertible bonds with an aggregate principal amount of $711,490 thousand (101.64% of the face value)
and a par value of $100 thousand per bond certificate.
The conversion price was set at $105 per share. Bondholders are entitled to convert bonds into the
Corporation’s common stock from January 13, 2021 to October 12, 2025.
If the closing price of the Corporation’s common stock continues being at least 130% of the conversion
price then in effect for 30 consecutive trading days or the aggregate outstanding balance of bonds
payable is less than 10% of the original issuance amount, the Corporation has the right to redeem theoutstanding bonds payable at par value in cash during the period from three months after the issuancedate to the date 40 days prior to the maturity date.
Under the terms of the convertible bonds, the bondholders have the right to require the Corporation toredeem any bonds in cash at face value of the convertible bonds plus interest compensation (1.2547%)
after two and a half years from the issuance.
The amount of the face value of the convertible bonds plus interest compensation (2.5251%) has to be
fully paid off in cash at maturity by the Corporation.
b. On October 15, 2020, the Corporation issued its 4th domestic four-year unsecured zero-coupon
convertible bonds with an aggregate principal amount of $500,000 thousand and a par value of $100
thousand per bond certificate.
The conversion price was set at $106.5 per share. Bondholders are entitled to convert bonds into the
Corporation’s common stock from January 16, 2021 to October 15, 2024.
If the closing price of the Corporation’s common stock continues being at least 130% of the conversion
price then in effect for 30 consecutive trading days or the aggregate outstanding balance of bonds
payable is less than 10% of the original issuance amount, the Corporation has the right to redeem theoutstanding bonds payable at par value in cash during the period from three months after the issuancedate to the date 40 days prior to the maturity date.
Under the terms of the convertible bonds, the bondholders have the right to require the Corporation toredeem any bonds in cash at face value of the convertible bonds plus interest compensation (0.7514%)
after two and a half years from the issuance.
The amount of the face value of the convertible bonds plus interest compensation (1.5085%) has to be
fully paid off in cash at maturity by the Corporation.

166

c. The convertible bonds contain both liability and equity components. The equity component waspresented in equity under the heading of capital surplus - options; the effective interest rate of the equity
and liability component was 0.8% and 1% per annum, respectively, on initial recognition.
2020
Proceeds from issuance (less transaction costs of $5,261 thousand)
Redemption of option
Equity component$ 1,206,229(30)(53,800)

Liability component at the date of issue$ 1,152,399

18. NOTES PAYABLE AND ACCOUNTS PAYABLEThe Group’s notes payable and accounts payable are generated from operating activities. The average credit
period of purchases of goods is around 30 to 120 days. The Group has financial risk management policies inplace to ensure that all payables are paid within the pre-agreed credit terms and, therefore, there was nointerest charged on the outstanding balance.

19. OTHER PAYABLES
December 31
2020
Payables for salaries
Payables for compensation of employees, board of directors andsupervisors
Payables for equipment
Payables for insurance
Payables for premium service fee
Payables for pension
Others$$34,113

2019$

50,024

3,659
3,283
2,149
1,381
16,14843,455
4,385
3,547
1,602
1,437
26,70960,733$ 131,159

20. RETIREMENT BENEFIT PLANS
a. Defined contribution plan
The Corporation and domestic subsidiaries adopted a pension plan under the Labor Pension Act (LPA),
which is a state-managed defined contribution plan. Under the LPA, the Group makes monthly
contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.
Subsidiaries are required by local regulations to make contributions to central provident fund andretirement insurance, which are also considered defined contribution plans.
b. Defined benefit plan
The defined benefit plans adopted by the Corporation are in accordance with the Labor Standards Act
and operated by the government of the ROC. Pension benefits are calculated on the basis of the lengthof service and average monthly salaries of the 6 months before retirement. The Corporation contributes
amounts based on the law to a pension fund administered by the pension fund monitoring committee.
Pension contributions are deposited in the Bank of Taiwan in the committee’s name. Before the end of167

each year, the Group assesses the balance in the pension fund. If the amount of the balance in thepension fund is inadequate to pay retirement benefits for employees who conform to retirement
requirements in the next year, the Group is required to fund the difference in one appropriation thatshould be made before the end of March of the next year. The pension fund is managed by the Bureauof Labor Funds, Ministry of Labor (“the Bureau”); the Group has no right to influence the investment
policy and strategy.
The amounts included in the consolidated balance sheets in respect of the Group’s defined benefit plans
were as follows:
December 31
2020

2019

Present value of defined benefit obligation
Fair value of plan assets$ 11,727(2,433)$ 10,851(2,112)

Net defined benefit liabilities

$

$

9,294

8,739

Movements in net defined benefit liabilities were as follows:
Present Valueof the Defined
BenefitObligation
Balance at January 1, 2019$

Service cost
Current service cost
Interest expense (income)
Recognized in profit or loss

9,959

Fair Value ofthe Plan Assets$(1,794)

Net Defined
BenefitLiabilities
$

8,165

213
124
337

(24)
(24)

213
100
313

-

(54)

(54)

700
(145)

-

700
(145)

555

(54)

501

-

(240)

(240)

Balance at December 31, 201910,851(2,112)

8,739

Service cost
Current service cost
Interest expense (income)
Recognized in profit or loss

224
109
333

(22)
(22)

224
87
311

-

(59)

(59)

298

-

298
(Continued)

Remeasurement
Return on plan assets (excluding amounts
included in net interest)
Actuarial loss - changes in financial
assumptions
Actuarial gain - experience adjustments
Recognized in other comprehensive income(loss)
Contributions from the employer

Remeasurement
Return on plan assets (excluding amounts
included in net interest)
Actuarial loss - changes in financial
assumptions

168

Present Valueof the Defined
BenefitObligation
Actuarial loss - experience adjustments
Recognized in other comprehensive income(loss)$

Contributions from the employer
Balance at December 31, 2020$

245

Fair Value ofthe Plan Assets$-

Net Defined
BenefitLiabilities
$

245

543

(59)

484

-

(240)

(240)

11,727$(2,433)$

9,294(Concluded)

Through the defined benefit plans under the Labor Standards Act, the Group is exposed to the following
risks:
1) Investment risk
The plan assets are invested in domestic and foreign equity and debt securities, bank deposits, etc.
The investment is conducted at the discretion of the Bureau or under the mandated management.
However, in accordance with relevant regulations, the return generated by plan assets shall not be
below the interest rate for a 2-year time deposit with local banks.
2) Interest risk
A decrease in the bond interest rate will increase the present value of the defined benefit obligation;
however, this will be partially offset by an increase in the return on the plans’ debt investments.
3) Salary risk
The present value of the defined benefit obligation is calculated using the future salaries of plan
participants. As such, an increase in the salaries of the plan participants will increase the present
value of the defined benefit obligation.
The actuarial valuations of the present value of the defined benefit obligation were carried out by
qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations are
as follows:
December 31

Discount rate(s)Expected rate(s) of salary increase

2020

2019

0.80
2.25

1.00
2.25

If possible reasonable changes in each of the significant actuarial assumptions will occur and allother assumptions will remain constant, the present value of the defined benefit obligation would
increase (decrease) as follows:
December 31
2020
Discount rate(s)Increase 0.25%
Decrease 0.25%

