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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 20-F/A

Amendment No. 1



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| ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR



|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED APRIL 30, 2007
|- | -----------------------------------------------------------------------------------------------------------------------------

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

OR



| ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------



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Commission file number: 000-30842

ASAT Holdings Limited

(Exact name of Registrant as specified in its charter)

N/A

(Translation of Registrants name into English)



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Cayman Islands

(Jurisdiction of
incorporation or organization)

14th Floor, 138 Texaco Road

Tsuen Wan, New Territories

Hong Kong

(Address of principal executive office)



---

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Name of each exchange and Title of each class on which registered:

American Depositary Shares, each representing 15 ordinary shares, par value $0.01 per share,

Nasdaq Capital Market

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None

Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

Indicate the number of outstanding shares of each of the Issuers classes of capital or common stock as of the close of the period covered by the
annual report:



|                                 |  |                                                  
|-------------------------------- |  | -------------------------------------------------
|Class                            |  | Number of shares outstanding as of
April 30, 2007
|Ordinary Shares, par value $0.01 |  | 704,348,844                                      



---

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes ̈No  x

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.    Yes ̈No  x

Note  Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.    Yes  x    No ̈

Indicate by check mark if the registrant is a large accelerated filer, an accelerated filer, or a
non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ̈Accelerated filer ̈Non-accelerated filer  x

Indicate by check mark which financial statement item the registrant has elected to follow.     Item 17 ̈Item 18  x

If this is an annual
report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.).    Yes ̈No  x



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EXPLANATORY NOTE

This Amendment No. 1 on Form 20-F/A is being filed solely to correct Item 18 of ASAT Holdings Limiteds Annual Report on Form 20-F for the fiscal year ended April 30, 2007 (Form 20-F), which was filed
on October 15, 2007. This Amendment No. 1 is being filed to include the Report of Independent Registered Public Accounting Firm (the Report), which was inadvertently undated in the Form 20-F. The Report has been dated October 15, 2007,
which is the date on which the Registrant received such Report.

This Amendment No. 1 is not intended to revise any of the financial data
and information presented in the Registrants Annual Report on Form 20-F as originally filed and all such other information in the original filing remains unchanged.

This Amendment No. 1 does not reflect events occurring after the filing of the Form 20-F and does not modify or update the disclosure therein in any way other than as discussed above. As a result, this Amendment No. 1
continues to speak as of October 15, 2007.

TABLE OF CONTENTS



|                              |  |   |  | 
|----------------------------- |  | - |  | 
|PART III                      |  |  
|ITEM 17. FINANCIAL STATEMENTS |  | 1
|ITEM 18. FINANCIAL STATEMENTS |  | 1
|ITEM 19. EXHIBITS             |  | 1
|SIGNATURES                    |  | 4



---

PART III



|ITEM 17. | FINANCIAL STATEMENTS
|-------- | --------------------

We have responded to
Item 18 in lieu of responding to this item.



|ITEM 18. | FINANCIAL STATEMENTS
|-------- | --------------------

See pages F-1 through F-44.



|ITEM 19. | EXHIBIT INDEX
|-------- | -------------



|          |  |                                                                                                                                                              
|--------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibits  |  | Description                                                                                                                                                  
|          | 
|1.1(1)    |  | Restated Memorandum of Association of ASAT Holdings Limited.                                                                                                 
|          | 
|1.2(1)(7) |  | Restated Articles of Association of ASAT Holdings Limited, as amended.                                                                                       
|          | 
|2.1(1)    |  | Form of Deposit Agreement between ASAT Holdings Limited and The Bank of New York.                                                                            
|          | 
|2.2(1)    |  | Form of ADR (included in Exhibit 4.1).                                                                                                                       
|          | 
|2.3(1)    |  | Form of specimen certificate representing ordinary shares of ASAT Holdings Limited.                                                                          
|          | 
|4.1(2)    |  | ASAT Holding Limited Stock Option Plan.                                                                                                                      
|          | 
|4.3(2)    |  | Form of ASAT Holdings Non-Qualified Stock Option Agreement.                                                                                                  
|          | 
|4.4(3)    |  | Supply Agreement dated March 8, 2001 entered into among ASAT Limited, Talent Focus Limited and QPL Limited.                                                  
|          | 
|4.5(4)    |  | Lease Agreement dated as of August 8, 2002 between Dongguan Changan County Changshi Development Company and TTimerson Limited.                               
|          | 
|4.6(5)    |  | Indenture dated as of January 26, 2004, between New ASAT (Finance) Limited, ASAT Holdings Limited and its subsidiaries, and The Bank of New York, as trustee.



1



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|         |  |                                                                                                                                                                                          
|-------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|         | 
|4.7(5)   |  | Form of 9.25% Senior Note due 2011 (included in Exhibit 4.6).                                                                                                                            
|         | 
|4.8(5)   |  | Lease Agreement dated as of May 7, 2004 among Dongguan Changan County Changshi Development Company, Dongguan Changan ASAT Semiconductor Assembly and Test Factory and Timerson
Limited.  
|         | 
|4.9(6)   |  | Supply Agreement dated as of May 1, 2004 entered into among ASAT Limited, Talent Focus Industries Limited and QPL Limited.                                                               
|         | 
|4.10(6)  |  | Supply Agreement dated June 23, 2005 entered into among ASAT Limited, Talent Focus Industries Limited and QPL Limited.                                                                   
|         | 
|4.11(7)  |  | Amended and Restated Supply Agreement dated October 27, 2005 entered into among ASAT Limited, Talent Focus Industries Limited and QPL Limited.                                           
|         | 
|4.12(6)  |  | Purchase Money Loan Agreement dated as of July 31, 2005 among ASAT Holdings Limited, the Lenders named therein, and Asia Opportunity Fund, L.P.                                          
|         | 
|4.13(7)  |  | Amended and Restated Securities Purchase Agreement dated as of October 27, 2005 among ASAT Holdings Limited and the purchasers party thereto.                                            
|         | 
|4.14(7)  |  | Amended and Restated Shareholders Agreement dated November 10, 2005, by and among ASAT Holdings Limited and the shareholders party thereto.                                              
|         | 
|4.18(8)  |  | Form of Warrant Agreement between ASAT Holdings Limited and U.S. Bank National Association.                                                                                              
|         | 
|4.19(9)  |  | Second Supplemental Indenture dated as of August 27, 2007 between New ASAT (Finance) Limited, ASAT Holdings Limited and its guarantor subsidiaries, and The Bank of New York, as
trustee.
|         | 
|4.20(9)  |  | Waiver and Amendment Agreement dated as of August 23, 2007 among ASAT Holdings Limited, the Lenders named therein, and Asia Opportunity Fund, L.P.                                       
|         | 
|4.21(9)  |  | Revolving Credit Facility Agreement dated as of September 21, 2007 among X Y and Z (original in Chinese; English translation provided).*                                                 
|         | 
|4.22(9)  |  | Form of Warrant to Bondholders.                                                                                                                                                          
|         | 
|4.23(9)  |  | Form of Warrant to Lenders.                                                                                                                                                              
|         | 
|8.0(9)   |  | Subsidiaries of the Registrant.                                                                                                                                                          
|         | 
|11.0(6)  |  | Code of Ethics.                                                                                                                                                                          
|         | 
|12.1(9)  |  | Certification of the Acting Chief Executive Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.                                                                                  
|         | 
|12.2(9)  |  | Certification of the Chief Financial Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.                                                                                         
|         | 
|13.1(10) |  | Certification of the Acting Chief Executive Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.          
|         | 
|13.2(10) |  | Certification of the Chief Financial Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                 
|         | 
|14.0(3)  |  | Letter re Andersen Assurances.                                                                                                                                                           

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|(1) | Incorporated herein by reference to Registrants Registration Statement on Form F-1 filed on July 7, 2000 (Registration No. 333-12124).
|--- | ---------------------------------------------------------------------------------------------------------------------------------------



|(2) | Incorporated herein by reference to Registrants Registration Statement on Form S-8 filed on February 13, 2001 (Registration No. 333-55464).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------



|(3) | Incorporated herein by reference to Registrants Annual Report on Form 20-F filed on June 28, 2002.
|--- | ---------------------------------------------------------------------------------------------------



2



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|(4) | Incorporated herein by reference to Registrants Annual Report on Form 20-F filed on July 28, 2003.
|--- | ---------------------------------------------------------------------------------------------------



|(5) | Incorporated herein by reference to Registrants Annual Report on Form 20-F filed on July 9, 2004.
|--- | --------------------------------------------------------------------------------------------------



|(6) | Incorporated herein by reference to Registrants Annual Report on Form 20-F filed on August 2, 2005.
|--- | ----------------------------------------------------------------------------------------------------



|(7) | Incorporated herein by reference to Registrants Quarterly Report on Form 6-K filed on January 11, 2006.
|--- | --------------------------------------------------------------------------------------------------------



|(8) | Incorporated herein by reference to Registrants Registration Statement on Form F-1 filed on January 27, 2006.
|--- | --------------------------------------------------------------------------------------------------------------



|(9) | Previously filed as an exhibit to Registrants Annual Report on Form 20-F for the year ended April 30, 2007 filed on October 15, 2007.
|--- | --------------------------------------------------------------------------------------------------------------------------------------



|(10) | Previously furnished as an exhibit to Registrants Annual Report on Form 20-F for the year ended April 30, 2007 filed on October 15, 2007.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------



|* | Certain portions of this exhibit have been omitted based upon a request for confidential treatment. The omitted portions will be separately submitted to the Securities and Exchange
Commission.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



3



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SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and
that it has duly caused and authorized the undersigned to sign this amendment to such annual report on its behalf.



|                       |  |  |  |                       |  |                               
|---------------------- |  |  |  | --------------------- |  | ------------------------------
|                       |  |  |  | ASAT HOLDINGS LIMITED
|                       |  |  | 
|Date: November 1, 2007 |  |  |  | By:                   |  | /s/    Tung Lok Li            
|                       |  |  |  | Name:                 |  | Tung Lok Li                   
|                       |  |  |  | Title:                |  | Acting Chief Executive Officer
|                       |  |  | 
|Date: November 1, 2007 |  |  |  | By:                   |  | /s/    Kei Hong Chua          
|                       |  |  |  | Name:                 |  | Kei Hong Chua                 
|                       |  |  |  | Title:                |  | Chief Financial Officer       



4



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ASAT HOLDINGS LIMITED

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



|                                                                                                               |  |     
|-------------------------------------------------------------------------------------------------------------- |  | ----
|                                                                                                               |  | Page
|Report of Independent Registered Public Accounting Firm                                                        |  | F-2 
|Consolidated Balance Sheets as of April 30, 2006 and 2007                                                      |  | F-3 
|Consolidated Statements of Operations and Comprehensive Loss for the years ended April 30, 2005, 2006 and 2007 |  | F-4 
|Consolidated Statements of Shareholders Deficit for the years ended April 30, 2005, 2006 and 2007             |  | F-5 
|Consolidated Statements of Cash Flows for the years ended April 30, 2005, 2006 and 2007                        |  | F-6 
|Notes to Consolidated Financial Statements                                                                     |  | F-7 



F-1



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF ASAT
HOLDINGS LIMITED

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations
and comprehensive loss, consolidated statements of shareholders deficit, and consolidated statements of cash flows present fairly, in all material respects, the financial positions of ASAT Holdings Limited (the Company) and its
subsidiaries at April 30, 2006 and 2007 and the results of their operations and their cash flows for each of the three years in the period ended April 30, 2007 in conformity with accounting principles generally accepted in the United
States of America. These consolidated financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits
of these consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.



/s/ PricewaterhouseCoopersHong KongOctober 15, 2007




F-2



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ASAT HOLDINGS LIMITED

CONSOLIDATED BALANCE SHEETS

AS OF APRIL 30, 2006 AND 2007

(Expressed in United States dollars)



|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------- |  | -------------- | - |  | -------------- | -
|                                                                                                                                                                                                                  |  | Note(s) |  | April 30, 2006 |   |  | April 30, 2007 |  
|                                                                                                                                                                                                                  |  |         |  | $000          |   |  | $000          |  
|ASSETS                                                                                                                                                                                                            |  |         |  |                |   |  |                |  
|Current assets:                                                                                                                                                                                                   |  |         |  |                |   |  |                |  
|Cash and cash equivalents                                                                                                                                                                                         |  |         |  | 11,915         |   |  | 7,325          |  
|Restricted cash                                                                                                                                                                                                   |  | 8       |  |               |   |  | 900            |  
|Accounts receivable, net                                                                                                                                                                                          |  | 6       |  | 29,607         |   |  | 17,704         |  
|Inventories                                                                                                                                                                                                       |  | 7       |  | 23,319         |   |  | 13,270         |  
|Prepaid expenses and other current assets                                                                                                                                                                         |  |         |  | 8,084          |   |  | 5,171          |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total current assets                                                                                                                                                                                              |  |         |  | 72,925         |   |  | 44,370         |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Restricted cash, net of current portion                                                                                                                                                                           |  | 8       |  | 3,320          |   |  | 900            |  
|Property, plant and equipment, net                                                                                                                                                                                |  | 9       |  | 93,831         |   |  | 79,582         |  
|Deferred charges, net                                                                                                                                                                                             |  | 2       |  | 7,115          |   |  | 5,277          |  
|Other non-current assets                                                                                                                                                                                          |  | 14      |  | 4,270          |   |  | 5,008          |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total assets                                                                                                                                                                                                      |  |         |  | 181,461        |   |  | 135,137        |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|LIABILITIES AND SHAREHOLDERS DEFICIT                                                                                                                                                                             |  |         |  |                |   |  |                |  
|Current liabilities:                                                                                                                                                                                              |  |         |  |                |   |  |                |  
|Short-term bank loan                                                                                                                                                                                              |  | 10      |  |               |   |  | 3,837          |  
|Accounts payable                                                                                                                                                                                                  |  |         |  | 38,249         |   |  | 25,926         |  
|Accrued liabilities                                                                                                                                                                                               |  | 11      |  | 23,698         |   |  | 22,445         |  
|Amount due to QPL                                                                                                                                                                                                 |  | 4       |  | 5,826          |   |  | 2,532          |  
|Current portion of capital lease obligations                                                                                                                                                                      |  | 14      |  | 2,051          |   |  | 1,822          |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total current liabilities                                                                                                                                                                                         |  |         |  | 69,824         |   |  | 56,562         |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Accounts payable, net of current portion                                                                                                                                                                          |  |         |  | 1,830          |   |  |               |  
|Other long-term payable                                                                                                                                                                                           |  | 12      |  |               |   |  | 2,086          |  
|Purchase money loan                                                                                                                                                                                               |  | 12      |  | 6,382          |   |  | 8,249          |  
|9.25% senior notes due 2011                                                                                                                                                                                       |  | 13      |  | 150,000        |   |  | 150,000        |  
|Capital lease obligations, net of current portion                                                                                                                                                                 |  | 14      |  | 2,539          |   |  | 758            |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total liabilities                                                                                                                                                                                                 |  |         |  | 230,575        |   |  | 217,655        |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Series A Redeemable Convertible Preferred Shares                                                                                                                                                                  |  | 15      |  | 4,143          |   |  | 5,743          |  
|Commitments and contingencies                                                                                                                                                                                     |  | 24      |  |                |   |  |                |  
|Shareholders deficit:                                                                                                                                                                                            |  |         |  |                |   |  |                |  
|Common stock ($0.01 par value, 2,999,000,000 ordinary shares authorized, 689,859,869 and 711,401,844 ordinary shares issued, respectively;
682,806,869 and 704,348,844 ordinary shares outstanding, respectively) |  | 18      |  | 6,899          |   |  | 7,114          |  
|Less: Repurchase of shares at par                                                                                                                                                                                 |  |         |  | (71            | ) |  | (71            | )
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|                                                                                                                                                                                                                  |  |         |  | 6,828          |   |  | 7,043          |  
|Additional paid-in capital                                                                                                                                                                                        |  |         |  | 246,353        |   |  | 246,072        |  
|Deferred stock-based compensation                                                                                                                                                                                 |  |         |  | (63            | ) |  |               |  
|Accumulated deficit                                                                                                                                                                                               |  |         |  | (306,152       | ) |  | (341,192       | )
|Accumulated other comprehensive loss                                                                                                                                                                              |  |         |  | (223           | ) |  | (184           | )
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total shareholders deficit                                                                                                                                                                                       |  |         |  | (53,257        | ) |  | (88,261        | )
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  
|Total liabilities and shareholders deficit                                                                                                                                                                       |  |         |  | 181,461        |   |  | 135,137        |  
|                                                                                                                                                                                                                  |  |         |  |                |   |  |                |  

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



F-3



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ASAT HOLDINGS LIMITED

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE YEARS ENDED APRIL 30, 2005, 2006 AND 2007

(Expressed in United States dollars, except share and per share data)



|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|--------------------------------------------------------------- |  | ------- |  | ----- | ----------- | - | ----- | - | ----------- | ----- |  | - | ----------- | -
|                                                                |  | Note(s) |  | 2005  |             |   | 2006  |   |             | 2007  | 
|                                                                |  |         |  | $000 |             |   | $000 |   |             | $000 | 
|Net sales                                                       |  |         |  |       | 194,411     |   |       |   | 182,115     |       |  |   | 164,853     |  
|Cost of sales                                                   |  | 4, 7    |  |       | 182,319     |   |       |   | 168,859     |       |  |   | 149,927     |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Gross profit                                                    |  |         |  |       | 12,092      |   |       |   | 13,256      |       |  |   | 14,926      |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Operating expenses                                              |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Selling, general and administrative                            |  | 4       |  |       | 27,455      |   |       |   | 29,448      |       |  |   | 22,065      |  
|Research and development                                       |  |         |  |       | 4,481       |   |       |   | 4,059       |       |  |   | 2,218       |  
|Reorganization expenses                                        |  | 21      |  |       | 928         |   |       |   | 4,690       |       |  |   | 2,473       |  
|Litigation settlement                                          |  | 23      |  |       | 4,603       |   |       |   |            |       |  |   |            |  
|Impairment of property, plant and equipment                    |  | 5       |  |       | 19,944      |   |       |   | 3,890       |       |  |   |            |  
|Facilities and relocation charges                              |  |         |  |       |            |   |       |   | 1,054       |       |  |   | 3,047       |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Total operating expenses                                        |  |         |  |       | 57,411      |   |       |   | 43,141      |       |  |   | 29,803      |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Loss from operations                                            |  |         |  |       | (45,319     | ) |       |   | (29,885     | )     |  |   | (14,877     | )
|Other income, net                                               |  | 16      |  |       | 688         |   |       |   | 3,438       |       |  |   | 643         |  
|Interest expense:                                               |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Amortization of deferred charges                               |  | 2       |  |       | (958        | ) |       |   | (1,947      | )     |  |   | (3,705      | )
|Third parties                                                  |  |         |  |       | (14,088     | ) |       |   | (14,686     | )     |  |   | (15,837     | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Loss before income taxes                                        |  |         |  |       | (59,677     | ) |       |   | (43,080     | )     |  |   | (33,776     | )
|Income tax (expense) benefit                                    |  | 17      |  |       | (748        | ) |       |   | 649         |       |  |   | (1,264      | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Net loss                                                        |  |         |  |       | (60,425     | ) |       |   | (42,431     | )     |  |   | (35,040     | )
|Other comprehensive loss:                                       |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Foreign currency translation                                    |  |         |  |       | (179        | ) |       |   | 11          |       |  |   | 39          |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Comprehensive loss                                              |  |         |  |       | (60,604     | ) |       |   | (42,420     | )     |  |   | (35,001     | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Net loss applicable to common stockholders:                     |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Net loss                                                        |  |         |  |       | (60,425     | ) |       |   | (42,431     | )     |  |   | (35,040     | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Preferred shares:                                               |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Cumulative preferred share dividends                           |  |         |  |       |            |   |       |   | (976        | )     |  |   | (1,990      | )
|Accretion of preferred shares                                  |  |         |  |       |            |   |       |   | (500        | )     |  |   | (1,232      | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Net loss applicable to common stockholders                      |  |         |  |       | (60,425     | ) |       |   | (43,907     | )     |  |   | (38,262     | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Net loss per ordinary share:                                    |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Basic and diluted net loss per share (dollars per share)        |  | 2       |  | $     | (0.09       | ) |       | $ | (0.06       | )     |  | $ | (0.06       | )
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  
|Basic and diluted weighted average number of shares outstanding |  | 2       |  |       | 677,953,380 |   |       |   | 679,357,820 |       |  |   | 691,798,216 |  
|                                                                |  |         |  |       |             |   |       |   |             |       |  |   |             |  

