Taiwan Semiconductor Co., Ltd.
Minutes of the 2023 Annual General Meeting
Time : Monday, 19 June 2023 at 09：00 am
Place : Taiwan Semiconductor Co., Ltd. I-Lan factory (No.96,Meijou 2nd Rd. ,I-Lan
City, I-Lan County 260, Taiwan R.O.C.)
Shareholders Present：The number of shares presented in person or by proxy is
161,926,799 shares (including 155,819,921 shares fromelectronic voting rights ), representing 61.45% of total
outstanding shares.
Directors Present: Director Mr. Wang shiu Ting, TSC Auto ID Technology Co., Ltd.
Legal Representative Director Mr. Wang Hsing Lei, UMC Capital
Legal Representative Director Mr. Liu Chang Yu, Independent
Director Mr. Jhan Cian Long, Independent Director Mr. Fan Hong
Shu, Independent Director Mr. Lin Bo Sheng, Independent Director
Mr. Ma Shu Zhuang.
Lawyer : Tien Jen Jieh (Lee and Li, Attorneys-at-Law)
Accountants : Mei Yuan Chen (KPMG Certified Public Accountants)
Chairman：Mr. Wang shiu Ting (Chairman of the Board of Directors)
Record：Ms. Luo Yue Guei
The agenda for the meeting is as follows:
1. The Chairman called the meeting to order.
2. Chairman’s Address：(omitted)
3. Report Items：(1) 2022 Business Report and 2023 Annual Business Plan Report(2) Audit Committee’s 2022 Review Report(3) Status report on the Endorsement and Guarantee, Loaning of Company Funds,
Regulations Governing the Acquisition and Disposal of Assets, the Trading of
Financial Derivatives of the Company and its subsidiaries in 2022
(4) Report on 2022 employees’ profit sharing bonus and directors’ compensation(5) Report on The performance evaluation and compensation report of directors andmanagers
4. Approval Items：(1) Proposal 1 : The Company’s 2022 Business Report and Financial Statements(Proposed by the Board）
Explanation: 1. The Company＇s business report, standalone financial statement, andconsolidated financial statements have been approved by the Board andexamined by the audit committee.

2. The business report, standalone financial statement, and consolidated
financial statements are attached in the Meeting Agenda.

Voting Results: Shares represented at the time of voting: 161,926,799 votes
Voting Results(Including electronic votes) % of the total represented share present
94.32%
Approval votes:
152,733,203 votes
0.06%
Disapproval votes:
112,300 votes
0.00%
Invalid votes:
0 votes
5.60%
Abstention votes/no votes: 9,081,296 votes
RESOLVED, that The Company＇s 2022 Business Report and Financial Statements be andhereby were accepted as submitted.
(2) Proposal 2 : The Company’s 2022 earnings Distribution.
(Proposed by the Board）
Explanation: 1. In order to improve the capital structure and avoid dilution of earnings, theCompany proposes full cash dividend distribution.
2. The net profit after tax in 2022 was NT$1,562,886,413, the Company
appropriates NT$156,718,710 to legal reserve, and adds beginning retained
earnings NT$ 1,084,254,443 and adds remeasurements of defined benefit
plans NT$ 4,300,684. The distributable earnings amounted to NT$
2,494,722,830. The Company plans to distribute the dividends toshareholders with NT$ 1,053,941,944 all in cash. After the approval of thegeneral meeting of shareholders, an ex-dividend date and payment date forcash dividends will be set. Dividends are allocated based on theshareholding ratio of shareholders listed on Shareholders’ Rosters on the
ex-dividend record date; NT$ 4.0 per share. The cash dividends shall be
distributed to the NTD (decimals are rounded down). The total number offractional amounts below NT$1 shall be listed as the Company's otherincome.
If there is an increase or decrease in the total number of outstanding sharesof the Company, which results in a change in the shareholders’ payout ratio,
it is proposed to request the shareholders' meeting to authorize the Board of
Directors to deal with the matter in its sole discretion.
3. Please refer to Earnings Distribution Table on page 36 of this Meeting
Agenda.

Voting Results: Shares represented at the time of voting: 161,926,799 votes
Voting Results(Including electronic votes) % of the total represented share present
94.37%
Approval votes:
152,826,003votes
0.07%
Disapproval votes:
115,497 votes
0.00%
Invalid votes:
0 votes
5.54%
Abstention votes/no votes: 8,985,299 votes
RESOLVED, that the above proposal be and hereby was approved as proposed.

5. Discussion items：(1)Proposal 1 : To Amend the rules for the corporation by-laws（Proposed by the Board）
Explanation:1. To meet the need of the Company's future development. We plan to amend thecorporation by-laws of the company, and the comparison table of amendment
is below. We propose for the approval of 2023 shareholders meeting.
2. Please proceed to discuss.

Voting Results: Shares represented at the time of voting: 161,926,799 votes
Voting Results(Including electronic votes) % of the total represented share present
80.47%
Approval votes:
130,305,786 votes
13.98%
Disapproval votes:
22,637,412 votes
0.00%
Invalid votes:
0 votes
5.54%
Abstention votes/no votes: 8,983,601 votes
RESOLVED, that the above proposal be and hereby was approved as proposed.
(2)Proposal 2 : To amend the articles of Company’s “Regulations Governing theAcquisition and Disposal of Assets”. （Proposed by the Board）
Explanation: 1. Proposed amendments to the Company’s “Regulations Governing theAcquisition and Disposal of Assets” to meet the operating requirement for theCompany. The comparison table of amendments is as follows which is
submitted to the 2023 shareholders' meeting for the approval.
2. Please proceed to discuss.

Voting Results: Shares represented at the time of voting: 161,926,799 votes
Voting Results(Including electronic votes) % of the total represented share present
79.90%
Approval votes:
129,391,973 votes
9.21%
Disapproval votes:
14,917,121 votes
0.00%
Invalid votes:
0 votes
10.88%
Abstention votes/no votes: 17,617,705 votes
RESOLVED, that the above proposal be and hereby was approved as proposed.
6. Extraordinary Motions : none
7. Adjournment: 9:13 am ( No question was raised by Shareholder.)Mr. Wang shiu Ting
Chairman

Ms. Luo Yue Guei
RecorderAppendix
1. 2022 Business Report(1) Implementation of Business Plan
The Company's and its subsidiaries major businesses included the production and saleof rectifiers and barcode printers. In 2022, the earnings per share after tax was NT$6.28. The
2022 consolidated operating revenue, gross profit, operating income, net income before tax,
net income, comprehensive income, and after-tax earnings per share compared to 2021 ispresented below:
Unit: NT$ thousand
Implementation of Business Plan
Item
2022
2021
Increase(decrease)
Operating revenue
15,687,134
13,177,417
19.05%
Gross Profit

5,349,166

4,127,721

29.59%

Operating Income

2,790,521

1,908,907

46.18%Net income before tax

3,013,930

1,947,632

54.75%Net income

2,176,915

1,381,895

57.53%

Comprehensive income
Net income attributable to
the Parent Company
Comprehensive
incomeattributable to the Parent
Company
After-tax earnings per share(NT$)

2,478,073

1,269,814

95.15%

1,562,877

882,805

77.04%

1,738,755

809,542114.78%

6.28

3.55

76.90%(2) Budget Implementation: The Company did not disclose its financial forecasts of the year of2022, so it is not necessary to publicly disclose the implementation of the budget.
(3) Financial Status and Profitability
Unit: NT$ thousand
Annual revenue and expenditure
Item
2022
2021
Increase(decrease)
Interest Revenue
19,892
14,54136.80%
Interest Expense
38,33030,91124.00%