$
$

169

(371)
385

2019

$
$

(357)
370
(Continued)

December 31
2020
Expected rate(s) of salary increase
Increase 1%
Decrease 1%

2019$ 1,606$ (1,404)$ 1,551$ (1,354)(Concluded)

The above sensitivity analysis may not be representative of the actual changes in the present valueof the defined benefit obligation as it is unlikely that changes in assumptions would occur inisolation of one another as some of the assumptions may be correlated.
December 31
2020

2019

Expected contributions to the plans for the next year

$ 240

$ 240

Average duration of the defined benefit obligation

16.3

15.8

21. MATURITY ANALYSIS OF ASSETS AND LIABILITIESThe current/non-current classification of the Group’s assets and liabilities relating to the construction
business was based on its operating cycle. The amount expected to be recovered or settled within 1 year
after the reporting period and more than 1 year after the reporting period for related assets and liabilities
were as follows:

Within 1 Year

More Than
1 Year$202,598
226,083
944,432
237,987
120,941$

174,996-$$ 1,732,041$

174,996$ 1,907,037$

110,865
65,3572,380$

71,397-$

110,865
136,754
2,380$

178,602$71,397$

249,999$

277,637
286,809$-$277,637
286,809(Continued)

Total

December 31, 2020
AssetsFinancial assets at amortized cost - current
Notes receivable and accounts receivable
Contract assets - current
Inventories
Prepayments

Liabilities
Notes payable and accounts payable
Contract liabilities - current
Provisions - current

202,598
226,083
1,119,428
237,987
120,941

December 31, 2019
AssetsFinancial assets at amortized cost - current
Notes receivable and accounts receivable

170

Within 1 Year

More Than
1 Year$975,040
232,958
227,425$

60,764-$ 1,035,804
232,958
227,425$ 1,999,869$

60,764$ 2,060,633$

96,384
162,783
2,328

$

-

$

96,384
162,783
2,328$

261,495$-$

261,495(Concluded)

Contract assets - current
Inventories
Prepayments

Liabilities
Notes payable and accounts payable
Contract liabilities - current
Provisions - current

Total

22. EQUITY
a. Ordinary share capital
December 31
2020

2019

Number of shares authorized (in thousands)
Shares authorized

90,000$ 900,000

90,000$ 900,000

Number of shares issued and fully paid (in thousands)
Shares issued

55,747$ 557,474

55,747$ 557,474

Fully paid ordinary shares, which have a par value of $10, carry one vote per share and the right todividends.
b. Capital surplus
December 31
2020

2019

$ 1,719,817
247,223$ 1,719,817
247,223

1,113

1,116

53,800-$ 2,021,953$ 1,968,156

May be used to offset deficit, distributed as cash dividends
or transferred to share capital (Note)
Issuance of ordinary shares
Conversion of bonds
May only be used to offset deficit
Changes in percentage of ownership interests in subsidiaries
May not be used for any purpose
Equity component of convertible bonds payable

171Note: Such capital surplus may be used to offset a deficit; in addition, when the Corporation has no
deficit, such capital surplus may be distributed as cash dividends or transferred to share capital(limited to a certain percentage of the Corporation’s capital surplus and to once a year).
c. Retained earnings and dividends policy
Under the dividends policy, where the Corporation made a profit in a fiscal year, the profit shall be firstutilized for paying taxes, offsetting losses of previous years, setting aside as a legal reserve 10% of theremaining profit until the legal reserve equals the Corporation’s paid-in capital. Besides, the profit shallbe set aside or reversed as a special reserve in accordance with the laws and regulations, and then any
remaining profit together with any undistributed retained earnings shall be used by the Corporation’sboard of directors as the basis for proposing a distribution plan, which should be resolved in theshareholders’ meeting for the distribution of dividends and bonuses to shareholders. For the policies on
the distribution of compensation of employees and remuneration of directors and supervisors, refer tocompensation employees and remuneration of directors and supervisors in Note 24(g) Compensation of
employees and remuneration of directors and supervisors.
The dividends policy of the Corporation considers the plans for the expansion of the scale of operations
and research and development plans, and the overall environment and the features of the industry inorder to pursue sustainable operations and long-term benefits for shareholders. The dividends toshareholders can be paid in cash or issued as shares, but cash dividends shall be not less than 10% of thetotal dividends.
Legal reserve may be used to offset a deficit. If the Corporation has no deficit and the legal reserve has
exceeded 25% of the Corporation’s paid-in capital, the excess may be transferred to capital or
distributed in cash.
Items referred to under Rule No. 1010012865 and Rule No. 1010047490 issued by the FSC should beappropriated to or reversed from a special reserve by the Corporation.
The appropriations of earnings for 2019 and 2018 which were proposed and approved in theshareholders’ meetings on May 28, 2020 and May 29, 2019, respectively, were as follows:
Appropriation of Earnings
2019
2018
Legal reserve
Special reserve
Cash dividends$

36,612
14,857
312,186$

16,992(4,049)179,453

Dividends Per Share (NT$)
2019
2018

$

5.6

$

3.38

The Corporation’s shareholders also resolved in the shareholders’ meeting on May 29, 2019 to issue
share dividends of 32,918 thousand shares ($0.62 per share) and cash dividends of $26,546 thousand($0.5 per share) from the capital surplus.
The resolution of the year 2020 proposal for reduction of capital to offset deficit will be made at theregular shareholders’ meeting on May 28, 2021.

172

d. Other equity items
Exchange differences on translation of financial statements of foreign operations
For the Year Ended December 31
2020
2019
Balance, beginning of year
Recognized for the year
Exchange differences on translation of financial statements offoreign operations
Share from associates accounted for using the equity method$ (14,857)

$

7,012

(10,767)(840)(21,911)42

Balance, end of year

$ (26,464)$ (14,857)

e. Non-controlling interests
For the Year Ended December 31
2020
2019
Balance, beginning of year
Share in profit for the period
Other comprehensive income (loss) for the year
Exchange differences on translation of financial statements offoreign operations
Cash dividends distributed by subsidiaries
Acquisition of non-controlling interests in subsidiaries
Increase in non-controlling interests$ 73,173(2,574)$ 63,296
17,285594(68,719)284

28(2,335)(5,167)
66

Balance, end of year

$

2,758

$ 73,173

23. REVENUE
For the Year Ended December 31
2020
2019
Construction contract revenue
Licensing revenue
Sales of tickets and merchandise
Service revenue$

988,901
8,344
43,18922,465$ 1,975,221
1,194
75,62828,398$ 1,062,899$ 2,080,441

a. Contract information
1) Construction contract revenue comes from the construction of simulator rides and is recognized by
the percentage of completion of each contract.
2) Licensing revenue comes from authorizing the use of intellectual property rights of the film, etc.
3) Sales of tickets and merchandise comes from sales of tickets and peripheral products in eachself-operated outlets.
4) Service revenue comes from providing maintenance service to simulator rides by the Group.