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



F-4



---

ASAT HOLDINGS LIMITED

CONSOLIDATED STATEMENTS OF SHAREHOLDERS DEFICIT

FOR THE YEARS ENDED APRIL 30, 2005, 2006 AND 2007

(Expressed in United States dollars, except shares data)



|                                                  |  |                        |  |        |  |                          |   |  |                                 |   |  |                    |   |  |                                            |   |  |         |  
|------------------------------------------------- |  | ---------------------- |  | ------ |  | ------------------------ | - |  | ------------------------------- | - |  | ------------------ | - |  | ------------------------------------------ | - |  | ------- | -
|                                                  |  | Common Stock (Note 18) |  |        |  |                          |   |  |                                 |   |  |                    |   |  |                                            |   | 
|                                                  |  | Share                  |  | Amount |  | Additionalpaid-incapital |   |  | Deferredstock-basedcompensation |   |  | Accumulateddeficit |   |  | Accumulatedothercomprehensiveincome (loss) |   |  | Total   |  
|                                                  |  | 000                   |  | $000  |  | $000                    |   |  | $000                           |   |  | $000              |   |  | $000                                      |   |  | $000   |  
|Balance as of April 30, 2004                      |  | 676,973                |  | 6,769  |  | 231,118                  |   |  | (754                            | ) |  | (203,296           | ) |  | (55                                        | ) |  | 33,782  |  
|Net loss for the year                             |  |                       |  |       |  |                         |   |  |                                |   |  | (60,425            | ) |  |                                           |   |  | (60,425 | )
|Translation adjustment                            |  |                       |  |       |  |                         |   |  |                                |   |  |                   |   |  | (179                                       | ) |  | (179    | )
|Exercise of stock options                         |  | 1,464                  |  | 15     |  | 218                      |   |  |                                |   |  |                   |   |  |                                           |   |  | 233     |  
|Reversal of deferred stock-based compensation     |  |                       |  |       |  | (228                     | ) |  | 228                             |   |  |                   |   |  |                                           |   |  |        |  
|Amortization of stock-based compensation          |  |                       |  |       |  |                         |   |  | 133                             |   |  |                   |   |  |                                           |   |  | 133     |  
|                                                  |  |                        |  |        |  |                          |   |  |                                 |   |  |                    |   |  |                                            |   |  |         |  
|Balance as of April 30, 2005                      |  | 678,437                |  | 6,784  |  | 231,108                  |   |  | (393                            | ) |  | (263,721           | ) |  | (234                                       | ) |  | (26,456 | )
|Net loss for the year                             |  |                       |  |       |  |                         |   |  |                                |   |  | (42,431            | ) |  |                                           |   |  | (42,431 | )
|Translation adjustment                            |  |                       |  |       |  |                         |   |  |                                |   |  |                   |   |  | 11                                         |   |  | 11      |  
|Exercise of stock options                         |  | 1,025                  |  | 10     |  | 99                       |   |  |                                |   |  |                   |   |  |                                           |   |  | 109     |  
|Reversal of deferred stock-based compensation     |  |                       |  |       |  | (516                     | ) |  | 516                             |   |  |                   |   |  |                                           |   |  |        |  
|Reversal of stock-based compensation              |  |                       |  |       |  |                         |   |  | (186                            | ) |  |                   |   |  |                                           |   |  | (186    | )
|Fair value of the beneficial conversion feature   |  |                       |  |       |  | 10,179                   |   |  |                                |   |  |                   |   |  |                                           |   |  | 10,179  |  
|Amortization of the accretion of preferred shares |  |                       |  |       |  | (500                     | ) |  |                                |   |  |                   |   |  |                                           |   |  | (500    | )
|Preferred shares dividend                         |  | 3,345                  |  | 34     |  | (34                      | ) |  |                                |   |  |                   |   |  |                                           |   |  |        |  
|Issuance of warrants                              |  |                       |  |       |  | 6,017                    |   |  |                                |   |  |                   |   |  |                                           |   |  | 6,017   |  
|                                                  |  |                        |  |        |  |                          |   |  |                                 |   |  |                    |   |  |                                            |   |  |         |  
|Balance as of April 30, 2006                      |  | 682,807                |  | 6,828  |  | 246,353                  |   |  | (63                             | ) |  | (306,152           | ) |  | (223                                       | ) |  | (53,257 | )
|Net loss for the year                             |  |                       |  |       |  |                         |   |  |                                |   |  | (35,040            | ) |  |                                           |   |  | (35,040 | )
|Translation adjustment                            |  |                       |  |       |  |                         |   |  |                                |   |  |                   |   |  | 39                                         |   |  | 39      |  
|Exercise of stock options                         |  | 2,140                  |  | 21     |  | 197                      |   |  |                                |   |  |                   |   |  |                                           |   |  | 218     |  
|Reversal of deferred stock-based compensation     |  |                       |  |       |  | (63                      | ) |  | 63                              |   |  |                   |   |  |                                           |   |  |        |  
|Amortization of stock-based compensation          |  |                       |  |       |  | 888                      |   |  |                                |   |  |                   |   |  |                                           |   |  | 888     |  
|Fair value of the beneficial conversion feature   |  |                       |  |       |  | 95                       |   |  |                                |   |  |                   |   |  |                                           |   |  | 95      |  
|Amortization of the accretion of preferred shares |  |                       |  |       |  | (1,232                   | ) |  |                                |   |  |                   |   |  |                                           |   |  | (1,232  | )
|Preferred shares dividend                         |  | 19,402                 |  | 194    |  | (194                     | ) |  |                                |   |  |                   |   |  |                                           |   |  |        |  
|Issuance of warrants                              |  |                       |  |       |  | 28                       |   |  |                                |   |  |                   |   |  |                                           |   |  | 28      |  
|                                                  |  |                        |  |        |  |                          |   |  |                                 |   |  |                    |   |  |                                            |   |  |         |  
|Balance as of April 30, 2007                      |  | 704,349                |  | 7,043  |  | 246,072                  |   |  |                                |   |  | (341,192           | ) |  | (184                                       | ) |  | (88,261 | )

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



F-5



---

ASAT HOLDINGS LIMITED

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED APRIL 30, 2005, 2006 AND 2007

(Expressed in United States dollars)



|                                                                                          |  |         |   |  |         |   |  |         |  
|----------------------------------------------------------------------------------------- |  | ------- | - |  | ------- | - |  | ------- | -
|                                                                                          |  | 2005    |   |  | 2006    |   |  | 2007    |  
|                                                                                          |  | $000   |   |  | $000   |   |  | $000   |  
|Operating activities:                                                                     |  |         |   |  |         |   |  |         |  
|Net loss                                                                                  |  | (60,425 | ) |  | (42,431 | ) |  | (35,040 | )
|Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |  |         |   |  |         |   |  |         |  
|Depreciation and amortization:                                                            |  |         |   |  |         |   |  |         |  
|Property, plant and equipment                                                             |  | 31,682  |   |  | 26,886  |   |  | 23,328  |  
|Deferred charges and debt discount                                                        |  | 958     |   |  | 1,947   |   |  | 3,705   |  
|Loss (gain) on disposal of property, plant and equipment                                  |  | 136     |   |  | (14     | ) |  | 173     |  
|Non-cash impairment of property, plant and equipment                                      |  | 19,944  |   |  | 3,890   |   |  |        |  
|Amortization (reversal) of stock-based compensation                                       |  | 133     |   |  | (186    | ) |  | 888     |  
|Changes in operating assets and liabilities:                                              |  |         |   |  |         |   |  |         |  
|Accounts receivable, net                                                                  |  | 8,744   |   |  | (11,927 | ) |  | 11,903  |  
|Restricted cash                                                                           |  |        |   |  | (3,320  | ) |  | 1,520   |  
|Inventories                                                                               |  | 3,408   |   |  | (5,301  | ) |  | 9,939   |  
|Prepaid expenses and other current assets                                                 |  | (1,457  | ) |  | (929    | ) |  | 2,913   |  
|Other non-current assets                                                                  |  | (2,946  | ) |  | (1,324  | ) |  | (738    | )
|Accounts payable                                                                          |  | (2,664  | ) |  | 16,815  |   |  | (5,728  | )
|Accrued liabilities                                                                       |  | 6,726   |   |  | 5,914   |   |  | (1,252  | )
|Amount due to QPL                                                                         |  | (2,353  | ) |  | 2,920   |   |  | (3,294  | )
|Other long-term payable                                                                   |  |        |   |  |        |   |  | 2,086   |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Net cash provided by (used in) operating activities                                       |  | 1,886   |   |  | (7,060  | ) |  | 10,403  |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Investing activities:                                                                     |  |         |   |  |         |   |  |         |  
|Proceeds from disposal of property, plant and equipment                                   |  | 13      |   |  | 116     |   |  | 181     |  
|Acquisition of property, plant and equipment                                              |  | (40,740 | ) |  | (23,520 | ) |  | (17,748 | )
|                                                                                          |  |         |   |  |         |   |  |         |  
|Net cash used in investing activities                                                     |  | (40,727 | ) |  | (23,404 | ) |  | (17,567 | )
|                                                                                          |  |         |   |  |         |   |  |         |  
|Financing activities:                                                                     |  |         |   |  |         |   |  |         |  
|Increase in short-term bank loan                                                          |  | 4,831   |   |  |        |   |  | 3,837   |  
|Repayment of short-term bank loan                                                         |  | (604    | ) |  | (4,227  | ) |  |        |  
|Proceeds from stock options exercised                                                     |  | 233     |   |  | 109     |   |  | 218     |  
|Proceeds from issuance of Series A Redeemable Convertible Preferred Shares                |  |        |   |  | 7,500   |   |  |        |  
|Proceeds from purchase money loan                                                         |  |        |   |  | 9,150   |   |  |        |  
|Proceeds from right offering                                                              |  |        |   |  |        |   |  | 490     |  
|Payment of debt issuance costs                                                            |  | (617    | ) |  |        |   |  |        |  
|Payment of other deferred charges                                                         |  | (510    | ) |  | (1,677  | ) |  |        |  
|Repayment of capital lease obligations                                                    |  | (746    | ) |  | (1,204  | ) |  | (2,010  | )
|Proceeds from sale-leaseback transaction                                                  |  | 6,540   |   |  |        |   |  |        |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Net cash provided by financing activities                                                 |  | 9,127   |   |  | 9,651   |   |  | 2,535   |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Net decrease in cash and cash equivalents                                                 |  | (29,714 | ) |  | (20,813 | ) |  | (4,629  | )
|Cash and cash equivalents at beginning of year                                            |  | 62,610  |   |  | 32,717  |   |  | 11,915  |  
|Effects of foreign exchange rates change                                                  |  | (179    | ) |  | 11      |   |  | 39      |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Cash and cash equivalents at end of year                                                  |  | 32,717  |   |  | 11,915  |   |  | 7,325   |  
|                                                                                          |  |         |   |  |         |   |  |         |  
|Supplemental disclosure of cash flow information:                                         |  |         |   |  |         |   |  |         |  
|Cash paid (received) during the year for:                                                 |  |         |   |  |         |   |  |         |  
|Interest expense                                                                         |  | 14,248  |   |  | 14,239  |   |  | 14,211  |  
|Income taxes                                                                             |  | 5       |   |  | (639    | ) |  | 102     |  
|Purchase of property, plant and equipment by increasing capital lease obligations        |  | 6,540   |   |  |        |   |  |        |  
|Non-cash financing activity:                                                              |  |         |   |  |         |   |  |         |  
|Waiver of payment to QPL in exchange of Series A Redeemable Convertible Preferred Shares  |  |        |   |  | 7,500   |   |  |        |  

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



F-6



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Amount expressed in United States dollars unless otherwise stated)

1. ORGANIZATION AND BASIS OF PRESENTATION

ASAT Holdings Limited, a company incorporated under the
laws of Cayman Islands (including its consolidated subsidiaries, collectively ASAT or the Company), was formed on October 20, 1999. ASAT is principally engaged in the provision of assembly and test services for packaged
integrated circuits to customers in the semiconductor industry. The Companys principal production facilities are located in the Peoples Republic of China. The Companys sales offices are strategically located in the United States,
Hong Kong, Singapore, Germany and South Korea.

On July 14, 2000, the Company offered 6,666,666 American Depositary Shares
(ADS) representing 100,000,000 ordinary shares at $36.00 per ADS to the public and has the ADSs quoted on the Nasdaq Capital Market under the symbol ASTT. On September 17, 2007, the Company received a Nasdaq Staff
Determination letter indicating that the Companys market value of listed securities has been below $35,000,000 as required for continued inclusion by Marketplace Rule 4320(e)(2)(B) and that its American Depositary Shares are, therefore,
subject to delisting. The Company was also notified by Nasdaq at that time that it does not comply with the minimum stockholders equity of $2,500,000 or net income from continuing operations of $500,000 in the most recently completed fiscal
year or in two of the last three most recently completed fiscal years, which are also requirements for continued listing on the Nasdaq Capital Market. The Company has appealed the Staff Determination and has received a hearing date of
November 1, 2007 for such appeal. At the hearing, the Company will be required to address the foregoing non-compliance with the Nasdaq listing rules. Nasdaqs delisting action has been stayed, pending a final written determination by the
Nasdaq Listing Qualifications Panel following the hearing.

The accompanying consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of America.

The Company has experienced recurring net losses
of $60.4 million, $42.4 million and $35.0 million for the years ended April 30, 2005, 2006 and 2007, respectively. As of April 30, 2006 and April 30, 2007, the Company had net liabilities of $49.1 million and $82.5 million,
respectively, and an accumulated deficit of $306.2 million and $341.2 million, respectively. In response to current financial conditions, the Company has explored various means of obtaining additional financing, and on May 1, 2006, the Company
entered into a financing agreement, as amended from time to time, with one of its customers to provide the Company $6.0 million of financing in the form of advance payments for assembly and test services, subject to certain conditions. The advance
was made to the Company on June 9, 2006 and is included in accrued liabilities in the Companys consolidated balance sheet as of April 30, 2007. The primary purpose of this financing was to purchase new equipment to support the
customers production capacity demands. This financing bears no interest and is being repaid beginning in January 2007 by off-setting amounts against the Companys receivables from its future sales to the customer up to a fixed maximum
monthly amount, and to the extent the maximum amount exceeds the receivables from the Companys sales to the customer in a given month, the difference shall be paid by the Company in cash. As of April 30, 2007, the outstanding balance on
this customer financing was $4.0 million. In September 2006, ASAT Semiconductor (Dongguan) Limited (ASAT China), a wholly-owned subsidiary of the Company, obtained a revolving credit facility for $3.8 million with a term of one year,
renewable after one year from a bank in China. On October 8, 2006, the Company drew down $2.5 million, and on April 30, 2007, the Company drew down the remaining balance of this revolving credit facility. In September 2007, ASAT China
renewed $2.5 million of the credit facility for another year. As such, the entire borrowing of $3.8 million with regard to this revolving credit facility remains outstanding as of the date of this Annual Report. On August 23, 2007, the purchase
money loan facility was amended to extend the maturity due date of the $10.0 million principal amount until April 30, 2009 and to extend the payment due date for interest payments (and interest on such interest) for March 31,
2006, June 30, 2006, September 30, 2006, December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007 to become due on



F-7



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



October 31, 2007. On October 10, 2007, we amended the purchase money loan facility to extend the payment due date for interest including any penalty
interest as required by the agreement. Interest that was due or will be due for payment on or before December 31, 2008 will be due and payable on December 31, 2008. In September 2007, ASAT China obtained a revolving credit facility of RMB 150
million (approximately US$ 20 million) with a term of one year. This facility is secured by certain trade receivables of ASAT China. This facility has not been drawn down as of the date of this Annual Report. The Companys gross margin had
improved as a result of achieving a lower cost structure after the migration of the entire manufacturing operations from Hong Kong to Dongguan, China. Management believes the cost structure will continue to improve during the course of localization.
With the support of external financing, management believes that there are sufficient financial resources to meet the cash requirements for the next 12 months and the financial statements have been prepared on a going concern basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)
Basis of Preparation

These financial statements were prepared on a going concern basis. The Company has determined that the going
concern basis of preparation is appropriate based on its estimates and judgments of future performance of the Company, future events and projected cash flows. At each balance sheet date, the Company evaluates its estimates and judgments as part of
its going concern assessment. Based on its assessment, the Company believes there are sufficient financial and cash resources to finance the Company as a going concern in the next twelve months. Accordingly, management has prepared the financial
statements on a going concern basis.

(b) Basis of consolidation

The consolidated financial statements include the accounts of ASAT Holdings Limited and its subsidiaries (see Note 3 for details of the Companys
principal consolidated subsidiaries). All significant intercompany balances and transactions have been eliminated upon consolidation.

(c) Revenue recognition and risk of loss

The Company does not take ownership of customer-supplied semiconductor wafers or
die. Title and risk of loss remains with the customers for these materials at all times. Accordingly, the cost of the customer-supplied materials is not included in the consolidated financial statements. The Company recognizes revenue net of
discounts from packaging semiconductors and performing test services directly to customers, when persuasive evidence of an arrangement exists, the price is fixed or determinable, delivery has occurred and services rendered, and collectibility is
reasonably assured. Shipping and handling costs associated with product sales are included in cost of sales. Such policies are consistent with provisions in the Securities and Exchange Commissions Staff Accounting Bulletin (SAB)
No. 101, Revenue Recognition in Financial Statements., as revised by SAB No. 104 Revenue Recognition.

(d) Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash accounts, interest bearing savings
accounts placed with banks and financial institutions and all highly liquid debt instruments with original maturity of three months or less, less any amounts which are restricted as to use.

(e) Allowance for doubtful accounts

Allowance for doubtful accounts is made against accounts receivable to the extent they are considered to be doubtful. Accounts receivable in the balance sheet are stated net of such allowance. The collectibility of the Companys
accounts receivable is evaluated based on a combination of factors. In circumstances where the



F-8



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Company is aware of a specific customers inability to meet its financial obligation to the Company, a specific reserve for bad debts is recorded
against amounts due. A provision is also made based on the aging of accounts receivable and the history of uncollectible accounts receivable.

