Stock Code: 1605
Walsin Lihwa Corporation
2022 Annual Report
Printed on March 21, 2023
For related information, please visit:
http://www.walsin.com
http://mops.twse.com.tw
1. Spokesperson
Name: David Wen
Title:
Special Assistant to Chairman
Tel:
+886-2-8726-2211
Email: walsinspk@walsin.com
2. Deputy Spokesperson
Name: Sophi Pan
Title:
Chief of Staff
Tel:
+886-2-8726-2211
Email: walsinspk@walsin.com
3. Address and Phone Number of Head Office, Branches and Plants
Taipei Head Office 25F, No.1, Songzhi Rd., Taipei
Taichung Plant
No.57, Jing 3rd Rd., Wuqi Dist., Taichung City
Tel: +886-2-8726-2211
Tel: +886-4-2659-5552
Hsinchuang Plant No.397, Hsinshu Rd., Hsin Chuang Dist., New Taipei City
Tel: +886-2-2202-9121
Yangmei Plant
No. 566, Gaoshi Rd., Yangmei Dist., Taoyuan City
Tel: +886-3-478-6171
Yenshui Plant
No. 3-10, Shi Jou Liau, Chin Shuei Li, Yenshui Dist., Tainan City Tel: +886-6-652-0911
4. Stock Transfer Agent
Name: Walsin Lihwa Joint Shareholders Service Office
Add:
Tel:
8F., No.398, Xingshan Rd., Neihu Dist., Taipei City
+886-2-2790-5885
Website: http://stock.walsin.com/
5. Independent Auditors
Company: Deloitte Touche Tohmatsu Limited
Auditors: Wen-Yea, Shyu and Ker-Chang Wu
Add:
Tel:
20F, No. 100, Songren Rd., Xinyi Dist., Taipei
+886-2-2725-9988
Website:
http://www.deloitte.com.tw
6. Overseas Securities Exchange
Issued globally and traded on the Luxembourg Stock Exchange
The information is available at http://mops.twse.com.tw
7. Email Address of Investor Relations Contact: opinion@walsin.com
8. Corporate Website: http://www.walsin.com
Contents
I Letter to Shareholders ........................................................................................................... 1
II Company Profile
1. Date of establishment ..................................................................................................................... 4
2. Company History & Evolution ......................................................................................................... 4
III Corporate Governance Report
1. Organizational Chart ....................................................................................................................... 6
2. Profiles of Board Directors, President, Vice Presidents and Department Heads ........................... 8
3. Remunerations to Directors, President and Vice Presidents in the Most Recent Year ................ 24
4. Corporate Governance Status ...................................................................................................... 31
5. Information on CPAs' fees ............................................................................................................ 94
6. Information on the replacement of CPAs: .................................................................................... 94
7. Chairman, President, or managers responsible for financial or accounting affairs who
worked for the firm to which the certifying CPA belongs or its affiliate in the most recent
year. .............................................................................................................................................. 94
8. Transfer and pledge of shares of the directors, managers and shareholders holding more
than 10% of the company's shares ............................................................................................... 95
9. Information on relationships amongst the top ten shareholders and their relationships
with spouses or relatives within the second degree of kinship .................................................... 96
10. The number of shares of the same investee held by the Company, its directors,
managers and which the Company controls directly or indirectly, with the aggregate
shareholding percentages........................................................................................................... 100
IV Fundraising Overview
1. The Company’s Capital and Shares ............................................................................................. 101
2. Issuance of Corporate Bonds: ..................................................................................................... 107
3. Issuance of Preferred Shares: None. .......................................................................................... 107
4. Issuance of Global Depositary Receipts (GDRs) .......................................................................... 107
5. Exercise of Employee Stock Option Plan (ESOP): None. ............................................................. 108
6. Mergers, acquisitions or issuance of new shares for acquisition of shares of other
companies: .................................................................................................................................. 108
7. Implementation of capital allocation plan. ................................................................................. 108
V
Business Overview
1. Business activities ....................................................................................................................... 109
2. Market Analysis and Sales Overview .......................................................................................... 119
3. Employee Data ............................................................................................................................ 129
Contents
4. Environmental Protection Expenditure Information .................................................................. 130
5. Employees-employer relations ................................................................................................... 137
6. Information Security Management ........................................................................................... 143
7. Material Contracts .................................................................................................................... 145
VI Financial Information
1. Brief Balance Sheets and Comprehensive Income Statements of Recent Five Years ................ 148
2. Financial Analysis of Recent Five Years ....................................................................................... 152
3. Audit Committee’s Review Report for the Recent Year ............................................................. 155
4. Financial report of the most recent year .................................................................................... 156
5. Financial report of the parent company of the most recent year audited and certified by
Supervisors .................................................................................................................................. 295
6. Any financial crunch confronted by the Company or its subsidiaries and related impacts in
the most recent year and up to the date of annual report publication ..................................... 385
VII
Review of Financial Conditions, Financial Performance, and Risk Management
1. Financial Status - Consolidated (Based on IFRSs) ....................................................................... 386
2. Financial Performance - Consolidated (Based on IFRSs) ............................................................ 387
3. Cash Flow - Consolidated (Based on IFRSs) ................................................................................ 388
4. Effect of Major Capital Expenditure on Financial Business Operations: .................................... 389
5. Investment Policy of the Past Year, Profit/Loss Analysis, Improvement Plan and
Investment Plan for the Coming Year: ........................................................................................ 389
6. Risk Management and Assessment of the Following Items for the Past Year and the Year
to Date: ....................................................................................................................................... 390
7. Other Major Issues: None ........................................................................................................... 392
VIII
Special Disclosures
1. Summary of Affiliates Companies ............................................................................................... 393
2. Progress of private placement of securities during the latest year and up to the date of
annual report publication ........................................................................................................... 403
3. The subsidiaries’ shareholding or disposal of the company’s shares during the latest year
and up to the date of annual report publication ........................................................................ 403
4. Other supplemental information ................................................................................................ 403
5. Corporate events with material impact on shareholders' equity or stock prices set forth in
Subparagraph 2, Paragraph 2, Article 36 of the Securities and Exchange Act during the
most recent year and up to the annual report publication date ................................................ 403
I Letter to Shareholders
Dear Shareholders,
The year 2022 was an important year for Walsin Lihwa Group, as it deepened the supply chain of nickel
resources production and application, completed the international acquisition of Cogne steel plant in Italy, and
took the pioneering opportunity to develop the submarine cable business, reaching various strategic
development milestones. The Company's total assets therefore grew from NT$183 billion in 2021 to NT$252.5
billion in 2022. Looking back at the past three years affected by the COVID-19 pandemic, various policies and
market interventions, changing from border closure to reopening, from broken to short production and supply
chains, and from quantitative easing to interest rate hikes in the financial market, all tested the Company's
ability to manage and respond to the overall production and operational risks. When reviewing our operational
results and strategic development, we have not changed or remained stagnated
in the changing
macroeconomic environment, whether in terms of the adequacy of our inventory management, the
enhancement of our high-value production capacity, or the development of our new energy business.
Although the global economy is still being affected by the war between Russia and Ukraine and inflation, the
Company continues to focus on its core businesses, adopt advanced technology, and plan for sustainability. In
addition to continuing the construction of the cable intelligent factory and the expansion of the stainless steel
high-value plant, we will actively enhance the benefits of the integration with the Cogne steel plant in Italy to
expand our global market of high-value steel products. In order to develop the cable business, we are targeting
the offshore wind power business opportunities under the government's new energy policy, and have obtained
the expertise and cooperation opportunities relating to submarine cables., We will continue to be cautious and
fearful in the face of the speed and changes of the economic cycle and make every effort to maintain our
outstanding results with a pragmatic attitude.
Accomplishments in 2022
The Company's consolidated revenue and consolidated gross profit for the year 2022 was NT$180.4 billion and
NT$17.3 billion respectively, and its total operating income reached NT$19.4 billion, with earnings per share of
NT$5.45. The major contributors of the revenue growth were our Wire and Cable Business and Resources
Business. A portion of the net income was generated from the gains from the disposal of the site development
business department of Borrego, a U.S. subsidiary of the Company. In 2022, the Company acquired a 50.1%
shareholding in PT. Sunny Metal Industry (based in Indonesia) and a 29.5% shareholding in Wistron to invest in
the nickel products used for electric vehicle batteries, and completed the acquisition of Cogne in Italy to
expand into the global market for high value steel products.
Wire and Cable Business:
The overall profit of the Wire and Cable Business grew compared to the previous year, mainly benefiting from
the strong demand for corporate plant construction. In the meantime, the increase in green power business
opportunities and Taipower's plan to promote power grid reinforcement also led to a rise in the demand for
power cables.
1 1
Letter to Shareholders
Stainless Steel Business:
The overall profit of the Stainless Steel Business declined compared to the previous year, mainly due to the
impact of the lockdown under the pandemic and inventory adjustments. Although the price of steel products
fell due to the lack of market demand, we were able to effectively reduce our operational risks by managing
the supply of raw materials and analyzing changes in customer demand.
Resources Business:
The overall profit of the Resources Business increased compared with the previous year, mainly due to the
completion of the RKEF production line of PT. Walsin Nickel Industrial Indonesia in 2021 and its full production
in 2022, with the sales of nickel pig iron increasing from 14,000 metric tons of nickel to 41,000 metric tons of
nickel.
Real Estate Business:
The overall operating results of the Real Estate Business remained stable. In addition to the rental income from
the headquarter office in Taipei, the rental income from the offices in Building No. 6 in Lot AB of Phase II in
Nanjing, China, the operating income from the shopping mall, One Mall, and the execution of the lease
agreement for the offices in Building No.1, constructed and delivered in July 2022, with an area of 15,000
square meters, created effective rental income streams.
Summary of 2023 Business Plan
Wire and Cable Business:
We will continue to promote intelligent manufacturing and innovative service models to maintain our leading
position in the market, and actively participate in the energy transformation and the domestic cable
strengthening program. We will also cooperate with Danish NKT Group to invest in the submarine cable
business and build a submarine cable plant in Kaohsiung Port, in order to produce high voltage output cables
and medium voltage AC submarine cables required by the offshore wind power market. In addition, we will
extend the products from wind turbine cables and land cables to submarine cables and further develop the
industrial chains relating to offshore wind power.
Stainless Steel Business:
We will continue expanding the proportion of our high-value products, optimizing the production process at
Yenshui Plant in Taiwan, commissioning the new rolling mill in Yantai, China, and integrating with the products
and capacity of Cogne in Italy. We will also expand our distribution channels in Europe, Asia, and the U.S. to
grasp the sales portfolio of niche steel grades and get into the market of high-value steel products, with a view
to becoming a global stainless steel long products manufacturer.
Resources Business:
We will ensure a stable capacity utilization of the nickel pig iron production lines of PT. Walsin Nickel Industrial
Indonesia by effectively controlling the acquisition of raw materials for stainless steel. We will also ensure the
full production and sales of nickel matte production lines of PT. Sunny Metal Industry as scheduled so as to
immediately enter the battery nickel industry chain for electric vehicles. In addition, we plan to promote green
energy recycling projects, mainly targeting energy creation, energy storage and circular economy, in response
2
to climate change and the trend of sustainable development, in order to achieve a win-win situation for both
the economy and the environment.
Real Estate Business:
We will continue maintaining the stability of leasing income from existing office buildings and dynamically
adjusting the retail mix of One Mall in Nanjing, China, in order to enhance the overall brand value through
integrated marketing and to bring in abundant foot traffic and consumption. Since Building No. 1, which meets
Grade A of International Office Standards, has been awarded LEED & WELL double gold international
certification, we expect the progress for leasing out the offices to accelerate to create stable cash flows.
Future corporate development strategy under the influence of external competition,
regulations and overall business operation
Looking ahead to 2023, the international economic conditions, climate change risks and other factors will still
affect our business operations. In the face of uncertainties, the Company will enhance its core competitiveness
as its priority by continuing to promote process transformation, digital transformation and technology
application and to expand into energy creation, storage, operation, and use and recycling economy. We expect
to strengthen our growth momentum by turning challenges into opportunities and implementing risk
management.
Chairman Yu-Lon Chiao
3 3
Company Profile
II Company Profile
1. Date of establishment December 2, 1966
2. Company History & Evolution
1966 Walsin Wire & Cable Co., Ltd. established.
1969 Walsin and Lihwa merged and renamed as Walsin Lihwa Wire & Cable Co., Ltd.
1970
Formed technological partnerships with Western Electric in the U.S. and Fujikura in Japan and began
production of plastic insulation telephone cable.
1972
Began production of EP rubber high-voltage cables.
The Company's shares were listed on the Taiwan Stock Exchange.
1977
1982
Completed the Hsinchuang plant for SCR copper rod production, with annual manufacturing capacity
of 50,000 tonnes of low-oxygen copper rods.
Expanded SCR production facilities to increase annual manufacturing capacity to 100,000 tonnes of
low-oxygen copper rods.
1987
Construction of the Yangmei plant completed.
Entered the semiconductor IC industry by investing in Winbond Electronics Corp. and Sumi-Pac Corp.
In the following decade, the Company expanded into passive component, LCD panel, PCB thin board
and other industries.
1991
Invested in PT. Walsin Lippo Industries in Indonesia to expand aluminum wire business into the
Southeast Asian market.
1992
Company renamed Walsin Lihwa Corporation.
Electronics division merged with the acquired Wanbang Electronics to form the new Walsin
Technology Corp.
Established plants in Shanghai and Jiangyin to produce power cables and steel cables, thus beginning a
new chapter in China investment.
1993
Expanded into the stainless steel industry by forming Walsin Cartech Specialty Steel, a joint venture
with Carpenter Technology Corp. in the U.S.
Established the Wuhan wire and cable plant for optical communication cable production.
1995
Formed Walsin (China) Investment Co., Ltd. and set up four operating locations in China's major cities,
including Hangzhou, Shanghai and Nanjing, for the production of power cables, bare copper wires and
fiber optic cables.
1997
Established specialty steel plants in Changshu and in Baihe, Shanghai, for the production and sale of
seamless steel tubes and straight steel bars.
Formed HannStar Board Corp. to expand into the PCB industry.
1998
Acquired and incorporated the assets of Walsin Cartech into the company.
Conducted enterprise re-engineering and full implementation of the SAP enterprise resource
management system.
Expanded into the TFT-LCD industry by forming HannStar Display Corp.
Established the Dongguan plant for bare copper wire production.
Expansion of Yanshui specialty steel plant was carried out to include slab steelmaking facilities.
2000
2002
2003 With Yanshui specialty steel plant beginning slab production, the company expanded into the stainless
steel plate market.
2005
Set up new plants in Nanjing, Changshu and Jiangyin to produce copper products as well as seamless
steel pipes and steel wire products.
Shanghai and Hangzhou power cable plants completed expansion and increased production capacity;
began mass production of 220kV EHV cables.
4
Expansion of Yanshui specialty steel plant to include slab steelmaking facilities was completed.
2006
New copper production plant in Nanjing completed, with annual production capacity of 250,000
tonnes. Total copper production increased from 400,000 to 650,000 tonnes.
Development of 500kV EHV cables for Hangzhou power plant was invested and received certification.
The Company's consolidated revenue exceeded NT$100 billion.
2007
Expanded steel production capacity by acquiring stake in Yantai Huanghai Iron and Steel Co., Ltd.
Changshu specialty steel plant passed review by the National Nuclear Safety Administration and
received certification for nuclear power plant sales.
Hangzhou power cable plant began expansion efforts and construction of the second VCV process
tower and added high voltage cable production lines.
2008
2009
Expansion of Yantai plant for stainless steel manufacturing process; added new stainless steel billet
products.
Yantai stainless steel plant completed transformation of stainless steel manufacturing processes;
stainless steel and high-grade alloy steel products were added.
Changshu plant's seamless steel tube production began Phase 2 expansion to increase production
capacity.
Completion of the new A6 building in Xinyi Development Zone and the relocation of Walsin Lihwa
headquarters.
2010
Nanjing Walsin Centro began construction in Nanjing's Hexi Newtown. A multi-purpose commercial
center spanning one million square meters will be developed over several phases.
Partnered with Nanjing municipal government to create the Nanjing Taiwan Trade Mart, thus
establishing a cross-Strait commercial trading platform.
Construction of two office buildings in C1 land plot of Nanjing Walsin Centro completed and
transferred to the Jiangsu Branch of the China Development Bank and the Nanjing Branch of China
Guangfa Bank.
Cold rolled steel coil production officially commenced at the Taichung Harbor stainless steel roll plant.
First batch of premium residential buildings in C2 land plot in Nanjing Walsin Centro delivered; phased
development of D and AB land plots planned.
The Company marked its 50th anniversary.
Taiwan and China, have recorded steady increase in overall steelmaking and annual production of
710,000 tonnes.
2012
2013
2014
2016
2017
2018
The roughing mill was launched in Yanshui plant to improve the product quality and yield rate.
Phase I office buildings in Nanjing Walsin Centro on AB land plot and Phase II houses on D land plot were
delivered.
2019 Walsin shopping mall in Nanjing was open for operation, serving as a representative landmark for Walsin's
entrance to shopping mall industry.
2020
2021
The Company established PT Walsin Nickel Industrial Indonesia to extend into the production and sale of
upstream raw materials for stainless steel.
Construction of nickel iron production line in Indonesia was completed, and nickel metal, the raw material
for stainless steel, started to be produced.
2022
Invested in Cogne, Italy to expand into the global market of stainless steel.
Invested in PT. Sunny Metal Industry, Indonesia and built a nickel ice plant to enter the battery nickel
market.
Commissioned Yantai rolling mill, a milestone towards intelligent manufacturing.
5 5
Corporate Governance Report
III Corporate Governance Report
1. Organizational Chart
(1) Company Organization Chart (March 21, 2023)
(2) Principal Duties of Various Departments
Department
Audit Committee
Compensation
Committee
Sustainable
Development
Committee
Nomination
Committee
Stainless Steel BG
Job Duties & Functions
Assisting the Board of Directors in decision-making and supervising matters, including the correctness and accuracy of
the Company’s financial statements, the engagement (dismissal), independence and performance of attesting CPA,
internal control, legal compliance and risk management.
Drafting and periodically reviewing the performance evaluation of board directors and managers, as well as the policy,
system, standard and structure of compensation. Periodically evaluating and determining the compensation for board
directors and managers.
Formulating corporate social responsibility vision and strategy; inspecting the Group's overall as well as various
committees' steering and overseeing implementation performances via regular meetings; annual CSR results to be
submitted to the Board of Directors in the following year.
Assisting the Board of Directors in developing and identifying candidates for Board members and senior management
and their independence standards, establishing and periodically reviewing a continuing education and succession plan,
and ensuring that the Company operates in accordance with the Corporate Governance Best Practice Principles.
Product Types: Stainless steel slabs (ingots), hot-rolled steel coils, cold-rolled steel coils, hot-rolled rods and cold drawn
straight bars, and stainless steel seamless pipes and alloy steel pipes, including ordinary fluid pipes, heat-exchanging
pipes, boiler pipes, instrumentation tubes, steel wires for pre-stressed concrete, stranded steel wires, zinc-plated steel
wires for bridge cables, zinc-plated stranded steel wires, PE for bridge bracing cables and epoxy-coated stranded steel
wires.
Responsible for integrating the functions of business, technology, manufacturing, operation and administration of each
BU.
The managers of this BG are responsible for its profit/loss, improving long-term competitiveness and executing the
Company's strategies.
6
Department
Job Duties & Functions
Wire & Cable BG
Product Types: Copper rods and wires that power cable and wire industries use as basic raw materials for conductors, as
well as low-, medium- and high-voltage PVC cables, cross-linking PE cables, specialty & professional fire-resistant, fire-
retardant, low-smoke and halogen-free cables for different industries, rubber cables, communication cables, related
materials for cable insulation, as well as other plastic accessories.
Responsible for integrating the functions of business, technology, manufacturing of each BU.
The managers of this BG are responsible for its profit/loss, improving long-term competitiveness and executing the
Company's strategies.
Product types: Production of nickel pig iron and nickel matte as well as agency sales of stainless steel semi-finished
products
Resources BG
Responsible for integrating the functions of business, technology, manufacturing of each Indonesia subsidiaries.
The managers of this BG are responsible for its profit/loss, improving long-term competitiveness and executing the
Company's strategies.
Business Items: Developing composite commercial properties, real estate management, etc.
The managers of this BG are responsible for its profit/loss, improving long-term competitiveness and executing the
Company's strategies.
Responsible for planning and auditing internal auditing systems.
Establishment of information system for Industry 4.0 business operation, establishment of reliable/safe information
system environment, realization of platform for cloud information service and establishment of big data analysis.
Responsible for human resources, media and general affairs, etc.
Responsible for the operation of financial accounting system and participating in the management and decision-making.
Commerce & Real
Estate BG
Auditing Office
IT Center
Administration
Management Center
Financial Management
Center
Strategic Information
Management Center
Responsible for data utilization indicator design and action plan planning, data analysis and modeling, data management
and information security, internal and external resources integration and management.