Financial
Structure
Liquidity
Analysis
Profitability

Item
Total debt to assets (%)
Long-term asset to real estate, plantand equipment ratio (%)
Current ratio (%)
Quick ratio (%)
Return on assets (%)
Return on equity (%)
Profit ratio (%)

2022

2021

41.12
286.9742.28
259.53206.86136.76
12.89
21.82
13.88

206.04145.12
9.19
16.19
10.49

After-tax earnings per share (NT$)
6.28
3.55
(4) Research and Development(A) Rectifier
To increase our overall competitiveness and gross margin, the Company invests a great
deal of manpower and budget every year in collecting market information, analyzing
market demand, and setting the direction and strategy for new product development. As
most of the mainstream products in the market today are becoming thin and light, ourproducts are also actively developing toward small, energy-saving, and comprehensive inorder to develop new markets. We have developed and increased market penetration inpersonal handheld products, automotive electronics, industrial control industry and white
goods market.
In recent years, with self-developed chip technology and the advantage of automatedpackaging, we have continued to develop Schottky rectifier, MOSFET, ESD protection,
automotive LED driver, automotive low dropout voltage regulator and other products.
The development of the new generation of trench Schottky rectifier, Super Junction
MOSFET, and Split Gate Technology MOSFET that can effectively reduce conduction loss
and switching loss to meet market trends and needs for environmental protection,energy-saving, and low power consumption. These new technologies will be developed ina full range to facilitate the promotion of active and passive safety applications forautomotive electronics, industrial, communications, and energy industries.
Fully automated die bonding technology and fully automated high-speed packaging,testing and printing technology have been fully introduced, which is conducive toenhancing product reliability and significantly increasing output and reducing costs to
expand market share and enhance profitability. Packaging technology has developed higher
current density surface mount power device components, which surpasses the European,
American and Japanese top tier manufacturers.
The development of ESD protection has been focused on multi-channel, ultra-low
junction capacitance and miniature packaging. Corresponding to the application of various
high-frequency transmission ports in the market, such as ESD protections on USB3.1,
USB3.0, USB2.0, HDMI2.0 ports.
The Company has put a full range of LED lighting product lines into mass production,
which can be applied to various solutions including isolation, non-isolation and dimming
features. The dimming series covers existing dimming methods such as linear dimming,
PWM dimming, etc., as well as various integrated high-voltage MOSFET solutions, whichhave reached maturity and have been adopted by international manufacturers, and which
has continued to grow steadily. Facing a low-price, competitive market in China, thecompany actively seeks products with higher quality and gross profit. The Company also
cooperates with customers to develop customized products, particularly focusing on
automotive products as it has been the main R&D project in recent years, including theautomotive LED Driver ICs, which can cover all kinds of voltage and applications ofautomotive lighting, such as headlamps, tail lamps, fog lamps, daytime running lamps andso on. Various low power consumption and high output current automotive low-dropout
and low power consumption regulator ICs are also being developed, which can be used tosupply 3.3V and 5V voltage regulators to automotive MCUs, and some of them have beendeveloped independently. The Company has invested more manpower and equipment costsin the verification of vehicle regulations and is now gradually passing the qualification of
AEC-Q100 standard. We hope to gain the recognition of automotive customers with highquality and service.
(B) Barcode printerWith the increase in applications for automatic identification in the global market, theCompany spent NT$229,823 thousand on research and development in 2022, accounting
for 3% of the revenue and will continue invest in network applications, network security,and cloud software and hardware application and development to expand the Company's
market coverage. In addition to developing new generation products and applications in
new fields, the Company will focus on automated data collection, product mobility, RFID
applications, online barcode detection and linerless environmental label applications. The
Group will also spend the funds on the capital expenditures on labeling paper equipment tostrengthen competitiveness and ensure sustainable growth.
2. 2023 Business Plan
(1) Business Policy(A) Rectifier(1) Continue to create global marketing channels to increase global market share(2) Strengthen the professional marketing team both domestically and internationally.
Providing technical and comprehensive services to customers and improve our brandimage(3) Continue to expand our R&D team to create and maintain leading technology andrapidly develop next-generation products(4) Continue to develop and implement the most advanced production equipment toincrease profitability by increasing productivity and reducing costs(5) Actively develop new packaging technologies and higher current density surface
mount power device packages to meet market demand(6) Seek cooperation with world known companies(7) Continue to develop small signal products for automotive applications and offer acomprehensive product line for automotive electronics(8) Actively promote automotive analog ICs, SOI MOSFET, LED driver ICs, and highpower density products to enhance product value and profitability with integrated
solution sales and win customers' trust and reliance.
(9) Continue the development and production of upstream wafer products to integrate
upstream and downstream supply, and ensure stable supply of key raw materials andabsolute cost advantage(10) Develop new products with big international companies to create high profitability
with oligopoly supply chain(B) Barcode printer
The Company continues to develop the manufacturing and service of automatic
identification system, actively expand the marketing channels of the low, middle andhigh-end product lines, and continue to plan upstream and downstream strategic
investments, deepen the operation of the Company's own brand in all regions of the world,and expand the manufacturing and service of hardware and software. The Company also
intends to increase customer usage of intelligent services for automatic identification
system, so as to provide customers with a more complete service network and develop new
growth momentum.
(2) Important Production and Marketing Policies(A) Rectifier
The Company's industry is a semi-conductor industry. The Company's current production
and sales policy is a combination of build to stock and make-to-order production. In thisregard, the annual production and sales policy is formulated based on overall industrial
market development, market supply and demand, the Company’s established capacity andinventory level. Depending on the actual order status, it can be adjusted at any time tomaintain the optimal inventory level.
(B) Bar Code printerFuture production and marketing policies will focus on the following:1. Ensure stability and quality of supplies from important suppliers and maintain appropriate
inventory levels and turnover rates
2. Strengthen the education and training of regional distributors to enhance sales
3. Continue to develop emerging markets and mature markets.
(3) Operation Goals(A) Rectifier
The Company's main products are rectifier diodes and analog ICs. Taking into
account the competition and market conditions, the sales projection for 2023 is asfollows:
Products
2023 sales projection
2022 actual sales
Rectifier Diode5,596,986(kpcs)
4,443,018(kpcs)
Small signal products

1,797,234(kpcs)

1,867,206(kpcs)

MOSFET

305,924 (kpcs)

287,774(kpcs)