(f) Treasury stock

The Company accounts for treasury stock using the par value method.

(g) Inventories

Inventories consist
of raw materials, work-in-progress and finished goods and are stated at the lower of cost or market value. Cost of raw materials includes purchase and related costs incurred in bringing the products to their present location and condition. Cost is
determined by the first-in, first-out method. Cost of work-in-progress and cost of finished goods primarily include materials and an appropriate proportion of direct labor and manufacturing overhead.

The Company reserves for excess and obsolete inventories based on forecasted demand that the Company receives from its customers. When it is determined
that the inventories will not be either utilized in production based on customers forecast or recoverable from the customers, the material is written-off accordingly.

(h) Property, plant and equipment

Property, plant and equipment are recorded at cost less accumulated depreciation and impairment losses. Gains or losses on disposals are reflected in the consolidated statement of operations in current periods. Major expenditures for
betterments and renewals are capitalized. All ordinary repairs and maintenance costs are expensed as incurred.

Construction in progress is
carried at cost less impairment losses, if any. On completion, the construction is transferred to leasehold improvements, fixtures and furniture at cost less accumulated depreciation and impairment losses.

Depreciation for financial reporting purposes is provided using the straight-line method over the estimated useful lives of the assets as follows:



|                       |  |                               
|---------------------- |  | ------------------------------
|Plant and machinery    |  | 5 - 12 years                  
|Leasehold improvements |  | Over the unexpired lease terms
|Fixtures and furniture |  | 5 - 10 years                  
|Loose toolings         |  | 5 - 10 years                  
|Motor vehicles         |  | 5 years                       
|Office equipment       |  | 3 - 5 years                   
|Computer and software  |  | 3 - 7 years                   

(i) Valuation of long-lived assets

The Company applies Statements of Financial Accounting Standards (SFAS) No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets, for its long-lived asset valuation, which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment, such as reduction in demand or significant economic slowdown in the
semiconductor industry, are present. Reviews are performed to determine whether the carrying value of asset group is impaired, based on comparison to undiscounted expected future cash flows. If this comparison indicates that there is an impairment,
the impaired asset group is written down to fair value, which is determined by either using quoted market prices in active markets or other valuation techniques such as present value techniques. Impairment is based on the excess of the carrying
amount over the fair value of those assets.



F-9



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Depreciation for the impaired assets is then provided using the straight-line method over the
estimated remaining useful lives of the impaired assets.

(j) Assets held for disposal

Assets held for disposal represent machineries that are separately identified for not being used in production and are intended to be disposed of by sale.
The machineries which were re-commissioned into the operations were reclassified at the lower of their fair value at the date of the subsequent decision not to sell and their carrying value before they were classified as held for disposal, adjusted
for any depreciation expense that would have been recognized had they been continuously classified as held and used.

(k) Deferred
charges

Deferred charges are fees and expenses directly related to the issuance of senior notes and other financing activities.
Deferred charges attributable to the issuance of 9.25% senior notes are capitalized and amortized over the life of the notes. Deferred charges attributable to the issuance of the Series A Redeemable Convertible Preferred Shares (the Series A
Preferred Shares) and the warrants issued in connection with such shares are capitalized and amortized over the expected life of the Series A Preferred Shares. Deferred charges attributable to the purchase money loan facility and the warrants
issued in connection with such facility are capitalized and amortized over the life of the purchase money loan facility. Deferred charges, net of accumulated amortization, as of April 30, 2006, were $7.1 million as compared to $5.3 million as
of April 30, 2007. Accumulated amortization as of April 30, 2006 and 2007 was $2.8 million and $4.6 million, respectively. Amortization of deferred charges included in interest expense for the years ended April 30, 2005, 2006 and 2007
was $0.9 million, $1.6 million and $1.8 million, respectively.

(l) Research and development expenditures

Research and development expenditures include costs directly attributable to the conduct of research and development programs primarily related to the
development of new package designs and improvement of the efficiency and capabilities of the Companys existing production process. Such costs include salaries, employee benefit costs, materials costs, and the allocable portions of facility
costs such as rent, building management fee, utilities, repairs and maintenance, depreciation and general support services. All costs associated with research and development activities are expensed in the period as incurred.

(m) Income taxes

The Company
accounts for income taxes using SFAS No. 109, Accounting for Income Taxes, which requires the asset and liability approach for financial accounting and reporting for income taxes. Under this approach, deferred taxes are provided for
the estimated future tax effects attributable to temporary differences between financial statement carrying amounts of assets and liabilities and their respective tax bases, and for the expected future tax benefits from items including tax loss
carryforwards. Deferred tax assets and liabilities are measured using the enacted tax rates expected in the years of recovery or reversal and the effect from a change in tax rates is recognized in income for the period of enactment. A valuation
allowance is provided for the portion of deferred tax assets that will more likely than not be unrealized.

(n) Foreign currency
translation

The Company uses the United States dollar as its functional and reporting currency. Monetary assets and liabilities
denominated in currencies other than the United States dollar are remeasured into the United States dollar at the rates of exchange at the balance sheet date. Transactions in currencies other than the United States dollar during the year are
converted into the United States dollar at the rates of exchange at the transaction dates. Exchange differences are recognized in the statement of operations.



F-10



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



On consolidation, balance sheets of subsidiaries denominated in currencies other than the United
States dollar are translated into the United States dollar at the rates of exchange at the balance sheet date. Statements of operations of subsidiaries denominated in currencies other than the United States dollar are translated into the United
States dollar at average rates of exchange during the year. Exchange differences resulting from the translation of financial statements denominated in currencies other than the United States dollar and the effect of exchange rate changes on
intercompany transactions of a long-term investment nature are accumulated and credited or charged directly to a separate component of shareholders equity (deficit) and are reported as other comprehensive income (loss).

(o) Reorganization and relocation expenses

The Company has adopted SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities (SFAS No. 146) and SFAS No. 112 Employers Accounting for Postemployment Benefits
(SFAS No. 112) to record its reorganization and relocation expenses. SFAS No. 146 requires that a liability for a cost associated with an exit or disposal activity shall be recognized and measured initially at its fair value in
the period which the liability is incurred while SFAS No. 112 requires employers to recognize its obligation to provide postemployment benefits when the liability is probable and the amount can be reasonably estimated.

(p) Net loss per share

Net loss per
share is computed in accordance with SFAS No. 128, Earnings Per Share by dividing net loss for each year by the weighted average number of ordinary shares outstanding during the year.

Diluted net loss per share is computed by dividing net loss for each year by the weighted average number of ordinary shares and ordinary share
equivalents outstanding during the year. The weighted average number of shares used to compute diluted net loss per share include the incremental shares of ordinary shares relating to outstanding options and warrants to the extent such incremental
shares are dilutive.

The diluted net loss per share was the same as the basic net loss per share for the years ended April 30, 2005,
2006 and 2007 as all potential ordinary shares including the stock options and warrants are anti-dilutive and are therefore excluded from the computation of diluted net loss per share.

(q) Concentration of credit risk

The
Company places its cash investments with various financial institutions. The Company believes that no significant credit risk exists as these investments are made with high-credit, quality financial institutions.

The Companys business activities and accounts receivable are with customers in the semiconductor industry, the majority of which are located
throughout Asia, Europe and the United States. The Company performs ongoing credit evaluations of its customers and makes frequent contact with its customers. The Company believes that no significant credit risk exists as credit losses.

(r) Risk and uncertainties

The
Companys future results of operations involve a number of risks and uncertainties. Factors that could affect future operating results and cause actual results to vary materially from historical results include, but are not limited to,
dependence on the highly cyclical nature of the semiconductor industry, history of continuous operating losses, the Companys ability to rapidly develop and successfully bring to market advanced technologies and services, the incurrence of
significant capital expenditures for manufacturing technology and equipment, the working relationship with the Companys development partner in China, the Companys high leverage and the restrictive covenants contained in the agreements
governing its indebtedness, fluctuating



F-11



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



demand and continuous downward pressure on selling prices in the communications sector, low capacity utilization rates, loss of a large customer, loss of key
suppliers or their failure to deliver sufficient quantities of materials on a timely basis, the loss of key executive officers, weakness in global economies, natural disasters, losses of power to the Companys facilities in Dongguan, China,
volatility in the market prices of the Companys ADSs, environmental regulation, fluctuations in foreign currency, appreciation of Renminbi, uncertainty as to demand from its customers over both the long- and short-term, competitive pricing and
declines in average selling price the Company experienced, the timing and volume of orders relative to the production capacity, complexity in the Companys assembly processes, the availability of financing, the competition and the greater
operating and financial resources of competitors, ability to successfully complete potential acquisitions and integrate other parties into the Companys business, the potential economic, political, legal, operational and financial risks faced
by the Company operating facilities in Dongguan, China, the ability to receive dividends from and transfer funds to, the Companys Chinese operating subsidiary, dependence on raw material and equipment suppliers, the enforcement of intellectual
property rights by or against the Company and the adequacy of internal controls over financial reporting as required by Section 404 of the Sarbanes-Oxley Act of 2002.

(s) Comprehensive income (loss)

The
Company follows SFAS No. 130, Reporting Comprehensive Income for the reporting and display of its comprehensive income (loss) and related components in the financial statements and thereby reports a measure of all changes in equity
of an enterprise that results from transactions and economic events other than transactions with the shareholders. Items of comprehensive income (loss) are reported in both the Consolidated Statement of Operations and Comprehensive Loss and the
Consolidated Statement of Shareholders Equity (Deficit).

(t) Fair value of financial instruments

The carrying value of financial instruments, which consist of cash and cash equivalents, related company balances, accounts receivable, prepaid expenses
and other current assets, accounts payable, accrued liabilities, short-term bank loan and capital lease obligations, approximates fair value due to the short-term nature of these instruments.

(u) Use of estimates

The preparation
of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of net revenue and expenses during the reporting period. The Company regularly evaluates the estimates and assumptions related to going concern assessments, allowance for doubtful accounts, inventory reserves,
useful lives of property, plant and equipment, deferred income tax asset valuation allowance, accounting for financial arrangements, litigation and other contingencies. The Company bases the estimates and assumptions on experience and on various
other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. To the extent
there are material differences between the estimates and the actual results, future results of operations will be affected. Actual results could differ from those estimates. Differences from those estimates are reported in the period they become
known and are disclosed to the extent they are material to the financial statements taken as a whole.

(v) Segment information

The Company applies SFAS No. 131, Disclosure about Segments of an Enterprise and Related Information. SFAS
No. 131 establishes standards for the way that public business enterprises report information



F-12



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



about operating segments in annual consolidated financial statements and requires that those enterprises report selected information about operating segments
in interim financial reports. SFAS No. 131 also establishes standards for reporting information about operating segments on a basis consistent with the Companys internal organization structure as well as information about geographical
areas, business segments and major customers. It is the managements view that the services rendered by the Company are of one business segment.

(w) Related parties

Parties are considered to be related to the Company if the parties, directly or
indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal
owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might
be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can
significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

(x) Stock-based compensation

Prior
to May 1, 2006, the Company accounted for share-based compensation awarded to employees and directors in accordance with Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to
Employees (APB No. 25), and complied with the disclosure provisions of Statements of Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation (SFAS
No. 123). Under APB No. 25, compensation cost is recognized based on the excess, if any, of the quoted market price of the Companys stock over the amount an employee is required to pay to acquire the stock, as determined on the
date the option is granted. Total compensation cost is recorded in shareholders equity as additional paid-in capital and deferred share-based compensation. Deferred share-based compensation is amortized on a straight-line basis and charged to
expense over the vesting period of the underlying options.

Effective May 1, 2006, the Company adopted the fair value recognition
provisions of SFAS No. 123 (revised 2004), Share- Based Payment(SFAS No. 123(R)), which revises SFAS No. 123, and supersedes APB No. 25. Under the fair value recognition provisions of SFAS
No. 123(R), the Company is required to measure the cost of employee services received in exchange for stock-based compensation measured at the fair value of the award as of the grant date. Beginning May 1, 2006, the Company applied the
modified prospective transition method, which requires the application of SFAS No. 123(R) for new grants and nonvested grants that were outstanding as of such date. The Companys Consolidated Financial Statements as of and for the year
ended April 30, 2007 reflect the impact of SFAS No.123(R). In accordance with the modified prospective transition method, the Companys Condensed Consolidated Financial Statements for prior periods have not been restated to reflect, and do
not include, the impact of SFAS No.123(R). The valuation provisions of SFAS No. 123 (R) apply to new grants and nonvested grants that were outstanding as of the effective date. For new grants, the Company will amortize stock-based
compensation expenses on a straight-line basis over the requisite service period. Estimated compensation for nonvested grants that were outstanding as of the effective date are recognized over the remaining service period using the compensation
estimated for the SFAS No. 123(R) pro forma disclosures. See Note 9 below for further details.

(y) Capital leases

Leases that substantially transfer to the Company all the risks and rewards of ownership of assets are accounted for as capital leases. Capital leases
are capitalized at the inception of the leases at the lower of the fair value of the leased assets or the present value of the minimum lease payments. Each lease payment is allocated



F-13



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



between the capital and finance charges so as to achieve a constant rate on the capital balances outstanding. The corresponding rental obligations, net of
finance charges, are included in capital lease obligations. The finance charges are charged to the consolidated statement of operations over the term of the leases.

Assets held under capital leases are depreciated over the shorter of their estimated useful lives or the term of the leases.

(z) Operating leases

Leases where substantially all the risks and rewards of ownership of assets
remain with the leasing company are accounted for as operating leases.

Rental payments under operating leases are expensed on a
straight-line basis over the periods of the respective leases.

(aa) Recent Accounting Pronouncements

In July 2006, the FASB released FIN 48, Accounting for Uncertainty in Income Taxesan Interpretation of FASB Statement 109 (FIN 48). FIN
48 prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return (including a decision whether to
file or not to file a return in a particular jurisdiction). Under FIN 48, the financial statements will reflect expected future tax consequences of such positions presuming the taxing authorities full knowledge of the position and all relevant
facts, but without considering time values. FIN 48 is effective for annual periods beginning after December 15, 2006. We are in the process of assessing the impact of this recent accounting pronouncement.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. This Statement defines fair value, establishes a framework for
measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. This Statement applies under other accounting pronouncements that require or permit fair value measurements, the FASB having
previously concluded in those accounting pronouncements that fair value is the relevant measurement attribute. Accordingly, this Statement does not require any new fair value measurements. However, for some entities, the application of this
Statement will change current practice. This Statement is effective for financial statements issued for fiscal years beginning after November 15, 2007. Our management is in the process of evaluating the potential impact of this standard.

In February 2007, the FASB issued FAS 159, The Fair Value Option for Financial Assets and Financial Liabilities (FAS 159). FAS 159 permits
entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by
measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. FAS 159 is expected to expand the use of fair value measurement, which is consistent with the FASBs long-term measurement
objectives for accounting for financial instruments. FAS 159 also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and
liabilities. FAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. This Statement does not establish requirements for recognizing and measuring dividend income, interest
income, or interest expense. This Statement does not eliminate disclosure requirements included in other accounting standards, including requirements for disclosures about fair value measurements included in FASB Statements No. 157, Fair Value
Measurements, and No. 107, Disclosures about Fair Value of Financial Instruments. FAS 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007.



F-14



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



3. SUBSIDIARIES

Details of the Companys principal consolidated subsidiaries as of April 30, 2006 and 2007 were as follows:



|                                      |  |                           |  |                                              |   |  |      |   |  |                                                              
|------------------------------------- |  | ------------------------- |  | -------------------------------------------- | - |  | ---- | - |  | -------------------------------------------------------------
|                                      |  |                           |  | Ownership InterestAttributable to theCompany |   |  |     
|Company Name                          |  | Place of Incorporation    |  | 2006                                         |   |  | 2007 |   |  | Principal Activities                                         
|ASAT Limited (1)                      |  | Hong Kong                 |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services and investment holding
|                                      |  |                           |  |                                             
|Timerson Limited (2)                  |  | Hong Kong                 |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services                       
|                                      |  |                           |  |                                             
|ASAT, Inc.                            |  | California,United States  |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services                       
|                                      |  |                           |  |                                             
|ASAT (Finance) LLC                    |  | Delaware,United States    |  | 100                                          | % |  | 100  | % |  | Financial services                                           
|                                      |  |                           |  |                                             
|ASAT (Cayman) Limited                 |  | Cayman Islands            |  | 100                                          | % |  | 100  | % |  | Investment holding                                           
|                                      |  |                           |  |                                             
|ASAT (S) Pte. Ltd.                    |  | Singapore                 |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services                       
|                                      |  |                           |  |                                             
|ASAT Korea Limited                    |  | Korea                     |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services                       
|                                      |  |                           |  |                                             
|ASAT GmbH                             |  | Germany                   |  | 100                                          | % |  | 100  | % |  | Sales, marketing and customer services                       
|                                      |  |                           |  |                                             
|ASAT Semiconductor (Dongguan) Limited |  | PeoplesRepublic of China |  | 100                                          | % |  | 100  | % |  | Assembly and test services for packaged integrated circuits  
|                                      |  |                           |  |                                             
|New ASAT (Finance) Limited            |  | Cayman Islands            |  | 100                                          | % |  | 100  | % |  | Financial services                                           

---

|(1) | With effect from July 31, 2006, the entire assembly and test operations of ASAT Limited were transferred to ASAT Semiconductor (Dongguan) Limited and ASAT Limited became the
sales organization and corporate head office of the ASAT group.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | With effect from September 30, 2006, the entire assembly and test operations of Timerson Limited were transferred to ASAT Semiconductor (Dongguan) Limited and Timerson Limited
became dormant. Timerson Limited still holds a valid license for carrying out contract processing in China.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4. RELATED PARTY TRANSACTIONS

The Company undertook transactions with one of its major shareholders, QPL International Holdings Limited and its group companies
(collectively known as QPL). As described below, QPL owned approximately 42.5%, 42.4% and 42.5% of the Companys ordinary shares as of April 30, 2005, 2006 and 2007, respectively.

Major transactions with QPL during the years ended April 30, 2005, 2006 and 2007 are summarized as follows:

Purchase of materialsThe Company purchased leadframes from QPL amounting to $24.1 million, $22.5 million and $9.6 million for the years
ended April 30, 2005, 2006 and 2007, respectively.



F-15



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The Company also purchased other raw materials from QPL amounting to $0.9 million, $0.4 million and
$0.1 million for the years ended April 30, 2005, 2006 and 2007, respectively.

Rental expensesThe Company used to lease
its Hong Kong office and manufacturing premises from QPL under a lease agreement which expired on March 31, 2007. The Company paid rental expenses to QPL of $2.6 million for the years ended April 30, 2005. On April 30, 2005, QPL
completed the sale of ASATs leased facility from QPL to a third party that is unrelated to either party. The lease agreement with QPL has been transferred to this third party without any change in its terms and conditions. Subsequently, rental
payments to the new landlord during the year ended April 30, 2006 were no longer classified as related party transactions.

Administrative and management servicesThe Company used the chemical wastage disposal services and repairs and maintenance services provided by QPL under a cost sharing agreement for the year ended April 30, 2005. The
Company paid QPL services fees of $47 thousand for the year ended April 30, 2005. No such services were used for the years ended April 30, 2006 and 2007.