173b. Contract balances
December 31,
2020

December 31,
2019

Notes receivable and accounts receivable$

226,083$

286,809$292,820

Contract assets
Construction
Reserves of construction
Less: Allowance for impairment loss

$ 1,106,733
84,557(71,862)$

952,852
103,558(20,606)$

529,353
113,873-$ 1,119,428$ 1,035,804$

643,226$

120,016
16,738$134,295
28,488$74,294
77,791$

136,754$

162,783$

152,085

Contract liabilities
Construction
OthersJanuary 1,
2019

The changes in the balance of contract assets and contract liabilities primarily result from the timing
difference between the Group’s satisfaction of performance obligations and the respective customer’s
payment.
The movements of the loss allowance of contract assets were as follows:
For the Year Ended December 31
2020
2019
Balance, beginning of the year
Net remeasurement of loss allowance$ 20,606
51,256$

Balance, end of the year

$ 71,862$ 20,606

20,606

Revenue in the reporting period recognized from the beginning contract liabilities is as follows:
For the Year Ended December 31
2020
2019
Balance, beginning of the year
Construction
Others$38,11222,501$

74,294
77,791$60,613$ 152,085

24. PROFIT BEFORE INCOME TAX
a. Interest income
For the Year Ended December 31
2020
2019
Bank deposits
Others

174

$

7,565
928

$

9,865
466

$

8,493

$ 10,331

b. Other income
For the Year Ended December 31
2020
2019
Rental income
Government grants
Others$167
31,411
7,109$ 38,687$

1,478
35,666
6,034$ 43,178

The Group applied for and received government grant of $14,729 thousand in 2020 from the Ministryof Economic Affairs as subsidies for salary and working capital of businesses affected by thepneumonia.
c. Other gains and losses
For the Year Ended December 31
2020
2019
Gain (loss) on financial assets at fair value through profit or loss
Net foreign exchange gain
Gain on disposal of property, plant and equipment
Other losses$ (10,097)(28,445)
192(84)$ 55,727(28,733)554(703)$ (38,434)$ 26,845

d. Finance costs
For the Year Ended December 31
2020
2019
Interest on bank loan
Interest on lease liabilities
Interest on convertible bonds
Other finance costs$ 19,240
6,450
3,261
251

$ 17,243
6,484-$ 29,202$ 23,727

e. Depreciation and amortization
For the Year Ended December 31
2020
2019
Property, plant and equipment
Right-of-use assets
Intangible assets$

70,78042,95930,841$ 144,580$

71,04840,11330,866$ 142,027(Continued)

175

For the Year Ended December 31
2020
2019
An analysis of depreciation by function
Operating costs
Operating expenses$

An analysis of amortization by function
Operating costs
Operating expenses

43,972
69,767$51,16459,997$ 113,739$ 111,161$

18,756
12,085$

18,226
12,640$30,841$30,866(Concluded)

f. Employee benefits
For the Year Ended December 31
2020
2019
Short-term employee benefits$ 249,196$ 300,769

10,323311
10,634

9,781
313
10,094281

335$ 260,111$ 311,198$$

Post-employment benefits
Defined contribution plans
Defined benefit plans (Note 20)

Employee benefits expense (Note 27)

An analysis by function
Operating costs
Operating expenses

49,334
210,777$ 260,111

57,898253,300$ 311,198

g. Compensation of employees and remuneration of directors and supervisors
According to the Articles of Incorporation of the Corporation, the Corporation accrues compensation of
employees and remuneration of directors and supervisors at rates of 5% to 15% and no higher than 2%,
respectively, of net profit before income tax, compensation of employees, and remuneration of directors
and supervisors. The board of directors resolved not to accrue compensation of employees andremuneration of directors and supervisors for 2020 due to net loss before income tax. The
compensation of employees and remuneration of directors and supervisors for the year ended December
31, 2019 which have been approved by the Corporation’s board of directors on March 9, 2020 were as
follows:

176

For the Year
Ended
December 31,
2019
AmountCompensation of employees
Remuneration of directors and supervisors$ 34,599
7,595

If there is a change in the amounts after the annual consolidated financial statements are authorized for
issue, the differences are recorded as a change in the accounting estimate.
For the years ended December 31, 2019 and 2018, there is no difference between the actual amounts ofcompensation of employees and remuneration of directors and supervisors paid and the amounts
recognized in the consolidated financial statements for the years ended December 31, 2019 and 2018.
Information on the compensation of employees and remuneration of directors and supervisors resolvedby the Corporation’s board of directors is available at the Market Observation Post System website of
the Taiwan Stock Exchange.
h. Gains (losses) on foreign currency exchange
For the Year Ended December 31
2020
2019
Foreign exchange gains
Foreign exchange losses$

Net loss$ (28,445)

7,024(35,469)$

2,055(30,788)$ (28,733)

25. INCOME TAX RELATING TO CONTINUING OPERATIONS
a. Income tax recognized in profit or loss
Major components of income tax expense are as follows:
For the Year Ended December 31
2020
2019
Current tax
In respect of the current year
Income tax on unappropriated earnings
Adjustments for prior years$ 18,267
1,859
20,126$ 80,960
7(2,779)78,188(10,206)

9,903

9,920

$ 88,091

Deferred tax
In respect of the current year$177

A reconciliation of accounting profit and income tax expense is as follows:
For the Year Ended December 31
2020
2019
Profit before income tax$ (41,838)$ 471,901

Income tax expense calculated at the statutory rate
Permanent differences
Income tax on unappropriated earnings
Unrecognized temporary differences
Adjustments for prior years’ tax
Investment tax credits

$

6,525
3,198
1,931
1,859
(3,593)$96,247(1,718)7
42(2,779)(3,708)

$

9,920

$

88,091In July 2019, the president of the ROC announced the amendments to the Statute for Industrial
Innovation, which stipulate that the amounts of unappropriated earnings in 2018 and thereafter that are
reinvested in the construction or purchase of certain assets are allowed as deduction when computing
the income tax on unappropriated earnings. When calculating the tax on unappropriated earnings, theGroup only deducts the amount of the unappropriated earnings that has been reinvested in capital
expenditure.
The applicable tax rate used by subsidiaries in China is 25% and tax rates used by other entities in theGroup operating in other jurisdictions are based on the tax laws in those jurisdictions.
b. Income tax benefit (expense) recognized in other comprehensive income (loss)
For the Year Ended December 31
2020
2019
In respect of the current period
Remeasurement of defined benefit plans$ 237$ (100)c. Current tax assets and liabilities
December 31
2020
Current tax assets
Tax refund receivable$

20

Current tax liabilities
Income tax payable

$

5,918

d. Deferred tax assets and liabilities
Movements of deferred tax assets and liabilities were as follows:

178

2019

$

24

$ 53,952

For the year ended December 31, 2020

Opening
Balance

Recognized in
Profit or Loss

Recognized in
Other
Comprehensive
IncomeExchange
Differences

Closing Balance

Deferred tax assets
Temporary differences
Defined benefit obligations
Allowance for impairment loss
Difference between tax reporting andfinancial reporting - depreciation
expenseUnrealized loss on foreign currency
exchange
Others

$

795
4,790

Tax losses

$

1,300
9,196

$

(237)
-

$

-

$

1,858
13,986

1,874

(667)

-

-

1,207

5,811
1,467
14,737
6,077

(959)
2,738
11,608
7,271

(237)
-

24

4,852
4,205
26,10813,372$

20,814$

18,879

$

(237)

$

24

$

39,480$31,833
1,116

$

8,893
(220)