Analog IC

136,912(kpcs)
130,243(kpcs)
Technical Marketing comprehensive promotion with a total solution for different
industries. Because of the increasing popularity of hybrid electric vehicles and electricvehicles in the automotive electronics market, the market demand for power devices has
increased dramatically. The high power AC-DC converter, low loss MOSFET (FET), lowloss voltage regulator, surge absorber (TVS), electrostatic protection, fast recovery diode,and transistor continue selling to European, American, and Japanese companies, in themeantime, the Company developed the rapidly growing Chinese and Indian automotive
electronics companies. Due to the regulation amendment in vehicle lighting, it isnecessary to install daytime lighting. Also, due to energy-saving and new lighting
product trends, LED lighting is rapidly emerging in automotive applications, and thecapacity is growing to multiply many times. The company also provides overall solutions
actively in the vehicle lighting market, and introduces them to European, American, andJapanese automotive electronics manufacturers.
In addition to the existing products of high power Bridge Rectifier and high power
rectifier for automobile and locomotive charging systems, the new product high power
MOS is adopted as an automotive electronics certificated manufacturer, which shortensthe certification time.
In the LED lighting industry, the new products LED module and LED driver, whichcontains simplified constant current rectifying function design, with a full range ofsolutions including surface mount Bridge rectifier, Schottky, MOSFET, Small-signal
products, promote the high demanded Ball steep light and striplight to the American andEuropean lighting companies. In addition to small lighting products, the new products
also develop the AC-DC LED applications and are imported into American and Japanesemanufacturers.
The industrial application market is dominated by foreign competitors, especiallythe renewable energy industry (solar systems and power converters) has thecharacteristics of low substitution and high gross margin, which is difficult for the local
and Chinese manufacturers to introduce. The Company has a long-term experience ofhigh quality control and performance in the automobile electronics industry and the fast
globalized local design service. In addition to the existing products, new products likefast recovery rectifier, low loss high junction temperature Trench Schottky, and low loss
high power MOSFET are being promoted all-inclusively.
In recent years, the considerable business opportunities in automobile electronics,
detecting instruments, industrial control, and major appliances markets attract more andmore foreign manufacturers to enter. The Company will develop the differentspecifications of Hall effect IC and flux collector, which are used in automobiles,
industry, major appliances, and the consumer market. In these markets, these ICs areused in different kinds of measurement of position and angle. Take automobile
electronics electoral power steering system as an example, linearity and angle Hall effect
IC collector can measure the angle, running torque, and an engine speed of the steering
wheel.
To consolidate the existing product lines and promote the consumer electronics
industry, like TV, PC/Tablet, STB, Home appliance, Gaming, GPS, the Company
continues to increase the amount of shipment like Bridge rectifier, MOS, Schottky, Zener
diode, switching diode, different types of the voltage regulator, high recovery rectifier
etc.
The TVs combine with internet and video function, high frequency, and multiple
connecting ports. To protect ICs, the electrostatic protection component and wave
filtering component are more needed. The development of new series of electrostatic
protection products includes multiple output Array and combine with EMI Filter. Under
the need of Eco-Friendly, all end products are pursuing high efficiency and low loss. The
new products develop low-impedance MOS, low loss voltage regulator, low loss bridge
rectifier, Ultra-low capacitance electrostatic protection component, etc.
Machine to Machine, because of the need for revolutionary applications due to therise of the Internet of Things and the 5G communication smart city, the Ultra-low loss
SOI MOSFET and low power trench Schottky, high power low voltage small patch TVS
are being promoted.
(B) Bar Code Printer
The Company’s major income source is the sales, service, and sales of label paper of theautomatic recognition printer. The estimated sale in 2023 as follow.
Unit: Thousand
Products

2023 sales projection

2022 actual sales

Automatic
800
700
identification printerOn the basis of the estimation, the key points for future production and marketing policies
are as follows:
1.
Ensurestability and quality of supplies from important suppliers and maintain appropriate
inventory levels and turnover rates
2.
Continue toexpand the scale of global operations and strengthen the core competitiveness of theCompany's operating fundamentals.
3.
Provide acomprehensive high-quality service and establish business capacity.
3. Future Development Strategies and Influence from External Competition, Regulations andMacro-operating Environment(1) Future Development Strategies(A) Rectifier: Continuing to innovate technology, accelerate research and development,
increase product value, complete upstream and downstream deployment andinvestment opportunities in China to strengthen integration benefits.
(B) Bar Code printer: The Company continues to expand market share and enhancecompetitive advantage by marketing our own brand, optimizing
after-sales services and improving the quality of customer services,and continuing to provide a comprehensive one-stop services tocreate opportunities for multi-win growth.
(2) Influence from External Competition

(A) Rectifier
The subsidy policy of local governments gives China’s semiconductor
manufacturers the advantage of competing at a low price, which has a certain impact on
the low-end application market. The company is still focusing on the development ofhigher specification products, from wider penetration of consumer electronics,
automotive electronics, industrial control to medical and communication equipment. We
expect to achieve a balanced development of low, medium and high application markets
and to occupy more areas with higher entry barriers to maintain a larger gap withcompetitors and improve profitability. Currently, the Company's new technology
development and existing high-end products are comparable to or even surpassing theworld's first-class manufacturers, and we expect to develop more innovative andrevolutionary products to surpass our world-class competitors and make outstanding
contributions to environmental protection, energy savings and carbon reduction.
(B) Bar Code printerAs the demand for automatic identification becomes more life-oriented and common,the demand for auto-recognition printing is becoming more and more active. In the faceof the external competitive environment, the Company continues to develop innovativetechnologies, strengthen core capabilities for resource integration and interdisciplinary
development, expand market cooperation and links, and actively face external challenges
with the goal of profitability and stable growth.
(3) Influence from Regulations(A) Rectifier
For adapting EU RoHS regulation, the Company provides all series of non-halogen
products, which are popular among the consumer companies from Europe, America,
Japan, and Korea. EISA2007 (Energy VI Efficiency) that demands higher standby power
consumption and power conversion efficiency of the electric products, has been executedsince 2016. For power devices, the wastage of electric property of rectifier and MOSFET
should be lower and a smaller packaging should be used. Major appliances are affected
the most. To cope with the legal requirement, they must be switched to variablefrequency voltage source due to the large consumption of motor and compressor. The
starter motor requires a higher voltage and soft switching ability for the powercomponents. The power components in major appliances with DC frequency conversion
have to concur with EMI factors, therefore it is difficult for other low-cost appeal
companies to compare the excellent research and development ability of TAIWANSEMICONDUCTOR Co., LTD. Additionally, due to the promoted policy of renewableenergy, the need for solar energy and renewable energy source is highly requested by not
only developed countries like North America, Japan, and Europe but also other emerging
markets. Our new products with low consumption of high junction temperature Schottky
can combine with solar module and power converter when used.
With the improvement of the battery technic in electric vehicles, the charging
specification has changed from AC to DC 600V direct charging. The power system ofvehicles will also change from a 12V 24V system to a 48V system. For this changing
power system, the design pool of the original suppliers needs to be replaced with a new
specification. It is a good design point for our new products high-voltage fast recovery
diode, ultra-low power consumption rectifier, and trench Schottky.
(B) Bar Code PrinterThere haven’t been significant influences for the Company that attributes to theimportant policy and law changes domestic and foreign in recent years.
(4)Influence from Macro-operating Environment(A) Rectifier
Global Service-Customer management system and regional industrial development
expand the global division of labor without borders. The Company uses customer

management to respond to the rapidly changing electronics industry. Products from big
companies around the world are locally original designed, then be delivered andproduced in various places. Through “Account management”, OEM and IPO canachieve a perfect order service.
Regional industrial development helps to balance and to strengthen the productstructure. North American market focuses on automobiles, industry, telecommunication,and illumination. Japanese market focus on automobiles and industry. The European
market focuses on automotive electronics, industry, renewable energy sources, andillumination. Chinese market focuses on consumer electronics, automobiles, andindustry. The domestic demand market of emerging markets like India, South Asia,
Russia, and South America expands due to the rapid growth of the middle class. Basic
telecommunication, cable lighting construction, Home appliance, and Telecom, etc. are
the industries that have been introduced into.
In the rapidly changing economy, the global configuration strategy of the Company
has shown its efficiency and vision regarding OEM without frontiers and spreading therisk of the differences between strong and weak regional economics.
(B) Bar Code Printer
The Company follows all changes of regulation.
In the future, with the growing stability and the expansion of the applied field of rectifier and bar
code printer markets, the Company and each subsidiary company will uphold our innovative,
professional, and dedicated corporate philosophy. Also, keep strengthening the research anddevelopment and salability, improve our performance, and company profits, in order share the profits
with the stockholders, clients, and employees.