Provision of management information servicesThe Company provided management information services to QPL under a cost sharing agreement and received service income from QPL of $37 thousand, $7 thousand and
nil for the years ended April 30, 2005, 2006 and 2007, respectively.

Provision of facility servicesThe Company provided
building facility services to QPL under a cost sharing agreement and received service charges of $69 thousand, $12 thousand and nil for the years ended April 30, 2005, 2006 and 2007, respectively.

The amount due to QPL was unsecured and interest free.

On September 1, 2006, the Companys board of directors appointed Tung Lok Li as Acting Chief Executive Officer. Mr. Li is Chairman of QPL, one of our principal shareholder groups, and a member of our
board of directors. Mr. Li assumes his position for the interim period while the Company continues searching for a permanent Chief Executive Officer. While Mr. Li continues to serve as a member of the board of directors, his employment
contract with us expressly prohibit him from entering into any related party transactions with QPL. On September 1, 2006, the board of directors appointed Joseph Martin as Executive Vice President of Sales and Marketing. Mr. Martin was
Chief Executive Officer of QPL, one of our principal shareholder groups, and is a member of the board of directors. Mr. Martin resigned from his position with QPL effective September 1, 2006 to avoid any conflicts of interest with his
current position at ASAT. On July 18, 2007, the board of directors appointed Kei Hong Chua as Chief Financial Officer. Mr. Kei Hong Chua succeeds his brother, Mr. Kei W. Chua, the former Acting Chief Financial Officer, a current
member of the board of directors and a Partner of CCMP Capital Asia Pte. Ltd..

5. IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT

The continuous weakness in sales and the substantial amount of operating losses, which mainly resulted from a shift in product mix and decrease in average
selling prices, in the second half of fiscal year 2005 have triggered the Company to perform an impairment review of its long-lived assets in the April 2005 quarter. The Company compared the undiscounted cashflow to the carrying values of its
long-lived assets. For long-lived assets which the carrying values exceeded the undiscounted cashflow, the Company determined the fair values of these long-lived assets based on the discounted cash flow model. Accordingly, the Company recorded a
non-cash impairment charge of $16.5 million in relation to the long-lived assets associated with certain chipscale packages in the April 2005 quarter.



F-16



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The Company also concluded that certain wire bonders and test equipment were either technologically
obsolete or with low utilization and would not be fully utilized in the Companys operation. As a result, the Company determined that these equipment items should be written off or written down, resulting in another $3.4 million non-cash charge
in the April 2005 quarter.

For the year ended April 30, 2005, the Company recognized a total of $19.9 million non-cash impairment
charges to reduce the net book value of the property, plant and equipment to its fair value. The $19.9 million non-cash impairment charges were recorded as operating expenses in the Companys consolidated statements of operations for the year
ended April 30, 2005.

For the year ended April 30, 2006, the Company recognized a total of $3.9 million non-cash impairment
charges to write-off property, plant and equipment which could not be transferred to the Companys new manufacturing facilities in Dongguan, China and which could not be sold. The $3.9 million non-cash impairment charges were recorded as
operating expenses in the Companys consolidated statements of operations for the year ended April 30, 2006.

No impairment
charge was recorded in the Companys consolidated statements of operations for the year ended April 30, 2007.

6. ACCOUNTS RECEIVABLE, NET



|                                   |  |        |   |  |        |  
|---------------------------------- |  | ------ | - |  | ------ | -
|                                   |  | 2006   |   |  | 2007   |  
|                                   |  | $000  |   |  | $000  |  
|Accounts receivable                |  | 29,796 |   |  | 18,364 |  
|Less: Allowance for doubtful debts |  | (189   | ) |  | (660   | )
|                                   |  |        |   |  |        |  
|                                   |  | 29,607 |   |  | 17,704 |  
|                                   |  |        |   |  |        |  

7. INVENTORIES

The components of inventories, net of the related reductions to the lower of cost or net realizable value, were as follows:



|                 |  |        |  |       
|---------------- |  | ------ |  | ------
|                 |  | 2006   |  | 2007  
|                 |  | $000  |  | $000 
|Raw materials    |  | 19,315 |  | 12,060
|Work-in-progress |  | 2,581  |  | 875   
|Finished goods   |  | 1,423  |  | 335   
|                 |  |        |  |       
|                 |  | 23,319 |  | 13,270
|                 |  |        |  |       

Management continuously reviews slow-moving and obsolete inventories and assesses any inventory
obsolescence based on inventory levels, material composition and expected usage as of that date. During the years ended April 30, 2005, 2006 and 2007, there were non-cash write-offs of specific inventories of $2.4 million, $1.8 million and $1.6
million, respectively.

8. RESTRICTED CASH

Restricted cash of $1.8 million as of April 30, 2007 represents a bank deposit securing the Companys capital lease obligations. On 7 August, 2007, the lender and a subsidiary of the Company had agreed to release



F-17



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



$0.9 million of the bank deposit. As such $0.9 million of the restricted cash was classified as current assets as at 30 April 2007. See Note 14 for
details of the capital lease.

9. PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment, net consisted of the following:



|                                                                                   |  |         |   |  |         |  
|---------------------------------------------------------------------------------- |  | ------- | - |  | ------- | -
|                                                                                   |  | 2006    |   |  | 2007    |  
|                                                                                   |  | $000   |   |  | $000   |  
|Plant and machinery                                                                |  | 91,106  |   |  | 96,621  |  
|Leasehold improvements                                                             |  | 31,113  |   |  | 31,044  |  
|Furniture and fixtures, computer and software, office equipment and motor vehicles |  | 18,505  |   |  | 21,065  |  
|Loose toolings                                                                     |  | 6,515   |   |  | 6,863   |  
|                                                                                   |  |         |   |  |         |  
|                                                                                   |  | 147,239 |   |  | 155,593 |  
|Less: Accumulated depreciation                                                     |  | (53,408 | ) |  | (76,011 | )
|                                                                                   |  |         |   |  |         |  
|                                                                                   |  | 93,831  |   |  | 79,582  |  
|                                                                                   |  |         |   |  |         |  

Included in the property, plant and equipment was equipment under capital leases at cost, after
impairment charge, of $5.3 million less accumulated depreciation of $2.9 million as of April 30, 2007.

During the years ended
April 30, 2005, 2006 and 2007, depreciation expenses amounted to $31.7 million, $26.9 million and $23.3 million, respectively.

As
described in Note 5, the Company recorded impairment charges of $19.9 million, $3.9 million and nil, which were principally related to plant and machinery, furniture and fixtures and loose toolings, for the years ended April 30, 2005, 2006
and 2007, respectively.

10. SHORT-TERM BANK LOAN

During the year ended April 30, 2005, ASAT Semiconductor (Dongguan) Limited, the Companys wholly owned subsidiary, entered into a loan agreement pursuant to which it borrowed $4.8 million from a Chinese
bank. The loan bore an annual interest rate of 5.022% payable on a monthly basis and had a maturity date of February 28, 2006. Under the loan agreement, the Company had fully and unconditionally guaranteed the loan. The borrowings were applied
to fund the capital expenditures in connection with the Companys Phase II facility. In April 2005, a partial repayment of the principal in the amount of $604 thousand was made. During the year ended April 30, 2006, the remaining $4.2
million was repaid.

In September 2006, ASAT Semiconductor (Dongguan) Limited obtained a revolving credit facility for $3.8 million with a
term of one year. On October 8, 2006, ASAT Semiconductor (Dongguan) Limited drew down $2.5 million, and on April 30, 2007, ASAT China drew down the remaining balance of this revolving credit facility. In September 2007, ASAT China rolled
over the original $2.5 million for another year. All of which remains outstanding as of the date of this Annual Report.



F-18



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



11. ACCRUED LIABILITIES

Accrued liabilities consisted of the following:



|                                                               |  |        |  |       
|-------------------------------------------------------------- |  | ------ |  | ------
|                                                               |  | 2006   |  | 2007  
|                                                               |  | $000  |  | $000 
|Accrued employee costs                                         |  | 1,510  |  | 720   
|Accrued severance payments and long service payments           |  | 4,835  |  | 565   
|Accrued vacation pay                                           |  | 775    |  | 262   
|Accrued senior notes interest and purchase money loan interest |  | 3,935  |  | 3,515 
|Accrued deferred financing costs                               |  | 110    |  | 10    
|Accrued legal and professional fees                            |  | 949    |  | 1,755 
|Accrued litigation settlement (Note a)                         |  | 1,871  |  | 1,621 
|Deferred revenue                                               |  | 1,047  |  | 10    
|Down payment received                                          |  | 1,020  |  | 735   
|Accrued value added tax and individual income tax              |  | 1,063  |  | 1,230 
|Accrued royalty expenses                                       |  | 734    |  | 217   
|Advance received from a customer (Note b)                      |  |       |  | 4,000 
|Provision for taxation (Note c)                                |  |       |  | 1,162 
|Accrued rental expense                                         |  |       |  | 2,549 
|Other accrued expenses                                         |  | 5,849  |  | 4,094 
|                                                               |  |        |  |       
|                                                               |  | 23,698 |  | 22,445
|                                                               |  |        |  |       

---

Notes:



|(a) | The amount represents a settlement to be made in the form of cash, rebates on future business associated with a settlement agreement with Freescale Semiconductor, Inc. that was
executed in July 2005 and was filed with the Court on July 18, 2005. During the fiscal year ended April 30, 2006 and 2007, the Company paid $1.75 million and $0.25 million, respectively, in cash to Freescale Semiconductor, Inc.
(Freescale) and also issued a 5-year warrant to Freescale for $1.75 million to purchase 10,937,500 ordinary shares, which is equivalent to 729,166 ADSs, initially exercisable at a price of $0.16 per ordinary share (equivalent to $2.40
per ADS) (Note 22) in connection with this settlement.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) | On May 1, 2006, the Company entered into a financing agreement, as amended from time to time, with one of its customers to provide the Company $6.0 million of financing in the
form of advance payments for assembly and test services, subject to certain conditions. The advance was made to the Company on June 9, 2006 and is included in accrued liabilities in the Companys consolidated balance sheet as of
April 30, 2007. The primary purpose of this financing was to purchase new equipment to support the customers production capacity demands. This financing bears no interest and is being repaid beginning in January 2007 by off-setting
amounts against the Companys receivables from its future sales to the customer up to a fixed maximum monthly amount, and to the extent the maximum amount exceeds the receivables from the Companys sales to the customer in a given month,
the difference shall be paid by the Company in cash.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(c) | The amount for the period ended April 30, 2007 represents provision for the Hong Kong profits tax concerning a tax dispute for the fiscal year 2000.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------

12. PURCHASE MONEY LOAN FACILITY

On July 31,
2005, the Company entered into agreements for a private financing of $30 million with JPMP Master Fund Manager, L.P. related funds (JPMP) and QPL, two of the Companys principal shareholder groups, in the form of a $15 million
preferred share financing (Note 15) and a $15 million purchase money loan



F-19



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



facility. The purchase money loan facility from Asia Opportunity Fund, L.P., an affiliate of JPMP, and related funds, provides for up to $15 million of loans
which can be borrowed in two tranches, in the amount of up to $10 million and up to $5 million, respectively, each in the event that the Companys cash position falls below $10 million. The loans may be drawn during a 15 month drawdown period
starting from the date of the agreement, subject to the Companys compliance with certain conditions. Each tranche has a maturity of two years from the time of borrowing and bears interest at the rate of 15% per annum, with interest to be
paid on a quarterly basis. In October 2005, in connection with the closing of the Companys sale of Series A Redeemable Convertible Preferred Shares, the Company issued five-year warrants for a total of 5 million ordinary shares
(equivalent to 0.3 million ADSs) exercisable at a price of $0.01 per share (equivalent to $0.15 per ADS) as an arrangement fee for the loan agreement.

On January 25, 2006, we borrowed the first $10.0 million tranche of funding under the purchase money loan facility. In return for drawing upon the first tranche, we issued the lenders under the purchase money
loan facility warrants to purchase an aggregate of 15,668,170 ordinary shares, which is the equivalent of 1,044,544 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS), as well as paid a commitment fee of $850,000
on a pro rata basis to the lenders that funded the first tranche. In each case, the warrants are exercisable for five years from the date of issuance. On July 31, 2007, the second $5.0 million tranche commitment expired and was not drawdown.
Therefore, the remaining second tranche of $5 million is no longer available to the Company.

On August 23, 2007, the Company amended
the purchase money loan facility to extend the maturity due date of the $10.0 million principal amount until April 30, 2009 and to extend the payment due date for interest payments (and interest on such interest) for March 31,
2006, June 30, 2006, September 30, 2006, December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007 to become due on October 31, 2007. In return for amending the purchase money loan
facility, the Company agreed to issue to the lenders under the purchase money loan facility warrants exercisable, in the aggregate, for a total of approximately 4.9% of the Companys total outstanding ordinary shares on a fully diluted basis
(inclusive of ordinary shares issuable upon exercise of warrants to the holders themselves and which the Company will grant to the eligible holders of our 9.25% senior notes due 2011). The warrants will have an exercise price of $0.01 per ordinary
share and will expire on February 1, 2011, subject to adjustment as provided in the warrants and the other terms and conditions contained therein. These warrants and the ordinary shares into which they will be exercisable are not registered
under the Securities Act of 1933, or any state securities laws, and will be sold in a private transaction under Regulation D and Regulation S. Unless the warrants and ordinary shares are registered in the future, they may not be offered or sold in
the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state laws.

On
October 10, 2007, the Company amended the purchase money loan facility to extend the payment due dates for the interest, including any penalty interest as required by the agreement. Interest that was due or will be due for payment on or before
December 31, 2008 will be due and payable on December 31, 2008. As at April 30, 2007, the accrued interest payable was $2,085,833 and this has been classified as other long-term payable.

The purchase money loan facility is unsecured and contains various affirmative and negative covenants binding on us and our subsidiaries, including
limitations on our and our subsidiaries ability to incur indebtedness, grant liens on assets, pay dividends and enter into transactions with affiliates. In addition, the Company will be required to repay the loans with the net proceeds of
certain issuances of equity and debt and certain asset sales. The Company has agreed to file a registration covering the resale of shares issuable upon exercise of the warrants described above.



F-20



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



13. 9.25% SENIOR NOTES DUE 2011

On January 26, 2004, the Companys wholly-owned finance subsidiary, New ASAT (Finance) Limited, issued $150.0 million aggregate principal amount of 9.25% senior notes due in February 2011 (9.25% senior
notes), which were issued at par with semi-annual interest payable on February 1 and August 1 beginning on August 1, 2004. The Company sold $150 million aggregate principal amount of its 9.25% senior notes to the initial
purchaser pursuant to the exemption from registration under Section 4(2) of the Securities Act for resale by the initial purchaser to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933 (the Securities
Act), and to non-U.S. persons in transactions outside the United States in reliance on Regulation S of the Securities Act. On March 17, 2005, the Company completed an exchange offer whereby it exchanged $150 million aggregate principal
amount of 9.25% senior notes due 2011 that were registered under the Securities Act, for its outstanding 9.25% senior notes due 2011 that were subject to transfer restrictions under U.S. securities laws.

The 9.25% senior notes are unsecured and guaranteed on a senior unsecured basis by the Company and certain of the Companys subsidiaries which are
restricted subsidiaries as defined in the indenture governing the 9.25% senior notes. The indenture governing the 9.25% senior notes contains certain covenants that will, among other things, restrict the ability of the Company and its
restricted subsidiaries to borrow money, pay dividends on or repurchase capital stock of the Company and make certain other restricted payments or investments, sell assets or enter into mergers or consolidations and create liens on assets. The 9.25%
senior notes are redeemable, by the Company, prior to February 1, 2008, in whole or in part, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest and liquidated damages and additional amounts, if any,
plus a make-whole amount and on or after February 1, 2008 at the various redemption prices set out in the indenture governing the 9.25% senior notes.

In connection with the issuance of the 9.25% senior notes, the Company recorded $7.0 million in deferred financing fees and expenses, which are being amortized as a yield adjustment over the life of the notes.

Of the $150.0 million of 9.25% senior notes proceeds, the Company used $111.0 million to fully redeem the 12.5% senior notes with face
value of $100.75 million on February 25, 2004. In connection with the redemption of the 12.5% senior notes, the Company incurred a charge on early redemption of 12.5% senior notes of approximately $10.3 million, consisting of an early
redemption premium of $6.3 million and $4.0 million for the non-cash write-off of deferred financing costs and debt discount associated with the redeemed notes. This charge on early redemption was classified as ordinary as required by SFAS
No. 145 effective in fiscal year 2004.

14. CAPITAL LEASE OBLIGATIONS

During the fiscal year ended April 30, 2005, the Company sold certain equipment for $6.5 million. The equipment was leased back from the purchaser
(the purchaser-lessor) under leases pursuant to which the Company is required to pay to the purchaser-lessor on a quarterly basis the greater of (i) a lease payment based on the reported usage of the equipment or (ii) a minimum
commitment. The initial terms of the leases expire upon the earlier of the date that the committed usage has been achieved under the leases or 14 quarters after the lease commencement date. In connection with the sale-leaseback, the Company
recognized a gain of approximately $115 thousand on disposal of fixed assets, which is being deferred and amortized in the consolidated statement of operations against depreciation expenses over the term of the leases.

At the inception of the lease, the Company paid to the purchaser-lessor a deposit and prepaid rent amount of $1.6 million. As of April 30, 2007 and
2006, the amount of this deposit classified as other non-current assets in consolidated balance sheets is $0.7 million and $1.6 million, respectively.



F-21



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



At the end of each of the initial lease terms, the Company has an option to (i) return all the
equipment to the purchaser-lessor; (ii) purchase all the equipment at price based on the then fair market values of the equipment; or (iii) extend the lease terms by two additional quarters and purchase the equipment at the price of $1,000
for each piece of equipment. Pursuant to these sale-leaseback arrangements, the purchaser-lessor entered into a separate term loan facility agreement for up to $5.0 million with a bank in Hong Kong (the Lender). Upon demand by the
Lender, the Company and one of its subsidiaries fully and unconditionally guaranteed the obligations of the purchaser-lessor under the $5.0 million term loan facility. The Company believes that this guarantee (the Guarantee) has the
characteristics set forth in Financial Accounting Standards Board (FASB) Interpretation No. 45, Guarantors Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of
Others, which requires initial recognition of the guarantee at fair value upon its inception. Nonetheless, the fair value of the Guarantee is considered to be insignificant given the risk of loss on such Guarantee at the date of its inception
and, therefore, no amount was recognized in the consolidated financial statements on the inception date.

On March 31, 2006, the
Company deposited $3.3 million in cash with the Lender as collateral for the Guarantee obligations. In consideration thereof, the Lender released the Company and one of its subsidiaries from the Guarantee. The Lender will return the deposit to the
Company upon repayment of the term loan facility by the purchaser-lessor. The deposit is classified as restricted cash in the consolidated balance sheets as of April 30, 2007 and April 30, 2006. On February 12, 2007, an agreement had
been reached between the Company and the Lender to return $1.5 million of the $3.3 million deposit. On August 7, 2007, the Lender agreed to further return $0.9 million. As such $0.9 million of the restricted cash had been classified from
non-current asset to current asset.