$

-

$

629
-

$

41,355896$

32,949

$

8,673

$

-

$

629

$

42,251

Deferred tax liabilities
Temporary differences
Deferred gross margin
OthersFor the year ended December 31, 2019

Opening
Balance

Recognized in
Profit or Loss

Recognized in
Other
Comprehensive
IncomeExchange
Differences

Closing Balance

Deferred tax assets
Temporary differences
Defined benefit obligations
Allowance for impairment loss
Difference between tax reporting andfinancial reporting - depreciation
expenseUnrealized loss on foreign currency
exchange
Others$Tax losses

680
2,855

$

15
1,935

$

100
-

$

-

$

795
4,790

1,902

(28)

-

-

1,874

972
3,765
10,1742,444

4,839(2,298)
4,463
3,705

100
-

(72)

5,811
1,467
14,737
6,077$

12,618

$

8,168

$

100

$

(72)

$

20,184$

15,614394$

17,349
722

$

-

$

(1,130)-$31,833
1,116$

16,008$18,071$-$(1,130)$32,949Deferred tax liabilities
Temporary differences
Deferred gross margin
Otherse. Deductible temporary differences for which no deferred tax assets have been recognized in the
consolidated balance sheets.
For the Year Ended December 31
2020
2019
Deductible temporary differences
Loss on foreign investments$ 8,842179$ 3,731

f. Information about unused loss carryforwards
Loss carryforwards as of December 31, 2020 comprised:
Unused Amount
$

5,494
1,389
1,021
19,04737,942$64,893

Expiry Year
2023
2024
2025
2029
2030

g. Taxable temporary differences not assessed for deferred tax liabilities
As of December 31, 2020 and 2019, the taxable temporary differences associated with investments in
subsidiaries for which no deferred tax liabilities have been recognized were $125,950 thousand and$132,388 thousand.
h. Income tax assessments
The income tax returns through 2018 for the Corporation and its domestic subsidiaries have beenassessed by the tax authorities.

26. EARNINGS PER SHARE
The earnings and weighted average number of ordinary shares outstanding used in the computation of
earnings per share are as follows:a. Net profit for the year
For the Year Ended December 31
2020
2019
Net profit attributable to owners of the Corporation$ (49,184)$ 366,525

b. Weighted average number of ordinary shares outstanding (in thousands of shares)
For the Year Ended December 31
2020
2019
Weighted average number of ordinary shares

55,74755,747

27. SHARE-BASED PAYMENT ARRANGEMENTS
a. Employee share option plan of subsidiaries
Qualified employees of Brogent Global were granted 500 units of share options in February 2017. Each
option entitles the holder with the right to subscribe for one thousand ordinary shares of Brogent
Global. The options granted are valid for 10 years and exercisable at certain percentages after thesecond anniversary from the grant date.

180

Qualified employees of Brogent Mechanical were granted 250 units of share options in November 2016
and 250 units of share options in March 2019. Each option entitles the holder with the right to subscribe
for one thousand ordinary shares of Brogent Mechanical. The options granted are valid for 10 years andexercisable at certain percentages after the second anniversary from the grant date.
Information on employee share options is as follows:
1) Brogent Global
For the Year Ended December 31
2020
2019
Number of
WeightedNumber of
WeightedOptions (Inaverage
Options (InaverageThousands of
ExerciseThousands of
ExerciseUnits)
Price ($)
Units)
Price ($)
Balance at January 1
Options forfeited
Balance at December 31
Options exercisable, end of theyear
Weighted-average fair value of
options granted ($)

$

500
(277)
223

$ 10.00
10.00

500
500

$ 10.00
10.00

167

10.00

250

10.00

1.82

$

1.82

Information on outstanding options is as follows:
December 31
2020
Range of exercise price ($)
Weighted-average remaining contractual life (in years)

$

2019

10
6.14

$

10
7.14

Options granted in February 2017 were priced using the binomial option pricing model, and the
inputs to the model are as follows:
February 2017
Grant-date share price
Exercise price
Expected volatility
Expected life (in years)
Risk-free interest rate

$

5.57
10
38.06%
10
1.1214%2) Brogent Mechanical
For the Year Ended December 31
2020
2019
Number of
WeightedNumber of
WeightedOptions (Inaverage
Options (InaverageThousands of
ExerciseThousands of
ExerciseUnits)
Price ($)
Units)
Price ($)
Balance at January 1
Options granted

500
-

181

$ 10.47-250
250$ 10.00
10.93(Continued)

For the Year Ended December 31
2020
2019
Number of
WeightedNumber of
WeightedOptions (Inaverage
Options (InaverageThousands of
ExerciseThousands of
ExerciseUnits)
Price ($)
Units)
Price ($)
Options forfeited
Balance at December 31
Options exercisable, end of theyear
Weighted-average fair value of
options granted ($)

(500)
-

$

$

-

500

-

-

125

1.82

-

$

$

10.47
10.00

1.82
(Concluded)

Information on outstanding options is as follows:
December 31,
2019
Range of exercise price
Weighted-average remaining contractual life (in years)$10-$10.93
7.54

Options granted in November 2016 and March 2019 were priced using the binomial option pricing
model, and the inputs to the model are as follows:

Grant-date share price
Exercise price
Expected volatility
Expected life (in years)
Risk-free interest rate

March 2019

November 2016

$

$

6.78
10.93
30.16%
10
0.77%

5.83
10
38.17%
10
1.07%

Compensation costs recognized by Brogent Global and Brogent Mechanical were $281 thousand
and $335 thousand for the years ended December 31, 2020 and 2019, respectively.

28. CAPITAL MANAGEMENTThe Group manages its capital to ensure that entities in the Group will be able to continue as going
concerns while maximizing the return to stakeholders through the optimization of the debt and equity
balance.
The capital structure of the Group consists of net debt and equity of the Group.
The Group is not subject to any externally imposed capital requirements.

29. FINANCIAL INSTRUMENTS
a. Fair value of financial instruments not measured at fair value
The Group’s management considers that the carrying amounts of financial instruments that are notmeasured at fair value approximate their fair values, except for convertible bonds.
182

The carrying amount and fair value of convertible bonds on December 31, 2020 were as follows:
December 31,
2020
Book value
Fair value$ 1,155,660$ 1,163,530

b. Fair value of financial instruments that are measured at fair value on a recurring basis
1) Fair value hierarchy
December 31, 2020
Level 1

Level 2

Level 3

Total

Financial assets at FVTPL
Mutual funds
Unquoted ordinary shares
Derivative financial assets$ 380,382
-

$

-

$

281,474
1,860$ 380,382
281,474
1,860$ 380,382$-$ 283,334$ 663,716

Level 3

Total

December 31, 2019
Level 1

Level 2Financial assets at FVTPL
Mutual funds
Unquoted ordinary shares$ 248,751
-

$

-

$

302,389$ 248,751
302,389$ 248,751$-$ 302,389$ 551,140

There were no transfers between Levels 1 and 2 for the years ended December 31, 2020 and 2019.
2) Reconciliation of Level 3 fair value measurements of financial assets
For the Year Ended December 31, 2020

Derivatives

EquityInstruments

Total

Financial Assets at FVTPL
Balance at January 1
Additions
Recognized in profit or loss