Chairman: Wang shiu Ting

President: Wang shiu Ting

CFO: Cheng I-ChengIndependent Auditors’ Report

To the Board of Directors of TAIWAN SEMICONDUCTOR CO., LTD.:
OpinionWe have audited the financial statements of TAIWAN SEMICONDUCTOR CO., LTD. (“the Company”),
which comprise the statement of balance sheet as of December 31, 2022 and 2021, and the statement ofcomprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial
statements, including a summary of significant accounting policies.
In our opinion, based on our audits and the report of the other auditors (please refer to Other Matter paragraph),the accompanying financial statements present fairly, in all material respects, the financial position of theCompany as of December 31, 2022 and 2021, and its financial performance and its cash flows for the years thenended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
Basis for Opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Certification of Financial
Statements by Certified Public Accountants and Standards on Auditing of the Republic of China. Our
responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of
the Financial Statements section of our report. We are independent of the Company in accordance with the Normof Professional Ethics for Certified Public Account of Republic of China "the code", and we have fulfilled ourother ethical responsibilities in accordance with the Code. Based on our audits and the reports of other auditors,
we believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of ouropinion.
Other Matter
We did not audit the financial statements of TSC Auto ID Technology Co., Ltd. (TSC Auto ID) of which
represented investment accounted for using the equity method of the Company. Those statements were auditedby the other Certified Public Accountants whose report has been furnished to us, and our opinion, insofar as it
relates to the amounts included for TSC Auto ID, is based solely on the report of the other Certified Public
Accountants. The investment in TSC Auto ID amounted for using the equity method constituting 8.68% and8.26% of the total assets at December 31, 2022 and 2021, respectively, and the related share of profit ofsubsidiaries accounted for using the equity method constituting 17.16% and 26.34% of the total income before
tax for the years then ended respectively.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significant in our audit of
the financial statements of the current period. These matters were addressed in the context of our audit of thefinancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion onthese matters.

1. Valuation of accounts receivable
Please refer to Note 4(f) “Financial instruments” of the financial statements for details on the accounting
policy about valuation on accounts receivable; Note 5 “Assessment of impairment of trade receivable”
for details on the significant accounting assumptions and judgments, and major sources of the estimation
uncertainty on accounts receivable; and Note 6(c) “Notes and accounts receivable” for details on therelated explanation.
Description of key audit matter:
The Company has transactions with a large number of customers and the accounts receivable collection days
differ in length. As a result, the expected credit loss determined for accounts receivable lies in the
management’s subjective judgment based on experience. Therefore, the accounts receivable of theCompany is one of our key audit matters.
How the matter was addressed in our audit:
Our key audit procedures included (i) analyzing the reasonableness of the accounts receivable at the year-end
and considering the collection subsequent to the year-end. (ii) verifying the adequacy of the Company’s
expected credit loss provisions against trade receivables by assessing the relevant assumptions. (iii) taking
account of our own knowledge on recent collections experience in this industry and also historical data fromthe Company’s previous collections experience in order to assess the reasonableness of the expected credit
loss for accounts receivable. Besides, we assessed that the valuation of accounts receivable was disclosed thenotes to the parent Company only financial statements properly.
2. Impairment on investment accounted for using the equity method
Please refer to Note 4(h) “Investment in subsidiaries” of the financial statements for the details on theaccounting policy about investments accounted for using equity method; Note 6(e)” investments accounted
for using equity method” for details on the related explanation.
Description of key audit matter:
When the Company obtained the business combinations and its control, and recognized a goodwill in the
consolidated financial report, the amount is regarded as material. Besides, evaluating whether goodwill is
impaired depends on the estimation of the future cash flow of the cash-generating unit to determine therecoverable amount. The estimation of the future cash flow involves industrial environment and the forecastof the future operating results. Once the indicators of the forecast change, the recoverable amount will change
as well and may cause an impairment loss. Due to the investments are the important investees and the amountis regarded as material. Therefore, the impairment on investment amounted for using the equity method is ourof key audit matters.
How the matter was addressed in our audit:
Our key audit procedures included: (i) obtaining the assessment on impairment loss of goodwill reportprovided by the evaluator appointed by the management of TSC, as well as inquiring and assessing theprofessional ability and independence. (ii) appointing the internal expert to execute the related procedures toassess the reasonableness of the assumption used in the evaluation model and weighted average cost ofcapital. (iii) evaluating the previous operating conditions, the conditions of industrial environment and future
outlook, etc. in order to comprehensively determine the reasonableness of the assessment on impairment lossof goodwill.
The adoption of the independent auditor’s reports of TSC Auto ID issued by other Certified Public
Accountants included (i) communication of the related issue with other Certified Public Accountants, which
included sending audit instruction to other Certified Public Accountants and obtaining the independent
auditor’s report of TSC Auto ID issued by other Certified Public Accountants.

The audit procedure executed by other Certified Public Accountants included (i) obtaining the report of theassessment of impairment loss of goodwill provided by the evaluation expert appointed by the managementof TSC Auto ID. (ii) understanding and assessing the reasonableness of the recoverable amount based on theevaluation model. (iii) comprehensively assessing the reasonableness of the assessment of impairment loss of
goodwill based on the assumption used in the evaluation model, including sales growth rate, profit margin,
weighted average cost of capital (WACC, which includes risk-free return rate, volatility and risk premium),etc. and assessing the previous operating conditions, the conditions of industrial environment and future
outlook.
Our audit procedure also compare the difference of the investment amounted and the net assets of TSC Auto
ID (according to our ownership share) and observe TSC Auto ID ‘s stock price. In addition, (ii) we
assessed the related information was disclosed in the notes to the parent Company only financial statements
properly.
Responsibilities of Management and Those Charged with Governance for the Parent Company Only
Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordancewith the Regulations Governing the Preparation of Financial Reports by Securities Issuers and for such internal
control as management determines is necessary to enable the preparation of financial statements that are freefrom material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability tocontinue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Company or to cease operations,or has no realistic alternative but to do so.
Those charged with governance (including the Audit Committee) are responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes ouropinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance with the Standards on Auditing of the Republic of China will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in theaggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis ofthese financial statements.
As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise
professional judgment and professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
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 theCompany’s internal control.

3.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated 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 Company’s ability to continue as a going concern. If we conclude that amaterial uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,and whether the financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of the investment inother entities accounted for using the equity method to express an opinion on this financial statements. We areresponsible for the direction, supervision and performance of the 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 financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
The engagement partners on the audit resulting in this independent auditors’ report are Mei, Yuan-Chen andHsu, Yu-Feng.

KPMG
Taipei, Taiwan (Republic of China)
March 15, 2023

Notes to Readers
The accompanying parent company only financial statements are intended only to present the financial position, financial performanceand cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of
any other jurisdictions. The standards, procedures and practices to audit such parent company only financial statements are thosegenerally accepted and applied in the Republic of China.
The independent auditors’ audit report and the accompanying parent company only financial statements are the English translation of
the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of
the English and Chinese language independent auditors’ audit report and parent company only financial statements, the Chinese version
shall prevail.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD.
Balance Sheets
December 31, 2022 and 2021
(Expressed in Thousands of

1100
1110
1150
1170
1180
1200
130X
1479

1517
1551
1600
1822
1840
1980
1990

AssetsCurrent assets:
Cash and cash equivalents (note 6(a))
Current financial assets at fair value through profit or loss - current (note6(b))
Notes receivable, net (note 6(c))
Accounts receivable, net (note 6(c))
Accounts receivable due from related parties, net (note 7)
Other receivables (note 7)
Inventories (note 6(d))
Other current assets

December 31, 2022
Amount%$Non-current assets:
Non-current financial assets at fair value through other comprehensive
income (note 6(b))
Investments accounted for using equity method (note 6(e))
Property, plant and equipment (note 6(f))
Intangible assets (note 6(g))
Deferred tax assets (note 6(l))
Other non-current financial assets (note 6(b))
Other non-current assets (note 6(h))

Total assets

See accompanying notes to parent company only financial statements.