Future minimum lease payments under capital lease obligations as of April 30, 2007 are as
follows:



|                                    |  |           |  |               |  |      
|----------------------------------- |  | --------- |  | ------------- |  | -----
|                                    |  | Equipment |  | Motor vehicle |  | Total
|                                    |  | $000     |  | $000         |  | $000
|Fiscal year ending April 30:        |  |           |  |               |  |      
|2008                                |  | 1,844     |  | 15            |  | 1,859
|2009                                |  | 730       |  | 15            |  | 745  
|2010                                |  |          |  | 15            |  | 15   
|2011                                |  |          |  | 3             |  | 3    
|                                    |  |           |  |               |  |      
|Total minimum lease payments        |  | 2,574     |  | 48            |  | 2,622
|Less: Amounts representing interest |  | 35        |  | 7             |  | 42   
|                                    |  |           |  |               |  |      
|Present value of minimum payments   |  | 2,539     |  | 41            |  | 2,580
|Current portion                     |  | 1,809     |  | 13            |  | 1,822
|                                    |  |           |  |               |  |      
|Non-current portion                 |  | 730       |  | 28            |  | 758  
|                                    |  |           |  |               |  |      

15. SERIES A REDEEMABLE CONVERTIBLE PREFERRED SHARES

On July 31, 2005, the Company entered into agreements for a private financing of $30 million with JPMP and QPL, two of the Companys principal
shareholder groups, in the form of a $15 million preferred share financing and a $15 million purchase money loan facility (Note 12). The preferred share financing provided for the issuance and sale of 300,000 Series A Preferred Shares for a total
price of $15 million and the issuance of five-year warrants for a total of 20 million ordinary shares (equivalent to 1.3 million ADSs) exercisable at a price of $0.01 per share (equivalent to $0.15 per ADS), of which warrants for a total
of 5 million ordinary shares (equivalent to 0.3 million ADSs) were issued as an arrangement fee. The securities purchase agreement for the Series A Preferred Share financing was amended and restated on October 27, 2005 to, among other
things, add



F-22



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Olympus-ASAT II, L.L.C. (Olympus), as a party. The preferred share financing closed on October 27, 2005. Half of this $15.0 million of
financing was provided by JPMP related funds and Olympus, and half of the financing was provided by QPL and/or its affiliates. Each Series A Preferred Share issued pursuant to the agreements is convertible at the option of the holder into ordinary
shares at an initial conversion price equal to $0.09 per ordinary share (equivalent to $1.35 per ADS), but will be reset on October 31, 2006 to 80% of the average trading price per share equivalent of the Companys ordinary shares during
the preceding three months if such amount is below the conversion price of $0.09 per ordinary share (equivalent to $1.35 per ADS), subject to a floor of $0.065 per ordinary share (equivalent to $0.975 per ADS). The conversion price and ratio shall
be proportionally adjusted for share splits, dividends, re-combinations and similar events. Subject to certain exceptions specified in the Companys restated articles of association, the conversion price will also be adjusted on a
weighted-average basis in the event of any future issuance of ordinary shares or securities convertible, exchangeable or exercisable into ordinary shares, subject to certain exceptions, for no consideration or for consideration per share less than
the then-effective conversion price applicable to the Series A Preferred Shares, as determined based on the average closing prices of the Companys ADSs for a thirty-day trading period ending three days prior to the date of determination.

The Series A Preferred Shares are entitled to a semi-annual dividend equal to 13% per annum of the purchase price payable in arrears.
Such dividend shall be payable, at the Companys option, in cash unless payment in cash is prohibited by law or by the terms of the Companys debt instruments, or in additional Series A Preferred Shares or in ordinary shares of the
Company. The Companys indenture governing its 9.25% senior notes currently prohibits such payment in cash, and such prohibition is expected to continue in the foreseeable future. The Series A Preferred Shares are redeemable, in whole or in
part, at the option of the holders on or after May 4, 2011. The redemption price for the Series A Preferred Shares so redeemed will equal the issue price of the Series A Preferred Shares plus the accrued but unpaid dividends thereon to, but
excluding, the redemption date. The Series A Preferred Shares are also redeemable for cash at the Companys option, in whole or in part, at any time. The redemption price for the Series A Preferred Shares redeemed at the Companys option
will equal the higher of the issue price of the Series A Preferred Shares plus accrued but unpaid dividends thereon to, but excluding, the redemption date, and the aggregate fair market value of the ordinary shares into which such Series A Preferred
Shares are then convertible.

In connection with this financing agreement, the Company issued to the shareholder groups, other than
Olympus, as an arrangement fee, warrants to purchase 5,000,000 ordinary shares, which is the equivalent of 333,333 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS). Simultaneous with the issuance and sale of the
Series A Preferred Shares under the financing agreement, the Company issued additional five-year warrants to purchase an aggregate of 15,000,000 ordinary shares, which is the equivalent of 1,000,000 ADSs, exercisable at a price of $0.01 per ordinary
share (equivalent to $0.15 per ADS). The warrants are exercisable for five years from the closing date of the securities purchase agreement.

The Company engaged independent appraisers to assess the fair value of the warrants referenced above and the intrinsic value of the beneficial conversion feature of the Series A Preferred Shares. The fair value of the warrants was estimated
to be approximately $1.2 million and the intrinsic value of the beneficial conversion feature of the Series A Preferred Shares was estimated to be approximately $10.1 million as of October 31, 2005. The fair value of the warrants and the
intrinsic value of the beneficial conversion feature of the Series A Preferred Shares have been deducted from the gross proceeds from the issuance of the $15 million preferred shares financing and has been allocated to additional paid-in capital
upon the issuance of the Series A Preferred Shares on October 27, 2005.

On March 15, 2006, the Company paid the semiannual
dividend of $743 thousand due on its outstanding Series A Preferred Shares. The Company paid the dividend in its ordinary shares, issued 11.15 ordinary shares



F-23



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



per Series A Redeemable Share and 3,345,054 ordinary shares in the aggregate to members of the investor group and Everwarm Limited, a wholly-owned subsidiary
of QPL. On September 15, 2006, the Company paid semiannual dividend due on our outstanding Series A Preferred Shares. the Company paid the dividend in our ordinary shares, issuing 36.73 ordinary shares per Series A Preferred Share and
11,020,338 ordinary shares in the aggregate to members of the investor group and Everwarm Limited, a wholly owned subsidiary of QPL, and issuing 9.97 ordinary shares per Series A Preferred Share and 97,706 ordinary shares in the aggregate to holders
of Series A Preferred Shares who subscribed to our rights offering, all in accordance with the terms of our Series A Preferred Shares. On March 15, 2007, the Company paid semiannual dividend due on the outstanding Series A Preferred Shares. the
Company paid the dividend in our ordinary shares, issuing 26.74 ordinary shares per Series A Preferred Share and 8,021,906 ordinary shares in the aggregate to members of the investor group and Everwarm Limited, and issuing 26.74 ordinary shares per
Series A Preferred Share and 262,025 ordinary shares in the aggregate to holders of Series A Preferred Shares who subscribed to the rights offering, all in accordance with the terms of our Series A Preferred Shares. On September 15, 2007, the
Company paid semiannual dividend due on our outstanding Series A Preferred Shares. The Company paid the dividend in ordinary shares, issuing 84.84 ordinary shares per Series A Preferred Share and 25,452,045 ordinary shares in the aggregate to
members of the investor group and Everwarm Limited, and issuing 84.84 ordinary shares per Series A Preferred Share and 825,876 ordinary shares in the aggregate to holders of Series A Preferred Shares who subscribed to the rights offering, all in
accordance with the terms of our Series A Preferred Shares.

Under the securities purchase agreement, the Company undertook a rights
offering of the Series A Preferred Shares and warrants for the benefit of existing shareholders other than the purchasers of the Series A Preferred Shares and certain other shareholders that have agreed to waive participation in the rights offering.
This rights offering was completed on July 28, 2006 and 9,799 shares were subscribed.

The Company has also agreed to file a
registration statement covering the resale of the shares issuable upon exercise of the Series A Preferred Shares and warrants described above.

16.
OTHER INCOME, NET

Other income, net consisted of the following:



|                                                               |  |       |   |  |       |  |       |  
|-------------------------------------------------------------- |  | ----- | - |  | ----- |  | ----- | -
|                                                               |  | 2005  |   |  | 2006  |  | 2007  |  
|                                                               |  | $000 |   |  | $000 |  | $000 |  
|Interest income                                                |  | 639   |   |  | 394   |  | 366   |  
|(Loss) gain on disposal of property, plant and equipment       |  | (136  | ) |  | 14    |  | (173  | )
|Reversal of previously accrued write-off of ASAT S.A. (Note a) |  |      |   |  | 2,323 |  |      |  
|Rental income                                                  |  | 4     |   |  |      |  |      |  
|Others, net                                                    |  | 181   |   |  | 707   |  | 450   |  
|                                                               |  |       |   |  |       |  |       |  
|                                                               |  | 688   |   |  | 3,438 |  | 643   |  
|                                                               |  |       |   |  |       |  |       |  

---

Note:



|(a) | The amount represented the accrual for potential claims which could have arisen from the winding up of ASAT S.A. In December 2000, the Company exercised the option to acquire ASAT
S.A. in Nancy, France from QPL for $20.0 million and the acquisition became effective in January 2001. Accounted for under the purchase method, ASAT S.A. has become a wholly-owned subsidiary of the Company.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In October 2001, the Company determined not to fund ASAT S.A. as part of the global restructuring program. ASAT S.A. filed for court protection under
French law and is under the process of court administered liquidation.



F-24



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The three-year statute of limitations applicable to the claims arising out of the winding up of ASAT
S.A. which began in the third quarter of fiscal year 2003 expired during the third quarter of fiscal year 2006. In view of such expiration, the Company reversed the accrued amount of $2.3 million and recorded as other income during the year ended
April 30, 2006.

17. INCOME TAXES

Income is subject to taxation in the various countries in which the Company and its subsidiaries operate. The (loss) income before income taxes by geographical locations was as follows:



|                            |  |         |   |  |         |   |  |         |  
|--------------------------- |  | ------- | - |  | ------- | - |  | ------- | -
|                            |  | 2005    |   |  | 2006    |   |  | 2007    |  
|                            |  | $000   |   |  | $000   |   |  | $000   |  
|Hong Kong                   |  | (62,244 | ) |  | (39,436 | ) |  | (44,551 | )
|United States               |  | 795     |   |  | (686    | ) |  | (6,951  | )
|Germany and other countries |  | 1,772   |   |  | (2,958  | ) |  | 17,726  |  
|                            |  |         |   |  |         |   |  |         |  
|                            |  | (59,677 | ) |  | (43,080 | ) |  | (33,776 | )
|                            |  |         |   |  |         |   |  |         |  

The (provision) benefit for income taxes by geographical location were as follows:



|              |  |       |   |  |       |   |  |        |  
|------------- |  | ----- | - |  | ----- | - |  | ------ | -
|              |  | 2005  |   |  | 2006  |   |  | 2007   |  
|              |  | $000 |   |  | $000 |   |  | $000  |  
|Current:      |  |       |   |  |       |   |  |        |  
|Hong Kong     |  |      |   |  |      |   |  | (1,264 | )
|United States |  | (691  | ) |  | 665   |   |  |       |  
|Others        |  | (57   | ) |  | (16   | ) |  |       |  
|Deferred:     |  |       |   |  |       |   |  |        |  
|Hong Kong     |  |      |   |  |      |   |  |       |  
|              |  |       |   |  |       |   |  |        |  
|              |  | (748  | ) |  | 649   |   |  | (1,264 | )
|              |  |       |   |  |       |   |  |        |  

An analysis of the Companys deferred tax liabilities and deferred tax assets as of
April 30, 2006 and 2007 was as follows:



|                                                                 |  |         |   |  |         |  
|---------------------------------------------------------------- |  | ------- | - |  | ------- | -
|                                                                 |  | 2006    |   |  | 2007    |  
|                                                                 |  | $000   |   |  | $000   |  
|Deferred tax liabilities:                                        |  |         |   |  |         |  
|Temporary differences arising from depreciation and amortization |  | (8,681  | ) |  | (5,944  | )
|                                                                 |  |         |   |  |         |  
|Total gross deferred tax liabilities                             |  | (8,681  | ) |  | (5,944  | )
|Deferred tax assets:                                             |  |         |   |  |         |  
|Reserves and accruals not currently deductible                   |  | 176     |   |  | 229     |  
|Net operating losses carried forward                             |  | 32,048  |   |  | 39,254  |  
|                                                                 |  |         |   |  |         |  
|Total gross deferred tax assets                                  |  | 32,224  |   |  | 39,483  |  
|                                                                 |  |         |   |  |         |  
|Net deferred tax assets                                          |  | 23,543  |   |  | 33,539  |  
|Less: valuation allowance                                        |  | (23,543 | ) |  | (33,539 | )
|                                                                 |  |         |   |  |         |  
|                                                                 |  |        |   |  |        |  
|                                                                 |  |         |   |  |         |  



F-25



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The Company provided a full valuation allowance against the deferred tax assets of the subsidiaries
in both the United States and Hong Kong as of April 30, 2006 and 2007 due to the uncertainty surrounding the realizability of these benefits in future tax returns.

The reconciliation of the effective tax rate of the Company to the Hong Kong profits tax rate (the principal tax jurisdiction of the Company) was as follows:



|                                                                  |  |      |    |  |       |   |  |       |   
|----------------------------------------------------------------- |  | ---- | -- |  | ----- | - |  | ----- | --
|                                                                  |  | 2005 |    |  | 2006  |   |  | 2007  |   
|Hong Kong profits tax rate                                        |  | 17.5 | %  |  | 17.5  | % |  | 17.5  | % 
|Tax effect of difference in Hong Kong and United States tax rates |  | (0.6 | )  |  | 0.8   |   |  | 1.0   |   
|Tax effect of difference in Hong Kong and Germany tax rates       |  | (0.2 | )  |  |      |   |  |      |   
|Non-taxable interest/other income                                 |  | 0.2  |    |  | 1.1   |   |  | 0.2   |   
|Income not subject to taxation                                    |  | (0.8 | )  |  | (1.9  | ) |  | 1.2   |   
|Non-deductible expenses                                           |  | (7.6 | )  |  | (2.0  | ) |  | (0.2  | ) 
|Change in valuation allowance                                     |  | (9.5 | )  |  | (17.3 | ) |  | (23.4 | ) 
|Utilization of tax losses previously not recognized               |  |     |    |  |      |   |  | 2.8   |   
|Reversal of valuation allowance                                   |  |     |    |  | 0.6   |   |  |      |   
|Overpayment of U.S. tax                                           |  |     |    |  | 1.5   |   |  |      |   
|Under-provision of Hong Kong taxation in prior years              |  |     |    |  |      |   |  | (3.7  | ) 
|Others, net                                                       |  | (0.3 | )  |  | 1.2   |   |  | 0.9   |   
|                                                                  |  |      |    |  |       |   |  |       |   
|Effective tax (expense) benefit rate                              |  | (1.3 | )% |  | 1.5   | % |  | (3.7  | )%
|                                                                  |  |      |    |  |       |   |  |       |   

As of April 30, 2007, the Company had available Hong Kong operating loss carryforwards of
$207.2 million which, subject to the agreement by the Hong Kong Inland Revenue Department, can be carried forward indefinitely to offset against operating income arising in the future. From its operation in the United States, it had available United
States federal net operating loss carryforwards of approximately $9.4 million which, subject to agreement by the Internal Revenue Service, expires from 2011 to 2024. The extent to which the loss carryforwards can be used to offset future taxable
income to taxes may be limited, depending on the extent of ownership changes within any three-year period as provided by Section 382 of the Internal Revenue Code and applicable California state tax law.

On December 8, 2006, ASAT Limited, a subsidiary of the Company, received an additional tax assessment from the Hong Kong Inland Revenue Department
(HKIRD) with respect to the deductibility of certain expenses for Hong Kong Profits Tax purposes for fiscal year 2000/2001. Queries were raised by the HKIRD concerning the deductibility of interest expenses related to certain
borrowings of ASAT Limited for Profits Tax purposes in order to assess whether the related borrowings were used towards revenue-generating activities. The assessment requires ASAT Limited to pay HK$18.8 million (approximately US$2.4 million) by
January 12, 2007. On December 29, 2006, ASAT Limited filed an objection to the HKIRD for the full amount. On January 29, 2007, ASAT Limited filed a request to the HKIRD to reconsider its holdover claim and on
January 30, 2007, the HKIRD had offered ASAT Limited an unconditional holdover, i.e. waiver, for 50% of the total tax in dispute (approximately HK$9.4 million or US$1.2 million). Although the case is not yet concluded and ASAT Limited is still
required to provide further evidence to the HKIRD showing that the borrowings were used towards revenue-generating activities and therefore, the consequential interest expenses will be deductible for tax purposes, HKIRD had requested ASAT Limited to
make prepayment for the remaining 50% of the total tax in dispute. On January 31, 2007, ASAT Limited filed a proposal to HKIRD for installment payments for the remaining HK$9.4 million (approximately US$1.2 million) tax in dispute and the
proposal was accepted on March 27, 2007. As of the date of this report, ASAT Limited has made installment payments of approximately HK$3.1 million (approximately US$0.4 million) to the HKIRD. As the result of the final tax liability,
if any, will



F-26



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



depend upon the quality of the evidence that ASAT Limited can provide and ASAT Limited is still in the process of gathering information to address the
queries, ASAT Limited had recorded a provision of US$1.2 million for the amount of tax in dispute as at April 30, 2007. If the HKIRD accepts the evidence provided, the installment payments made shall be refunded.

18. COMMON STOCK



|                                                                 |  |        |  |       
|---------------------------------------------------------------- |  | ------ |  | ------
|                                                                 |  | 2006   |  | 2007  
|                                                                 |  | $000  |  | $000 
|Authorized:                                                      |  |        |  |       
|2,999,000,000 (20062,999,000,000) ordinary shares of $0.01 each |  | 29,990 |  | 29,990
|                                                                 |  |        |  |       
|Issued:                                                          |  |        |  |       
|711,401,844 (2006689,859,869) ordinary shares of $0.01 each     |  | 6,899  |  | 7,114 
|                                                                 |  |        |  |       
|Outstanding:                                                     |  |        |  |       
|704,348,844 (2006682,806,869) ordinary shares of $0.01 each     |  | 6,828  |  | 7,043 
|                                                                 |  |        |  |       

No repurchase of ADSs occurred for the years ended April 30, 2005, 2006 and 2007.

In a private placement transaction took place in October 1999, the Company issued 155,000 units consisting of 155,000 warrants to purchase ordinary
shares of ASAT Holdings Limited and $155,000,000 aggregate principal amount of 12.5% senior notes due 2006 of ASAT (Finance) LLC, all of which notes were redeemed on February 25, 2004 and are no longer outstanding. Each warrant entitles the
holder, subject to specific conditions, to subscribe for 114.19 ordinary shares of ASAT Holdings Limited at an exercise price of $0.39 per share, with both the exercise price and the number of ordinary shares issuable upon exercise subject to
adjustment under specified circumstances. As a result of a share dividend of 47 ordinary shares for each outstanding share undertaken contemporaneously with the completion of the Companys offering of ADSs on July 14, 2000, the total
number of ordinary shares of ASAT Holdings Limited issuable upon exercise of the warrants was adjusted from 371,132 shares to 17,699,450 shares, and the exercise price for the warrants was adjusted from $18.6 per ordinary share to $0.39 per ordinary
share. The warrants are exercisable at any time on or after November 1, 2001 and will expire on November 1, 2006. The warrants do not provide the holders any voting rights but the shares to be issued upon exercise of the warrants will be
voting shares.