Procurement Center
Responsible for establishing procurement policies and standards and performing procurement functions, including
capital expenditure, engineering and maintenance, material back up supplies, outsourcing and other non-critical
material procurements.
Commodity Center
Responsible for entering into transactions of important raw material procurements and controlling raw material prices.
Business Innovation
Center
1. Conducting research on international market opportunities and trends in the next 5 to 10 years and providing
innovative solutions to achieve corporate sustainability goals.
2. Collaborating with business units in helping them implement daily improvements, understand customers' future
needs and provide appropriate solutions.
1. Creating a learning organization with full employee participation (i.e., learning by doing and doing by learning) via OJT
2. Learning from TPS to train outstanding T-shaped executives at current time and places with current resources who
are suitable for use by the Group
3. Strengthening the DNA of the Group through TPS improvement activities
4. Implementing the mechanism for cultivating human resources on its own and promoting the sustainable
management of the Company.
Responsible for legal risk management and the preparation and management of various contracts, legal disputes,
litigation or non-litigation cases.
Responsible for investment planning and execution related to company strategy.
Responsible for the Company's environmental protection, occupational safety and health management and other
related matters, and promoting and implementing the company-wide environment, safety and health business
strategies and plans.
Responsible for the planning and execution of the Company's shareholder services and the administration matters
relating thereto.
TPS Center
Legal Division
Corporate Planning
Div.
Environment, Health &
Safety Division
Joint Shareholders
Service Office
7 7
Corporate Governance Report
2. Profiles of Board Directors, President, Vice Presidents and Department Heads
(1)
Information on Directors
Title
Nationality
or
Registration
Country
Chairman
R.O.C.
Name
Gender
& Age
Term
Began
Term
Date First
Elected
Shares Held When
Elected
Shares Currently Held
Shares Currently Held by
Spouse and Underage
Children
Number of
shares
Percentage
Number of
shares
Percentage
Number of
shares
Percentage
Yu-Lon
Chiao
May 29,
2020
Male
61-70
years
old
3 years April 10,
45,961,773
1.38% 50,460,440
1.35% 21,011,889
0.56%
1981
Vice
Chairman
R.O.C.
Patricia
Chiao
May 29,
2020
Female
61-70
years
old
3 years May 31,
91,969,006
2.77% 109,085,587
2.92% 0.00
0.00%
2005
(Note2)
Director
R.O.C.
May 29,
2020
Yu-
Cheng
Chiao
Male
61-70
years
old
3 years April 10,
39,508,661
1.19% 41,001,551
1.10% 19,502,428
0.52%
1981
Director
R.O.C.
May 29,
2020
Yu-
Heng
Chiao
Male
61-70
years
old
3 years April 18,
57,792,197
1.74% 65,343,810
1.75% 10,993,619
0.29%
1990
8
Shares Held in Name of
Others
Number of
shares
Percentage
0
0.00%
Key Education/Work Experience Other Current Positions Within the Company
Business
Department,
Washington;
former President
Chairman.
University
Administration
of
The Company's
and Vice
0
0
0.00% MBA at College of Notre Dame;
the Company’s former assistant
vice president of
Investment
Dept., assistant vice president of
Financial Dept., head of Financial
Investment Dept., assistant vice
president of Commodity Center
and
Investment
Management Center, President
of Insulated Wire & Cable BU.
of Washington
University
Masters of Electrical Engineer
and Business Administration The
Company's former chairman.
Financial
0.00%
0
0.00%
Golden Gate University, Master
of Business Administration The
Company's former vice president
and vice chairman.
Chairman of Concord Venture Capital Group;
Director/ Vice Chairman of Hangzhou Walsin
Power Cable & Wire Co., Ltd., Director of
Walton Advanced Engineering, Inc., Ltd., and
Vice President Commissioner of subsidiaries
of Walsin Lihwa Corporation.
Director of Walsin Lihwa Holding Co., Ltd.,
Walsin Specialty Steel Holding Co., Ltd.,
Walsin Specialty Steel Corporation, and Joint
Success Enterprises Limited; President of
Chin-Xin Investment Co., Ltd.
International
Electronics
of Winbond
Chairman
Corporation, Chin-Xin Investment Co., Ltd
and Chenghe Investment Co., Ltd.; Director
of Walsin Technology Corporation, Nuvoton
Technology Corp, Jincheng Construction Co.,
Ltd., United Industrial Gases Co., Ltd., MiTAC
Holdings Corporation, Landmark Group
Holdings Ltd., Peaceful River Corporation,
Winbond
Corporation,
Winbond Electronics Corporation America,
Marketplace Management Limited, Nuvoton
Investment Holding Ltd., Pigeon Creek
Holding Co., Ltd., and Songyong Investment
Co., Ltd.; CEO of Winbond Electronics
Corporation; Manager of Goldbond LLC;
Independent Director, member of the Audit
Committee, Nomination Committee and
convener of the Compensation Committee
at Taiwan Cement Corp.
Chairman of Walsin Technology Corporation,
Inc.,
Walton
HannStar Board Corp., Global Brands
Manufacture, Prosperity Dielectrics Co., Ltd.,
Info-Tek
Technology
Corporation, Career Technology Mfg. Co.,
Ltd.; Director of Inpaq Technology Co., Ltd.
Engineering,
Advanced
Silitech
Corp.,
December 31, 2022
Note
(Note
1)
None
None
Other Officer, Director or Supervisor who
are Spouse or Relative within Second
Degree
Position
Name
Relationship
Vice Chairman
Director
Director
Director
Chairman
Director
Director
Director
Patricia
Chiao
Yu-Cheng
Chiao
Yu-Heng
Chiao
Wei-Shin
Ma
Yu-Lon
Chiao
Yu-Cheng
Chiao
Yu-Heng
Chiao
Wei-Shin
Ma
Younger
sister
Older
brother
Younger
brother
Sister-in-law
Older
brother
Older
brother
Younger
brother
Sister-in-law
None
Chairman
Vice Chairman
Director
Director
Yu-Lon
Chiao
Patricia
Chiao
Yu-Heng
Chiao
Wei-Shin
Ma
Younger
brother
Younger
sister
Younger
brother
Sister-in-law
None
Chairman
Vice Chairman
Director
Director
Yu-Lon
Chiao
Patricia
Chiao
Yu-Cheng
Chiao
Wei-Shin
Ma
Older
brother
Older
sister
Older
brother
Sister-in-law
9 9
Corporate Governance Report
Title
Nationality
or
Registration
Country
Director
R.O.C.
Name
Gender
& Age
Term
Began
Term
Date First
Elected
Shares Held When
Elected
Shares Currently Held
Number of
shares
Percentage
Number of
shares
Percentage
Shares Currently Held by
Spouse and Underage
Children
Number of
shares
Percentage
Andrew
Hsia
Male
71-80
years
old
May 29,
2020
3 years May 29,
0
0.00%
0
0.00%
0
0.00%
2020
Director
R.O.C.
Wei-
Shin Ma
Female
51-60
years
old
May 29,
2020
3 years June 11,
244,033
0.01%
244,033
0.01% 54,435,693
1.46%
2014
Legal
Person:
May 31,
2005
(Note3)
Represen
tative:
May 29,
2020
-
May 29,
2020
3 years
210,011,000
6.31%
247,399,375
6.63%
-
-
0
0.00%
0%
0
0.00%
0
0
0.00%
0
0.00%
May 29,
2020
3 years June 11,
0
0.00%
2014
Male
51-60
years
old
Male
61-70
years
old
Director
R.O.C.
Independe
nt Director
R.O.C.
Chin-Xin
Investm
ent Co.,
Ltd
Represe
ntative:
Pei-
Ming
Chen
Ming-
Ling
Hsueh
10
Shares Held in Name of
Others
Number of
shares
0
Percentage
0.00%
0
0.00%
-
-
0
0
0.00%
0.00%
December 31, 2022
Other Officer, Director or Supervisor who
are Spouse or Relative within Second
Degree
Position
Name
Relationship
Note
(Note
1)
None
None
None
None
Key Education/Work Experience
Other Current Positions Within the
Company
Vice President & Spokesman of Phu
My Hung Holding Group; Chief
Representative of Central Trading &
Development Corporation.
Chengchi University;
He received his bachelor's degree in law
from Fu Jen Catholic University and his
master's degree in diplomacy from the
National
he
graduated from Graduate Institute of
Legal Studies, University of Oxford, UK
(M. Litt); he was Head of the Political
Section of the R.O.C. Representative
in the United States, Deputy
Office
Representative
R.O.C.
of
Representative Office in Canada, Head
of the R.O.C. Representative Office in
New York, R.O.C. Representative Office
in India, Political Deputy Minister of
Ministry of Foreign Affairs, Deputy
Minister of Ministry of National
Defense, and Chairman of the Mainland
Affairs Council, Executive Yuan.
the
Chairman of HannsTouch Solution
Inc., Golden Apple
Investment
Company, Online Banking Investment
Co., Ltd., and Torch Investment Co.,
Ltd.; Director of Walsin
Lihwa
Corporation, HannStar Color Co.,
Winbond Electronics Corporation,
United Integrated Services Co., Ltd.,
White
Management
Consultancy, and Hanns Blegrain Ltd.;
Supervisor of Pottery Inc.
Stone
President of Winbond Electronics Co.
Ltd.
Chairman
Vice Chairman
Director
Director
Yu-Lon
Chiao
Patricia
Chiao
Yu-Cheng
Chiao
Yu-Heng
Chiao
None
Brother-in-
law
Sister-in-law
Brother-in-
law
Brother-in-
law
None
None
None
None
Ph.D., College of Humanities and Social
Sciences of National
Tsing Hua
University, Peking University, Master of
Business Administration
for Senior
Managers, University of California
(Berkeley), Department of East Asian
Languages;
Yuanta
Chairman
Securities Investment Trust Corporation
and HannStar Display Corp.
of
M.S. in Electrical Engineering, University
in Electrical
of Detroit, USA; B.S.
Engineering, National Cheng Kung
University;
Nuvoton
Director,
Technology Co. Ltd. and Vice President
of DRAM Products Business Group of
Winbond Electronics Co.
Holdings
Independent Director of Yuanta
Yuanta
Financial
Commercial Bank, TTY Biopharm and
Lite-On
Corporation;
Technology
Director of Tung Hua Book Co., Ltd.
&
University, Master
Soochow
in
Accountancy; Bloomsburg University of
Pennsylvania, Master of Business
Administration; PwC Taiwan Director;
Executive Director, Taiwan Corporate
Governance
Adjunct
Professor, School of Science and
Technology Management, National
Tsing Hua University; Adjunct Professor,
School of Management, National
Taiwan University of Science and
Technology.
Association;
None
None
None
None
11 11
Corporate Governance Report
Title
Nationality
or
Registratio
n Country
Name
Gender
& Age
Term
Began
Term
Date First
Elected
Shares Held When
Elected
Shares Currently Held
Number of
shares
Percentage
Number of
shares
Percentage
Shares Currently Held by
Spouse and Underage
Children
Number of
shares
Percentage
Independe
nt Director
R.O.C.
King-
Ling Du
May 29,
2020
Male
71-80
years
old
3 years June 11,
0
0.00%
0
0.00%
0
0.00%
2014
Independe
nt Director
R.O.C.
Shiang-
Chung
Chen
Male
51-60
years
old
May 29,
2020
3 years June 11,
0
0.00%
0
0.00%
0
0.00%
2014
Independe
nt Director
R.O.C.
Fu-
Hsiung
Hu
Male
61-70
years
old
May 29,
2020
3 years May 29,
0
0.00%
0
0.00%
0
0.00%
2020
Note 1: Where the chairman and the general manager or person of an equivalent post (the highest level manager) of a company are the
same person, spouses, or relatives within the first degree of kinship, an explanation shall be given of the reason for,
reasonableness of, necessity of, and the measures adopted in response to, the above situation.
Note 2: Patricia Chiao served on the Company’s Board between May 31, 2005 and June 10, 2014 and from May 25, 2016 until now.
Note 3: Chin-Xin Investment Co., Ltd served on the Company’s Board between May 31, 2005 and June 10, 2014 and from May 26, 2015
until now.
Note 4: The shareholding ratios are rounded to the nearest hundredth percent.
12
Shares Held in Name of
Others
Key Education/Work Experience
Other Current Positions Within the Company
Degree
1)
December 31, 2022
Other Officer, Director or Supervisor who
Note
are Spouse or Relative within Second
(Note
Number of
shares
0
Percentage
Position
Name
Relationship
0.00% Mississippi State University, Masters in
Director of Sheh Fung Screws Co., Ltd and
None
None
None
None
Green River Holding Co., Ltd.
Chairman and President of Mercuries Data
Nanjing
Systems Ltd.; Chairman of
Mercuries Development of Software Co.,
Ltd., Mercuries Insurance Agent Co., Ltd. and
Hipact Tech
Inc.; Director of Mercuries
Holdings Corporation, Mercuries Data
Systems Ltd., Shang-Ling Investment Inc.,
Inc., Yangzheng
Investment
Shang-Hong
Investment Co.,
EASYCARD
and
Ltd.
Investment Holding Company; Supervisor of
Digicentre Co., Ltd.; Independent Director of
Teco Image Systems Inc.; Director of Taiwan
Masters Golf Promotion Foundation, and
Institute
for National Policy Research
Foundation;Director of the Friends of the
Police Association of the Republic of China,
Vice President of Criminal Investigation and
Prevention Association of the Republic of
China; Chairman of the Security Police Third
Corps Police Club of the Police Friendship
the Republic of China;
Association of
Director of Taipei Independent Directors
Association
Independent Managing Director of O-Bank
Co., Ltd.
None
None
None
None
None
None
None
None
Mechanical Engineering; New York
University, financial management
research; Stanford University, Advance
marketing research; U.S. representative
of China Steel Corporation (Steel
Division, U.S. Purchasing Group of
Executive Yuan), Deputy General
Manager of Business Department,
Engineering Department, Corporate
Planning Department, and Executive
Deputy General Manager; General
Manager, Kaohsiung Rapid Transit
Corporation; Chairman, China Ecotek
Corporation.
0
0.00%
The School of Industrial Engineering at
Purdue University;
of
Mercuries Data Systems Ltd.
President
0
0.00% M.A., Graduate School of Business,
National Taiwan University; Managing
Director, Central Trust Bureau; Director
of Mega Bank; Director of Department
of Economic Energy and Agriculture,
Executive Yuan; Vice Chairman of
Council of Agriculture; Chairman of
National Animal Industry Foundation,
and
Institute of Animal
Credit
and
Technology,
Information
Taiwan
Center
Cooperative Securities
Science
Joint
and
13 13
Corporate Governance Report
1. Major shareholders of institutional shareholder
Name of Institutional Shareholder
Major Shareholders of Institutional Shareholders (Note)
December 31, 2022
Shareholding
Chin-Xin Investment Co., Ltd
Winbond Electronics Corp.
Walsin Lihwa Corporation
Huali Investment Corp.
Yu-Cheng Chiao
Yu-Lon Chiao
Yu-Heng Chiao
Yu-Chi Chiao
Walsin Technology Corporation.
HannStar Board Corporation
Prosperity Dielectrics Co., Ltd.
37.69%
36.99%
4.43%
3.14%
3.14%
3.14%
3.14%
1.86%
1.34%
0.72%
Note 1: Top ten shareholders of the institutional shareholder.
Note 2: The shareholding ratios are rounded to the nearest hundredth percent.
2. Major Shareholders in Previous Table who are Institutional Investors and their Major Shareholders
Name of Institutional Shareholder
Major Shareholders of Institutional Shareholders (Note)
December 31, 2022
Shareholding
Walsin Lihwa Corporation
Chin-Xin Investment Co., Ltd
Yu-Cheng Chiao
Vanguard Emerging Markets Stock Index Fund managed by Vanguard Group
under the custody of JP Morgan Chase Bank N.A.
22.20%
6.03%
1.59%
1.04%
LGT Bank (Singapore) under the custody of Business Department of Standard
1.04%
Winbond Electronics Corporation
Chartered Bank
Pai-Yung Hong
PGIA General International Stock Index Fund under the custody of JP Morgan
Chase Bank N.A.
iShares MSCI Taiwan Index ETF Investment Fund under the custody of Standard
Chartered Bank
Yu-Lon Chiao
Note 1: Top ten shareholders of the institutional shareholder.
Note 2: The shareholding ratios are rounded to the nearest hundredth percent.
Name of Institutional Shareholder
Major Shareholders of Institutional Shareholders (Note)
Winbond Electronics Corporation
Chin-Xin Investment Co., Ltd
LGT Bank (Singapore) Investment Fund under the custody of Business
Department, Standard Chartered Bank (Taiwan) Ltd.
Walsin Lihwa Corporation
TECO Electric and Machinery Co., Ltd.
Rong Jiang Co., Ltd.
Patricia Chiao
Huali Investment Corp.
Yu-Heng Chiao
Pai-Yung Hong
Yu-Chi Chiao
Note 1: Top ten shareholders of the institutional shareholder.
Note 2: The shareholding ratios are rounded to the nearest hundredth percent.
0.96%
0.95%
0.75%
0.69%
0.64%
March 15, 2023
Shareholding
6.63%
6.63%
6.38%
5.64%
4.92%
2.92%
2.87%
1.75%
1.39%
1.38%
14
Name of Institutional Shareholder
Major Shareholders of Institutional Shareholders (Note)
Shareholding
December 31, 2022
Huali Investment Corp.
HannStar Color Co. Ltd.
Walsin Lihwa Corporation
HannStar Board Corporation
Global Brands Manufacture Ltd.
Walton Advanced Engineering, Inc.
Yu-Heng Chiao
Kim Eng Securities Private Co., Ltd. investment account under the custody of
Walsin Technology Corporation
Citibank Taiwan Ltd.
Winbond Electronics Corporation
Giga Investment Co.
Vanguard Emerging Markets Stock Index Fund managed by Vanguard Group
under the custody of JP Morgan Chase Bank N.A.
100%
18.30%
7.65%
3.30%
2.74%
2.65%
2.61%
1.72%
1.37%
1.37%
Vanguard Total International Stock Index Fund, a series of Vanguard Star Funds,
1.35%
under the custody of JPMorgan Chase Bank N.A.
Walsin Technology Corporation
Walsin Lihwa Corporation
Career Technology (Mfg.) Co., Ltd.
Chin-Xin Investment Co., Ltd
HannStar Board Corporation
Yu-Heng Chiao
Pai-Yung Hong
Special Account of BNP Paribas, Singapore Branch under the custody of HSBC
Prosperity Dielectrics Co., Ltd.
Tsai Yi Corporation
Yu Yueh Co., Ltd.
Walsin Technology Corporation
Walton Advanced Engineering, Inc.
Investment Account of Mercer Investment No. 1 Fund Entrusted by Mercer QIF
Fund Company with the External Manager, Fei-Si Investment Management Co.,
Ltd., under the custody of Business Department of Standard Chartered Bank
Prosperity Dielectrics Co., Ltd.
Ta-Ho Maritime Corporation
(Taiwan) Limited
Yu-Heng Chiao
ABC Taiwan Electronics Corp
Wen-Che Shen
Sheng-Chi Liao
Tsung-Yuan Huang
Royce - Asia Small-Cap Investment Account under the custody of Business
Department of Standard Chartered Bank (Taiwan) Limited on behalf of GAM
Investment Management Company (Switzerland)
Note 1: Top ten shareholders of the institutional shareholder.
Note 2: The shareholding ratios are rounded to the nearest hundredth percent.
20.32%
12.06%
5.44%
3.55%
2.19%
1.86%
1.50%
1.07%
0.96%
0.89%
43.13%
0.75%
0.72%
0.62%
0.55%
0.47%
0.44%
0.36%
0.30%
0.15%
15 15
Corporate Governance Report
3. Disclosure of Professional Qualifications of Directors and Independence of Independent Directors
Qualification
Name
Professional Qualifications and Experience
Independence (Note)
Number of
Other Public
Companies
Where He/She
Acts as
Independent
Directors
Concurrently
Yu-Lon Chiao, Chairman, has not been
involved in any of the circumstances
described in Subparagraph 6, Paragraph
1, Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies.
of
involved
any
described
Patricia Chiao, Vice Chairman, has not
the
been
in
in
circumstances
Subparagraphs 6 and 9, Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies.
Yu-Cheng Chiao, Director, has not been
involved in any of the circumstances
described in Subparagraphs 1 and 6,
Paragraph 1, Article 3 of the Regulations
Governing Appointment of Independent
Directors and Compliance Matters for
Public Companies.
Yu-Heng Chiao, Director, has not been
involved in any of the circumstances
described
in Subparagraph 1 and
Subparagraphs 6 to 9, Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies.
0
0
1
0
the
experience
circumstances described
Mr. Yu-Lon Chiao joined Walsin Lihwa in 1983 and has
served as Vice President, President, Vice Chairman, and
CEO, and took over as Chairman in 1996. Mr. Chiao,
highly experienced in the wire and cable, stainless
steel, electronic technology, commercial and real
estate industries, has focused on the management of
the Company and
led the Company's continuous
growth with good results. He has not been involved in
the
in
any of
subparagraphs of Article 30 of the Company Act.