10-567,039
152,006

52
618,016
670,796
38,005
1,193,998
109,435
3,769,845

-

-

10
1
32

531
718,390558,975
24,318760,114
69,3392,850,712

4,157

-

-

-

45
19
1
1
1
1
68

4,414,662
2,379,502
91,45339,221
55,41574,343
7,054,596

44
24
1
1
1
71

5,113,463
2,168,878
64,45970,59667,718141,359
7,630,630$

December 31, 2021
Amount%1,139,543-

5
6

11,400,475 100

New Taiwan Dollars)

6
1

7
6
8
1
29

9,905,308 100

2100
2120
2150
2170
2181
2220
2230
2320
2399

Liabilities and Equity
Current liabilities:
Short-term borrowings (note 6(i))
Current financial liabilities at fair value through profit or loss (note 6(b))
Notes payable
Accounts payable
Accounts payable to related parties (note 7)
Other payables to related parties (note 7)
Current tax liabilities
Long-term borrowings, current portion (note 6(j))
Other current liabilities

2541
2570
2640

Non-Current liabilities:
Long-term borrowings (note 6(j))
Deferred tax liabilities (note 6(l))
Net defined benefit liability, non-current (note 6(k))

3110
3200
3300
3400
3500

Total liabilities
Stockholder’ equity attributable to parent:(note 6(m))
Common stock
Capital surplus
Retained earnings
Other stockholders’ equity
Treasury shares
Total equity
Total liabilities and equity

December 31, 2021
Amount%December 31, 2022
Amount%$590,000
408
482,502338,627
38,555
221,499
259,349
418,550
2,349,490
527,391
441,616
20,046
989,053
3,338,543

$

5
4
3
2
2
4
20
5
4
9
29

2,634,854 23
2,137,088 19
4,155,591 36(359,558) (3)(506,043) (4)8,061,932 71
11,400,475 100

370,720120
1,607
314,254664,236
55,327123,065
294,810
1,824,139
649,310382,147
23,057
1,054,514
2,878,653

4
3
7
1
1
2
18
7
4
11
29

2,650,854 27
2,166,799 22
3,247,117 32(531,125) (5)(506,990) (5)7,026,655 71
9,905,308 100

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD.
Statements of Comprehensive Income
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

2021

2022
%

Amount

%5,755,056
55,901
5,699,155
4,058,148
1,641,007
53,444
1,587,563

101
1
100
71
29
1
28

4,851,282
47,805
4,803,477
3,896,023
907,454
3,081
904,373

101
1
100
81
19
19

438,244297,659
81,604
817,507770,056

8
5
1
14
14

388,376
202,130
56,976
647,482
256,891

8
4
1
13
6

1
3

1,421
7,485
12,203(6,775)

15
19
33
5
28

734,675
749,009
1,005,900
123,095
882,805

Amount
4110
4190

5910

Total sales revenue (notes 6(n) and 7)
Less: Sales discounts and allowances
Net operating revenues
Cost of goods sold (notes 6(d) and 7)
Gross profit
Less:Unrealized profit (loss) from sales

6000
6100
6200
6300

Operating expenses (note 7):
Selling expenses
Administrative expenses
Research and development expenses

5000

7100
7010
7020
7050
7070

7950
8300
8310
8311
8330

8360
8361
8300

$

Operating income
Non-operating income and expenses (notes 6(o) and 7):
Interest income
Other income
Other gains and losses
Finance costs
Share of profit of subsidiaries accounted for using equity method(note 6(e))

3,635
28,629164,096(11,349)

See accompanying notes to parent company only financial statements.

-

874,492
1,059,503
1,829,559
266,672
1,562,887

Profit before tax
Less: Income tax expenses (note 6(l))
ProfitOther comprehensive income:Components of other comprehensive income (loss) that will not bereclassified to profit or loss
Gains (losses) on remeasurements of defined benefit plans(note 6(k))
Share of other comprehensive income of subsidiaries accounted forusing equity method, components of other comprehensive incomethat will not be reclassified to profit or loss
Components of other comprehensive income (loss) that will bereclassified to profit or loss
Exchange differences on translation of foreign financial statements
Other comprehensive income (after tax)
Comprehensive income
Basic earnings per common share (NT dollars) (note 6(q))
Diluted earnings per common share (NT dollars) (note 6(q))

-

$
$
$

15
15
21
3
18

2,549

-

(1,247)

-

1,752
4,301

-

(191)
(1,438)

-

3
3
31
6.28
6.23

(71,825)(73,263)809,542

(1)
(1)
17
3.55
3.52

171,567
175,868
1,738,755

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD.
Statements of Changes in Equity
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars)

Share capital$
Balance at January 1, 2021
Net income
Other comprehensive income
Total comprehensive income
Conversion of convertible bands
Appropriation and distribution of retained earnings:
Provision of legal reserve
Provision of special reserve
Cash dividends
Adjustments of capital surplus for company's cash dividends received
by subsidiaries
Changes in equity of affiliate accounted for using equity method
Balance at December 31, 2021
Net income
Other comprehensive income
Total comprehensive income
Retirement of treasury shares
Subsidiaries purchase of treasury shares
Appropriation and distribution of retained earnings:
Provision of legal reserve
Provision of special reserve
Cash dividends
Adjustments of capital surplus for company's cash dividends received
by subsidiaries
Changes in equity of affiliate accounted using equity method
Balance at December 31, 2022$

Advancereceipts for
Ordinaryshare capitalshares2,494,539
22,196
156,315(22,196)

See accompanying notes to parent company only financial statements.

Total other
equity interest
Retained earnings
Exchangedifferences ontranslation of
Unappropriatedretained
Capital
Total retained foreign financial
statements
earnings
surplusearnings
Legal reserve Special reserve
Treasury shares
1,516,265
830,920445,618
1,484,440
2,760,978(459,300)(506,990)
882,805
882,805(1,438)(1,438)(71,825)881,367
881,367(71,825)
604,864----

53,967-2,650,854(16,000)--

20,40025,2702,166,799(69,482)
-

-

-

-

-

-

-

2,634,854-

37,0002,771
2,137,088---

13,682--884,887459,300-

88,137

71,825

973,024

531,125

Total equity
5,827,688
882,805(73,263)809,542
738,983(53,967)(13,682)(395,228)(395,228)--(395,228)

1,902,930
1,562,887
4,301
1,567,188-

3,247,117
1,562,887
4,301
1,567,188-(531,125)
171,567
171,567-(506,990)
85,482(84,535)

20,40025,2707,026,655
1,562,887
175,868
1,738,755(84,535)(88,137)(71,825)(658,714)(658,714)--(658,714)

2,651,442

4,155,591(359,558)(506,043)

37,0002,771
8,061,932

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD.
Statements of Cash Flows
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars)
2022
Cash flows from (used in) operating activities:
Profit before tax
Adjustments:
Adjustments to reconcile profit (loss):
Depreciation expense
Amortization expense
Net loss on financial assets or liabilities at fair value through profit or
loss
Interest expense
Interest income
Share of profit of subsidiaries accounted for using equity method
Gain on disposal of property, plan and equipment
OthersTotal adjustments to reconcile profit (loss)
Changes in operating assets and liabilities:
Net loss (gain) on financial assets or liabilities at fair value through profit
or loss(Increase) decrease in notes receivable(Increase) decrease in accounts receivable
Increase in accounts receivable due from related parties
Increase in other receivable
Increase in inventories(Increase) decrease in other current assets
Decrease in notes payable
Increase in accounts payable
Increase (decrease) in accounts payable to related parties
Increase in other payable
Increase (decrease) in other payable to related parties
Increase in other current liabilities
Decrease in net defined benefit liability
Total adjustments
Cash inflow generated from operations
Interest received
Dividends received
Interest paid
Income taxes paid
Net cash flows from operating activities
Cash flows from (used in) investing activities:
Acquisition of financial assets at fair value through other comprehensive
incomeAcquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Acquisition of intangible assets(Increase) decrease in other non-current assets
Increase in prepayments for equipment
Net cash flows used in investing activities