The fair value of the warrants has been deducted from the gross proceeds from the issuance of the 12.5% senior notes and
was allocated to additional paid-in capital upon the issuance of the 12.5% senior notes in October 1999. The fair value of the warrants was determined using the Black-Scholes pricing model, which takes into account a number of factors, including
expected volatility of the underlying stocks return, the level of interest rates, the relationship of the underlying stocks price to the strike price of the warrants, and the time remaining until the warrants expire.

Pursuant to the securities purchase agreement with JPMP related funds, QPL and Olympus which closed on October 27, 2005, the Company issued 300,000
units Series A Preferred Shares for a total price of $15 million. In connection with this securities purchase agreement, the Company has issued to the shareholder groups, other than Olympus, as an arrangement fee, warrants to purchase 5,000,000
ordinary shares, which is the equivalent of 333,333 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS). Simultaneous with the issuance and sale of the Series A Preferred Shares under the securities purchase
agreement, the Company issued additional five-year warrants to purchase an aggregate of 15,000,000 ordinary shares, which is



F-27



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



the equivalent of 1,000,000 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS). The warrants are exercisable for five
years from the closing date of the securities purchase agreement.

The Company engaged independent appraisers to assess the fair value of
the warrants referenced above . The fair value of the warrants was estimated to be approximately $1.2 million as of October 31, 2005. The fair value of the warrants was deducted from the gross proceeds from the issuance of the $15 million
Series A Preferred Shares financing and was allocated to additional paid-in capital upon the issuance of the Series A Preferred Shares on October 27, 2005.

In connection to the purchase money loan facility, the Company issued to the administrative agent, as an arrangement fee, warrants to purchase an aggregate of 5,000,000 ordinary shares, which is the equivalent of
333,333 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS). The Company engaged an independent appraiser to assess the fair value of the warrants and the fair value was estimated to be approximately $692 thousand.
The fair value of the warrants was capitalized as deferred charges and amortized over the life of the purchase money loan facility. The fair value of the warrants was also credited to additional paid-in capital upon the effectiveness of the purchase
money loan facility on October 27, 2005.

On January 25, 2006, the Company borrowed the first $10.0 million tranche of funding
under the purchase money loan facility and issued five-year warrants for a total of 15,668,170 ordinary shares, which is the equivalent of 1,044,544 ADSs, exercisable at a price of $0.01 per ordinary share (equivalent to $0.15 per ADS), the warrants
are exercisable for five years from the date of issuance. The Company estimated the fair value of these warrants to be approximately $3.2 million. The fair value of the warrants and commitment fees was deducted from the gross proceeds of the $10.0
million purchase money loan and amortized over the life of the purchase money loan.

On March 15, 2006, the Company paid the
semiannual dividend of $743 thousand due on its outstanding Series A Preferred Shares. The Company paid the dividend in its ordinary shares, issuing 11.15 ordinary shares per Series A Preferred Share and 3,345,054 ordinary shares in the aggregate to
members of the investor group and Everwarm Limited, a wholly-owned subsidiary of QPL. On September 15, 2006, the Company paid semiannual dividend due on our outstanding Series A Preferred Shares. the Company paid the dividend in our ordinary
shares, issuing 36.73 ordinary shares per Series A Preferred Share and 11,020,338 ordinary shares in the aggregate to members of the investor group and Everwarm Limited, a wholly owned subsidiary of QPL, and issuing 9.97 ordinary shares per Series A
Preferred Share and 97,706 ordinary shares in the aggregate to holders of Series A Preferred Shares who subscribed to the Companys rights offering, all in accordance with the terms of the Series A Preferred Shares. On March 15, 2007, the
Company paid semiannual dividend due on the outstanding Series A Preferred Shares. the Company paid the dividend in the ordinary shares, issuing 26.74 ordinary shares per Series A Preferred Share and 8,021,906 ordinary shares in the aggregate to
members of the investor group and Everwarm Limited, and issuing 26.74 ordinary shares per Series A Preferred Share and 262,025 ordinary shares in the aggregate to holders of Series A Preferred Shares who subscribed to our rights offering, all in
accordance with the terms of the Series A Preferred Shares.

Effective at the close of business on December 22, 2006, the Company
effected an adjustment to the ADS to ordinary share ratio from a ratio of one ADS for every five ordinary shares to a ratio of one ADS for every fifteen ordinary shares. All ADS and per ADS amounts contained in this report have been restated to
reflect the adjustment to our ADS ratio.

19. STOCK OPTION PLAN

On July 6, 2000, the Company adopted a Stock Option Plan (2000 Stock Option Plan) under which the Board of Directors may, at their discretion, invite any key officers, employees, consultants and
non-employee



F-28



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



directors of ASAT to subscribe for its shares up to a maximum of 110,000,000 ordinary shares of the Company. The Board of Directors will determine which
individuals will be granted options, the number of ADSs subject to the options, the exercise price for the options, the vesting periods and any other terms that will apply as the Board deems appropriate.

Prior to May 1, 2006, the Company provided the disclosures required under APB No. 25 and SFAS No. 123. APB No. 25 accounted for
stock-based compensation awarded to employees using the intrinsic value method supplemented by pro forma disclosures in accordance with APB 25 and SFAS No. 123. If the Company had accounted for its stock option plan by recording compensation
based on the fair value at grant date for such awards consistent with the method of SFAS No. 123, the Companys net loss and net loss per share would have been increased to the pro forma amounts for the year as follows:.



|                                                                                                                              |  |         |   |  |         |  
|----------------------------------------------------------------------------------------------------------------------------- |  | ------- | - |  | ------- | -
|                                                                                                                              |  | 2005    |   |  | 2006    |  
|                                                                                                                              |  | $000   |   |  | $000   |  
|Net loss                                                                                                                      |  |         |   |  |         |  
|Net loss, as reported                                                                                                         |  | (60,425 | ) |  | (43,907 | )
|Add: stock-based employee compensation reversal as included in the reported net loss, net of tax effect                       |  | 133     |   |  | (186    | )
|Deduct: stock-based employee compensation expense determined under fair value based method for all rewards, net of tax effect |  | (4,363  | ) |  | (1,342  | )
|Net loss, pro forma                                                                                                           |  | (64,655 | ) |  | (45,435 | )
|                                                                                                                              |  |        
|Net loss per ordinary share (dollars per share):                                                                              |  |         |   |  |         |  
|Basic                                                                                                                        |  | (0.09   | ) |  | (0.06   | )
|Diluted                                                                                                                      |  | (0.09   | ) |  | (0.06   | )
|                                                                                                                              |  |        
|Pro forma net loss per ordinary share (dollars per share):                                                                    |  |         |   |  |         |  
|Basic                                                                                                                        |  | (0.10   | ) |  | (0.07   | )
|Diluted                                                                                                                      |  | (0.10   | ) |  | (0.07   | )

Effective May 1, 2006, the Company adopted SFAS No. 123(R). Under the fair value
recognition provisions of SFAS No. 123(R), the Company is required to measure the cost of employee services received in exchange for stock-based compensation measured at the fair value of the award as of the grant date. Beginning May 1,
2006, the Company applied the modified prospective transition method, which requires the application of SFAS No. 123(R) for new grants and nonvested grants that were outstanding as of such date. The Companys Consolidated Financial
Statements as of April 30, 2007 reflect the impact of SFAS No. 123(R). In accordance with the modified prospective transition method, the Companys Consolidated Financial Statements for prior periods have not been restated to reflect,
and do not include, the impact of SFAS No. 123(R). The valuation provisions of SFAS No. 123(R) apply to new grants and nonvested grants that were outstanding as of the effective date. For new grants, the Company will amortize stock-based
compensation expenses on a straight-line basis over the requisite service period. Estimated compensation for nonvested grants that were outstanding as of the effective date were recognized over the remaining service period using the compensation
estimated for SFAS No. 123(R) pro forma disclosures.

SFAS No. 123(R) requires that the deferred stock-based compensation on the
Condensed Consolidated Balance Sheet on the date of adoption be netted against additional paid-in capital. As of April 30, 2006, there was a balance of $63 thousand of deferred stock-based compensation that was netted against additional paid-in
capital on May 1, 2006.

The fair value of stock-based compensation awards is determined using the Black-Scholes option pricing model,
which is consistent with the valuation techniques previously utilized for options in footnote disclosures required under SFAS No. 123. The determination of the fair value of stock-based compensation awards on the



F-29



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



date of grant using an option-pricing model is affected by the Companys stock price as well as assumptions regarding a number of complex and subjective
variables, including the expected volatility of the Companys stock price over the term of the awards, actual and projected employee stock option exercise behaviors, risk-free interest rate and expected dividends. The assumptions used to value
stock-based compensation awards for the year ended April 30, 2005, 2006 and 2007 are as follows:



|                          |  |      |   |  |      |   |  |      |  
|------------------------- |  | ---- | - |  | ---- | - |  | ---- | -
|                          |  | 2005 |   |  | 2006 |   |  | 2007 |  
|Risk-free interest rate   |  | 3.67 | % |  | 4.71 | % |  | 4.67 | %
|Expected life (years)     |  | 4    |   |  | 4    |   |  | 4    |  
|Expected stock volatility |  | 67   | % |  | 101  | % |  | 93   | %
|Dividend yield            |  | 0    | % |  | 0    | % |  | 0    | %

Expected life represents the weighted average period of time that stock-based awards granted are
expected to be outstanding giving consideration to historical exercise patterns. Expected stock volatilities are based on historical volatilities of the Companys stock price. Risk-free rate is based on U.S. Treasury zero-coupon issues with
remaining terms similar to the expected term on the stock-based awards. The Company does not anticipate paying any cash dividends in the foreseeable future.

Changes in subjective input assumptions can materially affect the fair value estimate. In the opinion of the Companys management, the existing model may not necessarily provide a reliable single measure of the
fair value of the stock options.

Total stock-based compensation recognized in cost of sales, selling, general and administrative expenses
on the Companys Consolidated Statements of Operations for the year ended April 30, 2007 was $888 thousand.

Stock option
activity related to the Companys stock options for the year ended April 30, 2005, 2006 and 2007 is summarized as follows (stated in American Depositary Share, or ADS, equivalents based on fifteen ordinary shares per ADS:



|                              |  |                      |   |  |                                        |     
|----------------------------- |  | -------------------- | - |  | -------------------------------------- | ----
|                              |  | Outstanding Options 
|                              |  | Number ofADS options |   |  | Weighted-averageexercise price per ADS
|Outstanding at April 30, 2004 |  | 3,811,806            |   |  | $                                      | 6.24
|                              |  |                      |   |  |                                        |     
|Granted                       |  | 743,225              |   |  | $                                      | 3.66
|Cancelled                     |  | (645,476             | ) |  | $                                      | 6.54
|Exercised                     |  | (97,617              | ) |  | $                                      | 2.40
|                              |  |                      |   |  |                                        |     
|Outstanding at April 30, 2005 |  | 3,811,938            |   |  | $                                      | 5.79
|                              |  |                      |   |  |                                        |     
|Granted                       |  | 772,939              |   |  | $                                      | 2.46
|Cancelled                     |  | (1,707,298           | ) |  | $                                      | 5.91
|Exercised                     |  | (68,309              | ) |  | $                                      | 1.59
|                              |  |                      |   |  |                                        |     
|Outstanding at April 30, 2006 |  | 2,809,270            |   |  | $                                      | 4.92
|                              |  |                      |   |  |                                        |     
|Granted                       |  | 473,715              |   |  | $                                      | 1.64
|Cancelled                     |  | (1,290,439           | ) |  | $                                      | 5.94
|Exercised                     |  | (142,667             | ) |  | $                                      | 1.53
|                              |  |                      |   |  |                                        |     
|Outstanding at April 30, 2007 |  | 1,849,879            |   |  | $                                      | 3.66
|                              |  |                      |   |  |                                        |     
|ADS options exercisable at:   |  |                      |   |  |                                        |     
|April 30, 2005                |  | 2,553,824            |   |  | $                                      | 5.91
|April 30, 2006                |  | 1,789,527            |   |  | $                                      | 5.70
|April 30, 2007                |  | 1,234,137            |   |  | $                                      | 4.37



F-30



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The aggregate intrinsic value was calculated as the difference between the exercise price of the
underlying awards and the quoted price of the Companys ADSs that were in-the-money at April 30, 2007. During the year ended April 30, 2005, 2006 and 2007, the aggregate intrinsic value of options exercised were $290,868, $88,512 and
$94,565, respectively, determined as of the date of option exercise.

The weighted average grant-date fair value of options granted in the
year ended April 30, 2005, 2006 and 2007 was $1.96, $1.79 and $1.13, respectively.

The following table presents a summary of the
status of the Companys nonvested stock options as of April 30, 2006, and changes during the year ended April 30, 2007 (stated in ADS equivalents based on fifteen ordinary shares per ADS):



|                            |  |                      |   |  |                                                 |     
|--------------------------- |  | -------------------- | - |  | ----------------------------------------------- | ----
|                            |  | Number of ADSoptions |   |  | Weighted-average fairvalue per ADS at grantdate
|Nonvested at April 30, 2006 |  | 1,019,813            |   |  | $                                               | 2.31
|Granted                     |  | 473,715              |   |  | $                                               | 1.13
|Vested                      |  | (521,563             | ) |  | $                                               | 3.24
|Forfeited                   |  | (356,223             | ) |  | $                                               | 3.07
|                            |  |                      |   |  |                                                 |     
|Nonvested at April 30, 2007 |  | 615,742              |   |  | $                                               | 1.52
|                            |  |                      |   |  |                                                 |     

As of April 30, 2007, there was approximately $1.0 million of unrecognized compensation cost
related to nonvested stock options. The cost is expected to be recognized over a weighted average period of 2.6 years.

The options
generally vest over four years and expire ten years from the date of grant or within three months of termination of employment.

The
following table summarizes information about stock options issued under the plan described above that are outstanding and exercisable as of April 30, 2007:



|                        |  |                      |  |                                |       |                                         |      |                      |           |                                |   |      
|----------------------- |  | -------------------- |  | ------------------------------ | ----- | --------------------------------------- | ---- | -------------------- | --------- | ------------------------------ | - | -----
|Options outstanding     |  | Options exercisable 
|Range of exercise price |  | Number ofADS options |  | Weighted-averageexercise price |       | Weighted-averagecontractual life(years) |      | Number ofADS options |           | Weighted-averageexercise price
|$1.17        $2.88     |  | 619,340              |  | $                              | 1.70  |                                         | 8.57 |                      | 233,236   |                                | $ | 1.70 
|$2.97        $4.95     |  | 1,129,894            |  | $                              | 3.91  |                                         | 7.01 |                      | 907,631   |                                | $ | 4.13 
|$5.91        $9.15     |  | 74,165               |  | $                              | 7.33  |                                         | 6.91 |                      | 66,790    |                                | $ | 7.47 
|$12.75      $12.93     |  | 8,000                |  | $                              | 12.75 |                                         | 3.81 |                      | 8,000     |                                | $ | 12.75
|$23.07      $36.00     |  | 18,480               |  | $                              | 34.82 |                                         | 3.21 |                      | 18,480    |                                | $ | 34.82
|                        |  |                      |  |                                |       |                                         |      |                      |           |                                |   |      
|Total                   |  | 1,849,879            |  |                                |       |                                         |      |                      | 1,234,137 |                                |   |      
|                        |  |                      |  |                                |       |                                         |      |                      |           |                                |   |      

20. EMPLOYEE BENEFIT PLAN

The aggregate employers contributions which have been made were as follows:



|                         |  |       |  |       |  |      
|------------------------ |  | ----- |  | ----- |  | -----
|                         |  | 2005  |  | 2006  |  | 2007 
|                         |  | $000 |  | $000 |  | $000
|Employers contributions |  | 1,392 |  | 1,343 |  | 682  
|                         |  |       |  |       |  |      



F-31



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The Company has established a mandatory provident fund scheme for its Hong Kong employees who did not
join the defined contribution plan described below. The assets of the plan are held under provident funds managed by independent trustees. Both the employees and employers contributions are based on 5% of the individual employees
monthly basic salary or at a maximum of approximately $128 per month.

Also, the Company has a defined contribution plan for its Hong Kong
employees. The assets of the plan are also held under provident funds managed by independent trustees. The employees can elect to contribute a fixed percentage from 1% to 5% (in 1% increments) of an individual employees monthly basic salary.
The employers contributions are based on the percentage of contribution by the employee of the individual employees monthly basic salary. The employees are entitled to the whole of the employers contributions and accrued interest
thereon after 10 years of complete service or at a reduced scale of 30% to 90%, after completion of 3 to 9 years of service, respectively.

In addition, ASAT, Inc. has a 401(k) plan which covers all employees with six months or more of service. Employees who participate in the plan may contribute a portion of their salaries up to a limit specified by law. The Companys
contribution to the plan is based on the percentage of contribution by the employee of the individual employees monthly basic salary, whereby the Companys contributions to the plan for the years ended April 30, 2005, 2006 and 2007
were $150 thousand, $123 thousand and $42 thousand respectively.

21. REORGANIZATION EXPENSES

During the years ended April 30, 2005, 2006 and 2007, as part of the transition to China, the Company incurred $0.9 million, $4.7 million and $2.5
million, respectively, of reorganization expenses for the lay-off of approximately 300, 1,000 and 370 employees, respectively, who primarily served in the manufacturing functions in Hong Kong operations.

22. FACILITIES AND RELOCATION CHARGES

For the years
ended April 30, 2006 and 2007, the Company incurred facilities and relocation charges of $1.1 million and $3.0 million, respectively, in connection with the transfer of its assembly and test operations from Hong Kong to Dongguan, China.

23. LITIGATION SETTLEMENT

QPL entered
into a patent cross license agreement with Motorola, Inc. (Motorola) on October 1, 1993 (the Immunity Agreement). Under the terms of the Immunity Agreement, QPL had been obligated to pay quarterly royalties to Motorola
on a per solder ball pad basis for all BGA Packages, as defined therein. QPL, through its then subsidiary ASAT Limited, paid royalties on certain products and not others based on its understanding of the obligations under the Immunity
Agreement. When QPL assigned certain semiconductor assets to the Company in 1999, ASAT Limited continued to make payments to Motorola, even though the Immunity Agreement was not assigned to the Company or any of its subsidiaries.

Motorola approached the Company in December 2002 claiming that the Company had assumed QPLs obligations under the Immunity Agreement. It
commissioned a third-party auditor to audit the royalty payments the Company had made for the three-year period ended October 31, 2002. Based on the results of that audit, Motorola asserted that QPL and the Company collectively owed additional
royalties of $8,000,000 along with interest under either the Immunity Agreement or implied in fact contract that mirrors the terms of the Immunity Agreement. The bulk of the amount claimed stemmed from Motorolas contention that the
Company and QPL owe royalties for the manufacture of fpBGA products, a contention that both entities denied.