$

70
1,790

$ 302,389(20,915)$ 302,389
70(19,125)

Balance at December 31

$

1,860

$ 281,474$ 283,334

183

Derivatives
Financial Liabilities at FVTPL
Balance at January 1
Additions
Recognized in profit or loss

$

100
(100)

Balance at December 31$-

For the Year Ended December 31, 2019
EquityInstruments
Financial assets at FVTPL
Balance at January 1
Additions
Recognized in profit or loss
Balance at December 31$ 138,955
138,690
24,744$ 302,389

3) Valuation techniques and inputs applied for Level 3 fair value measurementa) Equity Instrument Investments
The fair values of unlisted equity securities were determined using the income approach. In thisapproach, the discounted cash flow method was used to capture the present value of the
expected future economic benefits to be derived from the ownership of these investees.
b) Convertible Bonds
The fair values of options were determined using the binomial option pricing model where theinput is historical volatility, risk-free interest rate, risk discount rate and the liquidity risk, etc.
c. Categories of financial instruments
December 31
2020

2019

$ 1,356,619
663,716$ 1,417,148
551,140

1,900,000

1,487,050

Financial assets
Financial assets at amortized cost (1)Financial assets at FVTPL
Financial liabilities
Amortized cost (2)1) The balances include financial assets measured at amortized cost, which comprise cash and cash
equivalents, financial assets at amortized cost, notes and accounts receivable and refundable
deposits.
2) The balances include financial liabilities measured at amortized cost, which comprise short-termborrowings, notes and accounts payable, other payables, long-term borrowings (including current
184portion) and bonds payable.
d. Financial risk management objectives and policies
The Group’s major financial instruments include time deposits, equity investments, notes and accounts
receivable, notes and accounts payable, borrowings, bonds payable and lease liabilities. The Group’s
corporate treasury function provides services to the business, monitors and manages the financial risks
relating to the operations of the Group through internal risk reports which analyze exposures by degreeand magnitude of risks. These risks include market risk (including foreign currency risk, interest raterisk and other price risk), credit risk and liquidity risk.
The corporate treasury function reports regularly to the Group’s risk management committee.
1) Market risk
The Group’s activities exposed it primarily to the financial risks of changes in foreign currency
exchange rates (see (a) below), interest rates (see (b) below), and other price risk (see (c) below).
a) Foreign currency risk
The carrying amounts of the Group’s foreign currency denominated monetary assets andmonetary liabilities (including those eliminated on consolidation) are set out in Note 34.
Sensitivity analysis
The Group is mainly exposed to the USD, RMB, EUR and CAD.
The following table details the Group’s sensitivity to a 1% increase and decrease in the New
Taiwan dollar (i.e., the functional currency) against the relevant foreign currencies. The
sensitivity analysis included only outstanding deposits, receivables and payables not designatedas cash flow hedges, and adjusts their translation at the end of the reporting period for a 1%change in foreign currency rates. A positive number below indicates an increase in pre-tax profit
associated with the New Taiwan dollar weakening 1% against the relevant currency. For a 1%
strengthening of the New Taiwan dollar against the relevant currency, there would be an equaland opposite impact on pre-tax profit, and the balances below would be negative.
Impact on Profit Before
Income Tax
For the Year Ended December 31
2020
2019
USD
RMB
EUR
CAD

$ 2,404
2,055
388
249

$ 6,987
2,191
929
275

b) Interest rate risk
The Group was exposed to interest rate risk because the Group borrowed funds at both fixedand floating interest rates. The risk is managed by the Group by maintaining an appropriate mixof fixed and floating rate borrowings.
The carrying amounts of the Group’s financial assets and financial liabilities with exposure tointerest rates at the end of the reporting period were as follows:185

December 31

Fair value interest rate risk
Financial assets
Financial liabilities$

Cash flow interest rate risk
Financial assets
Financial liabilities

2020

2019

478,967
1,670,992$ 1,037,203
583,022

601,941
423,20243,724
1,034,507

Sensitivity analysis
The sensitivity analysis below was determined based on the Group’s exposure to interest rates
for non-derivative instruments at the end of the reporting period. For floating rate assets andliabilities, the analysis was prepared assuming the amount of each asset and liability outstandingat the end of the reporting period was outstanding for the whole year.
If interest rates had been 1% higher/lower and all other variables were held constant, theGroup’s pre-tax profit for the years ended December 31, 2020 and 2019 would haveincreased/decreased by $1,787 thousand and decreased/increased by $9,908 thousand,respectively, which was mainly attributable to the Group’s variable-rate bank deposits andborrowings.
c) Other price risk
The Group was exposed to equity price risk through its investments in domestic and foreign
marketable equity instruments. The equity investments are held for strategic rather than trading
purposes.
Sensitivity analysis
The sensitivity analysis below was determined based on the exposure to equity price risks at theend of the reporting period.
If equity prices had been 1% higher/lower, the pre-tax other comprehensive income for the year
ended December 31, 2020 and 2019 would have increased/decreased by $6,619 thousand and$5,511 thousand, respectively, as a result of the changes in the fair value of financial assets at
FVTPL.
2) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting
in a financial loss to the Group. As at the end of the reporting period, the Group’s maximum
exposure to credit risk, which would cause a financial loss to the Group due to the failure of thecounterparty to discharge its obligation to the Group, could be equal to the carrying amount of therespective recognized financial assets as stated in the consolidated balance sheets.
For the financial risk management policies adopted by the Group, refer to Note 9.

186

The Group’s credit risk is mainly concentrated in the following groups of accounts receivable:
December 31
2020
Group AGroup B
Group CGroup DGroup EGroup F$2019

55,35924,772
18,761
1,782
60,573$$ 161,247

54,613
41,79642,29074,40638,424-$ 251,529

The Group’s concentration of credit risk accounted for 75% and 88% of total accounts receivablefrom the above-mentioned groups as of December 31, 2020 and 2019, respectively.
3) Liquidity risk
The Corporation manages liquidity risk by monitoring and maintaining a level of cash and cash
equivalents deemed adequate to finance the Group’s operations and mitigate the effects offluctuations in cash flows.
Liquidity risk tables for non-derivative financial liabilities
The following table details the Group’s remaining contractual maturities for its non-derivative
financial liabilities with agreed upon repayment periods. The table has been drawn up based on theundiscounted cash flows of financial liabilities from the earliest date on which the Group can berequired to pay. The table includes both interest and principal cash flows. Specifically, bank loans
with a repayment on demand clause were included in the earliest time band regardless of theprobability of the banks choosing to exercise their rights. The maturity dates for othernon-derivative financial liabilities were based on the agreed upon repayment dates.
To the extent that interest flows are at floating rates, the undiscounted amount was derived from theinterest rate curve at the end of the year
Within1 Year

2-3 Years

4-5 Years

More than
5 Years

Total

December 31, 2020
Non-interest bearing liabilities
Lease liabilities
Variable interest rate liabilities
Fixed interest rate liabilities$

171,598
62,760122,391
149,665$

86,779118,375
1,226,113$

80,10552,750-$164,633
155,523-$

171,598394,277
449,039
1,375,778$

506,414$ 1,431,267$

132,855$

320,156$ 2,390,692$

227,543
56,839459,792$

76,629355,347$

72,369295,474$

183,385
211,402$$744,174$

431,976$

367,843$394,787$ 1,938,780

December 31, 2019
Non-interest bearing liabilities
Lease liabilities
Interest rate liabilities