Patricia Chiao, Vice Chairman, has been with the
Company since 1981, has served as Assistant Vice
President of the Finance Department, Special Assistant
to the President, Associate Manager and Vice President
of the Commodity Center and Financial Investment
Management Center, General Manager of the Copper
Business Group, and General Manager of the Wire and
Cable Business Group, and has served as Vice Chairman
since 2016. She is familiar with the organization and
the Company and has
business operations of
and
knowledge
professional
in
management,
judgment and human
investment
resources. She has not been involved in any of the
circumstances described
in the subparagraphs of
Article 30 of the Company Act.
Yu-Cheng Chiao, Director, served as Chairman of the
Company from 1986 to 1994. Currently, he serves as
Chairman of Winbond Electronics Corporation,
Independent Director of Taiwan Cement Corporation,
Director of Walsin Technology Corporation. He served
as, among others, Chairman of Nuvoton Technology
Corporation and Director of Taiwan Electrical and
Electronic Manufacturers' Association, received the
ERSO Award and was elected as the eighth member of
ITRI. Therefore, he has the necessary expertise and
experience in management and business development
of the Company. In addition, he has not been involved
in the
in any of the circumstances described
subparagraphs of Article 30 of the Company Act.
Yu-Heng Chiao, Director, the Vice President and Vice
Chairman of the Company from 1990 to 1996.
Currently, he acts as Chairman of Walsin Technology
Corporation, HannStar Board Corp., Global Brands
Manufacture Ltd., Walton Advanced Engineering, Inc.,
Prosperity Dielectrics Co., Ltd., Info-Tek Corp., and
Silitech Technology Corporation. Therefore, he has the
necessary expertise and experience in management
In
and business development of the Company.
addition, he has not been involved in any of the
circumstances described
in the subparagraphs of
Article 30 of the Company Act.
Yu-Lon Chiao
Patricia Chiao
Yu-Cheng Chiao
Yu-Heng Chiao
16
Qualification
Name
Professional Qualifications and Experience
Independence (Note)
Number of
Other Public
Companies
Where He/She
Acts as
Independent
Directors
Concurrently
Andrew Hsia
Wei-Shin Ma
Chin-Xin
Investment Co.,
Ltd
Representative:
Pei-Ming Chen
Ming-Ling Hsueh
in business,
Andrew Hsia, Director, serves as Vice President and
Spokesman of Phu My Hung International Corporation
and Chief Representative of Central Trading &
Development Corporation (Samoa). He served as,
among others, a diplomat of the Republic of China,
Chairman of the Mainland Affairs Council, Deputy
the Ministry of National Defense,
Minister of
Representative of the Ministry of Foreign Affairs in
Indonesia, and Head of Political Section, Ministry of
Foreign Affairs. He has a background of legal and
diplomatic expertise and an international perspective,
and is familiar with the economies and markets of the
Southeast Asian region. In addition, he has not been
involved in any of the circumstances described in the
subparagraphs of Article 30 of the Company Act.
Wei-Shin Ma, Director, serves as CEO and Chairman of
HannsTouch Solution Inc., Chairman of Golden Apple
Investment Company, Online Banking Investment Co.,
Ltd., and Torch Investment Co., Ltd., Director of
HannStar Color Co., Winbond Electronics Corporation,
White Stone Management Consultancy, United
Integrated Services Co., Ltd., and Hanns Blegrain Ltd.
She has experience
finance and
accounting, with expertise in technology leadership,
operational judgment and management. In addition,
she has not been involved in any of the circumstances
described in the subparagraphs of Article 30 of the
Company Act.
Pei-Ming Chen, Director, is President of Winbond
Electronics Co. Ltd. He was Chairman of Nuvoton
Technology Co. Ltd. and Vice President of DRAM
Products Business Group and Sales Center of Winbond
Electronics Co. With his primary education in electrical
engineering and his work experience focused on the
semiconductor business, he has participated in many
mergers and acquisitions and international business
integration and therefore has the necessary experience
and expertise
and
development of the Company's business. In addition,
he has not been involved in any of the circumstances
described in the subparagraphs of Article 30 of the
Company Act.
Ming-Ling Hsueh, Independent Director, used to act as
PwC Taiwan Director, and is Independent Director of
Yuanta Financial Holdings & Yuanta Commercial Bank,
Lite-On Technology Corporation, and TTY Biopharm,
and Director of Tung Hua Book Co., Ltd. He is also
Adjunct Professor, School of Science and Technology
Management, National Tsing Hua University, Adjunct
Professor, School of Management, National Taiwan
University of Science and Technology, and Executive
Director, Taiwan Corporate Governance Association.
Therefore, he has professional knowledge and
background
in finance, accounting and corporate
governance. In addition, he has not been involved in
the
in
any of
subparagraphs of Article 30 of the Company Act.
in business management
circumstances described
the
Andrew Hsia, Director, has not been
involved in any of the circumstances
described
in Subparagraph 1 and
Subparagraphs 3 to 9, Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
for Public
and Compliance Matters
Companies.
Wei-Shin Ma, Director, has not been
involved in any of the circumstances
described
in Subparagraph 1 and
Subparagraphs 6 to 9, Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies.
Pei-Ming Chen, Director, has not been
involved in any of the circumstances
described in Subparagraphs 1, 3, 4, 6, 7,
and 9, Paragraph 1, Article 3 of the
Regulations Governing Appointment of
Independent Directors and Compliance
Matters for Public Companies.
Ming-Ling Hsueh, Independent Director,
has not been involved in any of the
circumstances described in Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies. Besides, neither he nor his
spouse nor any of his relatives within
second degree of kinship is a director of
the Company or its affiliates holding any
number and proportion of shares of the
Company (which are not held in the
name of others).
0
0
0
3
17 17
Corporate Governance Report
Qualification
Name
Professional Qualifications and Experience
Independence (Note)
King-Ling Du
Shiang-Chung
Chen
Fu-Hsiung Hu
King-Ling Du, Independent Director, was Executive Vice
President, Vice President of Business and Planning and
Engineering, and Representative in Singapore and New
York, USA, of China Steel Corporation; General
Manager, Kaohsiung Rapid Transit Corporation; and
Chairman, China Ecotek Corporation. He is currently
Director of Sheh Fung Screws Co., Ltd and Green River
Holding Co., Ltd. He has long experience in the steel
industry and
is familiar with the planning and
promotion of production, plant expansion and
environmental protection projects, with expertise in
mechanical engineering, industrial development and
operation management. In addition, he has not been
involved in any of the circumstances described in the
subparagraphs of Article 30 of the Company Act.
Shiang-Chung Chen, Independent Director, served in
the Stainless Steel Business Group of the Company
from 1993 to 2004 as Head of Division. He is now
Chairman and President of Mercuries Data Systems
Ltd. and Independent Director of Hipact Tech Inc.,
Nanjing Mercuries Development of Software Co., Ltd.,
Mercuries Insurance Agent Co., Ltd. and Teco Electric &
Machinery Co., Ltd. He has long experience in the
system and platform development and integration
engineering business in the information industry and is
sales
also
management of stainless steel business; therefore, he
has the necessary professional and work experience
for the Company's business. In addition, he has not
been involved in any of the circumstances described in
the subparagraphs of Article 30 of the Company Act.
Fu-Hsiung Hu,
Independent Director, was Vice
Chairman, Council of Agriculture, Executive Yuan;
Director of Department of Economic Energy and
Agriculture, Executive Yuan; Director of the Office of
the President of the Executive Yuan; Chairman of Joint
Credit
Information Center, Taiwan Cooperative
Securities, and National Animal Industry Foundation;
Director, Mega International Commercial Bank and
Taiwan Cooperative Bank; Managing Director, Central
Trust of China; Director, Straits Exchange Foundation.
He is currently acting as Managing Director of O-Bank,
with professional knowledge and background
in
business administration, finance and securities, and
credit
information. In addition, he has not been
involved in any of the circumstances described in the
subparagraphs of Article 30 of the Company Act.
the production and
familiar with
involved
in any of
King-Ling Du, Independent Director, has
the
not been
circumstances described in Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies. Besides, neither he nor his
spouse nor any of his relatives within
second degree of kinship is a director of
the Company or its affiliates holding any
number and proportion of shares of the
Company (which are not held in the
name of others).
described
circumstances
Independent
Chen,
Shiang-Chung
Director, has not been involved in any of
the
in
Paragraph 1, Article 3 of the Regulations
Governing Appointment of Independent
Directors and Compliance Matters for
Public Companies. Besides, neither he
nor his spouse nor any of his relatives
within second degree of kinship is a
director of the Company or its affiliates
holding any number and proportion of
shares of the Company (which are not
held in the name of others).
involved
in any of
Fu-Hsiung Hu, Independent Director, has
not been
the
circumstances described in Paragraph 1,
Article 3 of the Regulations Governing
Appointment of Independent Directors
and Compliance Matters
for Public
Companies. Besides, neither he nor his
spouse nor any of his relatives within
second degree of kinship is a director of
the Company or its affiliates holding any
number and proportion of shares of the
Company (which are not held in the
name of others).
Number of
Other Public
Companies
Where He/She
Acts as
Independent
Directors
Concurrently
0
1
1
Note : None of the Independent Directors of the Company are directors, supervisors or employees of companies with specific
relationships with the Company and have not received compensation for providing business, legal, financial or accounting
services to the Company or its affiliates in the last two years.
18
4. Diversity and Independence of the Board
(1) Diversity of the Board
In accordance with Article 20 of the Company's Corporate Governance Best Practice Principles and the "Principles
of Election of Board Members and Managers and Guidelines for Continuing Education and Succession Planning"
established by the Company, the Board of Directors will implement the objectives of diversity and independence in
terms of expertise, experience and gender required for Board members, and will continue to invite appropriate
candidates to join the Board of Directors in accordance with the above objectives in order to strengthen the
balance of the Board of Directors in response to the Company's development strategies and changes in the internal
and external environment. In order to achieve the desired objectives of corporate governance, the Board of
Directors of the Company is composed of members from the management team, managers of relevant industries
and professionals with financial, business and accounting backgrounds, who effectively perform the duties of Board
members with different fields and work backgrounds. These duties include establishing and maintaining the
Company's vision and values, assisting in promoting corporate governance and strengthening management,
overseeing and evaluating the implementation of management policies and operational plans, and being
responsible for the Company's overall economic, social, and environmental operations to enhance corporate
governance and corporate value from the perspective of stakeholders.
The Company has built its strength by being focused on the wire and cable, stainless steel, commodity, and
commercial real estate fields and become a model of business excellence moving towards the manufacturing
service industry. If we look at the list of directors of the Company, Yu-Lon Chiao, Chairman, has been working in the
business field of the Company for a long time and has a good understanding of the operation and development of
the industry, with an open-minded leadership style that encourages adoption of suggestions; Director Yu-Cheng
Chiao and Director Yu-Heng Chiao have joined the management team of the Company and therefore are familiar
with the organization and business operation of the Company and are good at operation management; Andrew
Hsia, Director, comes from a diplomatic background with an international perspective and therefore has a good
grasp of the conditions of the Southeast Asian market and can fully assist the Company in making relevant
investment decisions; Director Pei-Ming Chen's work experience is focused on semiconductor business, and he has
participated in many mergers and acquisitions and international business integration and therefore has operational
management experience and expertise. As for the two female Directors, Director Wei-Shin Ma specializes in
technology leadership, operational judgment and operational management, while Director Patricia Chiao
specializes in operational management, investment judgment and human resources. The Company's Independent
Directors have industry knowledge and an international market perspective, with Independent Director Ming-Ling
Hsueh specializing in finance, accounting and corporate governance, Independent Director Fu-Hsiung Hu having
expertise and experience in business administration, finance and securities, and credit information, Independent
Director King-Ling Du having extensive steel expertise and being familiar with the development and management
of the stainless steel industry, and Independent Director Shiang-Chung Chen specializing in intelligent technology
leadership with a good grasp of the development of Industry 4.0.
(2) Independence of the Board:
There are 11 Directors of the Company, including 4 Independent Directors, whose terms of office do not exceed
three consecutive terms, so as not to reduce their independence due to long tenure and to enable them to exercise
their duties and responsibilities objectively, and none of them are subject to Paragraphs 3 and 4 of Article 26-3 of
the Securities and Exchange Act.
The Company should have only 3 Independent Directors in accordance with the law, but it has four Independent
Directors, one more than legally required, which exceed the statutory target and account for 36% of all Directors of
the Company, in order to improve the Company's operation and development and operation of corporate
governance practices.
19 19
Corporate Governance Report
(2) Profile of President, Vice Presidents and Department Heads
Title
Nationality
Name
Gender
Date
appointed
Number of
shares
Percentage
Number of
shares
Percentage
Number of
shares
Percentage
Shares Held
Shares Held by Spouse
and Underage Children
Shares Held in Name of
Others
President &
President of
Commerce & Real
Estate BG
R.O.C.
Fred Pan
Male
July 16,
2007
614,804
0.02%
0
0.00%
0
0.00%
Executive Vice
President & Head
of Finance Dept.
R.O.C.
C.C. Chen Male
May 1,
2010
572,209
0.02%
0
0.00%
0
0.00%
President of
Insulated Wire &
Cable BG
R.O.C.
Jin-Renn
Leu
Male
August 13,
2014
180,900
0.00%
1,000
0.00%
0
0.00%
President of
Stainless Steel BG
R.O.C.
Kevin Niu Male
December
4, 2017
300,000
0.01%
0
0.00%
0
0.00%
President of
Commodity BG
R.O.C.
Josh Chia Male
June 13,
2019
200,000
0.01%
6,559
0.00%
0
0.00%
20
Manager who is Spouse or
Relative within the Second
Degree
Title Name Relationship
None None
None
December 31, 2022
Shares
Acquired
by
Managers
under
Employee
Stock
Options
None
Note
(Note
2)
None
None None
None
None
None
Education/Work Experience
Other Current Positions at Other Companies
MBA of US Tulane University; Finance Chief of Marketing of
Philips Taiwan Semiconductor, Finance Chief of Sales of
Philips Asia Pacific Semiconductor;
the Company's
Accounting Division head, Chief of Staff and Vice President.
Vice Chairman of Nanjing Walsin Property
Management Co., Ltd.; Director of Walsin
Ltd., Walsin
(Nanjing) Development Co.,
Success
International
Enterprises Limited; Director and President of
Jincheng Construction Co., Ltd., Walsin China
Investment Co., Ltd.
Investment,
Joint
Master of Accounting Graduate School, National Taiwan
University; Audit Team Leader of Deloitte Touche Tohmatsu
Limited, Financial Assistant Vice President of Promisedland,
Partner of GACPA, Partner of Tianyao United Accountants;
the Company's Manager of Performance Analysis
Department of Financial Service Center, Head of Financial
Management Center, Head of Accounting Division, Head of
China Management Division, Vice President of Specialty
Steel BG, Head of Yantai BU, Head and Vice President of
Specialty Steel BU, and President of Commodity BG.
International
Investment,
Director of Walsin
Walsin China Investment Co., Ltd., Walsin Info-
Industrial
Electric
Inc., PT. Walsin Nickel
Indonesia, PT. Sunny Metal
Industry, PT.
Westrong Metal Industry, PT CNGR Walsin New
Energy and Techology andWalsin Lihwa Europe
S.a.r.l.
of
Optical
M.S. in Electrical Engineering, Yuan Ze University; Assistant
Manager
Communication
Division/Communication Technology Division, Manager of
Communication Technology/Quality Assurance Technology
Division, Electrical Production/Communication Operation
Division, Director of Hsinchuang BU, Vice President of Cable
& Wire BG; Head of Wire BU of the Company.
Ph.D., Carnegie Mellon University, Pittsburgh, USA;
Quantitative Analyst of U.S. based Provident Capital
Management, Special Assistant to CEO of Chinatimes
Network Technology, Associate Manager of Financial
Trading Department of Yuanta Securities, Vice President of
Securities Department of CTBC Bank, Vice President of
Derivatives Department of KGI Securities; Chief Marketing
Officer and Head of Resources Management Center of the
Company.
MPA in Finance, New York University; MBA in Accounting,
National Taiwan University; Bachelor of Accounting,
National Taiwan University; Head of Asset and Liability
Management
Department/Performance Management
Department/ Corporate Finance Department of Standard
Chartered Bank,
Executive Vice President & Accounting Officer of Finance
Division of Standard Chartered Bank, Vice President of
Accounting Department of Fubon Bank (China) Co., Ltd.; the
Company's Project Director of the President Office, Head of
Finance Division and Vice President of Financial
Management Center.
Director of Shanghai Walsin Lihwa Power Wire &
Cable Co., Ltd., and Taiwan Electric Research &
Testing Center
None None
None
None
None
Director of Cogne Acciai Speciali S.p.A.
None None
None
None
None
None None
None
None
None
Chairman of PT. Walsin Nickel
Industrial
Indonesia and PT. Sunny Metal Industry; Director
of Walsin Precision Technology Co., Ltd., Walsin
Singapore Pte. Ltd., PT. Westrong Metal
Industry, PT. CNGR Walsin New Energy and
Technology
Indonesia, and PT. ANUGERAH
BAROKAH CAKRAWALA.
21 21
Corporate Governance Report
Title
Nationality
Name
Gender
Date
appointed
Number of
shares
Percentage
Number of
shares
Percentage
Number of
shares
Percentage
Shares Held
Shares Held by Spouse
Shares Held in Name of
and Underage Children
Others
Head of Corporate
Governance
R.O.C. Hueiping Lo
Female
January 22,
2021
230,000
0.01%
0
0.00%
0
0.00%
Director of
Accounting
R.O.C.
Richard Wu Male
May 1,
2010
418,121
0.01%
0
0.00%
0
0.00%
Note 1: Date appointed is the first time appointed department heads.
Note 2: Where the chairman and the general manager or person of an equivalent post (the highest level manager) of a company are the
same person, spouses, or relatives within the first degree of kinship, an explanation shall be given of the reason for,
reasonableness of, necessity of, and the measures adopted in response to, the above situation.
Note 3: The shareholding ratios are rounded to the nearest hundredth percent.
22
Manager who is Spouse or
Relative within the Second
Degree
Title Name Relationship
Shares
Acquired
by
Managers
under
Employee
Stock
Options
Note
(Note
2)
None None
None
None
None
None None
None
None
None
Education/Work Experience
Other Current Positions at Other Companies
M.B.A., National Taiwan University; former Vice President
of Taiwan Cooperative Securities, Associate Manager of KGI
Commercial Bank, and Associate Manager of China
Development Financial Holding Corporation.
Department of Accounting, Zhongyuan University; Team
Leader of Deloitte, Deputy Manager of Southern Taiwan
Accounting Firm, Deputy Manager of Kunjin Co., Ltd., and
Financial Manager of Shanglin Enterprise; Associate
Manager, Cost Section, Yenshiu Plant of the Company,
Control Officer of Stainless Steel BU, Head of Auditing
Division, and Head of General Manager Office.
Director of Hannstar Display Corporation, PT.
Walsin Nickel Industrial Indonesia, PT Walsin
Research Innovation Indonesia, Walsin Lihwa
Europe S.a.r.l.; Supervisor of PT. Westrong Metal
Industry
Director of Walsin Singapore Pte. Ltd.; Supervisor
of Jincheng Construction Co., Ltd., Walsin Info-
Electric Corp., Min Maw Precision Industry Corp.,
Huatuo Green Resources Co., Ltd., PT. Westrong
Metal Industry, PT. Sunny Metal Industry, and
Walsin Research Innovation Indonesia;
Supervisor of Walsin China Investment Co., Ltd.,
Dongguan Walsin Wire & Cable Co. Ltd.,
Shanghai Walsin Lihwa Power Wire & Cable Co.,
Ltd., Changshu Walsin Specialty Steel Co., Ltd.,
Yantai Walsin Stainless Steel Co., Ltd., Jiangyin
Walsin Special Alloy Material Co., Ltd., Jiangying
Walsin Steel Cable Co., Ltd., Nanjing Taiwan
Trade Mart, Walsin (Nanjing) Real Estate
Development Co., Ltd. and Nanjing Walsin
Property Management Co., Ltd.
23 23
Corporate Governance Report
3. Remunerations to Directors, President and Vice Presidents in the Most Recent Year
(1) Remuneration to Directors (including Independent Directors)
Directors Remuneration
Remuneration (A)
(Note 1)
Pension (B)
Remuneration to Directors
(C)
(Note 2)
Business Expense (D)
(Note 3)
Company
All
Companies
In Financial
Statements
(Note 6)
Company
All
Companies
In Financial
Statements
(Note 6)
Company
All
Companies
In Financial
Statements
(Note 6)
Company
All
Companies
In Financial
Statements
(Note 6)
78,400,000
78,400,000
0
0
73,370,000
73,370,000
4,595,880
4,619,880
2,940,000
2,940,000
0
0
26,680,000
26,680,000
5,496,000
5,496,000
Title
Name
Chairman
Vice Chairman
Director
Director
Director
Legal Person
Director and
Representative
Yu-Lon Chiao
Patricia Chiao
Yu-Cheng Chiao
Yu-Heng Chiao
Wei-Shin Ma
Chin-Xin
Investment Co.,
Ltd
Representative:
Pei-Ming Chen
Director
Andrew Hsia
Independent
Director
Independent
Director
Independent
Director
Ming-Ling Hsueh
King-Ling Du
Shiang-Chung
Chen
Independent
Director
Fu-Hsiung Hu
D
i
r
e
c
t
o
r
I
n
d
e
p
e
n
d
e
n
t
D
i
r
e
c
t
o
r
1.