F-32



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



On April 9, 2003, the Company and its subsidiary, ASAT, Inc., as co-plaintiffs initiated a
lawsuit against Motorola in the United States District Court for the Northern District of California (the Court) by filing a complaint for Declaratory Judgment seeking a declaration from the court that neither plaintiff owed Motorola any
royalty payments under the Immunity Agreement or any other agreement. Motorola counter-claimed for breach of contract against the Company, ASAT, Inc., ASAT Limited and QPL, seeking $8,000,000 plus interest accruing at the rate of 1% per month
on the alleged unpaid royalties. The substantial majority of Motorolas demand was directed to the Company and its subsidiaries.

In
July 2005, the Company entered into a formal settlement agreement and mutual release with Motorola and Freescale, the former semiconductor products division of Motorola, to fully and finally compromise, settle and discharge the claims,
controversies, demands and disputes between the parties. The formal written settlement agreement was executed in July 2005 and was filed with the Court on July 18, 2005. Under the settlement agreement and mutual release, the Company agreed to
pay Freescale a total of $2.0 million in cash. The Company also agreed to provide Freescale with a rebate of 20% on all future products sales and services invoiced by the Company to Freescale until the aggregate amount of the rebate provided to
Freescale by the Company totals $1.75 million. This 20% rebate will not expire until the maximum total rebate of $1.75 million is paid back to Freescale. Based on the discounted cash flows analysis and the expected timeframe of the rebate
utilization by Freescale, the fair value of the rebate was estimated to be approximately $1.62 million as of April 30, 2005. The Company also issued a 5-year warrant to Freescale for $1.75 million to purchase 10,937,500 ordinary shares, which
is equivalent to 729,167 ADSs, initially exercisable at a price of $0.16 per ordinary share (equivalent to $2.4 per ADS). The Company engaged an independent appraiser to assess the fair value of the warrants and the fair value of the warrants was
estimated to be approximately $982 thousand as of April 30, 2005.

The accrued litigation settlement totaling $4.6 million,
representing $2.0 million cash settlement, $1.62 million fair value of future rebate and $982 thousand fair value of the warrants, was charged to the Companys consolidated statements of operations for the year ended April 30, 2005.

24. COMMITMENTS AND CONTINGENCIES

Capital expenditure

As of April 30, 2005, 2006 and 2007, the Company had contracted for capital expenditure on
property, plant and equipment of $21.1 million, $2.9 million and $1.2 million, respectively. The capital commitment as of April 30, 2005 included the completion of the interior finish and fixtures contract for the Phase II facility.

Operating leases

The Company
leases certain land, buildings, equipment and machinery and motor vehicles, under operating lease agreements expiring at various times through July 2020. The Hong Kong facility leased from QPL is under a three-year term which expired in March 2007.
On April 30, 2005, QPL completed the sale of ASATs leased facility from QPL to a third party that is unrelated to either party. The lease agreement with QPL was transferred to this third party without any change in its terms and
conditions. The lease of the Hong Kong facility was renewed in August 2006 under a one-year term which expired on August 31, 2007. Subsequently, the Company surrendered a portion of its Hong Kong office premises and entered a new lease
agreement with a one-year term expiring on August 31, 2008, with an option to extend for an additional year.

The Company entered into
a lease of a factory facility (the Phase I facility) in Dongguan, China in August 2002 under which the lessor was responsible for the design and construction of the interior finish and fixtures of the factory building. The Company
is obligated to pay a monthly rental payment and management service fee for a period of 15 years from September 2003.



F-33



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



From October 30, 2004 and onward during the remaining term of the lease, the Company has an
option and a right of first refusal to purchase the Phase I facility and the related land-use right of the land on which the facility is located at prices fixed in a predetermined schedule or, subsequent to October 2009, at price based on the then
fair market value of the factory facility and the related land-use right. The highest price for the Phase I facility and the related land-use right listed on the predetermined schedule to the lease agreement is HK$108.4 million (approximately $13.9
million at an assumed exchange rate of HK$7.8 per $1.00).

On May 7, 2004, the Company entered into a lease agreement of another
factory facility (the Phase II facility) in Dongguan, China, under which the lessor is responsible for the design and construction of the factory building. The Company is obligated to pay a monthly lease payment for a term of 15
years starting from August 1, 2005. Under the terms of the Phase II facility lease, the Company is obligated to pay monthly payment of $179 thousand for the first six years of the lease term and $90 thousand per month for the seventh years
of the lease term.

At any time on or after October 31, 2008, the Company has an option and a right of first refusal under the lease
to purchase the Phase II facility and the land-use right of the land on which the facility is located at price fixed in a predetermined schedule during the period from October 2008 to July 2011 and thereafter at prices based on the then fair market
value of the factory facility and the related land-use right. The highest price for the Phase II facility and the related land-use right listed on the predetermined schedule to the lease agreement is HK$60.0 million (approximately $7.7 million at an
assumed exchange rate of HK$7.8 per $1.00).

Future minimum lease payments under operating leases as of April 30, 2007 are as follows:



|                             |  |       
|---------------------------- |  | ------
|                             |  | $000 
|Fiscal year ending April 30: |  |       
|2008                         |  | 4,774 
|2009                         |  | 4,572 
|2010                         |  | 3,325 
|2011                         |  | 2,692 
|2012                         |  | 1,974 
|Thereafter                   |  | 12,600
|                             |  |       
|Total                        |  | 29,937
|                             |  |       

25. SEGMENT INFORMATION

The Company operates in a single business segment comprising the assembly and test services of integrated circuits to customers in the semiconductor industry. It is the managements view that assembly and test
services are of one business segment. The Companys net sales are generated from the following geographical locations representing the geographical areas from which sales invoices were issued for the years indicated:



|                                  |  |          |   |  |          |   |  |          |  
|--------------------------------- |  | -------- | - |  | -------- | - |  | -------- | -
|                                  |  | 2005     |   |  | 2006     |   |  | 2007     |  
|                                  |  | $000    |   |  | $000    |   |  | $000    |  
|Hong Kong                         |  | 185,865  |   |  | 177,207  |   |  | 161,516  |  
|United States                     |  | 104,830  |   |  | 60,481   |   |  | 37,915   |  
|China (excluding Hong Kong)       |  | 9,774    |   |  | 74,278   |   |  | 379,631  |  
|Transfer between geographic areas |  | (106,058 | ) |  | (129,851 | ) |  | (414,209 | )
|                                  |  |          |   |  |          |   |  |          |  
|Total net sales                   |  | 194,411  |   |  | 182,115  |   |  | 164,853  |  
|                                  |  |          |   |  |          |   |  |          |  

Intercompany sales between geographic areas were recorded at cost plus a mark-up. Such transfers,
including unrealized profits, are eliminated on consolidation.



F-34



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



The Company ships completed packages at the direction of its customers to various destinations. The
following table provides a breakdown of the percentage of net sales by geographic destination:



|              |  |       |   |  |       |   |  |       |  
|------------- |  | ----- | - |  | ----- | - |  | ----- | -
|              |  | 2005  |   |  | 2006  |   |  | 2007  |  
|United States |  | 54.2  | % |  | 33.2  | % |  | 23.0  | %
|Asia (a)      |  | 43.9  | % |  | 63.0  | % |  | 70.6  | %
|Hong Kong     |  | 0.4   | % |  | 2.3   | % |  | 3.4   | %
|Europe        |  | 1.5   | % |  | 1.5   | % |  | 3.0   | %
|              |  |       |   |  |       |   |  |       |  
|              |  | 100.0 | % |  | 100.0 | % |  | 100.0 | %
|              |  |       |   |  |       |   |  |       |  

---

|(a) | For the Companys net sales by geographic destination, Asia mainly represents Singapore, Taiwan, Japan, Malaysia, China (excluding Hong Kong), Philippines and Korea.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

The geographical distribution of the Companys identifiable assets is summarized as follows:



|                            |  |         |  |         |  |        
|--------------------------- |  | ------- |  | ------- |  | -------
|                            |  | 2005    |  | 2006    |  | 2007   
|                            |  | $000   |  | $000   |  | $000  
|Hong Kong                   |  | 128,218 |  | 93,564  |  | 71,404 
|China (excluding Hong Kong) |  | 42,927  |  | 78,094  |  | 54,209 
|Asia (b)                    |  | 175     |  | 117     |  | 159    
|United States               |  | 7,342   |  | 9,635   |  | 9,296  
|Germany                     |  | 84      |  | 51      |  | 69     
|                            |  |         |  |         |  |        
|                            |  | 178,746 |  | 181,461 |  | 135,137
|                            |  |         |  |         |  |        

---

|(b) | For the Companys identifiable assets, Asia represents Singapore and Korea.
|--- | ---------------------------------------------------------------------------

The geographical distribution of the Companys long-lived assets is summarized as follows:



|                            |  |         |  |         |  |       
|--------------------------- |  | ------- |  | ------- |  | ------
|                            |  | 2005    |  | 2006    |  | 2007  
|                            |  | $000   |  | $000   |  | $000 
|Hong Kong                   |  | 72,196  |  | 44,060  |  | 47,862
|China (excluding Hong Kong) |  | 29,711  |  | 60,384  |  | 38,034
|Asia (c)                    |  | 54      |  | 35      |  | 35    
|United States               |  | 1,088   |  | 735     |  | 3,929 
|Germany                     |  | 6       |  | 2       |  | 7     
|                            |  |         |  |         |  |       
|                            |  | 103,055 |  | 105,216 |  | 89,867
|                            |  |         |  |         |  |       

---

|(c) | For the Companys long-lived assets, Asia represents Singapore and Korea.
|--- | -------------------------------------------------------------------------

26. MAJOR CUSTOMERS

An analysis of percentage of sales to major customers is as follows:



|          |  |      |   |  |      |   |  |      |  
|--------- |  | ---- | - |  | ---- | - |  | ---- | -
|          |  | 2005 |   |  | 2006 |   |  | 2007 |  
|Customer: |  |      |   |  |      |   |  |      |  
|A         |  | 21.1 | % |  | 32.6 | % |  | 53.7 | %
|B         |  | 12.1 | % |  | 8.6  | % |  | 5.0  | %
|C         |  | 10.8 | % |  | 7.0  | % |  | 4.1  | %
|D         |  | 5.0  | % |  | 7.0  | % |  | 3.4  | %
|E         |  | 4.9  | % |  | 4.0  | % |  | 2.8  | %



F-35



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



27. SUBSEQUENT EVENTS

On August 1, 2007, we did not pay the regularly scheduled interest payment of approximately $7.0 million on our 9.25% senior notes due 2011. The Company had subsequently paid such interest payment, including
accumulated penalty interest, for a total of $7.0 million on August 28, 2007 and within the 30 days grace period permitted under the indenture governing our 9.25% senior notes due 2011.

On August 23, 2007, the purchase money loan facility was amended to extend the maturity due date of the $10.0 million principal amount until
April 30, 2009 and to extend the payment due date for interest payments (and interest on such interest) for March 31, 2006, June 30, 2006, September 30, 2006, December 31, 2006, March 31, 2007,
June 30, 2007 and September 30, 2007 to become due on October 31, 2007. In return for amending the purchase money loan facility, the Company agreed to issue to the lenders under the purchase money loan facility warrants exercisable,
in the aggregate, for a total of approximately 4.9% of the Companys total outstanding ordinary shares on a fully diluted basis (inclusive of ordinary shares issuable upon exercise of warrants to the holders themselves and which the Company
will grant to the eligible holders of our 9.25% senior notes due 2011). The warrants will have an exercise price of $0.01 per ordinary share and will expire on February 1, 2011, subject to adjustment as provided in the warrants and the other
terms and conditions contained therein.

On October 10, 2007, we amended the purchase money loan facility to extend the payment due date
for interest including any penalty interest as required by the agreement. Interest that was due or will be due for payment on or before December 31, 2008 will be due and payable on December 31, 2008.

On August 27, 2007, the Company received consent from the 98% of the holders of the $150 million aggregate principal amount of outstanding 9.25%
Senior Notes due 2011 (the Senior Notes) to the amendment of certain provisions of the indenture, dated as of January 26, 2004, pursuant to which the Senior Notes were issued and the waiver of certain defaults and events of default that
may have occurred or may occur. The amendments included: (i) elimination of restrictions on the value of the assets that may be held by ASAT Semiconductor (Dongguan) Limited (ASDL), the Companys wholly owned subsidiary;
(ii) expand the ability of the Company and its subsidiaries to secure financing from additional sources; and (iii) extend the deadline for the Company to fulfill its reporting obligations under the indenture. The Company agreed to issue
warrants for ordinary shares in connection with the amendment of the indenture governing our 9.25% senior notes due 2011. These warrants will be issued to eligible holders of our 9.25% senior notes due 2011 who consented to the solicitation of
consents ended August 23, 2007 to amend the indenture governing our 9.25% senior notes due 2011, subject to certain conditions specified therein. These warrants would, in the aggregate, be exercisable for a total of approximately 4.9% of the
Companys total outstanding ordinary shares on a fully diluted basis (inclusive of ordinary shares issuable upon exercise of warrants to the holders themselves and which the Company will grant to the lenders under its purchase money loan
agreement). The warrants will have an exercise price of $0.01 per ordinary share and will expire on February 1, 2011, subject to adjustment as provided in the warrants and the other terms and conditions contained therein.

On September 17, 2007, the Company received a Nasdaq Staff Determination letter indicating that the Companys market value of listed securities
has been below $35,000,000 as required for continued inclusion by Marketplace Rule 4320(e)(2)(B) and that its American Depositary Shares are, therefore, subject to delisting. The Company was also notified by Nasdaq at that time that it does not
comply with the minimum stockholders equity of $2,500,000 or net income from continuing operations of $500,000 in the most recently completed fiscal year or in two of the last three most recently completed fiscal years, which are also
requirements for continued listing on the Nasdaq Capital Market. The Company appealed the Staff Determination and has received a hearing date of November 1, 2007 for such appeal. At the hearing, the Company will be required to address the
foregoing non-compliance with the Nasdaq listing rules. Nasdaqs delisting action has been stayed, pending a final written determination by the Nasdaq Listing Qualifications Panel following the hearing. The Companys ADSs are currently
trading on the Nasdaq Capital Market under the trading symbol ASTT.



F-36



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



In September 2007, ASAT China renewed $2.5 million of the credit facility for another year. As such,
the entire borrowing of $3.8 million with regard to this revolving credit facility remains outstanding as of the date of this Annual Report. In September 2007, ASAT China obtained a revolving credit facility of RMB150 million (approximately US$20
million) with a term of one year. The facility is secured by certain trade receivables of ASAT China and has not been drawn as of the date of this Annual Report.

28. CONDENSED CONSOLIDATED FINANCIAL INFORMATION

On January 26, 2004, New ASAT (Finance) Limited, a wholly-owned
subsidiary of the Company issued $150.0 million of its 9.25% senior notes as part of a refinancing transaction. See Note 13 for a more complete description of the 9.25% senior notes.

Under the indenture governing the 9.25% senior notes, the Company and certain of its wholly-owned subsidiaries that are restricted
subsidiaries under the indenture governing the 9.25% senior notes have fully and unconditionally guaranteed the 9.25% senior notes on joint and several basis.

The condensed consolidated financial statements are presented below and should be read in connection with the Consolidated Financial Statements of ASAT Holdings Limited. The subsidiary guarantors for the 9.25% senior
notes are ASAT Limited, ASAT Inc., Timerson Limited and ASAT (Cayman) Limited. Separate financial statements and other disclosures concerning the subsidiary guarantors are not included herein because (i) the subsidiary guarantors are
wholly-owned and have fully and unconditionally guaranteed the 9.25% senior notes on a joint and several basis, and (ii) the Companys management has determined that such information is not material to investors.

The following condensed consolidated financial information presents the condensed consolidated balance sheets as of April 30, 2007 and 2006 and the
related condensed consolidated statements of operations and cash flows for the years ended April 30, 2007, 2006 and 2005 of (a) ASAT Holdings Limited, the parent company; (b) New ASAT (Finance) Limited, the subsidiary issuer;
(c) the guarantor subsidiaries of ASAT Holdings Limited on a combined basis; (d) the non-guarantor subsidiaries of the Company on a combined basis; (e) eliminating entries; and (f) the total consolidated amounts.



F-37



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Balance Sheet as of April 30, 2007



|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|---------------------------------------------------- |  | ------------------- | - |  | ------------------------ |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                                     |  | $000               |   |  | $000                    |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|ASSETS                                               |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Current assets:                                      |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents                            |  | 232                 |   |  |                         |  | 6,508                 |   |  | 585                        |   |  |                   |   |  | 7,325             |  
|Restricted cash                                      |  |                    |   |  |                         |  | 900                   |   |  |                           |   |  |                   |   |  | 900               |  
|Accounts receivable, net                             |  |                    |   |  |                         |  | 17,543                |   |  | 161                        |   |  |                   |   |  | 17,704            |  
|Inventories                                          |  |                    |   |  |                         |  | 12,452                |   |  | 818                        |   |  |                   |   |  | 13,270            |  
|Prepaid expenses and other current assets            |  | 310                 |   |  |                         |  | 3,182                 |   |  | 1,679                      |   |  |                   |   |  | 5,171             |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total current assets                                 |  | 542                 |   |  |                         |  | 40,585                |   |  | 3,243                      |   |  |                   |   |  | 44,370            |  
|Restricted cash, net of current portion              |  |                    |   |  |                         |  | 900                   |   |  |                           |   |  |                   |   |  | 900               |  
|Property, plant and equipment, net                   |  |                    |   |  |                         |  | 74,414                |   |  | 5,168                      |   |  |                   |   |  | 79,582            |  
|Investment in and advance to consolidated entities   |  | 247,595             |   |  | 149,695                  |  | 363,412               |   |  | 570                        |   |  | (761,272           | ) |  |                  |  
|Deferred charges and other non-current assets        |  | 1,503               |   |  | 3,774                    |  | 4,989                 |   |  | 19                         |   |  |                   |   |  | 10,285            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total assets                                         |  | 249,640             |   |  | 153,469                  |  | 484,300               |   |  | 9,000                      |   |  | (761,272           | ) |  | 135,137           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|LIABILITIES AND SHAREHOLDERS EQUITY (DEFICIT)       |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Current liabilities:                                 |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Advance from consolidated entities                   |  |                    |   |  |                         |  | 722,440               |   |  | 608                        |   |  | (723,048           | ) |  |                  |  
|Other current liabilities                            |  | 57                  |   |  | 3,469                    |  | 43,950                |   |  | 9,086                      |   |  |                   |   |  | 56,562            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total current liabilities                            |  | 57                  |   |  | 3,469                    |  | 766,390               |   |  | 9,694                      |   |  | (723,048           | ) |  | 56,562            |  
|9.25% senior notes due 2011                          |  |                    |   |  | 150,000                  |  |                      |   |  |                           |   |  |                   |   |  | 150,000           |  
|Other non-current liability                          |  | 10,335              |   |  |                         |  | 758                   |   |  |                           |   |  |                   |   |  | 11,093            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total liabilities                                    |  | 10,392              |   |  | 153,469                  |  | 767,148               |   |  | 9,694                      |   |  | (723,048           | ) |  | 217,655           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Series A Redeemable Convertible Preferred Shares     |  | 5,743               |   |  |                         |  |                      |   |  |                           |   |  |                   |   |  | 5,743             |  
|Shareholders equity (deficit):                      |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Common stock ($0.01 par value)                       |  | 7,114               |   |  |                         |  | 7,271                 |   |  | 10,723                     |   |  | (17,994            | ) |  | 7,114             |  
|Less: Repurchase of stock at par                     |  | (71                 | ) |  |                         |  |                      |   |  |                           |   |  |                   |   |  | (71               | )
|Additional paid-in capital                           |  | 230,701             |   |  |                         |  | 15,601                |   |  |                           |   |  | (230               | ) |  | 246,072           |  
|Accumulated other comprehensive loss                 |  |                    |   |  |                         |  |                      |   |  | (184                       | ) |  |                   |   |  | (184              | )
|Retained earnings (Accumulated deficit)              |  | (4,239              | ) |  |                         |  | (305,720              | ) |  | (11,233                    | ) |  | (20,000            | ) |  | (341,192          | )
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total shareholders equity (deficit)                 |  | 233,505             |   |  |                         |  | (282,848              | ) |  | (694                       | ) |  | (38,224            | ) |  | (88,261           | )
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total liabilities and shareholders equity (deficit) |  | 249,640             |   |  | 153,469                  |  | 484,300               |   |  | 9,000                      |   |  | (761,272           | ) |  | 135,137           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-38