187

227,543
389,222
1,322,015

30. TRANSACTIONS WITH RELATED PARTIES
Details of transactions between the Group and other related parties are as follows:a. Related party name and category
Related Party Name

Related Party Category

Discover NY project company LLC (Discover
NY)
Brogent Japan Entertainment

Associates before September 2019
Associates

b. Operating Revenue
For the Year Ended December 31
2020
2019

Line Item
Construction contract revenue
Service revenue
Licensing revenue

$

1,767
404

$ 56,357
-

$

2,171

$ 56,357

The construction contract with the associate based on estimated construction cost plus reasonableadministrative expenses and profit was not significantly different from that of normal customers. After
negotiating the contract, the Group collects the payment according to the schedule agreed in thecontract.
c. Compensation of key management personnel
The amounts of the remuneration of directors and other members of key management personnel were as
follows:
For the Year Ended December 31
2020
2019
Short-term employee benefits
Post-employment benefits$ 13,902
555$ 21,280
529$ 14,457$ 21,809

31. ASSETS PLEDGED AS COLLATERAL OR SECURITY
The following assets were provided as collateral for construction guarantee and warranty, leasedevelopment, government grants, guarantee for notes performance and borrowings:
December 31

Financial assets at amortized cost - current
Demand deposits and time deposits
Financial assets at amortized cost - noncurrent
Time deposits
Property, plant and equipment

188

2020

2019

$ 156,343$ 271,320

15,000626,457

31,620649,384$ 797,800$ 952,324

32. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS
a. As of December 31, 2020 and 2019, the Group’s outstanding notes payable for performance andwarranty under various construction projects were $15,468 thousand and $15,639 thousand; letters ofguarantee for warranty under various construction projects were $27,112 thousand and $102,598
thousand, respectively.
b. As of December 31, 2020 and 2019, the outstanding notes payable for research and development wereboth $33,600 thousand.

33. OTHER ITEMS
Due to the impact of the COVID-19 pandemic, the global economic situation continues to tighten,
especially of the tourism and entertainment industries. The Group’s main products are simulator rides andsome of the contracts with customers were postponed. As a result, revenue recognized by the percentage ofcompletion of each contract decreased. As of the report date of the consolidated financial statements, noconstruction contract has been cancelled. With the epidemic slowing and policy loosening, the Group
expects that operations will gradually return to normal.
Based on the information available as of the balance sheet date, the Group considered the economic
implications of the pandemic when making its critical accounting estimates (refer to Note 5). For
information about government grants in 2020, refer to Note 24(b).
In addition, the followings are the actions that the Group has taken to respond to the influence of thepandemic:a. Normal operation planning
Due to the construction delays, the Group plans to reserve more cash for future necessary expenditure.
Moreover, the Group has continually kept in touch with the operating stakeholders to track the progressof the construction and be ready for the retaliatory rebound in advance.
b. Optimization of the product and system
The Group planned to improve production efficiency, increase gross margin by optimizing the original
products during the postponed period, and keep on reviewing the governance system andimplementation level.
c. Government relief grants
The Group has successively applied to the government for grants, such as salaries, operating income,etc.
d. Cost management
1) Pausing staff recruitment
2) Expenditure management and austerity3) Delivery process management to the suppliers.

189

34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIESThe Group’s significant financial assets and liabilities denominated in foreign currencies aggregated by theforeign currencies other than functional currencies and the related exchange rates between foreign
currencies and respective functional currencies were as follows:

Foreign
Currency(In Thousands)

Exchange Rate

Carrying
Amount(In Thousandsof New Taiwan
Dollars)

December 31, 2020
Financial assets
Monetary items
USD
RMB
RMB
EUR
CAD

$

8,535
43,508
3,399
1,105
1,113

28.48
4.38
0.153835.06
22.37(USD:NTD)(RMB:NTD)(RMB:USD)(EUR:NTD)(CAD:NTD)$ 243,081
190,566
14,88538,77324,900

43
49

28.48
6.5023(USD:NTD)(USD:RMB)

1,233
1,401

Financial assets
Monetary items
USD
RMB
EUR
CAD

23,34550,708
2,771
1,191

30.08
4.32
33.54
23.08

(USD:NTD)(RMB:NTD)(EUR:NTD)(CAD:NTD)

702,218
219,059
92,93927,488Financial liabilities
Monetary items
USD
RMB

116
2

30.08
4.32

(USD:NTD)(RMB:NTD)

3,489
9

Financial liabilities
Monetary items
USD
USD
December 31, 2019

For the years ended December 31, 2020 and 2019, realized and unrealized net foreign exchange losses were$28,445 thousand and $28,733 thousand, respectively. It is impractical to disclose net foreign exchange
gains and losses by each significant foreign currency due to the variety of the foreign currency transactions
and functional currencies of the entities in the Group.

35. SEPARATELY DISCLOSED ITEMS
a. Information about significant transactions and investees:
1) Financing provided to others: Table 1
2) Endorsements/guarantees provided: None190

3) Marketable securities held (excluding investments in subsidiaries, associates and joint ventures):
Table 24) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20%of the paid-in capital: None
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in
capital: None
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital:
None7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of thepaid-in capital: Table 38) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in
capital: None
9) Trading in derivative instruments: Note 710) Intercompany relationships and significant intercompany transactions: Table 411) Information on investees: Table 5
b. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal businessactivities, paid-in capital, method of investment, inward and outward remittance of funds,
ownership percentage, net income of investees, investment income or loss, carrying amount of theinvestment at the end of the period, repatriations of investment income, and limit on the amount ofinvestment in the mainland China area: Table 62) Any of the following significant transactions with investee companies in mainland China, either
directly or indirectly through a third party, and their prices, payment terms, and unrealized gains orlosses:a) The amount and percentage of purchases and the balance and percentage of the related payablesat the end of the period: Noneb) The amount and percentage of sales and the balance and percentage of the related receivables atthe end of the period.

Account
Construction contract revenue
Construction contract revenue
Accounts receivable
Accounts receivable

Trading Partners

AmountProportionof theAccount(%)

Hai Wei Culture Creative
Brogent Rides
Hai Wei Culture Creative
Brogent Rides$ 91,126
63,107
17,52066,5125384636c) The amount of property transactions and the amount of the resultant gains or losses: Noned) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at theend of the period and the purposes: None
191e) The highest balance, the end of period balance, the interest rate range, and total current periodinterest with respect to financing of funds: Nonef) Other transactions that have a material effect on the profit or loss for the year or on the financial
position, such as the rendering or receipt of services: Nonec. Information of major shareholders: List all shareholders with ownership of 5% or greater showing thename of the shareholder, the number of shares owned, and percentage of ownership of each shareholder(Table 7)

36. SEGMENT INFORMATIONThe chief operating decision maker of the Group reviews the overall operating results in order to makedecisions about resource allocation and assessment of the overall performance. The Group has a single
operation segment. Therefore, the measurement basis for sales, operating results, and assets of thereportable segments in 2020 and 2019 is the same as the corporate financial statements. Refer to the balance
sheets and the statements of comprehensive income for 2020 and 2019.
a. Revenue from major products and services: Note 23
b. Geographical information
The Group’s revenue from continuing operations from external customers by location of operations andinformation about its non-current assets by location of assets are detailed below.
Revenue from External
Customers
For the Year Ended December 31
2020
2019
TaiwanAsia
EuropeUnited States
Others$53,106
706,709106,743
195,971370$$ 1,062,899