In order to facilitate the management of the remuneration of directors and functional committee members of the Company, the Company has established the "Rules for the
Remuneration of Directors and Functional Committee Members", which clearly define the criteria for the remuneration payable to independent directors according to their individual
professional input and performance, while taking into account the reasonableness of individual performance, the Company's operating performance and future risks.
2. Except as disclosed in the above chart, remuneration to directors received due to the services provided to all companies listed in the financial statements (such as acting as advisors of parent
companies/all companies /investees listed in the financial statements who are not an employee thereof) in the most recent year: 0
24
Ratio of total (A), (B), (C) and
(D) to after-tax loss (Note 7)
(%)
Salary, Bonus and Special
Allowance (E) (Note 4)
Remuneration Received as Employee
Pension (F)
Employee Bonus (G) (Note 5)
Total of (A), (B), (C), (D), (E),
(F) and (G) and its Ratio to
After-tax Income (Note 7)
(%)
Company
All
Companies
In Financial
Statements
Company
All
Companies
In Financial
Statements
(Note 6)
Company
All Companies
In Financial
Statements
(Note 6)
Company
Cash Bonus
Stock
Bonus
All Companies
In Financial Statements
(Note 6)
Cash Bonus Stock Bonus
Company
All
Companies
In Financial
Statements
Unit: NT$
Remuneration
from Re-
investments
other than
Subsidiaries
(Note 8)
156,365,880
0.8080
156,389,880
0.8081
0
0
0
0
0
0
0
0
156,365,880
0.8080
156,389,880
0.8081
236,220,281
35,116,000
35,116,000
0
0
0
0
0
0
0
0
35,116,000
35,116,000
2,604,000
25 25
Corporate Governance Report
Table of Remuneration Ranges
Range of Remuneration
Paid to Directors
NT$100,000,000
Total
Note 1: The Company’s Independent Directors and Directors who are authorized by the Board of Directors to regularly
involve in the Company’s operation may receive remuneration; the amount of remuneration shall be reviewed in
accordance with Director’s participation and value contributed in the Company’s operation, together with
reference of international and domestic industrial practice, by the Remuneration Committee and submitted to
the Board of Directors for approval.
11
11
11
Note 2: Remunerations to Directors in 2022 approved by the Board of Directors have been listed.
Note 3: Refers to the expenses incurred by Directors in 2022 to perform relevant duties (including transportation,
attendance fees, special disbursements and various allowances).
Note 4: Refers to the salaries, additional pay, severance pay, various rewards, incentives, treasury stock price difference,
transportation subsidies, special allowance, various allowances and salary expenses listed in accordance with IFRS
2 "share-based payment", including shares acquired under employee stock option, restricted new shares to
employees and shares acquired from participation in cash capital increase option and so forth, received by
Directors who are also employees (including as President, vice president, managers and employees) in 2022. In
addition, the Company's remuneration to chauffeurs totaled NT$2,717,321/year.
Note 5: Refers to Directors also working as an employee (including as President, vice president, managers and employees)
and receiving employee bonus (including stocks and cash) in 2022; employee bonus for 2022 was approved by the
26
Board of Directors.
Note 6: Refers to the total pay to the Company's Directors from all companies in the consolidated statements (including
the Company).
Note 7: After-tax net income refers to the after-tax net income of the stand-alone financial statements in 2022, which
amounts to NT$19,352,097,000.
Note 8: a. This field shows the amount of related remunerations a Director of the Company receives from investees other
than subsidiaries of the Company.
b. The remuneration refers to remuneration, bonus (including bonuses to employees, Directors and Supervisors)
and related remunerations for the performance of duties received by a Director of the Company serving as a
Director, Supervisor or manager of an investee of the Company other than subsidiaries.
＊ The remuneration content disclosed in this Table differs from the income concept of the Income Tax Act; therefore, this
Table acts as a form of information disclosure and does not serve for the purpose of taxation
27 27
Corporate Governance Report
(2) Remunerations to President and Vice Presidents
Remuneration (A) (Note 1)
Pension (B)
Bonus and Special Allowances (C)
(Note 2)
Title
Name
Company
All Companies
In Financial
Statements
(Note 4)
Company
All Companies
In Financial
Statements
(Note 4)
Company
All Companies
In Financial
Statements
(Note 4)
President & President of
Commerce & Real Estate BG
Fred Pan
C.C. Chen
Executive Vice President
President of Stainless Steel
BG
President of Insulated Wire
& Cable BG
President of Commodity BG Josh Chia
Kevin Niu
Jin-Renn Leu
35,224,353
35,224,353
1,299,168
1,299,168
44,835,600
45,395,697
Table of Remuneration Ranges
Range of Remuneration Paid to
President and Vice Presidents
NT$100,000,000
Total
Note 1:
Note 2:
Note 3:
Note 4:
Note 5:
Note 6:
5
5
The most recent annual salary, managerial bonus, and severance pay of the presidents and vice presidents are presented above.
Refers to various bonuses, incentives, company car rental fees, vehicle subsidies, special allowance and salary expenses listed in accordance with IFRS 2 "share-based
payment", including shares acquired under employee stock options, restricted new shares to employees and shares acquired from participation in cash capital increase
options and so forth, received by managers ranked vice president or above in 2022. In addition, the Company's remuneration to chauffeurs totaled NT$1,232,523/year.
Refers to employee bonuses (including stock and cash bonuses) approved by the Board of Directors for distribution to managers ranked vice president or above in 2022.
Discloses the total payment to manager’s ranked vice president or above from all companies in the consolidated statements (including the Company).
a. This field shows the amount of related remuneration managers ranked vice president or above received from investees other than subsidiaries of the Company.
b. The remuneration refers to pay, bonus (including bonuses to employees, Directors and Supervisors) and related remunerations for the performance of duties received
by the Company's managers ranked vice president or above while serving as a Director, Supervisor or manager of an investee of the Company other than subsidiaries.
After-tax net income refers to the after-tax net income of the standalone financial statement in 2022, which amounts to NT$19,352,097,000.
＊
The remuneration content disclosed in this Table differs from the income concept of the Income Tax Act; therefore, this Table acts as a form of information disclosure and does
not serve for the purpose of taxation.
28
Employee Bonus (D) (Note 3)
Company
All Companies
In Financial
Statements (Note 4)
Cash Bonus
Stock
Bonus
Cash Bonus
Stock
Bonus
Total of (A), (B), (C) and (D) and Its Ratio to After-
tax Income (%) (Note 6)
Company
All Companies
In Financial Statements
(Note 4)
Unit: NT$
Remuneration from Re-investments
or Parent Company other than
Subsidiaries
(Note 5)
7,326,700
0
7,326,700
0
88,685,821
0.4583
88,709,821
0.4584
809,600
(3) Distribution of Employee Bonus to Managers
Title
Name
Stock bonus
Cash Bonus
Total
March 10, 2023
Percentage of
the Total to
After-tax Net
Income (%)
President & President
of Commerce & Real
Fred Pan
Estate BG
Executive Vice
President & Head of
C.C. Chen
M
a
n
a
g
e
r
s
Finance Dept.
President of Stainless
Steel BG
President of Insulated
Wire & Cable BG
President of
Commodity BG
Kevin Niu
Jin-Renn Leu
Josh Chia
Vice President &
Hueiping Lo
Head of Corporate
Governance
Head of Accounting
Richard Wu
Dept.
0
NT$8,677,700
NT$8,677,700
0.0448
※ This Table lists managers in active duty as of the end of 2022 and their summarized 2022 employee bonus for managers
approved by the Board of Directors.
※ After-tax net income refers to the after-tax net income of the stand-alone financial statements in 2022.
29 29
Corporate Governance Report
(4) Analysis of total remunerations to Directors, President, vice presidents etc. as a percentage of the
stand-alone after-tax net income in the last two years and description of the policy, standards and
packages of remunerations, procedure for making such decision and relation to business performance:
1. Analysis of total remunerations to Directors, President, vice presidents etc. as a percentage of the stand-alone
after-tax net income in the last two years:
Title
Director
President and Vice President
Total Remunerations as Percentage (%) of After-tax Net Income (Losses)
2022
2021
Company
0.99
0.46
Companies
in Consolidated
Financial Statements
0.99
0.46
Company
0.95
0.51
Companies
in Consolidated
Financial Statements
0.95
0.51
2. Description of the policy, standards and packages of remunerations, procedure for making such decision and
relation to business performance:
(1) The Company's policy for remunerating its directors is formulated based on the Company Act and the
Company's Articles of Incorporation. The remuneration of directors for the current year shall be limited to
an amount not exceeding 1% of the current year's earnings and shall be paid in accordance with the Rules
Governing the Compensation of Directors and Functional Members of the Company. The Company's
operating strategy, profitability, future development and industry condition, as well as their participation in
and contribution to the Company’s operation, have also been taken into account in order to give them
reasonable remuneration. The Compensation Committee then submits a proposal for such remuneration,
which is passed at a board meeting before the policy takes effect.
(2) The remuneration policy for the presidents, vice presidents and equivalent officers is based on the
Company's Regulations for the Evaluation of Managerial Performance and Compensation, taking into
account the Company's business strategy, profitability, performance and their contribution to the Company
and other factors, and by reference to the market compensation levels. The Compensation Committee then
submits a proposal for such remuneration, which is passed at a board meeting before the policy takes effect.
The said principles may be adjusted based on economic conditions, the Company's future development, and
profitability and operating risks.
30
4. Corporate Governance Status
(1) Overview of Board of Directors Operation
The Board of Directors totally held 9 meetings in 2022.
1. The attendance records for Directors are as follows:
Title
Name
Chairman
Vice Chairman
Director
Director
Director
Director
Director
Independent
Director
Independent
Director
Independent
Director
Independent
Director
Yu-Lon Chiao
Patricia Chiao
Yu-Cheng Chiao
Yu-Heng Chiao
Andrew Hsia
Wei-Shin Ma
Representative of Chin-Xin
Investment Co., Ltd.: Pei-
Ming Chen
Ming-Ling Hsueh
King-Ling Du
Shiang-Chung Chen
Fu-Hsiung Hu
Attended in
Person
9
8
8
6
9
7
Attended by
Proxy
0
1
1
3
0
1
9
9
9
9
9
0
0
0
0
0
Attendance
Percentage (%)
Remarks
100%
90%
90%
67%
100%
78%
None
None
None
None
None
None
100%
None
100%
None
100%
None
100%
None
100%
None
2. The attendance records for Independent Directors are as follows:
: Attended in Person; ◎: Attended by Proxy
15th Meeting
March 18, 2022
16th Meeting
April 11, 2022
19th Term
Ming-Ling
Hsueh
King-Ling Du
Shiang-Chung
Chen
Fu-Hsiung Hu
13th Meeting
January 11, 2022
14th Meeting
February 22, 2022
19th Term
17th Meeting
May 6, 2022
18th Meeting
May 24, 2022
19th Meeting
May 31, 2022
20th Meeting
August 5, 2022
Ming-Ling
Hsueh
King-Ling Du
Shiang-Chung
Chen
Fu-Hsiung Hu
◎
21st Meeting
November 4,
2022
31 31
Corporate Governance Report
Other details that need to be recorded in meeting minutes:
1. In the event of the occurrence of any of the following scenarios with the operation of the Board of Directors,
the dates of meetings, session number, resolution, opinions of all Independent Directors and the Company's
subsequent action in response to these opinions shall be clearly stated:
(1) Matters and items stipulated in Article 14-3 of the Securities and Exchange Act.
Independent
Directors’
Opinion(s)
December 31, 2022
Independent
Directors
with
Recorded or
Written
Opposing or
Reserved
Opinion(s)
Company’s
Handling of
Independent
Directors’
Opinion(s)
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
Board of
Directors
Meeting
Content of Proposal and Resolution
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
19th Term
13th
Meeting
January 11,
2022
Proposal:
Resolution:
Recusal:
Proposal:
Resolution:
Recusal:
Proposal:
Resolution:
32
of
the
Approval for the Company’s 2022
annual business plan.
Proposal passed.
Proposal for the replacement of CPAs
under the internal rotation mechanism
of Deloitte, as well as the annual
remuneration payable to the CPA firm
the
assessment
and
independence and suitability of the
CPAs.
Proposal passed.
Proposal to approve the loan of funds
by Walsin
Investment
International
Co., Ltd. to the Company and those
between the subsidiaries, in a total
amount of US$50 million and RMB1.5
billion respectively.
Proposal passed, except that the
explanatory text was amended as
in the summary of the
suggested
speech; the
loan period was thus
revised to February 1, 2022 to January
31, 2023.
Proposal to book a theater room to
watch a documentary film on the
pandemic prevention shot by HannStar
Foundation.
Proposal passed.
Wei-Shin Ma.
Advice on Chairman’s and Vice
Chairman’s 2021 performance bonus.
Proposal passed.
Yu-Lon Chiao and Patricia Chiao
Proposal
review manager’s
performance as well as 2021 bonuses
and compensation.
Proposal passed.
to
Board of
Directors
Meeting
Content of Proposal and Resolution
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Recusal:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
19th Term
14th
Meeting
February 22,
2022
19th Term
15th
Meeting
March 18,
2022
19th Term
16th
Meeting
April 11,
2022
19th Term
18th
Meeting
May 24,
2022
Resolution:
Proposal:
Resolution:
Proposal:
to draft
Advice on Company’s distributions for
2021 director and employee (including
officers) remunerations.
Proposal passed.
Proposal
the Company's
reports on the internal control system
for 2021.
Proposal passed.
Proposal to amend the Company's
Procedures for the Acquisition and
Disposal of Assets.
Proposal passed.
Proposal to lift the non-competition
ban under Article 209 of the Company
Act for the Company’s Directors.
Proposal passed.
Yu-Heng Chiao, Wei-Shin Ma and
Shiang-Chung Chen
Proposal to acquire land as right-of-
the
assets
use
for
development of
submarine cable
business.
Proposal passed.
Proposal to issue domestic straight
corporate bonds within the amount of
NT$10 billion.
Proposal passed.
required
acquire
50.1%
in PT. Sunny Metal
to
Proposal
shareholding
Industry.
Proposal passed.
The Company intends to restructure its
U.S. subsidiary investments through
Borrego Solar Systems, Inc., which is
held by Walsin Lihwa Holdings Limited,
a subsidiary of the Company.
Proposal passed.
Walsin Lihwa Holdings Limited, a
subsidiary of the Company, intends to
sell its entire shareholding in 2022
Solar Development, Inc.
Proposal passed.
Walsin Lihwa Holdings Limited, a
subsidiary of the Company, intends to
inject capital
subsidiary,
into
Borrego Energy, LLC, through Walsin
its
Independent
Directors’
Opinion(s)
December 31, 2022
Independent
Directors
with
Recorded or
Written
Opposing or
Reserved
Opinion(s)
Company’s
Handling of
Independent
Directors’
Opinion(s)
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
33 33
Corporate Governance Report
Board of
Directors
Meeting
Content of Proposal and Resolution
Independent
Directors’
Opinion(s)
December 31, 2022
Independent
Directors
with
Recorded or
Written
Opposing or
Reserved
Opinion(s)
Company’s
Handling of
Independent
Directors’
Opinion(s)
in
intends
America, LLC and Borrego Energy
Holdings, LLC,
in an amount not
exceeding US$33 million.
Proposal passed.
The Company intends to sell land in
Baoshan Township, Hsinchu County to
a related party, HuaBao Seed Breeding
Co., Ltd.
Proposal passed.
The Company intends to invest in its
subsidiary, Walsin Lihwa Europe S.a
r.l., in an amount not exceeding EUR
210.3 million.
Proposal passed.
The Company
to acquire
85.032% of the shares of MEG S.A. in
Luxembourg through its wholly-owned
subsidiary, Walsin Lihwa Europe S.a
r.l.. Proposal passed.
The Company intends to acquire a 40%
shareholding
Innovation West
Mantewe Pte.
Proposal passed.
Proposal to amend the Company's
internal control system.
Proposal passed.
The Company
lend
US$175.75 million to PT Sunny Metal
Indonesia under a non-
Industry
revolving line of credit.
Proposal passed.
Walsin Lihwa (China) Investment Co.,
Ltd. intends to lend Hangzhou Walsin
Power Cable & Wire RMB 80 million
under a non-revolving line of credit.
Proposal passed.
Walsin Lihwa Holdings Limited, a
wholly-owned
the
Company, intends to inject capital into
its wholly-owned subsidiary, Walsin
(China) Investment Co., Ltd., in the
amount not exceeding US$36 million,
and such company will acquire from its
wholly-owned
subsidiary, Walsin
Specialty Steel Corp., all of the shares
it holds in Changshu Walsin Specialty
Steel Co., Ltd.
Proposal passed.
subsidiary of
intends
to
19th Term
19th
Meeting
May 31,
2022
19th Term
20th
Meeting
August 5,
2022
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
34
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
Board of
Directors
Meeting
Content of Proposal and Resolution
Independent
Directors’
Opinion(s)
December 31, 2022
Independent
Directors
with
Recorded or
Written
Opposing or
Reserved
Opinion(s)
Company’s
Handling of
Independent
Directors’
Opinion(s)
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
19th Term
21st Meeting
November
4, 2022
in China
subsidiary of
Walsin Lihwa Holdings Limited, a
wholly-owned
the
Company, intends to inject capital into
its wholly-owned subsidiary, Walsin
(China) Investment Co., Ltd., in the
amount not exceeding US$18 million,
and such company will acquire from its
subsidiary, Concord
wholly-owned
Industries Limited, 30% of the shares it
holds
Steel Precision
Materials.
Proposal passed.
The Company intends to acquire 29.5%
of the shares in PT. Westrong Metal
Industry.
Proposal passed.
Proposal to amend the Company's
internal control system.
Proposal passed.
Walsin International Investment Co.,
Ltd. intends to lend PT. Walsin Nickel
Industrial
Indonesia US$100 million
under a non-revolving line of credit.
Proposal passed.
Proposal to approve the new loan of
funds from Walsin Info-Electric Inc. to
the Company in the form of a NT$130
million non-revolving facility.
Proposal passed.
lend PT.
The Company
Westrong Metal
Industry US$75
million under a non-revolving line of
credit.
Proposal passed.
The Company intends to lend PT Sunny
Metal Industry US$90 million under a
non-revolving line of credit.
Proposal passed.
The Company
intends to transfer
50.1% of the shares in PT. Sunny Metal
Indonesia, 40% of the
Industry
shares in Innovation West Mantewe
Pte. Ltd., and 29.5% of the shares in
PT. Westrong Metal Industry to Walsin
Singapore Pte. Ltd., a wholly-owned
subsidiary of the Company, and to
carry out a capital injection into WLS in
intends to
in
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
35 35
Corporate Governance Report
Board of
Directors
Meeting
Content of Proposal and Resolution
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
into
subsidiary of
the same amount.
Proposal passed.
The Company intends to inject US$300
its wholly-owned
million
Singapore subsidiary, Walsin Singapore
Pte. Ltd.
Proposal passed.
Walsin Lihwa Holdings Limited, a
wholly-owned
the
Company, intends to sell its earn-out
financial assets arising from equity
transactions to the Company, and
carry out a capital reduction in the
same amount.
Proposal passed.
In order to improve the efficiency of
capital utilization,
is propose to
reduce the capital of Walsin Lihwa
Holdings Limited by US$140 million in
cash.
Proposal passed.
it
Independent
Directors’
Opinion(s)
December 31, 2022
Independent
Directors
with
Recorded or
Written
Opposing or
Reserved
Opinion(s)
Company’s
Handling of
Independent
Directors’
Opinion(s)
None
None
None
None
None
None
None
None
None
(2) In addition to the foregoing, there were other matters to be resolved by directors board meetings about
which an independent director expressed objections or reservations that had been included in records or
stated in writing: Not applicable
2. Director recusals due to conflicts of interests totaled 3 times.
No.
Term/Meeting
Date
Name(s) of
Directors
Proposal
1
2
3
19th Term
13th Meeting
January 11, 2022
19th Term
14th Meeting
February 26, 2022
Wei-Shin Ma
Yu-Lon Chiao,
Patricia Chiao
Yu-Heng Chiao,
Wei-Shin Ma
and Shiang-
Chung Chen
Proposal to book a theater room
to watch a documentary film on
the pandemic prevention shot by
HannStar Foundation.