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Balance Sheet as of April 30, 2006



|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|---------------------------------------------------- |  | ------------------- | - |  | ------------------------ |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                                     |  | $000               |   |  | $000                    |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|ASSETS                                               |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Current assets:                                      |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents                            |  | 93                  |   |  |                         |  | 8,901                 |   |  | 2,921                      |   |  |                   |   |  | 11,915            |  
|Accounts receivable, net                             |  |                    |   |  |                         |  | 29,607                |   |  |                           |   |  |                   |   |  | 29,607            |  
|Inventories                                          |  |                    |   |  |                         |  | 21,720                |   |  | 1,599                      |   |  |                   |   |  | 23,319            |  
|Prepaid expenses and other current assets            |  | 106                 |   |  |                         |  | 7,707                 |   |  | 271                        |   |  |                   |   |  | 8,084             |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total current assets                                 |  | 199                 |   |  |                         |  | 67,935                |   |  | 4,791                      |   |  |                   |   |  | 72,925            |  
|Restricted cash                                      |  |                    |   |  |                         |  | 3,320                 |   |  |                           |   |  |                   |   |  | 3,320             |  
|Property, plant and equipment, net                   |  |                    |   |  |                         |  | 93,614                |   |  | 217                        |   |  |                   |   |  | 93,831            |  
|Investment in and advance to consolidated entities   |  | 247,675             |   |  | 148,689                  |  | 240,888               |   |  | 5,227                      |   |  | (642,479           | ) |  |                  |  
|Deferred charges and other non-current assets        |  | 2,335               |   |  | 4,780                    |  | 4,270                 |   |  |                           |   |  |                   |   |  | 11,385            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total assets                                         |  | 250,209             |   |  | 153,469                  |  | 410,027               |   |  | 10,235                     |   |  | (642,479           | ) |  | 181,461           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|LIABILITIES AND SHAREHOLDERS EQUITY (DEFICIT)       |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Current liabilities:                                 |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Advance from consolidated entities                   |  |                    |   |  |                         |  | 604,726               |   |  | (469                       | ) |  | (604,257           | ) |  |                  |  
|Other current liabilities                            |  | 432                 |   |  | 3,469                    |  | 63,288                |   |  | 2,635                      |   |  |                   |   |  | 69,824            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total current liabilities                            |  | 432                 |   |  | 3,469                    |  | 668,014               |   |  | 2,166                      |   |  | (604,257           | ) |  | 69,824            |  
|9.25% senior notes due 2011                          |  |                    |   |  | 150,000                  |  |                      |   |  |                           |   |  |                   |   |  | 150,000           |  
|Other non-current liability                          |  | 6,382               |   |  |                         |  | 4,369                 |   |  |                           |   |  |                   |   |  | 10,751            |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total liabilities                                    |  | 6,814               |   |  | 153,469                  |  | 672,383               |   |  | 2,166                      |   |  | (604,257           | ) |  | 230,575           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Series A Redeemable Convertible Preferred Shares     |  | 4,143               |   |  |                         |  |                      |   |  |                           |   |  |                   |   |  | 4,143             |  
|Shareholders equity (deficit):                      |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Common stock ($0.01 par value)                       |  | 6,899               |   |  |                         |  | 141                   |   |  | 10,723                     |   |  | (10,864            | ) |  | 6,899             |  
|Less: Repurchase of stock at par                     |  | (71                 | ) |  |                         |  |                      |   |  |                           |   |  |                   |   |  | (71               | )
|Additional paid-in capital                           |  | 230,983             |   |  |                         |  | 22,728                |   |  |                           |   |  | (7,358             | ) |  | 246,353           |  
|Deferred stock-based compensation                    |  | (63                 | ) |  |                         |  |                      |   |  |                           |   |  |                   |   |  | (63               | )
|Accumulated other comprehensive loss                 |  |                    |   |  |                         |  |                      |   |  | (223                       | ) |  |                   |   |  | (223              | )
|Retained earnings (Accumulated deficit)              |  | 1,504               |   |  |                         |  | (285,225              | ) |  | (2,431                     | ) |  | (20,000            | ) |  | (306,152          | )
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total shareholders equity (deficit)                 |  | 239,252             |   |  |                         |  | (262,356              | ) |  | 8,069                      |   |  | (38,222            | ) |  | (53,257           | )
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total liabilities and shareholders equity (deficit) |  | 250,209             |   |  | 153,469                  |  | 410,027               |   |  | 10,235                     |   |  | (642,479           | ) |  | 181,461           |  
|                                                     |  |                     |   |  |                          |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-39



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Statements of Operations for the year ended April 30, 2007



|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|------------------------------------ |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                     |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net sales                            |  |                    |   |  |                         |   |  | 435,000               |   |  | 144,067                    |   |  | (414,214           | ) |  | 164,853           |  
|Cost of sales                        |  | 83                  |   |  |                         |   |  | 442,973               |   |  | 154,303                    |   |  | (447,432           | ) |  | 149,927           |  
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Gross profit                         |  | (83                 | ) |  |                         |   |  | (7,973                | ) |  | (10,236                    | ) |  | 33,218             |   |  | 14,926            |  
|Operating expenses:                  |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Selling, general and administrative |  | 1,650               |   |  |                         |   |  | 20,967                |   |  | 2,642                      |   |  | (3,194             | ) |  | 22,065            |  
|Research and development            |  |                    |   |  |                         |   |  | 2,218                 |   |  |                           |   |  |                   |   |  | 2,218             |  
|Reorganization expenses             |  |                    |   |  |                         |   |  | 1,111                 |   |  | 1,362                      |   |  |                   |   |  | 2,473             |  
|Facilities and relocation charges   |  |                    |   |  |                         |   |  | 1,642                 |   |  | 1,405                      |   |  |                   |   |  | 3,047             |  
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total operating expenses             |  | 1,650               |   |  |                         |   |  | 25,938                |   |  | 5,409                      |   |  | (3,194             | ) |  | 29,803            |  
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income from operations        |  | (1,733              | ) |  |                         |   |  | (33,911               | ) |  | (15,645                    | ) |  | 36,412             |   |  | (14,877           | )
|Other income (expenses), net         |  | 3                   |   |  | 14,882                   |   |  | 42,581                |   |  | 2,402                      |   |  | (59,225            | ) |  | 643               |  
|Interest expense:                    |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Amortization of deferred charges    |  | (2,322              | ) |  | (753                     | ) |  | (1,384                | ) |  |                           |   |  | 754                |   |  | (3,705            | )
|Third parties                       |  | (1,691              | ) |  | (14,129                  | ) |  | (13,911               | ) |  | (8,165                     | ) |  | 22,059             |   |  | (15,837           | )
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income before income taxes    |  | (5,743              | ) |  |                         |   |  | (6,625                | ) |  | (21,408                    | ) |  |                   |   |  | (33,776           | )
|Income tax (expense) benefits        |  |                    |   |  |                         |   |  | (1,264                | ) |  |                           |   |  |                   |   |  | (1,264            | )
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net loss                             |  | (5,743              | ) |  |                         |   |  | (7,889                | ) |  | (21,408                    | ) |  |                   |   |  | (35,040           | )
|Other comprehensive loss:            |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Foreign currency translation         |  |                    |   |  |                         |   |  | 4                     |   |  | 35                         |   |  |                   |   |  | 39                |  
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Comprehensive loss                   |  | (5,743              | ) |  |                         |   |  | (7,885                | ) |  | (21,373                    | ) |  |                   |   |  | (35,001           | )
|                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-40



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Statements of Operations for the year ended April 30, 2006



|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|-------------------------------------------- |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                             |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                             |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net sales                                    |  |                    |   |  |                         |   |  | 295,363               |   |  | 14,497                     |   |  | (127,745           | ) |  | 182,115           |  
|Cost of sales                                |  |                    |   |  |                         |   |  | 290,003               |   |  | 11,412                     |   |  | (132,556           | ) |  | 168,859           |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Gross profit                                 |  |                    |   |  |                         |   |  | 5,360                 |   |  | 3,085                      |   |  | 4,811              |   |  | 13,256            |  
|Operating expenses:                          |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Selling, general and administrative         |  | 501                 |   |  |                         |   |  | 26,786                |   |  | 6,444                      |   |  | (4,283             | ) |  | 29,448            |  
|Research and development                    |  |                    |   |  |                         |   |  | 4,059                 |   |  |                           |   |  |                   |   |  | 4,059             |  
|Reorganization expenses                     |  |                    |   |  |                         |   |  | 4,114                 |   |  | 576                        |   |  |                   |   |  | 4,690             |  
|Facilities and relocation charges           |  |                     |   |  |                          |   |  | 1,054                 |   |  |                            |   |  |                    |   |  | 1,054             |  
|Impairment of property, plant and equipment |  |                    |   |  |                         |   |  | 3,890                 |   |  |                           |   |  |                   |   |  | 3,890             |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total operating expenses                     |  | 501                 |   |  |                         |   |  | 39,903                |   |  | 7,020                      |   |  | (4,283             | ) |  | 43,141            |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income from operations                |  | (501                | ) |  |                         |   |  | (34,543               | ) |  | (3,935                     | ) |  | 9,094              |   |  | (29,885           | )
|Other income (expenses), net                 |  | 1                   |   |  | 14,882                   |   |  | 9,187                 |   |  | 2,016                      |   |  | (22,648            | ) |  | 3,438             |  
|Interest expense:                            |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Amortization of deferred charges            |  | (742                | ) |  | (1,007                   | ) |  | (1,205                | ) |  |                           |   |  | 1,007              |   |  | (1,947            | )
|Third parties                               |  | (397                | ) |  | (13,875                  | ) |  | (14,246               | ) |  | (1,039                     | ) |  | 14,871             |   |  | (14,686           | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income before income taxes            |  | (1,639              | ) |  |                         |   |  | (40,807               | ) |  | (2,958                     | ) |  | 2,324              |   |  | (43,080           | )
|Income tax (expense) benefits                |  |                    |   |  |                         |   |  | 665                   |   |  | (16                        | ) |  |                   |   |  | 649               |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net loss                                     |  | (1,639              | ) |  |                         |   |  | (40,142               | ) |  | (2,974                     | ) |  | 2,324              |   |  | (42,431           | )
|Other comprehensive loss:                    |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Foreign currency translation                 |  |                    |   |  |                         |   |  |                      |   |  | 11                         |   |  |                   |   |  | 11                |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Comprehensive loss                           |  | (1,639              | ) |  |                         |   |  | (40,142               | ) |  | (2,963                     | ) |  | 2,324              |   |  | (42,420           | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-41



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Statements of Operations for the year ended April 30, 2005



|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|-------------------------------------------- |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                             |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                             |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net sales                                    |  |                    |   |  |                         |   |  | 300,469               |   |  |                           |   |  | (106,058           | ) |  | 194,411           |  
|Cost of sales                                |  |                    |   |  |                         |   |  | 290,435               |   |  |                           |   |  | (108,116           | ) |  | 182,319           |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Gross profit                                 |  |                    |   |  |                         |   |  | 10,034                |   |  |                           |   |  | 2,058              |   |  | 12,092            |  
|Operating expenses:                          |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Selling, general and administrative         |  | 712                 |   |  |                         |   |  | 29,574                |   |  | 1,977                      |   |  | (4,808             | ) |  | 27,455            |  
|Research and development                    |  |                    |   |  |                         |   |  | 4,481                 |   |  |                           |   |  |                   |   |  | 4,481             |  
|Reorganization expenses                     |  |                    |   |  |                         |   |  | 928                   |   |  |                           |   |  |                   |   |  | 928               |  
|Litigation settlement                       |  |                    |   |  |                         |   |  | 4,603                 |   |  |                           |   |  |                   |   |  | 4,603             |  
|Impairment of property, plant and equipment |  |                    |   |  |                         |   |  | 19,944                |   |  |                           |   |  |                   |   |  | 19,944            |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Total operating expenses                     |  | 712                 |   |  |                         |   |  | 59,530                |   |  | 1,977                      |   |  | (4,808             | ) |  | 57,411            |  
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income from operations                |  | (712                | ) |  |                         |   |  | (49,496               | ) |  | (1,977                     | ) |  | 6,866              |   |  | (45,319           | )
|Other income (expenses), net                 |  | 1                   |   |  | 14,833                   |   |  | 3,809                 |   |  | 3,744                      |   |  | (21,699            | ) |  | 688               |  
|Interest expense:                            |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Amortization of deferred charges            |  |                    |   |  | (958                     | ) |  | (958                  | ) |  |                           |   |  | 958                |   |  | (958              | )
|Third parties                               |  |                    |   |  | (13,875                  | ) |  | (14,054               | ) |  | (34                        | ) |  | 13,875             |   |  | (14,088           | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|(Loss) Income before income taxes            |  | (711                | ) |  |                         |   |  | (60,699               | ) |  | 1,733                      |   |  |                   |   |  | (59,677           | )
|Income tax expense                           |  |                    |   |  |                         |   |  | (691                  | ) |  | (57                        | ) |  |                   |   |  | (748              | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net loss                                     |  | (711                | ) |  |                         |   |  | (61,390               | ) |  | 1,676                      |   |  |                   |   |  | (60,425           | )
|Other comprehensive loss:                    |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Foreign currency translation                 |  |                    |   |  |                         |   |  |                      |   |  | (179                       | ) |  |                   |   |  | (179              | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Comprehensive loss                           |  | (711                | ) |  |                         |   |  | (61,390               | ) |  | 1,497                      |   |  |                   |   |  | (60,604           | )
|                                             |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-42



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Statements of Cash Flows for the year ended April 30, 2007



|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|---------------------------------------------------- |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                                     |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net cash provided by (used in) operating activities  |  | (649                | ) |  | 1,006                    |   |  | 14,318                |   |  | (4,272                     | ) |  |                   |   |  | 10,403            |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash (used in) provided by investing activities  |  | 78                  |   |  |                         |   |  | (9,893                | ) |  | (7,675                     | ) |  | (77                | ) |  | (17,567           | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash provided by (used in) financing activities  |  | 709                 |   |  | (1,006                   | ) |  | (6,818                | ) |  | 9,573                      |   |  | 77                 |   |  | 2,535             |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net (decrease) increase in cash and cash equivalents |  | 138                 |   |  |                         |   |  | (2,393                | ) |  | (2,374                     | ) |  |                   |   |  | (4,629            | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents at beginning of year       |  | 93                  |   |  |                         |   |  | 8,901                 |   |  | 2,921                      |   |  |                   |   |  | 11,915            |  
|Effects of foreign exchange rates change             |  |                    |   |  |                         |   |  |                      |   |  | 39                         |   |  |                   |   |  | 39                |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents at end of year             |  | 231                 |   |  |                         |   |  | 6,508                 |   |  | 586                        |   |  |                   |   |  | 7,325             |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  

Condensed Consolidated Statements of Cash Flows for the year ended April 30, 2006



|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|---------------------------------------------------- |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                                     |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net cash provided by (used in) operating activities  |  | 383                 |   |  | 1,007                    |   |  | (6,224                | ) |  | (2,226                     | ) |  |                   |   |  | (7,060            | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash (used in) provided by investing activities  |  | (15,550             | ) |  |                         |   |  | (23,220               | ) |  | (184                       | ) |  | 15,550             |   |  | (23,404           | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash provided by (used in) financing activities  |  | 15,084              |   |  | (1,007                   | ) |  | 10,680                |   |  | 444                        |   |  | (15,550            | ) |  | 9,651             |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net (decrease) increase in cash and cash equivalents |  | (83                 | ) |  |                         |   |  | (18,764               | ) |  | (1,966                     | ) |  |                   |   |  | (20,813           | )
|Cash and cash equivalents at beginning of year       |  | 176                 |   |  |                         |   |  | 27,665                |   |  | 4,876                      |   |  |                   |   |  | 32,717            |  
|Effects of foreign exchange rates change             |  |                    |   |  |                         |   |  |                      |   |  | 11                         |   |  |                   |   |  | 11                |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents at end of year             |  | 93                  |   |  |                         |   |  | 8,901                 |   |  | 2,921                      |   |  |                   |   |  | 11,915            |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  



F-43



---

ASAT HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)

(Amount expressed
in United States dollars unless otherwise stated)



Condensed Consolidated Statements of Cash Flows for the year ended April 30, 2005



|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|---------------------------------------------------- |  | ------------------- | - |  | ------------------------ | - |  | --------------------- | - |  | -------------------------- | - |  | ------------------ | - |  | ----------------- | -
|                                                     |  | ASATHOLDINGSLIMITED |   |  | NEW ASAT(FINANCE)LIMITED |   |  | GUARANTORSUBSIDIARIES |   |  | NON- GUARANTORSUBSIDIARIES |   |  | ELIMINATINGENTRIES |   |  | CONSOLIDATEDTOTAL |  
|                                                     |  | $000               |   |  | $000                    |   |  | $000                 |   |  | $000                      |   |  | $000              |   |  | $000             |  
|Net cash (used in) provided by operating activities  |  | (447                | ) |  | 150                      |   |  | 413                   |   |  | 1,770                      |   |  |                   |   |  | 1,886             |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash provided by (used in) investing activities  |  | 346                 |   |  |                         |   |  | (30,684               | ) |  | (10,043                    | ) |  | (346               | ) |  | (40,727           | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net cash (used in) provided by financing activities  |  | (277                | ) |  | (150                     | ) |  | (4,025                | ) |  | 13,233                     |   |  | 346                |   |  | 9,127             |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Net (decrease) increase in cash and cash equivalents |  | (378                | ) |  |                         |   |  | (34,296               | ) |  | 4,960                      |   |  |                   |   |  | (29,714           | )
|Cash and cash equivalents at beginning of year       |  | 554                 |   |  |                         |   |  | 61,961                |   |  | 95                         |   |  |                   |   |  | 62,610            |  
|Effects of foreign exchange rates change             |  |                    |   |  |                         |   |  |                      |   |  | (179                       | ) |  |                   |   |  | (179              | )
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  
|Cash and cash equivalents at end of year             |  | 176                 |   |  |                         |   |  | 27,665                |   |  | 4,876                      |   |  |                   |   |  | 32,717            |  
|                                                     |  |                     |   |  |                          |   |  |                       |   |  |                            |   |  |                    |   |  |                   |  



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