Non-current Assets
December 31
2020
2019

63,4501,366,913
292,253
356,333
1,492$ 1,347,046
130,483
67,277
1,388-$ 1,393,193
156,549
67,1431,863-$ 2.080,441$ 1,546,194$ 1,618,748

Non-current assets exclude financial instruments and deferred tax assets.
c. Information about major customers
For the Year Ended December 31
2020
2019
Proportion
Proportionof Netof NetOperatingOperating
Revenue
RevenueAmount(%)
Amount(%)
Group AGroup B$

361,036
109,677

192

34
10

$

511,067
290,47325
14(Continued)

For the Year Ended December 31
2020
2019
Proportion
Proportionof Netof NetOperatingOperating
Revenue
RevenueAmount(%)
Amount(%)
Group CGroup D$

77,112
2,884

7
-

$

$

550,70951$ 1,286,900

193

247,752
237,60812
11
62(Concluded)

TABLE 1

Brogent Technologies Inc. and Subsidiaries
FINANCING PROVIDED TO OTHERSFOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Financing Limit
for Each
Borrowing
Company

CollateralNo.

FinancingCompany0

The Corporation

0

The Corporation

0

The Corporation

Counterparty

Brogent Global

Financial
Statement Account

Other receivables related parties
Brogent Hong Kong Other receivables related parties
Brogent Mechanical Other receivables related parties

RelatedParty

Yes

Maximum Balance
for the Year$Ending Balance

Actual Amount
Drawn

$

$

150,000

150,000

Interest
Rate (%)

Nature ofFinancing--

Short-term financing

Transaction
Amount$Reason for
Financing-Operating Capital

Allowance for
Bad Debt
$

Item

-

-

Value
$

-

$

264,626

FinancingCompany’s Total
Financing Limit$

1,058,507

Notes 1 and 2
Notes 1 and 2

Yes

150,000

150,000--

Short-term financing-

Operating Capital

-

-

-

264,626

1,058,507

Yes

150,000---

Short-term financing-

Operating Capital

-

-

-

-

-

Note 1: The total financing limit shall not exceed 40% of the net worth of the financing company.
Note 2: The financing limit for each borrowing company shall not exceed 10% of the net worth of the financing company.
Note 3: Dissolved after being merged by the Corporation on September 30, 2020.

194

Note

Note 3

TABLE 2

Brogent Technologies Inc. and Subsidiaries
MARKETABLE SECURITIES HELDDECEMBER 31, 2020
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Holding Company

The Corporation

Type and Name of Marketable Securities

Mutual funds
Capital RMB Money Market Fund RMB

Relationship with theHolding Company-

Cathay RMB Money Market Fund-

Prudential Financial US Investment Grade
Corporate Bond Fund A CNY
Capital Global Senior Secured High Yield
Bond Fund
Cathay Senior Secured High Yield Bond
Fund A USD
JPMorgan Funds - Global Corporate BondFund
NN (L) US Credit - X Cap USD-

Prudential Financial US Investment Grade
Corporate Bond Fund Acc USD
Eastspring Investments - US Investment
Grade Bond Fund - A

-

-

-

Financial Statement AccountFinancial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current

Number of Shares

555,526

December 31, 2020
Percentage
ofCarrying Value
Ownership(%)$

28,733-423,657

22,540-22,540550,000

26,409-26,409453,038

22,366-22,3662,232,766

22,841-

22,841

158,884

92,265-92,265673

31,442-

31,442

94,46429,281-

29,28147,83129,291-29,291$ 305,168
Brogent Global

Common Stock
Jump Media International Co., LTD.

-

This is Holland B.V.

-

Preferred Stock
This is Holland B.V.

-

Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - noncurrent

264,001

Financial assets at fair value throughprofit or loss - noncurrent$

Brogent Rides

Common Stock
Discover NY Project Company, LLC-

Mutual funds
ICBC tian li bau-Net Asset Value Fund
NBCB-Net Asset Value Fund-

Common Stock
Fly Over The World Cultural
Development Co. Ltd-$$ 305,168
0.93

100

9,466

10

9,466

200

35,060-35,060Financial assets at fair value throughprofit or loss - noncurrent

2,143

Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current

1,000,000

Financial assets at fair value throughprofit or loss - noncurrent

44,526$ 116,255

$

$

$
19.44

-

44,526$ 116,255

6,505

-

83,921

438

-

438

20,000,000

155,7534

155,753$ 162,696

Note

28,733-$
Holey Holdings Limited

Fair Value

$

6,505

$ 162,696(Continued)

195Holding Company

Brogent Creative

Type and Name of Marketable Securities

Mutual funds
ICBC tian li bau-Net Asset Value Fund
NBCB-Net Asset Value Fund
(Redeemable)
NBCB-Financial Fund (capital protected)

Hai Wei Culture Creative

Mutual funds
NBCB-Net Asset Value Fund
(Redeemable)
NBCB-Net Asset Value Fund (capital
unprotected)
NBCB-Net Asset Value Fund (capital
unprotected)

Relationship with theHolding Company--

Financial Statement AccountFinancial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current

Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current
Financial assets at fair value throughprofit or loss - current

Number of Shares

500,000

December 31, 2020
Percentage
ofCarrying Value
Ownership
(%)

2,364

-

706,725

3,689

-

3,689

500,000

2,190

-

2,190

1,350,880$

Fair Value

$

8,243

$

7,050

-

$

2,364

$

8,243

$

7,050

1,400,000

6,201

6,201

8,532,685

46,777

46,777$60,028-$Note60,028(Concluded)
196

TABLE 3

Brogent Technologies Inc. and Subsidiaries
TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITALFOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Buyer

Related Party

Transaction Details

Relationship
Purchase/Sale

The Corporation

Note:

Brogent Mechanical

Subsidiary

PurchaseAmount$133,600

It was eliminated on consolidation.

197% of Total Payment Terms
20

Notes/Accounts Receivable(Payable)
Payment Terms Ending Balance % of Total

Abnormal Transaction
Unit Price

45 to 75 days after No comparable 45 to 75 days
monthly closing transaction
after monthly
with third party closing

$

-

-

Note
Note

TABLE 4

Brogent Technologies Inc. and Subsidiaries
INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONSFOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands of New Taiwan Dollars)

Transaction Details
No.