Advice on Chairman’s and Vice
Chairman’s 2021 performance
bonus
Proposal to lift the non-
competition ban for the
Company’s Directors
Reason for
Recusal
December 31, 2022
Participated in Vote
or Not
Personally
interested
Recused as
provided by law
Personally
interested
Recused as
provided by law
Personally
interested
Recused as
provided by law
36
3. Frequency, period, scope, method, and items of self-evaluation of the Board of Directors:
Scope
Frequency
Method
Period
Item
Once every year
2022/01/01
~
2022/12/31
Board of Directors
Internal self-
evaluation of
the Board of
Directors
2. Improve the quality of Board decisions.
3. Composition and structure of the board
of directors.
4. Selection and Continuing Education of
1. Involvement in the operation of the
Company.
Once every year
2022/01/01
~
2022/12/31
Directors.
5. Internal control.
Functional
Committees
(including
Compensation
Committee, Audit
Committee,
Sustainable
Development
Committee, and
Nomination
Committee)
1. Involvement in the operation of the
Company.
Internal self-
evaluation of
the functional
committees
2. Awareness of responsibilities of the
functional committees.
3. Improve the quality of decision making
in the functional committees.
4. Composition and selection of functional
committee members.
5. Internal control.
Once every year
2022/01/01
~
2022/12/31
Each director
Self or peer
performance
evaluation of
board
members
every
3
Once
years
2020/10/01
~
2021/09/30
Board of Directors
and each
functional
committee
Evaluation by
an external
organization
1. Understanding of the company's
objectives and tasks.
2. Awareness of directors' responsibilities.
3. Involvement in the operation of the
Company.
4. Internal relationship management and
communication.
5. Professional and continuing education
of directors.
6. Internal control.
Eight aspect of evaluation of the Board of
Directors: composition, guidance,
authorization, supervision,
communication, internal control and risk
management, self-regulation, among
others.
4. Evaluation of achievement of enhancing the Board’s performance (e.g. establishing an Audit Committee and
increasing information transparency):
(1) Formulation of regulations related to the corporate governance: In addition to explicitly stating the powers
and duties of the Board of Directors in the company's articles of incorporation, the Company also follows
rules and regulations including the "Board of Directors Procedural Regulations", "Guidelines for the Ethical
Conduct of Directors and Managerial Officers", "Procedures for the Processing of Critical Internal
Information", "Corporate Governance Principles and Practice", "Corporate Management
Integrity
Principles", "Behavioral Guidelines and Operation Procedures for Honest Practices", "Guidelines for the
Ethical Conduct of Employees", "Rules for Suggestions and Complaints from Related Parties", and "Practical
Guidelines for Corporate Social Responsibility" in order to strengthen operations of the Board of Directors
as well as corporate governance.
(2) Evaluation of the Performance of the Board of Directors: To implement corporate governance and enhance
the Company's board functions, and to set forth performance objectives to improve the operation
efficiency of the board of directors, the Rules of Performance Evaluation of the Board of Directors (these
37 37
Corporate Governance Report
"Rules") were established pursuant to the Corporate Governance Best-Practice Principles for TWSE/TPEx
Listed Companies and shall apply to the Board of Directors, functional committee and individual directors.
These Rules were established on October 28, 2015, and the most recent amendment to them was
approved by the Board of Directors on January 11, 2022. Each agenda working group shall provide a
questionnaire for the board members to complete in each December and provide the completed
attachments and information related to performance evaluation for the board members' reference.
The overall performance self-evaluation of our Board of Directors should cover at least the following five
major aspects:
A. Regarding external evaluations:
In 2018 and 2021, the Company appointed Taiwan Corporate Governance Association ("TCGA"), an
independent third party with which the Company has no business dealings, to evaluate the
effectiveness of its Board of Directors. The evaluation was conducted by means of questionnaires and
on-site interviews on eight major aspects of the board of directors, including composition, guidance,
authorization, supervision, communication and self-regulation, as well as internal control and risk
management. Through the review by a professional organization and with the guidance of and
communications with the evaluation members, the Company obtained professional and objective
evaluation results and recommendations. The results of the evaluation serve as the reference for the
Board to continue to improve its functions by continually enhancing and optimizing the quality of its
meetings.
The measures in response to the recommendations of the external evaluation institution in 2022 are
as follows:
Recommendations of External Evaluation Institution
Measures
Strengthen the
whistleblower mechanism
Set up a reporting channel that
Independent Directors can receive
the complaints simultaneously, or
engage an external agency to
serve as a complaint acceptance
window.
Continue to improve the
internal control system
A comprehensive review of the
Company's overall internal control
mechanism shall be conducted
every five years.
The Independent Directors have
simultaneously received
complaints from the complaint
mailbox set up by the audit unit,
to facilitate direct reporting by
complainants or whistle blowers,
and to enhance and ensure the
effective operation of the
whistleblower mechanism.
The Company's Internal Control
System has specified that the
design and implementation of the
internal control system will be
adjusted in a timely manner in
response to changes in the
environment, and that the system
will be adopted annually. Starting
from 2023, it has been added in
the Directors' self-assessment
questionnaire that the Company
will annually review the
effectiveness of the design and
implementation of the internal
control system and issue a
statement on the internal control
system after the approval of the
Board of Directors.
38
Recommendations of External Evaluation Institution
Measures
Improve the quality of
financial reporting audits
selecting
The Company should obtain AQI
from the certified
information
in advance
public accountants
for
them
when
evaluation purposes, so as to
and
evaluate
commitment
to
enhance the quality of the audit.
ability
objectively
their
The Company evaluates
the
independence and suitability of
the certified public accountants on
an annual basis. Starting from
2023, the Company has further
referred to the AQI disclosure
framework released by the FSC on
August 19, 2021 as a reference for
the evaluation. The evaluation
results are reported to the Audit
Committee and the Board of
Directors as the reference for
future appointment of CPAs.
B. Annual internal evaluation for 2022:
The 2022 Board of Directors' performance self-evaluation results go as follows:
(a) Board of Directors' overall average score 4.87 points (full score: 5 points)
(b) Board members' overall average score 4.93 points (full score: 5 points).
In December 2022, the Company conducted an internal annual board performance evaluation of the board
of directors, individual board members and functional committees in accordance with the evaluation
indicators and evaluation procedures specified in these Rules, and compiled and scored the data after the
questionnaires were collected, and made recommendations for improvement in 2022. This year, the
Company has made recommendations for improvement in the level of Directors' participation in the
Company's operations, as well as the follow-ups on the recommendations made by an external evaluation
institution in 2021, both of which were consolidated and reported to the Nomination Committee on
January 6, 2023 and the Board of Directors' meeting on January 10, 2023, the details of which were
disclosed on the Company's website.
(3) Implementing the performance evaluation of the functional committees: In accordance with the
"Regulations for the Evaluation of the Performance of the Board of Directors (including Functional
Committees) and their Remunerations" formulated by the Compensation Committee based on the latest
version published by the Competent Authority, our functional committees' members in December every
year evaluate themselves by the assessment indicators to measure the corporate leadership strategic
directions and oversee the corporate operational performance in an effort to improve shareholders' long-
term value.
(4) Actively participating in corporate governance: In recent years, the Company has actively participated in
the promotion of the corporate governance and the transparency in information disclosure. Walsin Lihwa
was listed as the top 5% outstanding companies by five consecutive times of Corporate Governance
Evaluation from 2017 to 2021. The Company also received Taiwan's Top 100 Sustainable Model Business
Award and Platinum Corporate Sustainability Report Award, as well as Bronze Prize for English
Sustainability Report for the first time. The Company will continue making efforts to maintain among the
top with respect to the Corporate Governance Evaluation Results. The Company not only will continue to
strive to actively participate in the corporate governance evaluation, but also has formed a project to
improve corporate governance matters and enhance corporate governance capabilities.
The Company is committed to enhancing the transparency of information. In addition to announcing
financial information in accordance with laws and regulations, the Company also holds regular investor
conferences four times a year. In 2022, the Company was granted a long-term credit rating of 'twA-' and a
short-term credit rating of 'twA-2' with a 'positive' outlook by Taiwan Ratings for the first time. The
39 39
Corporate Governance Report
Company's financial structure was certified by an external organization, and the disclosure of information
to stakeholders was also enhanced through the external release of credit ratings.
(5) Enhancing the board’s functions and decision-making quality: In order to bring into play the functions and
decision-making quality of the Board of Directors, our company regularly holds strategic meetings on a
quarterly basis to enable the directors to understand our financial and business conditions and the
formulation of major business strategies and the implementation of related plans. In addition, quarterly
operational meetings are also held to help directors understand the operational content through reporting
by operating units, so as to improve the performance of the Board of Directors. In the meantime, the
directors may provide their effective guidance out of their expertise and experience to the operating units
during such meetings.
(6) Heavy reliance on the independent directors’ functions: Authorizing independent directors to utilize their
own expertise and regularly participate in our company's investment assessment projects and matters
relevant to corporate governance. The Audit Committee was formally established by all independent
directors after the shareholders' meeting on May 26, 2017, and the Audit Committee of the second term
was formed by all independent directors on May 29, 2020; the Compensation Committee of the fourth
term was established on August 4, 2020, with all independent directors acting as its members. On August 4,
2020, the Chairman, Vice Chairman and all independent directors were appointed as members of the
Sustainable development committee of the second term of the Company. The first Nomination Committee
was formally established on August 6, 2021, with the Chairman and all Independent Directors acting as its
members. These four functional committees continue to assist the Board of Directors in its oversight
responsibilities.
(7) Raising the transparency of corporate data: On the MOPS and our official website, we voluntarily disclose
the related law and regulations which we follow, the important resolutions adopted at Board meetings and
the relevant information to help shareholders understand our activities and to raise transparency in our
corporate information.
40
(II) Operation of the Audit Committee
1. The major matters reviewed by the Audit Committee include:
(1) Adoption of or amendment to the internal control system pursuant to Article 14-1 of the Securities and
Exchange Act.
(2) Assessment of the effectiveness of the internal control system.
(3) Adoption of or amendment to procedures for financial or operational actions of material significance, such
as acquisition or disposal of assets, derivatives trading, extension of loans to others, or endorsements or
guarantees for others, pursuant to Article 36-1 of the Securities and Exchange Act.
(4) Matters bearing on the personal interest of a director.
(5) Material asset or derivatives transactions.
(6) Material loans, endorsements, or provision of guarantees.
(7) The offering, issuance, or private placement of any equity-type securities.
(8) The engagement or dismissal of a CPA, or the compensation given thereto.
(9) The appointment or discharge of a financial, accounting, or internal auditing officer.
(10) Annual financial reports signed or sealed by the Chairman, manager and accounting officer.
(11) Any other material matter so required by the Company or the Competent Authority.
2. Audit Committee's Annual Work Summary:
(1) Agenda arrangement (for Audit Committee meetings and communication meetings)
(2) Handling matters related to the meeting of the Audit Committee in accordance with the law (meeting notice,
proceedings)
(3) Follow-ups and execution of improvements requested by the Audit Committee
(4) Providing company information required by independent directors to assist them in fully exercising their
powers
(5) Annual self-assessment of the Audit Committee
(6) Establishing and revising the organizational regulations and relevant operating procedures
(7) Announcement of relevant matters concerning the Audit Committee pursuant to law (organizational
regulations and operational status)
(8) Whether any employee, manager and director has entered into related-party transactions and possible
conflicts of interest in such transactions
(9) Suggestions and complaints from interested parties
(10) Management of exchange rate risks
(11) Information Security
(12) Work safety/environmental protection and legal compliance
3. The Audit Committee of the second term started on May 29, 2020 and ended on May 28, 2023. The meetings
were held 10 times in 2022, and the attendance of the independent directors in 2022 is as follows:
Title
Name
Convener Ming-Ling Hsueh
Member
Member
Member
King-Ling Du
Shiang-Chung Chen
Fu-Hsiung Hu
Personally
Attended
Attended by
Proxy
Attendance
rate (%)
Remarks
10
10
10
10
0
0
0
0
100% None
100% None
100% None
100% None
41 41
Corporate Governance Report
4. Other matters that need to be recorded in meeting minutes:
(1) If any of the following circumstances occurs during the operation of the Audit Committee, the Board meeting
date, meeting number, the proposal contents, the resolution of the Audit Committee and our company's
handling of the Audit Committee's opinions shall be clearly described.
A. Items listed in Article 14-5 of the Securities and Exchange Act:
December 31, 2022
Audit
Committee
Meeting
Number and
Date
Board of
Directors
Meeting
Number and
Date
Proposals and Resolutions
Proposal:
Approval for the Company’s 2022
annual business plan.
Resolution: Proposal passed.
Independent
Directors'
Dissenting
Opinions,
Reservations or
Significant
Recommendations
None
2nd Term
15th Meeting
January 7, 2022
19th Term
13th Meeting
January 11,
2022
Proposal:
None
Proposal for the replacement of
CPAs under the internal rotation
mechanism of Deloitte, as well as
the annual remuneration payable to
the CPA firm and the assessment of
the independence and suitability of
the CPAs.
Resolution: Proposal passed.
Proposal:
Ltd.
Proposal to approve the loan of
International
funds by Walsin
Investment Co.,
the
to
Company and those between the
subsidiaries, in a total amount of
US$50 million and RMB1.5 billion
respectively.
Proposal passed.
None
None
Proposal: Approval for the Company’s 2021
financial
report
and
business
statements.
Resolution:
Resolution: Proposal passed.
Proposal:
Approval for the affiliates’ 2021
consolidated business report and
financial statements.
None
Resolution: Proposal passed.
Proposal:
Approval for the Company’s 2021
profit distribution plan.
None
Resolution: Proposal passed.
Proposal:
Approval for the Company’s 2021
statement on
control
system.
internal
None
Resolution: Proposal passed.
2nd Term
16th Meeting
February 18,
2022
19th Term
14th Meeting
February 22,
2022
Proposal:
Resolution:
Proposal:
Resolution:
42
Proposal to amend the Company's
Procedures for the Acquisition and
Disposal of Assets.
Proposal passed.
None
to
amend
Proposal
certain
provisions of the Company's Articles
of Incorporation.
Proposal passed.
None
Company’s
Handling of Audit
Committee
Member’s
Opinion
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
Audit
Committee
Meeting
Number and
Date
Board of
Directors
Meeting
Number and
Date
Independent
Directors'
Dissenting
Opinions,
Reservations or
Significant
Recommendations
None
Proposals and Resolutions
Proposal:
Resolution:
Recusal:
Proposal to lift the non-competition
ban for the Company’s Directors
under Article 209 of the Company
Act.
Proposal passed.
Shiang-Chung Chen
Proposal:
2nd Term
17th Meeting
March 18, 2022
19th Term
15th Meeting
March 18,
2022
Resolution:
Proposal:
2nd Term
18th Meeting
April 11, 2022
19th Term
16th Meeting
April 11,
2022
2nd Term
19th Meeting
April 29, 2022
19th Term
17th Meeting
May 6, 2022
2nd Term
20th Meeting
May 24, 2022
19th Term
18th Meeting
May 24, 2022
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
assets
required
Proposal to acquire land as right-of-
the
use
development of submarine cable
business.
Proposal passed.
for
Proposal to issue domestic straight
corporate bonds within the amount
of NT$10 billion.
Proposal passed.
to
acquire
50.1%
Proposal
shareholding in PT. Sunny Metal
Industry.
Proposal passed.
to
land
subsidiary
dispose
in
the
of
Proposal
Company's
Baoshan
Township, Hsinchu County, and sell
it to a related party.
The proposing unit withdrew this
proposal on its part.
The Company intends to restructure
its U.S.
investments
through Borrego Solar Systems, Inc.,
is held by Walsin Lihwa
which
Holdings Limited, a subsidiary of the
Company.
Proposal passed.
Walsin Lihwa Holdings Limited, a
subsidiary of the Company, intends
to sell its entire shareholding in
2022 Solar Development, Inc.
Proposal passed.
Walsin Lihwa Holdings Limited, a
subsidiary of the Company, intends
to inject capital into its subsidiary,
Borrego Energy, LLC, through Walsin
America, LLC and Borrego Energy
Holdings, LLC, in an amount not
exceeding US$33 million.
Proposal passed.
None
None
None
None
None
None
None
Company’s
Handling of Audit
Committee
Member’s
Opinion
Except for Shiang-
Chung
Chen,
Independent
who
Director,
recused
himself
due to personal
conflict
of
interests, all of
Directors
the
present approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
43 43
Company’s
Handling of Audit
Committee
Member’s
Opinion
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
the
approved
proposal
unanimously.
All
the
of
Directors present
the
approved
proposal
unanimously.
All
the
of
Directors present
the
approved
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
Independent
Directors'
Dissenting
Opinions,
Reservations or
Significant
Recommendations
None
None
None
Corporate Governance Report
Audit
Committee
Meeting
Number and
Date
Board of
Directors
Meeting
Number and
Date
Proposals and Resolutions
Proposal:
Resolution:
Proposal:
2nd Term
21st Meeting
May 31, 2022
19th Term
19th Meeting
May 31, 2022
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
2nd Term
22nd Meeting
July 29, 2022
19th Term
20th Meeting
August 5,
2022
44
The Company intends to sell land in
Baoshan Township, Hsinchu County
to a related party, HuaBao Seed
Breeding Co., Ltd.
Proposal passed.
The Company intends to invest in its
subsidiary, Walsin Lihwa Europe S.a
r.l., in an amount not exceeding EUR
210.3 million.
Proposal passed.
The Company intends to acquire a
Innovation
40% shareholding
West Mantewe Pte in Singapore.
Proposal passed.
in
Proposal to amend the Company's
internal control system.
Proposal passed.
None
None
None
None
to
intends
The Company
lend
US$175.75 million to PT Sunny
Metal Industry Indonesia under a
non-revolving line of credit.
Proposal passed.
Investment
Walsin Lihwa (China)
Co., Ltd. intends to lend Hangzhou
Walsin Power Cable & Wire RMB 80
million under a non-revolving line of
credit.
Proposal passed.
Walsin Lihwa Holdings Limited, a
wholly-owned subsidiary of
the
Company, intends to inject capital
its wholly-owned subsidiary,
into
Walsin (China) Investment Co., Ltd.,
in the amount not exceeding US$36
million, and such company will
its wholly-owned
acquire
subsidiary, Walsin Specialty Steel
Corp., all of the shares it holds in
Changshu Walsin Specialty Steel Co.,
Ltd.
Proposal passed.
Walsin Lihwa Holdings Limited, a
wholly-owned subsidiary of
the
Company, intends to inject capital
into
its wholly-owned subsidiary,
Walsin (China) Investment Co., Ltd.,
in the amount not exceeding US$18
million, and such company will
its wholly-owned
acquire
Industries
subsidiary,
Concord
from
from
None
All
the
of
Directors present
approved
the
proposal
unanimously.
Audit
Committee
Meeting
Number and
Date
Board of
Directors
Meeting
Number and
Date
Proposals and Resolutions
Independent
Directors'
Dissenting
Opinions,
Reservations or
Significant
Recommendations
Company’s
Handling of Audit
Committee
Member’s
Opinion
Limited, 30% of the shares it holds
in China Steel Precision Materials.
Proposal passed.
The Company intends to acquire
29.5% of the shares in PT. Westrong
Metal Industry.
Proposal passed.
None
Approval for the Company’s 2022
Audit plan.
Proposal passed.
None
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal to amend the Company's
internal control system.
Proposal passed.
None
None
None
None
None
None
Proposal:
Resolution:
Proposal:
2nd Term
23th Meeting
October 24,
2022
19th Term
21st Meeting
November 4,
2022
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
International
Investment
Walsin
Co., Ltd. intends to lend PT. Walsin
Nickel Industrial Indonesia US$100
million under a non-revolving line of
credit.
Proposal passed.
Proposal to approve the new loan of
funds from Walsin Info-Electric Inc.
to the Company in the form of a
NT$130 million
non-revolving
facility.
Proposal passed.
The Company intends to lend PT.
Westrong Metal
Industry US$75
million under a non-revolving line of
credit.
Proposal passed.
The Company intends to lend PT
Sunny Metal Industry US$90 million
under a non-revolving line of credit.
Proposal passed.
in
The Company intends to transfer
50.1% of the shares in PT. Sunny
Metal Industry in Indonesia, 40% of
the shares
Innovation West
Mantewe Pte. Ltd., and 29.5% of
the shares in PT. Westrong Metal
Industry to Walsin Singapore Pte.
Ltd., a wholly-owned subsidiary of
the Company, and to carry out a
capital
into Walsin
Singapore Pte. Ltd. in the same
amount.
Proposal passed.
injection
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
the
of
All
Directors present
approved
the
proposal
unanimously.
45 45
Corporate Governance Report
Audit
Committee
Meeting
Number and
Date
Board of
Directors
Meeting
Number and
Date
Proposals and Resolutions
Proposal:
Resolution:
Proposal:
Resolution:
Proposal:
Resolution:
2nd Term
24th Meeting
November 4,
2022
19th Term
21st Meeting
November 4,
2022
into
intends to
inject
The Company
US$300 million
its wholly-
owned Singapore subsidiary, Walsin
Singapore Pte. Ltd.
Proposal passed.