$

2021

1,829,559

1,005,900

319,548
48,443
1,701

319,368
37,443
1,966

9,810(3,635)(874,492)(2,792)53,444(447,973)

5,341(1,421)(734,675)
(819)
3,081
(369,716)

150,593(149,691)

479
100,374(111,821)(13,231)(433,884)(40,096)(1,607)
168,248(325,609)
637(16,772)
123,740(462)(847,384)
982,175
3,179
250,906(10,913)(140,144)
1,085,203(498)(251,660)(169,242)(13,695)(151,930)
7,708
(45)
109,498
131,409296
27,22499,561(577)(731,358)
274,5421,439
356,977(5,761)(74,360)
552,837(4,157)(52,494)
3,475(21,449)(2,617)(133,453)(210,695)(46,996)713(27,475)
13,199(53,363)(113,922)

Cash flows from (used in) financing activities:
Increase (decrease) in short-term loans
Repayments of convertible bonds
Proceeds from long-term borrowings
Repayments of long-term borrowings
Cash dividends paid
Net cash flows used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of period
Cash and cash equivalents at the end of period

219,280(236,240)(41,900)
379,760-$

139,320(1,890)(658,714)(302,004)
572,504
567,039
1,139,543(395,228)(293,608)
145,307421,732
567,039

Representation Letter

The entities that are required to be included in the combined financial statements of TAIWANSEMICONDUCTOR CO., LTD. as of and for the year ended December 31, 2022 under the Criteria Governing
the Preparation of Affiliation Reports, Consolidated Business Reports, and Consolidated Financial Statements ofAffiliated Enterprises are the same as those included in the consolidated financial statements prepared inconformity with International Financial Reporting Standards No. 10, "Consolidated Financial Statements.
"endorsed by the Financial Supervisory Commission of the Republic of China. In addition, the information
required to be disclosed in the combined financial statements is included in the consolidated financial statements.
Consequently, TAIWAN SEMICONDUCTOR CO., LTD. and Subsidiaries do not prepare a separate set ofcombined financial statements.

Company name: TAIWAN SEMICONDUCTOR CO., LTD.
Chairman: Wang Shiu-Ting
Date: March 15, 2023

Independent Auditors’ Report

To the Board of Directors of TAIWAN SEMICONDUCTOR CO., LTD.:
OpinionWe have audited the consolidated financial statements of TAIWAN SEMICONDUCTOR CO., LTD. (“theCompany”) and its subsidiaries (“the Group”), which comprise the consolidated balance sheet as ofDecember 31, 2022 and 2021, the consolidated statement of comprehensive income, consolidated changes inequity and cash flows for the years then ended, and notes to the consolidated financial statements, including asummary of significant accounting policies.
In our opinion, based on our audits and the report of the other auditors (please refer to Other Matter paragraph),the accompanying consolidated financial statements present fairly, in all material respects, the consolidated
financial position of the Group as of December 31, 2022 and 2021, and its consolidated financial performanceand its consolidated cash flows for the years then ended in accordance with the Regulations Governing the
Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards(“IFRSs”), International Accounting Standards (“IASs”), Interpretations, developed by the International
Financial Reporting Interpretations Committee (“IFRIC”) or the former Standing Interprotations Committee(“SIC”) endorsed and issued into effect. By the Financial Supervisory Commission of the Republic of China.
Basis for Opinion
We conducted our audit of the consolidated financial statements in accordance with the Regulations Governing
Auditing and Certification of Financial Statements by Certified Public Accountants, and Standards on Auditingof 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 independentof TAIWAN SEMICONDUCTOR CO., LTD. and its subsidiaries in accordance with the Certified Public
Accountants Code of Professional Ethics in Republic of China, and we have fulfilled our other ethicalresponsibilities in accordance with the Code. Base on our audits and the report of the other auditors, we believethat the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.
Other Matter
We did not audit the financial statements of TSC Auto ID Technology Co., Ltd. (TSC Auto ID) of the Group.
Those statements were audited by the other Certified Public Accountants whose report has been furnished to us,
and our opinion, insofar as it relates to the amounts included for TSC Auto ID, is based solely on the report ofthe other Certified Public Accountants. The financial statements of TSC Auto ID reflect the total assets
constituting 39.48% and 41.27% of the consolidated total assets at December 31, 2022 and 2021, respectively,
and the total operating revenues constituting 50.79% and 51.97% of the consolidated total operating revenues forthe years then ended respectively.
The company has additionally prepared its parent-company-only financial statements as of and for the years
ended December 31, 2022 and 2021, on which we have issued an unqualified opinion with other mattersparagraph.

Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significant in our audit of
the consolidated financial statements of the current period. These matters were addressed in the context of ouraudit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do notprovide a separate opinion on these matters.
1. Valuation of accounts receivable
Please refer to Note 4(g) “Financial instruments” of the consolidated financial statements for details on
the accounting policy about valuation on accounts receivable; Note 5 “Assessment of impairment of tradereceivable” for details on the significant accounting assumptions and judgments, and major sources of theestimation uncertainty on accounts receivable; and Note 6(c) “Notes and accounts receivable” for details
on the related explanation .
Description of key audit matter
The Group has transactions with a large number of customers and the accounts receivable collection days
differ in length. As a result, the expected credit loss determined for accounts receivable lies in the
management’s subjective judgment based on experience. Therefore, the accounts receivable of the Group is
one of our key audit matters.
How the matter was addressed in our audit:
Our key audit procedures included (i) analyzing the reasonableness of the accounts receivable at the year-end
and considering the collection subsequent to the year-end. (ii) verifying the adequacy of the Group’s
expected credit loss provisions against trade receivables by assessing the relevant assumptions. (iii) taking
account of our own knowledge on recent collections experience in this industry and also historical data fromthe Group’s previous collections experience in order to assess the reasonableness of the expected credit loss
for accounts receivable. Besides, we assessed that the valuation of accounts receivable was disclosed thenotes to the consolidated financial statements properly.
2. The assessment of impairment loss of goodwill
Please refer to Note 4(l) “Impairment of nonfinancial assets” of the consolidated financial statements fordetails on the accounting policy related to impairment loss of goodwill; and Note 6(i) “Goodwill” fordetails on the related explanation.
Description of key audit matter
When the Group obtained the business combinations and its control, and recognized a goodwill in the
consolidated financial report, the amount is regarded as material. Besides, evaluating whether goodwill is
impaired depends on the estimation of the future cash flow of the cashgenerating unit to determine therecoverable amount. The estimation of the future cash flow involves industrial environment and the forecastof the future operating results. Once the indicators of the forecast change, the recoverable amount will change
as well and may cause an impairment loss.
How the matter was addressed in our audit:
Our key audit procedures included: (i) obtaining the assessment on impairment loss of goodwill reportprovided by the evaluator appointed by the management of TSC, as well as inquiring and assessing theprofessional ability and independence. (ii) appointing the internal expert to execute the related procedures toassess the reasonableness of the assumption used in the evaluation model and weighted average cost ofcapital. (iii) evaluating the previous operating conditions, the conditions of industrial environment and future
outlook, etc. in order to comprehensively determine the reasonablesness of the assessment on impairment lossof goodwill.