Investee Company

Counterparty

Relationship0

The Corporation

Brogent Rides

Parent to subsidiary0

The Corporation

Brogent Rides

Parent to subsidiary0

The Corporation

Brogent Global

Parent to subsidiary0

The Corporation

Brogent Global

0

The Corporation

1

Financial Statement
Account

Construction contract
revenue
Accounts receivable

Amount$63,10766,512

Parent to subsidiary

Construction contract
revenue
Rent revenue

11,990hexaRide

Parent to subsidiary

Rent revenue

2,758

Brogent Global

Hai Wei Culture Creative

Subsidiary to subsidiary

91,126

1

Brogent Global

The Corporation

Subsidiary to parent

Construction contract
revenue
Service revenue

1

Brogent Global

The Corporation

Subsidiary to parent

Licensing revenue

5,730

1

Brogent Global

Hai Wei Culture Creative

Subsidiary to subsidiary

Accounts receivable

17,5202

Brogent Mechanical

The Corporation

Subsidiary to parent

Sales revenue

133,600

3

StarLite

Brogent Global

Subsidiary to subsidiary

Service revenue

7,277

3

StarLite

The Corporation

Subsidiary to parent

Service revenue

5,087

198

1,858

9,260

Payment Terms

No similar transactions withunrelated person
45 to 75 days after monthly
closing
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person
No similar transactions withunrelated person% of Total
Operating
Revenues(Assets)
6.00
1.00
1.00
9.00
1.00
1.00
13.00
1.00
-

TABLE 5

Brogent Technologies Inc. and Subsidiaries
INFORMATION ON INVESTEESFOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Investor Company

Investee Company

The Corporation

Brogent Mechanical

The Corporation

Brogent Creative Inc.

The Corporation

Brogent Hong Kong

The Corporation

Brogent Global

The Corporation

Dili Jie

Brogent Hong Kong

Brogent Japan Entertainment

Brogent Hong Kong

hexaRide the first LLP

Dili Jie

JetwayJetwayGarleyJetwayHoley Holdings Limited

Brogent Global

JetmayBrogent Global

Ou Wei Limited

JetmayStarLite

Location

Main Businesses andProducts

TaiwanManufacture and sales of thesimulator rides and its key
components
TaiwanDevelopment and sales of theperipheral products ofsimulator rides
Hong Kong Reinvestment and tradingbusiness
TaiwanDevelopment and managementbusiness of self-operated
outlets
British Virgin Reinvestment and trading
Islands
businessJapan
Management businessdevelopment and sales ofthe peripheral products ofsimulator rides in Japan
Japan
Management business of
self-operated outlets
CaymanReinvestment and trading
Islands
business
British Virgin Reinvestment and trading
Islands
business
British Virgin Reinvestment and trading
Islands
business
British Virgin Reinvestment and trading
Islands
businessHong Kong Reinvestment and tradingbusiness
CanadaManagement business of
self-operated outlets

Original Investment Amount
December 31, 2020 December 31, 2019$-$

As of December 31, 2020
Net Income (Loss)
Number ofof the Investee(%)
Carrying Amountshares

55,000--Subsidiary
and Note 3-

14,539

-

-

-

2

896

Subsidiary
and Note 3

270,727

200,338-

100.00263,931(6,503 )(6,478 )Subsidiary

300,000

300,000

36,214,332

100.00345,088(21,932 )(26,754 )Subsidiary

267,955

267,955-

100.00307,117(20,384 )(20,384 )Subsidiary

10,161

10,161

-

40.00

3,331

1,142

1,142

Associates

44,12235,818-88.89

22,066(15,880 )(14,875 )Subsidiary

270,020

270,020-100.00307,104(20,366 )(20,366 )Subsidiary131,258

131,258-

100.00188,404(18,225 )(18,225 )Subsidiary

139,753

139,753-

100.00117,779(38,408 )(38,408 )Subsidiary112,164

61,489-100.00181,345

21,972

20,462

Subsidiary

43,641

18,635-100.0032,559(5,111 )(5,111 )Subsidiary

15,054

15,054-100.0012,825

1,766

1,766

Subsidiary

Note 2: The share of profit (loss) of subsidiaries are eliminated on consolidation.
Note 3: Dissolved after being merged by the Corporation on September 30, 2020.
Note 4: Please refer to Table 6 for the information on investments in mainland China.

199

-

$

25,884$Note

27,453Note 1: The share of profit (loss) recognized for the year ended December 31, 2020 included eliminated unrealized gains or losses.

$

Share of Profit(Loss)TABLE 6

Brogent Technologies Inc. and Subsidiaries
INFORMATION ON INVESTMENTS IN MAINLAND CHINAFOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands of New Taiwan Dollars, Unless Stated Otherwise)

Main Businesses and Products

Paid-in Capital(Note 1)

Method ofInvestment (Note 2)

Brogent Rides

Import and export business$ 216,650

Brogent Creative

Management business of
self-operated outlets

56,940Hai Wei Culture Creative

Management business of
self-operated outlets

42,720Beijing Huawei Global
Cultural Development
Co., Ltd.

Management business of
self-operated outlets-

Reinvested
through thethird region
Brogent Hong
Kong andGarleyReinvested
through thethird region
Brogent Rides
Reinvested
through thethird region
JetmayReinvested
through thethird region
Brogent Rides

Investee Company

Investee Company
The Corporation

Accumulated Outward Remittancefor Investments in Mainland China
as of December 31, 2020$
311,166

Accumulated
Outward
Remittance forInvestment from
Taiwan as ofDecember 31,
2019$ 222,712

Accumulated
Outward%
Remittance
Ownership
Net Income of thefor Investment fromof Direct orInvestee
Taiwan as ofIndirect
December 31,
Investment
2020

Remittance of Funds

Outward$

Inward-$-$ 222,712$

31,791100.00Investment
Gain$

Accumulated
Carrying AmountRepatriation of
as of December 31, Investment Income
2020
as of December 31,
2020

31,791$ 322,741

$

-

-

-

-

-

(1,051 )100.00(1,051 )73,342-

46,334

42,120-88,454

20,273100.0020,273

170,006

-

-

-

-

-

-

35.00

-

4,599

-

Investment Amount Authorized
by the Investment Commission,
MOEA$
311,166

Upper Limit on the Amount of
Investments Stipulated by theInvestment Commission, MOEA
$ 1,587,761

Note 1: The basis for investment income (loss) recognition is from the financial statements audited and attested by parent company’s CPA.
Note 2: The certificate verification procedure is not completed, accounted for as prepaid investment.

200

Note

Note 2TABLE 7

Brogent Technologies Inc. and Subsidiaries
INFORMATION OF MAJOR SHAREHOLDERSDECEMBER 31, 2020

SharesNumber of Shares
Percentage of
Owned
Ownership (%)

Name of the Shareholder

Chih-Hung Ouyang
Fu Wu Investment Ltd.
Profit Power Management Consulting Limited
Ruentex Industries Ltd.

3,807,191
3,137,246
2,997,400
2,910,310

6.82
5.62
5.37
5.22

Note 1: The information of major shareholders presented in this table is provided by the Taiwan Depository &Clearing Corporation based on the number of ordinary shares and preferred shares held byshareholders with ownership of 5% or greater, including shares that have been issued without physicalregistration by the Corporation as of the last business day for the current quarter. The share capital in
the consolidated financial statements may differ from the actual number of shares that have been
issued without physical registration because of different preparation basis.
Note 2: If a shareholder delivers the shareholdings to the trust, the above information will be disclosed by theindividual truster who opened the trust account. For shareholders who declare insider shareholdings
with ownership greater than 10% in accordance with the Security and Exchange Act, theshareholdings include shares held by shareholders and those delivered to the trust over whichshareholders have rights to determine the use of trust property. For information relating to insider
shareholding declaration, please refer to Market Observation Post System.

201