Walsin Lihwa Holdings Limited, a
wholly-owned subsidiary of
the
Company, intends to sell its earn-
out financial assets arising from
equity transactions to the Company,
and carry out a capital reduction in
the same amount.
Proposal passed.
In order to improve the efficiency of
capital utilization, it is propose to
reduce the capital of Walsin Lihwa
Holdings Limited by US$140 million
in cash.
Proposal passed.
Independent
Directors'
Dissenting
Opinions,
Reservations or
Significant
Recommendations
None
None
None
Company’s
Handling of Audit
Committee
Member’s
Opinion
All
the
of
Directors present
approved
the
proposal
unanimously.
All
the
of
Directors present
the
approved
proposal
unanimously.
All
the
of
Directors present
approved
the
proposal
unanimously.
B. Except for the foregoing items, the items that were not approved by the Audit Committee but were
resolved by more than two-thirds of all directors: No such situation.
(2) Independent directors recusing themselves from conflicts of interest:
Item
Term
Date
Name of
Director
Content of Proposal
1
2nd Term
16th Meeting
February 18, 2022
Shiang-Chung
Chen
Proposal to lift the non-
competition ban for the
Company’s
Directors
under Article 209 of the
Company Act.
Reason for Recusal
Due to Conflict of
Interests
December 31, 2022
Participation in
Voting
Personal conflict of
interests
Recusal from voting
required by law
(3) Communication between independent directors, the chief internal auditor and CPAs:
A. Communication policy between independent directors, chief internal auditor and CPAs:
(A) The CPAs are invited to attend Audit Committee meetings at least twice a year and to report to the
Audit Committee on the review or audit results of our Company’s and its affiliates’ financial statements
and the internal control audit status. The CPA shall fully communicate any material adjustments to
entries or any amendments to laws and regulations.
(B) If necessary, a communication meeting may be called at any time with the CPAs.
(C) The chief internal auditor shall meet with the independent directors regularly in Audit Committee
meetings at least once a quarter to report on the internal audit implementation of our Company and
the internal control operations. In case of major irregularities, the meeting may be called at any time.
(D) The convener of the Audit Committee shall discuss the internal audit operation with the chief internal
auditor every quarter non-periodically aside from the above regular meetings.
46
B. Summary of communications between independent directors and CPAs for 2022:
Independent directors have good communication with CPAs individually.
Directors’
Recommendation
None.
None.
None.
Date
Communication Highlights
2022/02/18
Audit
Committee
Meeting
The CPAs have provided a
description of the key audits of
the stand-alone and
consolidated financial
statements for the year 2021
and the results of the audit.
2022/07/29
Audit
Committee
Meeting
The CPAs provide an
explanation of the audit results
of the consolidated financial
statements for the second
quarter of 2022.
2022/12/09
Individual
Communication
Meeting
The CPAs explained the scope,
method and discovery of the
annual audit for 2022 and
discussed with the Audit
Committee members on the
key audit matters.
Execution Result
The stand-alone and consolidated
financial statements for the year
2021 were approved by the Audit
Committee and submitted for
discussion at the 14th meeting of
the Board of Directors of 19th
term on February 22, 2022.
The consolidated financial
statements for the second
quarter of 2022 were approved by
the Audit Committee and
reported to the 20th meeting of
the Board of Directors of 19th
term on August 5, 2022.
1. Key audit matters for the 2022
financial statements were
confirmed.
2. The engagement and
assessment of the CPAs was
submitted to the 25th meeting
of the Audit Committee of
second term on January 6,
2023 for discussion.
C. Summary of communications between independent directors and the chief internal auditor for 2022:
Date
Key Points of
Independent Directors’
Follow-Ups and Results
Communications
Advice
Report on audit
implementation in the 4th
quarter of 2021.
None.
Report on audit
implementation in the 1st
quarter of 2022.
None.
Report on audit
implementation in the 2nd
quarter of 2022.
None.
2022/02/18
Audit
Committee
Meeting
2022/04/29
Audit
Committee
Meeting
2022/07/29
Audit
Committee
Meeting
The report on audit
implementation for the fourth
quarter of 2021 has been
passed by the Audit
Committee and reported to
the Board of Directors.
The report on audit
implementation for the first
quarter of 2022 has been
passed by the Audit
Committee and reported to
the Board of Directors.
The report on audit
implementation for the
second quarter of 2022 has
been passed by the Audit
Committee and reported to
the Board of Directors.
47 47
Corporate Governance Report
Date
Key Points of
Independent Directors’
Follow-Ups and Results
Communications
Advice
1. None.
1. Report on audit
1. Report on audit
implementation in the 3rd
quarter of 2022.
implementation in the 3rd
quarter of 2022 has been
passed by the Audit
Committee and reported to
2. the Board of Directors.
2023 annual audit plan has
been passed by the Audit
Committee and submitted to
the Board of Directors for
discussion.
1. We have been following up
on the improvements on
ESH issues.
We have been following up
on the risk management
and the promotion of
ethical management.
2. We will enhance the the
computer audit capabilities
of our existing employees,
and will prioritize the
recruitment of auditors
with computer skills.
2022/10/24
Audit
Committee
Meeting
2. Discussion of 2023 annual
audit plan.
2. None.
1. Major work results in
2022.
2022/12/09
Individual
Communication
Meeting
Between
Independent
Directors and
Chief Internal
Auditor
2. Work objectives and key
points for 2023.
1. Please continue to
follow up on the
improvements on ESH
issues.
Please continue to
follow up on the
improvements on the
risk management and
the promotion of ethical
management.
2. Please hire more
auditors with computer
skills to enhance the
effectiveness of
auditing.
48
(3) Differences between our corporate governance and the Corporate Governance Best-Practice Principles
for TWSE- and TPEx-listed Companies and reason(s):
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- TPEx-
listed Companies
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
1. Has the company set and
Yes
disclosed the principles for
practicing corporate
governance according to the
Corporate Governance Best-
Practice Principles for TWSE-
TPEx-listed Companies?
2. The Company's ownership
structure and shareholders’
equity
(1) Has the company
Yes
implemented a set of
internal procedures to
handle shareholders'
suggestions, queries,
disputes and litigations?
(2) Has the company had a
Yes
list of major
shareholders who
actually control the
company or a list of
ultimate controller of
such shareholders?
The Company has formulated the Corporate Governance
Principles and Practice according to the "Corporate
Governance Best-Practice Principles for TWSE- TPEx-listed
Companies", which were amended as approved by the
Board of Directors in 2022 and were disclosed on the
Company's website.
https://www.walsin.com/wp-
content/uploads/2023/03/rule13_20230224TC.pdf
(1) Our Shareholders Service & Contact Office is in charge
of handling various shareholder recommendations,
queries and disputes. The Company also provides
related contact details on the Company's website and
in the annual report and has set up a stakeholder
mailbox to collect stakeholders' questions and
suggestions.
(2) The Company periodically discloses the list of ultimate
controllers of its principal shareholders pursuant to the
laws and regulations.
(3) Has the company
Yes
(3) 1. The Company has drafted rules governing the
established and
implemented risk
control/management
and firewall mechanisms
between the company
and its affiliated firms?
supervision of its subsidiaries, which have been
approved by the Board.
2. All of the Company's affiliates are subsidiaries; the
Company directly or indirectly retains at least 50% of
their shares. Business dealings with affiliates are
treated as transactions with third parties.
3. The Company has drawn up rigorous rules governing
the lending, the endorsement/ guarantees as well as
the management of disposal/acquisition of assets
and derivatives transactions to/for/with its affiliates.
(4) Has the company set
Yes
(4)
internal regulations that
prohibit the company's
personnel from taking
advantage of
information that has not
been disclosed to the
public to purchase or sell
securities?
In order to establish an effective handling and
disclosure mechanism for major internal information
processing operations, so that unauthorized
information leakage can be avoided, consistency and
accuracy of information disclosed by the Company to
the public can be maintained and insider trading can
be prevented, the Company has established the
"Procedures for Major Internal Information Processing
Operations." Such procedures were last revised on
November 4, 2022 and renamed as "Procedures for
Handling Internal Material Information and Prevention
of Insider Trading" to strengthen the corporate culture
of prevention of insider trading and the control
measures against insider stock trading.
The Company's Directors' and Managerial Officers'
Code of Ethical Conduct was amended on August 4,
2020. Such code contains regulations pertaining to the
prohibition of insider trading pursuant to the
49 49
Corporate Governance Report
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
Company's internal regulations and the Securities and
Exchange Act. Relevant regulations are uploaded as an
electronic copy to the Company's electronic bulletin
board of its internal regulations for the perusal by
relevant personnel.
In 2022, the Company conducted educational training
and awareness-raising for directors and managers (and
other managers above such levels) on "Prevention of
Insider/Short-Swing Trading" and "Practicing Ethics
and Morals" to strengthen our education on the
regulations prohibiting insider stock trading. In
addition, some educational and awareness-raising
articles on compliance with the regulations prohibiting
insider trading were published on the Company's
internal education and training platform "Walsin Liwha
College", so that all managers may read and
understand information related to ethical
management. The details thereof have been disclosed
on the Company's website (in the Risk Management_
Prevention of Insider Trading Section):
https://www.walsin.com/investors/corporate-
governance/#pills-information-security
In accordance with Article 20 of the Company's
Corporate Governance Best Practice Principles and the
"Principles of Election of Board Members and
Managers and Guidelines for Continuing Education and
Succession Planning" established by the Company, the
Board of Directors will implement the objectives of
diversity and independence in terms of expertise,
experience and gender required for Board members,
and will continue to invite appropriate candidates to
join the Board of Directors in accordance with the
above objectives in order to strengthen the balance of
the Board of Directors in response to the Company's
development strategies and changes in the internal
and external environment. In order to achieve the
desired objectives of corporate governance, the Board
of Directors of the Company is composed of members
from the management team, managers of relevant
industries and professionals with financial, business
and accounting backgrounds, who effectively perform
the duties of Board members with different fields and
work backgrounds. These duties include establishing
and maintaining the Company's vision and values,
assisting in promoting corporate governance and
strengthening management, overseeing and evaluating
the implementation of management policies and
operational plans, and being responsible for the
Company's overall economic, social, and environmental
operations to enhance corporate governance and
corporate value from the perspective of stakeholders.
The Company has a total of 11 Directors, including 4
Independent Directors (36%). Independent Directors
were re-elected for fewer than 3 terms. Among the
Directors, 5 are aged 65 years and older, 5 are aged 55
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
3. The composition and duties
of the Board
(1) Has the Board of
Yes
(1)
Directors devised a
policy and concrete
management objectives
for a more diverse
composition of the
Board? If so, has the plan
been implemented?
50
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
to 64, and 1 are under 55 years old. In order to
implement Taiwan's gender equality policy, increase
women's participation in decision-making and improve
the structure of the Board of Directors, the Company's
Board of Directors also includes two female directors
(18%).
The Company has built its strength by being focused
on the wire and cable, stainless steel, commodity, and
commercial real estate fields and become a model of
business excellence moving towards the
manufacturing service industry. If we look at the list of
directors of the Company, Yu-Lon Chiao, Chairman, has
been working in the business field of the Company for
a long time and has a good understanding of the
operation and development of the industry, with an
open-minded leadership style that encourages
adoption of suggestions; Director Yu-Cheng Chiao and
Director Yu-Heng Chiao have joined the management
team of the Company and therefore are familiar with
the organization and business operation of the
Company and are good at operation management;
Andrew Hsia, Director, comes from a diplomatic
background with an international perspective and
therefore has a good grasp of the conditions of the
Southeast Asian market and can fully assist the
Company in making relevant investment decisions;
Director Pei-Ming Chen's work experience is focused
on semiconductor business, and he has participated in
many mergers and acquisitions and international
business integration and therefore has operational
management experience and expertise. As for the two
female Directors, Ma Wei-Shin specializes in
technology leadership, operational judgment and
operational management, while Director Patricia Chiao
specializes in operational management, investment
judgment and human resources. The Company's
Independent Directors have industry knowledge and
an international market perspective, with Independent
Director Ming-Ling Hsueh specializing in finance,
accounting and corporate governance, Independent
Director Fu-Hsiung Hu having expertise and experience
in business administration, finance and securities, and
credit information, Independent Director King-Ling Du
having extensive steel expertise and being familiar
with the development and management of the
stainless steel industry, and Independent Director
Shiang-Chung Chen specializing in intelligent
technology leadership with a good grasp of the
development of Industry 4.0.
The Company attaches importance to the diversity of
the composition of the Board of Directors. The target
of more than 15% of directorships being held by
women is currently 18%; therefore, the
implementation thereof exceeds the target. The target
number of independent directors is three in
accordance with the law; however, the Company
values corporate governance and thus has four
independent directors (one in excess of the statutory
51 51
Corporate Governance Report
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
Yes
(2)
(2) In addition to
establishing a
Compensation
Committee and an Audit
Committee, which are
required by law, is the
company willing to also
voluntarily establish
other types of functional
committees?
target), accounting for 36% of all directors of the
Company.
The elite directors of the Company were selected from
the industry to participate in major investment
projects related to the Company's business, assist the
Company's financial, accounting and corporate
governance businesses according to their expertise,
and assist the Company in making favorable decisions
through their diverse experience, which gives rise to
extensive and professional advice.
Diversification of the Board of Directors' members has
been implemented as shown in Note 2.
In addition to the committee established according to
the laws, the Company further set up the Sustainable
Development Committee and the Nomination
Committee.
1. On November 1, 2019, the 17th meeting of the
Board of Directors of the 18th term resolved to
establish the Sustainable Development Committee,
in which the Chairman acts as the convener, and
Vice-Chairman and all Independent Directors act as
the members, and under which ethical management,
environmental safety and health management,
green operations, customer service and suppliers
management and promotion and employee relations
and social care promotion centers were established.
The Sustainable Development Committee reviews
the annual plans of each promotion center, monitors
and tracks the implementation results of each
promotion center, and revises its charter.
2. The Nomination Committee was established by the
resolution of the 10th Board of Directors Meeting of
the 19th Term on August 6, 2021, with Independent
Director Fu-Hsiung Hu as the convener and the
Chairman and the remaining three independent
directors as members. The duties of the Nomination
Committee include setting standards for the
diversity of expertise, experience, gender and
independence required of Board members, and
identifying, reviewing and nominating candidates for
election as directors.
(3) Has the company
Yes
established methods for
appraising the
performance of the
Board of Directors as
well as actual procedures
for executing the
appraisals? If so, has the
company executed
appraisals of the
performance of the
Board annually? Are the
results of the
performance evaluations
reported to the Board of
Directors and used as a
(3) In order to improve our corporate governance, the
Company's Regulations for the Board of Directors'
Performance Appraisal stipulates that the Board of
Directors of the Company shall conduct a performance
evaluation at least once a year using questionnaires
for self-evaluation, that the evaluation of the Board of
Directors shall be evaluated at least once every three
years by an external professional and independent
organization or a team of external experts and
scholars, and that the performance evaluation of the
current year shall be conducted at the end of the year,
so as to measure the directors' strategic direction in
leading the Company and to oversee the operation of
the Company's management in order to provide board
performance and increase long-term shareholder
value.
52
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
reference for individual
directors' remuneration
and nomination for
reappointment?
The Company engaged the Taiwan Corporate
Governance Association in September 2021 for the
second time to evaluate the effectiveness of the
Company's Board of Directors, and the Company
obtained professional, objective evaluation results and
suggestions through the guidance of, and idea
exchanges with, the evaluation members. Such results
and suggestions were used as a reference in the
compensation of individual directors and nominations
for reappointment.
The Company conducted its own internal evaluation
for 2022 in December 2022 and reported to the Board
of Directors on January 10, 2023. The result has been
published on the Company's website, and the results
of these evaluations will be used as a reference in
individual directors' compensation and nominations
for reappointment, for the purpose of continuous
refinement and optimization of the functions of the
Board of Directors.( Note 3)
(4) Has the company
Yes
(4) Before we appoint a new CPA annually, its
periodically evaluated
the level of
independence of the
CPA?
independence and competency shall be examined by
the Audit Committee and Board of Directors for
approval by resolution. In addition, we request the
CPA to provide an "Impartiality and Independence
Statement" each year. We have to confirm that except
for the expenses paid to the CPA for certifying our
financial statements and for handling certain financial,
tax affairs, we have no other business dealings with
the CPA and that their family members have not
violated the independence requirements. Only after
such confirmation, will we consider the CPA's
appointment and the relevant expenses.
Items for assessment of the CPA's independence are
shown as Note 4.
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
4. Has the TWSE- or TPEx-listed
Yes
1. The Company appointed a Head of Corporate
company designated a
proper number of competent
staff in charge of the
corporate governance-
related affairs (including but
not limited to providing
information for the Directors
and Supervisors to execute
their duties, assisting the
Directors and Supervisors
with legal compliance,
handling the affairs related
to the Board meetings and
the Shareholders Meeting as
prescribed by law,
preparing the minutes of the
Board meetings and the
Shareholders Meeting, etc.)?
Governance as resolved by the Board of Directors on
June 12, 2019. The key responsibilities of the Head of
Corporate Governance include the meeting affairs in
connection with board meetings, preparation of such
meetings' minutes, assistance for Directors with the
onboarding and continuing education, provision of
information required for the business execution by
Directors, assistance for Directors with legal compliance
and other matters set out in the Articles of Incorporation
of the Company or contracts.
2. Vice President of the Company, Hueiping Lo, is currently
the Head of Corporate Governance. She has more than
three years of experience as a financial officer of a public
company and meets the statutory qualifications as the
head of corporate governance.
3. On June 12, 2019, the Company's Board of Directors also
resolved to approve the "Standard Operating Procedures
for Handling Directors' Requests" (which was lastly
updated on April 9, 2021) pursuant to the rules, through
the establishment of which the Directors have
53 53
Corporate Governance Report
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
appropriate operating procedures for handling
information necessary for the performance of their
business.
4. The business execution for the year 2022 are explained
as follows:
i. To manage the meetings of the Board of Directors
and related committees, and to strengthen the
procedures of meetings and recusal of interests.
ii. To provide the directors with the information
necessary for the execution of their business within
the statutory period, to remind the directors of the
relevant laws and regulations that they should comply
with in the execution of their business or after the
resolution of the board of directors, and to follow up
on the situation and progress of the
recommendations or opinions of the directors after
the meeting.
iii. To revise and amend the important regulations of the
Company by adapting to the latest laws and
regulations related to the Company's business field
and corporate governance, including amendments to
the Company's Corporate Governance Best Practice
Principles, Regulations Governing Board Performance
Evaluation, etc.
iv. Based on the characteristics of the industry where
the Company is operating, to handle matters related
to directors' further education and regularly forward
information on relevant external further education
programs to assist directors in implementing the
diversified education mechanism. (Note 5)
v. To provide directors with the necessary corporate
information, maintain smooth communication
between directors and business executives, and assist
in arranging communication meetings between
independent directors and the chief audit executive
and accountants to facilitate the execution of
business by independent directors.
vi. To conduct performance evaluations of the Board of
Directors and functional committees.
vii. In September 2022, the "Electronic Board Meeting
Information" App has upgraded to provide real-time
information updates and a fast and smooth
communication platform.
The Company has been maintaining open communication
channels with interested parties that include customers,
shareholders, banks it has business dealings with,
employees, suppliers, communities, competent
authorities, or persons so connected with the Company.
Communication channels can be found on the Company's
internal and external websites as well as in its annual
reports, to facilitate understanding of the Company's CSR
issues that interested parties are concerned about, so that
appropriate responses can be made.
The Company has amended in 2020 the "Procedures for
Interested Parties to Submit Complaints and
Recommendations", through which interested parties can
communicate with the Company’s supervisory unit
directly, propose constructive advice and file complaints.
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
Yes
5. Has the company established
channels for communicating
with interested parties
(including but not limited to
shareholders, employees,
customers, suppliers, etc.),
set up a dedicated interested
parties area on the
company's website, as well
as appropriately responded
to important CSR issues that
interested parties are
concerned about?
54
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
The Company has a contact channel on its website
designated to stakeholders; a mailbox also exists on the
employee portal site, thus providing internal and external
personnel with a means to make suggestions and file
complaints to the Company. Information received shall be
handled by the Auditing Office.
The Company regularly reports to the Board of Directors
on its communications with various interested parties on
an annual basis starting from 2019. The communications in
2022 have been reported to the Board of Directors at the
board meeting on November 4, 2022. Details of both
communications were disclosed on the Company's
website: https://www.walsin.com/wp-
content/uploads/2022/11/111%E5%B9%B4%E5%BA%A6%
E5%88%A9%E5%AE%B3%E9%97%9C%E4%BF%82%E4%BA
%BA%E5%A0%B1%E5%91%8A.pdf
No The Company has handled such affairs by itself since March
1993.
6. Has the company appointed
a professional shareholders
service agency to handle
affairs related to the
Shareholders Meeting?
7. Information disclosure
(1) Has the company
established a corporate
website to disclose
information regarding the
company's financial,
business and corporate
governance statuses?