The adoption of the independent auditor’s reports of TSC Auto ID issued by other Certified Public
Accountants included (i) communication of the related issue with other Certified Public Accountants, which
included sending audit instruction to other Certified Public Accountants and obtaining the independent
auditor’s report of TSC Auto ID issued by other Certified Public Accountants. The audit procedure executedby other Certified Public Accountants included (1) obtaining the report of the assessment of impairment lossof goodwill provided by the evaluation expert appointed by the management of TSC Auto ID. (2)understanding and assessing the reasonableness of the recoverable amount based on the evaluation model. (3)comprehensively assessing the reasonableness of the assessment of impairment loss of goodwill based on theassumption used in the evaluation model, including sales growth rate, profit margin, weighted average cost ofcapital (WACC, which includes risk-free return rate, volatility and risk premium), etc. and assessing theprevious operating conditions, the conditions of industrial environment and future outlook. In addition, (ii)
we assessed the audit procedure designed by other Certified Public Accountants according to related auditing
standards and that the related information was disclosed in the notes to the consolidated financial statements
properly.
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 IFRSs,
IASs, interpretations as well as related guidance endorsed by the Financial Supervisory Commission of the
Republic of China, and for such internal control as management determines is necessary to enable 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.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance with the Standards on Auditing of the Republic of China will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in theaggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis ofthese consolidated financial statements.
As part of an audit in accordance with Standards on Auditing of the Republic of China, we exercise professional
judgment and professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due tofraud 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 theGroup’s internal control.

3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated 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 a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the consolidated financial statements, including thedisclosures, and whether the consolidated financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.
6. Obtain sufficient appropriate audit evidence regarding the financial information of the 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.
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 of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
The engagement partners on the audit resulting in this independent auditors’ report are Mei, Yuan-Chen andHsu, Yu-Feng.

KPMG
Taipei, Taiwan (R.O.C)
March 15, 2023

Notes to Readers
The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial
performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China andnot those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are thosegenerally accepted and applied in the Republic of China.
The independent auditors’ audit report and the accompanying consolidated financial statements are the English translation of theChinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the
English and Chinese language independent auditors’ audit report and consolidated financial statements, the Chinese version shallprevail.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD. AND SUBSIDIARIES
Consolidated Balance Sheets
December 31, 2022 and 2021
(Expressed in Thousands of

1100
1110
1150
1170
1200
1220
130X
1410
1476

1517
1600
1755
1822
1805
1840
1980
1990

AssetsCurrent assets:
Cash and cash equivalents (note 6(a))
Current financial assets at fair value through profit or loss (note 6(b))
Notes receivable, net (note 6(c))
Accounts receivable, net (note 6(c))
Other receivables
Current tax assets
Inventories (note 6(d))
Prepayments
Other current financial assets (note 6(b))

December 31, 2022
Amount%$Non-current assets:
Non-current financial assets at fair value through other comprehensive
income (note 6(b))
Property, plant and equipment (note 6(f))
Right-of-use assets (note 6(g))
Intangible assets (note 6(h))
Goodwill (note 6(i))
Deferred tax assets (note 6(p))
Other non-current financial assets (note 6(b))
Other non-current assets (note 6(j))

3,595,681
1,798
588
3,015,880
105,789409
3,500,033
251,545599,488
11,071,211
4,157
4,483,033
229,239
308,413
1,136,565
458,165
83,020443,016
7,145,608

New Taiwan Dollars)

December 31, 2021
Amount
%

20
17
1
19
1
3
61

2,701,648
155,067751
2,950,815
63,284929
2,444,825
177,271373,5848,868,174

17
1
19
15
1
2
55

-

-

-

25
1
2
6
3
2
39

4,501,135
280,665
388,016
1,024,426
456,197
71,583395,775
7,117,797

28
2
3
6
3
3
45

2100
2120
2150
2170
2200
2230
2322
2280
2399

Liabilities and Equity
Current liabilities:
Short-term borrowings (note 6(k))
Current financial liabilities at fair value through profit or loss (note 6(b))
Notes payable
Accounts payable
Other payables (note 6(m))
Current tax liabilities
Long-term borrowings, current portion (note 6(l))
Lease liabilities, current (note 6(n))
Other current liabilities

2540
2580
2640
2570
2670

Non-Current liabilities:
Long-term borrowings (note 6(l))
Lease liabilities non-current (note 6(n))
Net defined benefit liabilities, non-current (note 6(o))
Deferred tax liabilities (note 6(p))
Other non-current liabilities

3110
3200
3300
3400

Total liabilities
Stockholder’ equity attributable to parent:(note 6(q))
Common stock
Capital surplus
Retained earnings
Other stockholders’ equity

3500
36XX
Total assets

See accompanying notes to financial statements.

$

18,216,819 100

15,985,971 100

Treasury shares
Total equity attributable to owners of parent
Non-controlling interests (note 6(e))
Total equity
Total liabilities and equity

December 31, 2022
Amount
%$1,466,515
2,392
1,648,557
1,065,266
415,066
322,349
106,012
325,900
5,352,057
1,084,391
123,21435,000825,106
71,5682,139,279
7,491,336

2,634,854
2,137,088
4,155,591(359,558)$

December 31, 2021
Amount%8

921,426563
1,607
1,673,549
883,040
412,838
65,000113,331
232,6814,304,035

10
6
3
1
1
27

12
41

1,484,310
190,820
42,788684,722
51,7872,454,427
6,758,462

10
1
4
15
42

14
12
23
(2)

2,650,854
2,166,799
3,247,117(531,125)

17
14
20
(4)

9
6
2
2
2
29
6
1
5

(506,043) (3)8,061,932 44
2,663,551 15
10,725,483 59
18,216,819 100

6(506,990) (3)7,026,655 44
2,200,854 14
9,227,509 58
15,985,971 100

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

2021

2022
Amount
4110
4190

6000
6100
6200
6300

Total sales revenue (note 6(s))
Less: Sales discounts and allowances
Net operating revenues
Cost of goods sold (note 6(d))
Gross profit
Operating expenses (notes 6(o) and (u)):
Selling expenses
Administrative expenses
Research and development expenses

7100
7010
7020
7050

Operating income
Non-operating income and expenses (note 6(t)):
Interest income
Other income
Other gains and losses
Finance costs

5000

7950
8300
8310
8311
8349

8360
8361
8399

8300

Profit before tax
Less: Income tax expenses (note 6(p))
ProfitOther comprehensive income:Components of other comprehensive income (loss) that will not bereclassified to profit or loss
Gains (losses) on remeasurements of defined benefit plans
Income tax related to components of other comprehensive income that will
not be reclassified to profit or loss
Components of other comprehensive income (loss) that will be reclassified
to profit or loss
Exchange differences on translation of foreign financial statements
Income tax related to components of other comprehensive income that will
be reclassified to profit or loss
Other comprehensive income (after tax)
Comprehensive income
Net income attributable to:
Owners of the parent
Non-controlling interests (note 6(e))
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests (note 6(e))
Basic earnings per common share (NT dollars) (note 6(v))
Diluted earnings per common share (NT dollars) (note 6(v))

See accompanying notes to financial statements.