(2) Has the company adopted
other ways to disclose
information (e.g.,
maintaining an English-
language website,
appointing responsible
people to handle
corporate information
collection and disclosure,
appointing
spokespersons,
webcasting investor’s
conferences, etc.)?
Yes
(1) Please visit Walsin Lihwa Corporation's Chinese/English
website: http: //www.walsin.com
Yes
(2) The Company has a dedicated department for
collecting its information and periodically updating its
website. The Company has implemented one-
spokesperson policy. It has also established the
"Procedures for Handling Internal Material Information
and Prevention of Insider Trading " that requires
management as well as employees to properly keep
financial as well as business secrets. We also require
that personnel follow the "Corporate Governance
Principles and Practices". Any change of our
spokesperson or deputy spokespersons shall
immediately be made public.
The Company's website regularly discloses major
Such matters are
handled by the
Company’s
shareholder
service. Matters
related to
shareholders’
meetings are
conducted in
accordance with
the Company’s
Articles of
Incorporation and
laws and
regulations, so that
shareholders’
meetings are
convened in a legal,
valid and safe
fashion.
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
55 55
Corporate Governance Report
Actual Governance (Note 1)
Appraisal Items
Yes No
Summary Description
Deviations from
Corporate
Governance Best-
Practice Principles
for TWSE-/ TPEx-
listed Companies
and Reason(s)
announcements, transactions with key stakeholders
and investors conferences at:
https://www.walsin.com/investors/shareholder/#pills-
important-announcement
(3) Does the Company
Yes
(3) 1.
announce and report its
annual financial report
within two months after
the end of the fiscal year,
and announce and report
its first, second and third
quarter financial report
and operations for each
month well in advance of
the required deadline?
In order for investors to obtain adequate and
accurate financial information in a timely manner,
the Company's annual financial report is
submitted to the Audit Committee and the Board
of Directors for approval within two months after
the end of the year, and the financial report is
announced on the Market Observation Post
System on the date of approval by the Board of
Directors; the financial report for the first, second
and third quarter is submitted to the Audit
Committee and the Board of Directors for
approval one week before the statutory
announcement deadline, and the financial report
is announced on the Market Observation Post
System on the date of report to the Board of
Directors.
Yes
8. Has the company had other
information that is helpful
for understanding the status
of corporate governance
(including but not limited to
employee rights and
interests, investor relations,
supplier relations, rights of
interested parties, further
education sought by
Directors and Supervisors,
implementation of risk
management policies and
risk evaluation standards,
implementation of customer
policies, the taking out of
liability insurance for
Directors and Supervisors)?
In line with the
Corporate
Governance Best-
Practice Principles
for TWSE- and
TPEx-listed
Companies.
2. The Company's operations for each month are also
fully disclosed on the Company's website and the
Market Observation Post System before the
statutory deadline.
1. Refer to "(5) Our Fulfillment of Sustainable Development
and differences between Our Fulfillment of Sustainable
Development and the Development Best Practice
Principles for TWSE/TPEx Listed Companies and reason(s)
therefor " and "(6) Performance of ethical operations
and differences from the Sustainable Development Best
Practice Principles for TWSE/TPEx Listed Companies and
the reasons therefor" of this year's Annual Report for
information concerning employee rights and interests,
employee care, investor relations, supplier relations,
rights of interested parties, and the implementation of
the customer policies.
2. Please refer to "(8) Other important information helpful
for improving understanding of the governance of the
company" and "6. Risk Analysis and Assessment for the
Following Items as of the Latest Year and up to the Date
of Printing of the Annual Report" for the information
regarding the implementation of directors' and
supervisors' continuing education, risk management
policies and risk measurement standards.
3. The Company's purchase of liability insurance for
directors and supervisors has been disclosed to the
Market Observation Post System.
9. With respect to the results of the annual Corporate Governance Evaluation most recently issued by the Corporate
Governance Center of Taiwan Stock Exchange, please describe the improvements and provide priority and measures to
enhance those matters that have not yet been improved.
1. With respect to the 2021 Corporate Governance Evaluation results, our improvements in 2022 are as follows: We
strengthened the correlation between performance evaluation and remuneration for directors and managerial
officers.
Improvement Priorities and Measures: We promoted ISO 27001 Information Security Management System (ISMS)
and completed SGS third party validation to implement our commitment to information security by way of PDCA.
We comprehensively constructed the confidentiality, integrity, and availability of information security management
system of our organization, and helped the Company continuously strengthen its information security management
through management plans in different aspects, such as prevention before the event, monitoring during the event,
and response after the event.
2.
56
Note 1: The Company shall provide explanations in the summary description box, regardless of whether actual governance
is ticked "Yes" or "No."
Note 2: Diversification of the Board of Directors' members has been implemented as follows.
Diversification items
Title
Name
Gender
m
a
n
a
g
e
m
e
n
t
i
A
d
m
n
i
s
t
r
a
t
i
v
e
M
a
k
i
n
g
i
L
e
a
d
e
r
s
h
p
a
n
d
D
e
c
i
s
i
o
n
-
I
n
d
u
s
t
r
y
k
n
o
w
e
d
g
e
l
l
a
w
i
F
n
a
n
c
e
/
a
c
c
o
u
n
t
i
n
g
a
n
d
I
n
d
u
s
t
r
i
a
l
t
e
c
h
n
o
o
g
y
l
M
a
r
k
e
t
i
n
g
P
r
o
c
u
r
e
m
e
n
t
C
o
m
m
e
r
c
e
a
n
d
T
r
a
d
e
I
n
t
e
r
n
a
t
i
o
n
a
l
I
n
f
o
r
m
a
t
i
o
n
t
e
c
h
n
o
o
g
y
l
e
n
v
i
r
o
n
m
e
n
t
a
l
p
r
o
t
e
c
t
i
o
n
l
R
e
n
e
w
a
b
e
e
n
e
r
g
y
a
n
d
M
M
King-Ling Du
Ming-Ling Hsueh
M
F
M
M
M
M
F
Yu-Lon Chiao
Patricia Chiao
Yu-Cheng Chiao
Yu-Heng Chiao
Andrew Hsia
Pei-Ming Chen
Wei-Shin Ma
Chairman
Vice Chairman
Director
Director
Director
Director
Director
Independent
Director
Independent
Director
Independent
Director
Independent
Director
Note 3: No more than 1% of the earnings of the Company for a given year may be distributed to its directors and
managers as their remuneration for such year in accordance with Paragraph 1, Article 25 of the Company's
Articles of Incorporation. In order to regularly assess the remuneration of directors and managers, directors and
managers are remunerated according to their degree of participation in the Company's operations and personal
performance, and in accordance with the Company's "Rules Governing the Compensation of Directors and
Functional Members" and "Rules Governing the Evaluation of Manager's Performance and Management of
Compensation". Such remuneration will be further calculated and reasonably paid in a proportion of such
earnings by taking into consideration the evaluation items specified therein, such as the directors' individual
professional input and performance, the manager's business strategy and medium- and long-term strategic plans,
and how the policy plans and performance indicators at all levels are carried out in accordance with the current
year's operating objectives. In addition, the director and manager remuneration system will be reviewed from
time to time based on the actual operating status and relevant laws and regulations.
Shiang-Chung Chen
Fu-Hsiung Hu
M
M
Note 4: Items for assessment of the CPA's independence
Appraisal Items
1. The CPA and/or any of his/her family members has/have no direct or indirect significant
financial interest in the Company.
2. The CPA and/or any of his/her family members has/have no financing or guarantee relations
with the Company or its directors.
3. The CPA and/or any of his/her family members has/have no commercial relations with the
Company, or any of its directors or managers.
4. Currently or in the most recent two years, the CPA does/did not hold any posts in the
Company, such as the director, manager or any post which significantly influences the auditing
work, neither did company promise its CPA any foregoing post.
5. At the time of the audit, no family member of the CPA held any position as a director or
manager of the Company or that which had any direct and material influence on the audit.
6. During the audit period, no family member of the CPA held the posts in the Company, such as
the director, managers or any post which directly and significantly influences the audit work.
7. The CPA did not receive from the Company or its directors, managers, or major shareholders
any offer or gift, the value of which exceeds the usual social etiquette standards.
Results
Compliant with
Independence?
True
True
True
True
True
True
True
Yes
Yes
Yes
Yes
Yes
Yes
Yes
57 57
Corporate Governance Report
Appraisal Items
8. The CPA's audit
regarding
independence/conflicts of interests without any violation of the independence or any
unsettled conflict of interests.
the necessary procedures
implemented
team has
Results
Compliant with
Independence?
True
Yes
Note: Family members: They mean the CPA's spouse (or cohabitant), minors or other dependents.
Audit period: It usually begins from the date on which the members of the audit team start auditing and ends on the date
when the audit report is issued. If the audit case is cyclical, the cycle period belongs to the audit period.
Note 5: The further education received by Independent Directors and other Directors is disclosed in " (8) Other important
information helpful for improving understanding of the governance of the company" in this annual report.
(4) Composition, duties and operation of the Compensation Committee and the Nomination Committee:
1. Compensation Committee
On September 27, 2011, the Company established the Compensation Committee and drew up the "Regulations
Governing the Organization of the Compensation Committee". The Compensation Committee of the fourth term
has four members and is comprised of four independent directors. The Committee is aimed at helping the Board
establish and periodically review the performance appraisal of Directors and managers and the remuneration
policy, system, standards and structure, as well as periodically review and determine the remunerations for
Directors and managers.
(1) Information of the members of the Compensation Committee
Title
Name
Criteria
Independent
Director
(Convener)
Independent
Director
King-Ling Du
Ming-Ling Hsueh
Independent
Director
Shiang-Chung
Chen
Independent
Director
Fu-Hsiung Hu
Qualifications and Experience
Independence
Number of Other Public Companies in
which the Member also Serves as an on
the Compensation Committee
Please refer to the "Disclosure of Professional Qualifications of
Directors and Independence of Independent Directors" form on
pages 16 to 18
0
4
1
1
(2) Information on Operation of the Compensation Committee
A. The Company's Compensation Committee operates in accordance with the Company's Compensation
Committee Charter and holds at least two regular meetings each year.
B. There are 4 members of the Compensation Committee of the fourth term in the Company.
C. Term of office of the members: It started on August 4, 2020 and will end on May 28, 2023. The
Compensation Committee met three times in 2022. The attendance records of the committee members
are as follows:
Title
Name
Attended in Person Attended by Proxy
Attendance Rate (%)
Convener
King-Ling Du
Member
Member
Member
Ming-Ling Hsueh
Shiang-Chung Chen
Fu-Hsiung Hu
3
3
3
3
0
0
0
0
100%
100%
100%
100%
58
D
.The matters for discussion and resolution by the Compensation Committee and the Company’s handling
of the opinions of the members of the Compensation Committee:
Compensation
Committee
Meeting Number
and Date
Board of Directors
Meeting Number
and Date
4th Term
6th Meeting
January 7, 2022
19th Term
13th Meeting
January 11, 2022
4th Term
7th Meeting
February 18,
2022
19th Term
14th Meeting
February 22, 2022
Proposals and Resolutions
Proposal for 2021's managerial performanc
evaluation and bonus compensation
Proposal for performance bonuses for the
Chairman and Vice Chairman of
the
Company for 2021
Setting of
objectives for 2022
the Company's managers'
Proposal for distribution of the Company's
directors' and managers' remuneration for
2021
4th Term
8th Meeting
May 31, 2022
19th Term
19th Meeting
May 31, 2022
Proposal for the Company's 2021 capital
injection through stock options offered to
employees and officers
Company’s Handling
of Compensation
Committee Member’s
Opinion
Compensation
Committee:
The relevant
proposals were
passed with the
consent of all
members present and
submitted to the
Board of Directors for
resolution.
Board of Directors:
All of the Directors
present approved the
proposals
unanimously.
(3) Other details that need to be recorded:
Decisions made by the Compensation Committee for which certain committee members were against or had
reservations that were recorded or expressed via written statements: None
(4) Scope of Duties of the Compensation Committee
A. The Compensation Committee shall exercise the care of a good administrator to faithfully perform the
following duties and present its recommendations to the Board of Directors for discussion.
(A) Periodically reviewing the Compensation Committee Charter and making recommendations for
amendments.
(B) Establishing and periodically reviewing the annual and performance goals for the directors and
managers of the Company and the policies, systems, standards, and structure for their compensation,
as well as disclosing the standards for evaluating their performance in the annual report.
(C) Periodically assessing the degree to which performance goals for the directors and managers of the
Company have been achieved, and setting the types and amounts of their individual compensation, as
well as disclosing the director and manager compensation in the annual report.
B. The Committee shall perform the duties under the preceding paragraph in accordance with the following
principles:
(A) Ensuring that the compensation arrangements of the Company comply with applicable laws and
regulations and are sufficient to recruit outstanding talents.
(B) Performance assessments and compensation levels of directors and managerial officers shall take into
account the general pay levels in the industry, as well as the reasonableness of the correlation
between the individual's performance and the Company's operational performance and future risk
exposure.
(C) There shall be no incentive for the directors or managerial officers to pursue compensation by
engaging in activities that exceed the risk appetite of the Company.
(D) For directors and senior managerial officers, the percentage of remuneration to be distributed based
on their short-term performance and the time for payment of any variable compensation shall be
decided with regard to the characteristics of the industry and the nature of the Company's business.
59 59
Corporate Governance Report
(E) Reasonableness shall be taken into account when the contents and amounts of the compensation of
the directors, supervisors, and managerial officers are set. It is not advisable for decisions on the
compensation of the directors, supervisors, and managerial officers to run counter to financial
performance to a material extent. It is not advisable for said compensation to be higher than that in
the preceding year in the event of a material decline in profits or of long-term losses. If it is still higher
than that in the preceding year, the reasonableness shall be explained in the annual report and
reported at a shareholders' meeting.
(F) No member of the Committee may participate in discussion and voting when the Committee is
deciding on that member's individual compensation.
(G) The Committee shall explain at the meeting the remuneration of any of its members that is to be
discussed at such meeting. Such members shall not join the discussion and vote if it may do harm to
the interests of the Company, and shall recuse themselves from the discussion and voting, and shall
not exercise their voting rights on behalf of other members.
"Compensation" as used in the preceding two paragraphs includes cash compensation, stock options,
profit sharing and stock ownership, retirement benefits or severance pay, allowances or stipends of any
kind, and other substantive incentive measures. Its scope shall be consistent with the compensation for
directors and managerial officers as set out in the Regulations Governing Information to be published in
Annual Reports of Public Companies.
If the decision-making and handling of any matter relating to the remuneration of directors and
managerial officers of a subsidiary is delegated to the subsidiary but requires ratification by the board of
directors of the Company, the Committee shall be asked to make recommendations before the matter is
submitted to the board of directors for deliberation.
2. Nomination Committee
(1) The Committee shall be composed of at least three directors elected by the Board of Directors, in which a
majority of the independent directors shall participate.
(2) The Committee, under the authority of the Board of Directors, shall faithfully perform the following duties and
responsibilities with the due care as a good administrator and shall submit its recommendations to the Board of
Directors for discussion:
A. To establish the criteria of diversity and independence in terms of professional knowledge, technology,
experience and gender required for board members and managers, and to identify, review and nominate
candidates for directors and managers accordingly.
B. To establish the organizational structure of each functional committee and to review the establishment and
amendment of the organizational rules and regulations of each functional committee.
C. To establish and regularly review the directors' continuing education program and succession plans for
directors and managers.
D. To review the establishment and amendment of the Company's corporate governance and board of
directors' operating rules and regulations.
E. Other matters to be dealt with by the Committee as resolved by the Board of Directors.
(3) Professional qualifications and experience of the members of the Nomination Committee and its operations:
A. There are 5 members in the Nomination Committee of the Company of this term.
60
B. The term of office of the current members: August 6, 2021 to May 28, 2023. The Nomination Committee
met three times in 2022, and the professional qualifications and experience of the members, their
attendance and matters discussed are as follows:
Title
Name
Convener
Fu-Hsiung Hu
Member
Yu-Lon Chiao
Member
Ming-Ling Hsueh
Member
King-Ling Du
Member
Shiang-Chung Chen
Professional
Qualification and
Experience
Please refer to the
"Disclosure of
Professional
Qualifications of
Directors and
Independence of
Independent
Directors" form on
pages 11 to 13.
Personally
Attended
Attended
by Proxy
Attendanc
e rate (%)
Remarks
3
3
3
3
3
0
0
0
0
0
100%
100%
100%
100%
100%
(4) Other matters that should be specified:
The results of the discussions and resolutions of the Nominating Committee and the Company's handling of the
opinions of the members in 2022:
Nomination
Committee Meeting
Number and Date
Board of Directors
Meeting Number and
Date
Proposals and Resolutions
1st Term
3th Meeting
January 11, 2022
19th Term
13th Meeting
January 11, 2022
1st Term
4th Meeting
April 29, 2022
19th Term
17th Meeting
May 6, 2022
1st Term
5th Meeting
July 29, 2022
19th Term
20th Meeting
August 5, 2022
Proposal:
Resolution:
Proposal:
Resolution:
Report
Proposal:
Resolution:
Proposal:
Resolution:
Proposal to amend certain articles of
and the relevant schedules to the
Company's Regulations Governing
Board Performance Evaluation.
Proposal passed, except it was
resolved that Article 8 thereof not be
amended.
Proposal to amend certain articles of
the Company's Corporate
Governance Best Practice Principles.
This proposal was withdrawn after
the chairman consulted with all
members present at the meeting.
The results of the Company's 2021
corporate governance evaluation and
the report on the improvement plan
for 2022 are hereby submitted for
review and approval.
All directors present were aware of
the foregoing matter.
Proposal to amend certain articles of
the Company's Corporate
Governance Best Practice Principles.
Proposal passed and submitted to the
Board of Directors for approval and
discussion.
Company’s
Handling of
Compensation
Committee
Member’s Opinion
All of the Directors
present approved
the proposal
unanimously.
All of the Directors
present approved
the proposal
unanimously.
61 61
Corporate Governance Report
(5) Our fulfillment of sustainable development:
The Company has established the Sustainable Development Committee under the Board of Directors, which is in
charge of the following matters and structured as follows:
Duties of the Committees
Responsibility and function
It is our highest-leveled CSR organization which establishes our corporate sustainable
development vision and strategy, reviews the overall operational directions of the Group
and each promotion center through regular meetings and oversees the implementation
results. It reports the annual CSR results to the Board of Directors in the following year.
It is responsible for formulating and promoting policies and systems related to ethical
management, integrating integrity and ethical values into the Company's business
strategies, and assisting the Board of Directors and the senior management in checking and
evaluating the effectiveness of the preventive measures established to implement ethical
management.
It is responsible for formulating our environmental protection, safety and health policies,
implementing related plans, planning energy and carbon management, overseeing and
reporting on the implementation performance and guidance. It is composed of the heads
of cross-business units and related departmental managers to execute the above matters.
It carries out the interdepartmental integration and implementation promotion on related
issues above.
It is responsible for formulating the green operation strategy and identifying green
products and services with future value based on the implementations of CSR, including
product design, material procurement, manufacturing, and sales and service systems,
which are all green oriented.
It is responsible for formulating policies and implementation plans for the improvement of
customer service quality and supplier management, overseeing and reporting on the
implementation performance. Being composed of the heads of cross-business units and
related departmental cadres,
integration and
implementation promotion on related issues.
It is responsible for promoting and building a safe and healthy working environment for
employees to fully utilize their talents for reasonable compensation and benefits. It also
develops social care policies to actively participate in the public welfare, social cares and
CSR education, so as to pay back to society with concrete, continuous action.
It is a staff unit established under the Sustainable Development Committee and is
responsible for assisting the Committee in exercising its responsibilities, tracking resolution
issues and coordinating the integration of the operations of the various promotion centers.
It is responsible for the preparation of CSR reports and the disclosure of CSR-related
information and the CSR promotion.
it carries out the
interdepartmental
Department
Sustainable Development
Committee
Ethical Management
Promotion Center
Environment, Safety and
Health Promotion Center
Green Operation Promotion
Center
Customer Service and Supplier
Management Promotion
Center
Employees Relations and
Social Care Promotion Center
Secretary Office
Corporate Social Responsibility
Report Preparation Team
62
The Differences between Our Fulfillment of Sustainable Development and the Development Best Practice
Principles for TWSE/TPEx Listed Companies and reason(s) therefor:
Actual Implementation
Promotion items
Yes No
Summary description
I.
Yes
promote
Has the Company established
a governance structure
to
promote
sustainable
development and set up a
dedicated (or part-time) unit
sustainable
to
development, which unit
is
handled
senior
by
management as authorized by
the Board of Directors? And
how does
the board of
directors supervise the same?
II.
Yes
Does the Company conduct
risk
of
assessments
and
environmental,
social
issues
corporate governance
the Company's
to
related
operations
formulate
and
risk management
relevant
policies
in
strategies
or
accordance with the principle
of materiality? (Note 1)
"Corporate
1. The Company's 7th meeting of the Board of
Directors of the 17th term approved the
establishment of
Social
the
Responsibility Committee" in April 29, 2015, and
the 17th meeting of the Board of Directors of the
18th term in November 1, 2019 approved the
establishment and organizational charter of the
"Sustainable Development Committee" by
existing
Social
the
merging
Responsibility
"Ethical
Committee"
Management Committee". The establishment
and the appointment of its members have been
approved by the Board of Directors, and the
is
Sustainable
responsible
corporate
sustainability strategies and visions to promote
CSR-related work and management.