$ 16,442,867
755,733
15,687,134
10,337,968
5,349,166%%

105 13,612,887
5
435,470
100 13,177,417
66 9,049,696
34 4,127,721

103
3
100
69
31

8
6
2
16
18

9
5
2
16
15

1,296,411
906,846
355,388
2,558,645
2,790,521
19,892
46,025
197,944(40,452)
223,409
3,013,930
837,015
2,176,915

Amount

1
1
19
5
14

1,175,935
726,018
316,861
2,218,814
1,908,907
14,541
46,312
10,864(32,992)
38,725
1,947,632
565,737
1,381,895

15
4
11

7,368

-

(1,771)

-

7,368

-

(1,771)-

2(125,433)

(1)

2
2
16

15,123(110,310)(112,081)
1,269,814

(1)
(1)
10

10
4
14

882,805
499,090
1,381,895

7
4
11$ 1,738,755
11739,3185
16$ 2,478,073
$
6.28
$
6.23

809,542460,272
1,269,814

6
4
10
3.55
3.52

-

341,796(48,006)
293,790
301,158$ 2,478,073$ 1,562,887
614,028$ 2,176,915-

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Changes in Equity
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars)

Equity attributable to owners of parent
Share capital

Balance at January 1, 2021$

Ordinaryshares2,494,539

Advancereceipts forshare capital
22,196

Capitalsurplus1,516,265

Total other equity
interest
Retained earnings
Exchangedifferences ontranslation of
Total equity
Unappropriated Total retained
foreign financial
attributable to Non-controllingstatements
earnings
Treasury shares owners of parent
interests
Legal reserve
Special reserve retained earnings
830,920445,618
1,484,440
2,760,978(459,300)(506,990)
5,827,688
2,020,901

Net income

-

-

-

-

-

882,805

882,805-

882,805

499,090

1,381,895

Other comprehensive income

-

-

-

-

-

(1,438)(1,438)(71,825)-(73,263)(38,818)(112,081)

-

-

-

-

-

881,367

881,367(71,825)-

809,542460,272

1,269,814--

738,983

Total comprehensive income
Conversion of convertible bonds

156,315(22,196)604,864--

Total equity
7,848,589

-

-

-

-

738,983(53,967)

-

-

-

-

-

-

(13,682)

-

-

-

-

-

-

Appropriation and distribution of retained earnings:
Provision of legal reserve

-

-

-

Provision of special reserve

-

-

-

-

Cash dividends

-

-

-

-

-

(395,228)(395,228)--(395,228)-(395,228)

-

-

-

-

-

-

-

-

20,400-20,40025,270-Adjustments of capital surplus for company's cash dividends
received by subsidiaries

53,967

20,400Changes in equity of affiliate accounted for using equity
method--Changes in non-controlling interests

-

-

-

Balance at December 31, 2021

25,27013,682

-

-

-

-

-

-

-

-

-

-

-

-

-

(280,319)(280,319)

2,650,854-

2,166,799

1,902,930

3,247,117(531,125)(506,990)

7,026,655

2,200,854

9,227,509

Net income

-

-

-

-

-

1,562,887

1,562,887--

1,562,887

614,028

2,176,915

Other comprehensive income

-

-

-

-

-

4,301

4,301

171,567-

175,868

125,290

301,158

-

-

-

-

1,567,188

1,567,188

171,567-

739,318

2,478,073

-

-

-

-

-

85,482

-

-

-

-

-

(84,535)(88,137)

-

-

-

-

-

-

(71,825)

-

-

-

-

-

-

Total comprehensive income-

Retirement of treasury shares(16,000)

Subsidiaries purchase of treasury shares-(69,482)

884,887459,300

25,2701,738,755-(84,535)

-

-

-

-

-

(84,535)

Provision of legal reserve

-

-

-

Provision of special reserve

-

-

-

-

Cash dividends

-

-

-

(658,714)(658,714)--(658,714)-(658,714)

Appropriation and distribution of retained earnings:
88,137

71,825--Adjustments of capital surplus for company's cash dividends
received by subsidiaries--

37,000

-

-

-

-

-

-

37,000-37,000Changes in equity of affiliate accounted for using equity
method

-

-

2,771

-

-

-

-

-

-

2,771

-

2,771

-

-

-

-

-

(276,621)(276,621)

2,651,442

4,155,591(359,558)(506,043)

8,061,932

2,663,551

10,725,483

Changes in non-controlling interests
Balance at December 31, 2022

See accompanying notes to financial statements.

$

-

-

-

2,634,854-

2,137,088-

973,024

531,125

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

TAIWAN SEMICONDUCTOR CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the years ended December 31, 2022 and 2021
(Expressed in Thousands of New Taiwan Dollars)

2022

2021

Cash flows from (used in) operating activities:$

3,013,930

1,947,632

Depreciation expense

790,180

732,723

Amortization expense

140,791

123,565

Expected credit loss

1,380

9,563

Net loss (gain) on financial assets or liabilities at fair value

51,151(8,726)

Interest expense

38,33030,911

Interest income(19,892)(14,541)

Loss on disposal of property, plant and equipment

4,840

3,601

Reversal of impairment (gain) or loss on non-financial assets

(595)

2,701

Others

2,771

25,2701,008,956

905,067

103,947(143,918)

163

(565)

Increase in accounts receivable(66,445)(591,627)

Increase in other receivables(42,049)(15,396)

Increase in inventories(1,055,208)(644,378)

Increase in prepayments(92,899)(7,114)(Increase) decrease in other financial assets(225,904)

108,236

Decrease in notes payable(1,607)(45)

Increase (decrease) in accounts payable(24,992)

502,115

Increase in other payable

181,589

248,737

Increase in other current liabilities

92,684

93,849Profit before tax
Adjustments:
Adjustments to reconcile profit (loss):through profit or loss

Total adjustments to reconcile profit (loss)
Changes in operating assets and liabilities:
Net loss (gain) on financial assets or liabilities at fair value
through profit or loss
(Increase) decrease in notes receivable28

Decrease in net defined benefit liabilities(7,788)(2,459)

Increase in other non-current liabilities

17,577

5,253

Total adjustments(111,976)

457,755

Cash inflow generated from operations

2,901,954

2,405,387

Interest received

19,436

14,559Interest paid

(28,454)(18,424)

Income taxes paid

(695,851)(409,095)

2,197,085

1,992,427

Net cash flows from operating activities
Cash flows from (used in) investing activities:
Acquisition of financial assets at fair value through other(4,157)-comprehensive income
Acquisition of property, plant and equipment(526,957)(525,777)

5,531

2,421

Increase in other financial assets(11,437)(3,979)Acquisition of intangible assets(35,317)(26,639)

Increase in other non-current assets(27,074)(45,846)

Increase in prepayments for equipment(92,105)(156,963)(691,516)(756,783)

545,089(480,528)

Proceeds from disposal of property, plant and equipment

Net cash flows used in investing activities
Cash flows from (used in) financing activities:
Increase (decrease) in short-term borrowings
Repayments of convertible bonds-(41,900)

Proceeds from long-term borrowings

419,320

679,760

Repayments of long-term borrowings(561,890)(430,000)

(130)

(35)

Payment of lease liabilities(127,258)(86,168)

Cash dividends paid

(621,714)(374,828)

Repurchase of treasury shares(84,535)

Change in non-controlling interests(276,621)(280,319)(707,739)(1,014,018)

Effect of exchange rate changes on cash and cash equivalents

96,203(83,648)

Net increase in cash and cash equivalents

894,033

137,9782,701,648

2,563,670

3,595,681

2,701,648

Decrease in guarantee deposits received

Net cash flows used in financing activities

Cash and cash equivalents at the beginning of period
Cash and cash equivalents at the end of period

$

29

-

TAIWAN SEMICONDUCTOR CO., LTD.
Fiscal Year 2022
Earnings Distribution Table
Unit: NTD
Items

Subtotal

Beginning retained earnings (Beginning Balance)

Total

1,084,254,443

Add: 2022 Net profit after tax

1,562,886,413
4,300,684

Add：Remeasurements of defined benefit planLess: 10% legal reserve

156,718,710

Distributable earnings

2,494,722,830

Less：Distributable items(1) Dividend to shareholders (NTD 4.0 per share)(NTD 4.0 per share of cash dividend) ----(Note)

1,053,941,944

Unappropriated retained earnings (Ending Balance)

1,053,941,944
1,440,780,886

Note:1) If there is an increase or decrease in the total number of outstanding shares of the Company, which results in achange in the shareholders’ payout ratio, it is proposed to request the shareholders' meeting to authorize the Board of
Directors to deal with the matter in its sole discretion.
2) Total Stock dividend of the director for the current period NTD
1,053,941,944
3) 2022 net profit after tax after distribution NTD
356,526,443 Hasn’t been distributed.

30