Development
for
"Corporate
and
Committee
developing
2. The Committee is composed of the Chairman as
convener, and the Vice Chairman and all
independent directors as members. The
Committee has five promotion centers, including
the Ethical Management Promotion Center, the
Environment, Safety and Health Management
Promotion Center,
the Green Operation
Promotion Center, the Customer Service and
Supplier Management Promotion Center, and
the Employee Relations and Social Care
Promotion Center.
3. The Board of Directors receives regular reports
on operations, finance, corporate governance,
sustainability issues, etc. Through the diverse
experience of its members, the Board offers
broad and professional opinions to assist the
Company in making appropriate decisions and
in a clear strategic
guiding the Company
direction.
the
Sustainable Development Committee were held:
the progress for the first half of 2022 was
reported on July 29, 2022, and the execution
results for 2022 and 2023 implementation plan
were approved by resolution on December 9,
2022.
two meetings of
In 2022,
1. In order to ensure the sound operation and
sustainable development of the Company, the
"Rules
for Risk Management Policies and
Procedures" were approved by the 19th meeting
Board of Directors of the 18th term in February
27, 2020 to establish an overall risk management
system. The Board of Directors, the Audit
Committee, the Auditing Office, the President
and
risk
President's Office,
management unit, and each unit and subsidiary
of the Company are collectively involved in
promoting the implementation of relevant risk
each
the
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
63 63
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
management measures.
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
environmental,
social
issues and planned
2. For the purpose of reducing the impact and
influence of internal and external risks, the
Company's governance units and other risk
management units have identified risks related
corporate
to
relevant
governance
management
in
accordance with the principle of materiality, the
business and operational characteristics of the
Company. The results of risk assessments
(including management policies, strategies or
mechanisms
risk category) are
summarized in Note 3.
control measures
for each
and
and
Environmental Issues
III.
(1) Has the Company established
a
environmental
management system based on
the
its
characteristics of
industry?
proper
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
3. In 2022, risk identification was carried out in a
systematic manner, and the identified risks were
measured and monitored by each
risk
management unit and reported to the Board of
Directors on November 4, 2022 (for the report,
please refer to https://www.walsin.com/wp-
content/uploads/2022/11/111%E5%B9%B4%E5
%BA%A6%E9%A2%A8%E9%9A%AA%E7%AE%A1
%E7%90%86.pdf).
Yes
(1) 1. The Company's Environmental, Health and
Safety Promotion Center under the Sustainable
Development Committee has set targets for
energy saving and carbon reduction, water
management and waste reuse in accordance
with Walsin Lihwa Environmental, Health and
Safety Policy, including a 10% carbon reduction
by 2025 compared to 2014, a 15% reduction in
water use in 2030 compared to 2014, and
capital expenditures to replace production
equipment, develop green processes, and
promote source improvement. Please refer to
Chapter 5 (Climate Strategies and Sustainable
Environment) of the 2022 Annual Sustainability
Report or the "Climate Strategies and
Sustainable Environments" page of the
Corporate Sustainability Section on the
Company's website
(https://esg.walsin.com/zh_TW/focus/saving)
for related specific results.
2. The environmental management of the
Company's domestic and overseas plants has
been carried out in accordance with
government regulations and international
environmental protection conventions. The
plants in Taiwan (Hsinchuang Plant 1,
Hsinchuang Plant 2, Yangmei Plant, Taichung
Plant and Yanshui Plant) and China (Shanghai
Power Plant, Jiangyin Plant, Yantai Plant and
Changshu Plant) have all received the
"Environmental Management System"
certification (ISO 14001:2015). The Company
64
Actual Implementation
Promotion items
Yes No
Summary description
(2) Has the company made efforts
to improve the efficiency of
resources utilization and use
recycled materials which have
a
the
impact
environment?
low
on
will also continue to improve and refine our
environmental management performance.
Please refer to the Company's website -
Document Center - Environmental Safety and
Health Policy and Related Certificates
(https://www.walsin.com/about-
us/newsroom/#pills-reports-document) for
relevant verification standards.
Yes
(2) 1. Walsin strives to be an environmentally
sustainable enterprise, and increases its
investment in energy saving, carbon reduction,
and resource recycling software and hardware
year by year, such as "control of reasonable
energy consumption per unit of the product",
"equipment energy efficiency management
and improvement", "reduction of smelting
process energy consumption and carbon
emission", waste heat recovery and process
technology improvement (such as pure oxygen
combustion technology and yield
improvement), and green power installation
(such as solar energy).
2. The Company mainly produces wire and
cable and stainless steel. After these two types
of products have gone through the stages of
production, use and disposal, they can be
recycled and reused to return to their life cycle,
which is in line with the concept of recycling for
new products in a circular economy. Regarding
the use of raw materials and materials used for
packaging, in addition to continuously raising
the rate of using recycled stainless steel and
carbon steel as raw materials, Walsin also
considerably uses recycled pallets, iron frames,
iron (wood) shafts, wooden plates, and iron
plates as packaging materials for copper wire
and cable. In 2022, approximately 93% of the
products produced by Cable & Wire Business
Group used recycled raw materials and
approximately 54% of those products used
recycled packaging materials; approximately
34.55% of the products produced by Stainless
Steel Business Group used recycled raw
materials for scrap steel and approximately
65.28% of those products used recycled raw
materials. For specific results, please refer to
Section 3.2 "Green Operations" of the 2022
Annual Sustainability Report or the "Industry
Innovation and Value Chain Integration" page
in the Corporate Sustainability section of the
Company's website
(https://esg.walsin.com/zh_TW/focus/creative
/green).
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
65 65
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
Yes
(3)
(3) Has the company assessed the
current and future potential
risks and opportunities of
climate
the
change
business and taken measures
to address climate related
issues?
for
In 2020, the Company formulated its risk
management policies and procedures to
incorporate climate change and environmental
risks into its management in accordance with
its business operations and operating
characteristics. The Company also introduced
the Climate Related Financial Disclosures
(TCFD) to set up the framework for managing
risks and opportunities relating to climate
change.
In accordance with the recommendations of
the Climate Related Financial Disclosures
(TCFD), in 2022, we set up different climate
scenarios, evaluated possible climate-related
risks and opportunities, studied international
climate change trends and industry-related
trends, and assessed internal and external
stakeholder attitudes, thereby identifying the
climate-related risks and opportunities for
Walsin Lihua. Please refer to Chapter 5
(Climate Strategies and Sustainable
Environment) of the 2022 Annual Sustainability
Report or the "Climate Strategies and
Sustainable Environment" page of the
Corporate Sustainability Section on the
Company's website
(https://esg.walsin.com/zh_TW/focus/saving/c
limate) for related specific results.
Yes
(4) Has the Company compiled
statistics on greenhouse gas
(GHG)
water
emissions,
consumption and total weight
of waste in the past two years,
and formulated policies on
energy conservation, carbon
reduction, GHG
reduction,
water consumption reduction
or other waste management?
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
(4) 1. The Company's energy-saving and carbon-
reduction strategy is to "implement lean
production management", "control reasonable
energy consumption per unit of the product",
"manage and improve equipment energy
efficiency", and "reduce energy consumption
and carbon emissions in the smelting process".
In addition, the Company will increase the
investment in software and hardware for
energy saving, carbon reduction and resource
recycling year by year, such as green raw
materials, waste recycling/regeneration (such
as recycling waste metals to replace natural
mineral mining, waste plastic recycling plastic
pellets, and waste acid regeneration), water
resources recycling (such as process cooling
water recycling and reuse of reclaimed water),
energy recycling (such as waste heat recovery)
and process technology improvement (such as
pure oxygen combustion technology and yield
improvement), end-of-line reuse and disposal
(such as furnace slag), and investment in green
power constructions (such as solar energy).
etc.
2. Our annual statistics on greenhouse gas
emissions, water consumption and total waste
volume indicate total greenhouse gas
emissions of 621,766.43 tonnes of CO2e, total
66
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
water consumption of 14,026 million liters and
total waste of 234,257 tonnes in 2022, an
increase by 0.93%, a drop by 14.51%, and an
increase by 17.87%, respectively, compared to
2021.
(1). Greenhouse gas emissions for the last 2
years (by the plants of the Company based in
Taiwan, Mainland China, and Malaysia)
Year
Scope 1
Scope 1
Unit: CO2e(tonnes)/Product(tonnes)
Emissions per
Product
0.46
0.48
414,804
2021
2022 194,649.63 427,116.80
201,262
(2). Water consumption for the last 2 years (by
the plants of the Company based in Taiwan,
Mainland China, and Malaysia)
Unit: Million liters / product (tonnes)
Year
2021
2022
Total Water
Consumption
16,409
14,027
Water Consumption
per Product
12.19
11.01
(3). Waste output for the last 2 years (by all
plants and subsidiaries of the Company)
Year Hazardous
2021
2022
Wastes
71,696
73,718
Unit: tonnes/product (tonnes)
Output per
Non-Hazardous
Product
Wastes
0.15
127,038
0.18
160,539
3. Our Taiwan plants have obtained ISO14064-
1:2018, ISO50001 certification and ISO
14067:2018 (Hsinchuang Plant), and our
overseas plants have obtained ISO50001
certification (Yantai and Shanghai
Plants).Please refer to the Company's website -
Document Center - Environmental Safety and
Health Policy and related certificates
(https://www.walsin.com/about-
us/newsroom/#pills-reports-document) for
relevant verification standards.
Yes
1.
IV. Social Issues
(1) Has the Company established
its management policies and
procedures in accordance with
relevant laws, regulations, as
well
international
conventions regarding human
rights?
as
2.
rights.
Implementation of gender work equality: We
comply with the Act of Gender Equality in
Employment to protect the gender equality in
The Company does not
work
in
discriminate on
the basis of gender
position
recruitment,
determination,
appraisal,
promotion, educational training, and welfare
and benefits, except when certain positions are
only suitable for a specific gender.
performance
screening,
hiring,
disabilities: We
Employment of people with physical and
mental
the
employment opportunities of people with
physical and mental disabilities, and the
number of our employees with physical and
mental disabilities are more than that required
the People with Disabilities Rights
by
protect
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
67 67
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
Protection Act and the Indigenous Peoples
Employment Rights Protection Act.
that
rights
3. Creating a diverse and inclusive culture: We
respect basic human
are
internationally recognized, do not discriminate
our employees on the basis of gender, race,
age, marital status, political stance, religious
beliefs, nationality, etc., encourage
the
exchange of ideas, value team members by
making them feel kindness and respect, and
inclusive
actively create a diverse and
workplace.
4.
Yes
1.
(2) Has the company established
and implemented reasonable
employee benefit measures
(including
compensation,
vacation and other benefits)
reflected
and
operating performance or
results
employee
in
compensation?
properly
68
a
in
channel:
Establishing
The
complaint
Company's Auditing Office has set up an email
address for complaints and a dedicated person
to receive them. For sexual harassment
prevention and control, we have formulated
the "Workplace Sexual Harassment Prevention
and Control Measures for Complaints and
Discipline" to protect gender equality at work
and to provide a working environment where
employees and visitors to our office are free
from sexual harassment. In the event of any
sexual harassment, the victim or his or her
agent may file a complaint with the Sexual
Harassment Complaint Committee either
verbally or in writing. In addition, the Company
has established relevant regulations
its
internal documents to protect the human
rights of employees and set up a complaint
channel for employees in the event that their
legal rights are violated or improperly handled,
and that such issue cannot be resolved in a
reasonable manner.
importance to the
The Company attaches
physical and mental health and welfare of our
employees by organizing book clubs, seminars
and competitions from time to time, in order
to increase exchanges among colleagues and to
achieve work-life balance. The Company also
provides
diversified
welfare measures. The Employee Welfare
Committee was established to handle various
welfare matters, including wedding and funeral
celebrations; maternity; company travel; club
subsidies; bonuses for three festivals, Labor
Day and birthday; children's scholarships;
interest-free loans; and hospitalization grants.
To
operational
performance of the Company, it has work rules
and management regulations, which cover
basic wages, working hours, annual leaves
more than what is provided in the Labor
Standards
Act,
meal/transportation/communication subsidies,
group insurance and health check-ups, and the
provision of staff restaurants, dormitories,
comprehensive
improve
overall
and
the
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
transportation vehicles, parking spaces, etc.
The Company's main business is wire and cable
and stainless steel manufacturing, which is a
labor-intensive industry. The operational work
at factories is mainly done by male employees,
so the proportion of male employees is higher
than that of female employees. In 2022, the
percentage of our female employees was
14.5% and the percentage of our female
management positions was 21.7%, showing an
increasing trend year by year.
2.
is competitive;
The Company conducts regular market salary
surveys to ensure that its overall compensation
structure
it also provides
performance bonuses and production bonuses
based
operational
performance, the achievement of team goals
and individual employees' performance. We
also pay our employees at a rate of not less
than 1% of our current year's profit to motivate
those who have performed well.
Company's
the
on
and
(3) Has the company provided a
healthy work
safe
environment
for employees
and provided education on
safety
for
employees on a regular basis?
health
and
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
Yes
safety
19,916
participating
(3) 1. In order to protect the health and safety of
employees,
in addition to the necessary
training required by law and regulations, our
training plan has been
annual
formulated according to the actual production
and each job type on site, taking into account
safety accidents in the previous year. In 2022,
we offered training to 1,409 participating new
in-service
recruits,
employees/1,155 sessions (internal/external),
and 3,651 participating contractors (before
entering factories)/739 sessions, mainly for in-
service employees (accounting for 79.74%). We
also have training plans for dedicated ESH
personnel, special hazardous operators, and
first aid personnel. For ESH training and
certification, a complete certification system
has been set up to keep track of the movement
and demand for certification at each site. E-
Learning online courses are also planned in
2023 to improve the training rate, thereby
establishing a concept and culture that values
workplace safety.
2. Our occupational
safety and health
management system (ISO 45001) covers all
workers (employees, contractors and visitors)
in Taiwan (Hsinchuang, Yangmei, Taichung,
Yenshui), China (Shanghai Huaxin, Dongguan
Huaxin,
Jiangyin Alloy,
Changshu Huaxin, Yantai Huaxin) and PT.
Walsin Nickel Industrial Indonesia, with an
overall coverage rate of 73.33% (Taipei Head
Office, Nanjing Property (Taipei Head Office,
Nanjing Real Estate, and Malaysia have not yet
been verified). Our Taiwan and China plants
Jiangyin Walsin,
69 69
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
have obtained ISO45001 certification. Please
refer to the Company's website - Document
Center - Environmental Safety and Health
Policy
certificates
(https://www.walsin.com/about-
us/newsroom/#pills-reports-document)
standards/scope
related
validity period.
verification
for
and
related
and
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
3. The number of employee accidents in 2022
was 51 (51 people in total), and the rate of
recordable occupational injuries was 0.41%
(the rate of cases per 200,000 man-hours). In
order to avoid recurrence of occupational
accidents, we have conducted risk assessment
and revision of related safety standards, using
Taichung and Yenshui Plants as KYT preliminary
drill sites to promote TPS spirit and Pointing
and Calling (KYT) activities. It is also combined
with SJP (Safety Job Procedures) to simplify the
identification of high-risk operations (SJP / TPM
/ 5S) and to combine critical and important
operations with the KYT of TPS using Pointing
and Calling. We have implemented it in daily
operations to enhance the overall hazard
identification.
The Company has developed a training system
according to each profession and
level, and
promoted three types of training methods: On-Job
Training (OJT), Off-Job Training (OJT), and Self
Development (SD) to support the development of
the Company's talent, so that employees can follow
in the capacity enhancement and cross-discipline
learning, in order to maintain the competitiveness
of the market. We develop knowledge/skill areas
and learning blueprints each year according to the
needs of our employees at each stage of their work
and career development, and provide diversified
training resources such as new recruit education
and training, basic/advanced internal knowledge
sharing, application of scientific tools (data analysis,
leadership
image recognition, etc.), work skills,
training, and industry trends. According to the
application level of knowledge and skills, we have
planned online knowledge courses, offline learning
communities,
classroom
courses/workshops. In 2022, the employee training
expenses were NT$15,401,000, and there were
47,811 training participants trained for 120,869.51
hours in total. On average, 22.79 hours of training
were received per employee. At the same time, in
the first and second half of each year, during the
implementation of performance appraisal,
in
addition to conducting the annual work review in
conjunction with colleagues, supervisors understand
the potentials of colleagues, professions and areas
to be improved based on their implementation of
their work, and jointly formulate development plans
for training, rotation and participation in projects.
mixed-level
and
(4) Has the company established
an
career
effective
development and capability
training
its
program
employees?
for
Yes
70
Actual Implementation
Promotion items
Yes No
Summary description
Yes
(5) Does the Company comply
with relevant regulations and
international
standards
regarding customer health and
safety,
privacy,
customer
marketing and labeling of its
products and services, and has
it formulated relevant policies
and complaint procedures to
protect consumer rights?
Yes
relevant
(6) Does the company have a
supplier management policy
requiring suppliers to comply
regulations
with
environmental
governing
protection,
occupational
safety and health, or human
rights in the workplace, and
how is it implemented?
to
the
In order
(5) 1. Our products and services are marketed and
clearly labeled in accordance with local and
international regulations and standards or
requirements of our
pursuant
to protect business
customers.
information and
the
Company establishes a code of ethical conduct
for employees and
security
policies and relevant regulations (Note 3) to
prevent any unauthorized access to, alteration
to, or improper disclosure of any information
that may infringe on customer privacy and
rights.
customer privacy,
information
the
information, and
In addition to providing its latest information,
product
telephone
numbers and e-mail addresses of the persons-
in-charge of each business on its website, the
Company has established communication
channels through which interested parties can
make complaints or communicate with the
Company. Upon receipt of any information
from an interested party, the Company will
transfer the case to a dedicated person for
him/her to confirm or handle, in order to reply
to the stakeholders within the time limit.
2. We have not violated any product- or
service-related laws or regulations regarding
customer health and safety, customer privacy,
marketing and labeling of our products and
services in 2022.
the
the
rules
latest
3. For
information, product
information, contact phone numbers and
emails, please refer to the Company's website.
https://www.walsin.com/our-business/
https://www.walsin.com/about-us/contact-us/
(6) 1. In order to strengthen and implement the
sustainable management of its suppliers, the
Company has established a supply chain
for
sustainability policy and
evaluating
the suppliers' performance of
corporate social responsibility, and requires
suppliers
to comply with environmental
protection, occupational safety and health or
labor human rights regulations in purchase
orders and contracts. Key suppliers and new
suppliers, in addition to signing the "Supplier
Management Commitment Letter", also need
to conduct self-assessments through the Key
Assessment
Supplier
Questionnaire, with evaluation items including
(i.e., sustainability management,
economic
supplier management, and
secret
protection), social (i.e., human rights, health,
(i.e.,
and
management system, greenhouse gas, air
pollution, water resources management, and
environmental
Sustainability
safety),
trade
and
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
71 71
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
waste management) aspects for the purpose of
identifying the degree of sustainability risk of
each key supplier, in order to comply with CSR-
related regulations along with the partnering
suppliers and ensure that the supply chain
fulfills its CSR commitments and implements
the Principles for Supplier CSR Performance
Assessment.
2. In 2022, there were 173 key suppliers in the
Wire and Cable, Stainless Steel and Commercial
and Real Estate Business Groups, among which
161 have been evaluated for their risks. Of
them, 25 were high-risk suppliers, 71 were
medium-risk suppliers, and 65 were low-risk
suppliers. In 2022, we kept conducting on-site
audits, interviews and guidance with regard to
high-risk key suppliers to prevent and reduce
the occurrence of risks, and will continue to
conduct on-site audits and guidance with
regard to high-risk key suppliers.
In line with the
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies.
Yes
1. Since 2014, we have been compiling
sustainability reports (Note 4) by reference to the
Global Reporting Initiative's (GRI) G4 Standards,
and since 2017, the report structure has followed
the core options of the latest GRI Standards. In
2020, we introduced the Sustainability
Accounting Standards Board (SASB) Industry
Standard and the Task Force on the Climate-
related Financial Disclosures (TCFD) framework to
provide stakeholders with more complete and
transparent ESG information.
2. Since 2015, we have engaged Deloitte Taiwan to
perform third-party assurance checks on our
reports and have obtained the CPA Statement of
Limited Assurance. The third-party assurance
checks are performed every year in accordance
with the standards set forth in Statement of
Standard on Assurance No. 3000, "Assurance
Cases Other Than Audits or Reviews of Historical
Financial Information" and "Rules for the
Preparation and Reporting of Sustainability
Reports by Public Companies." As of the date of
publication, the 2022 Annual Sustainability
Report is being under assurance checks by
Deloitte Taiwan, which is expected to issue a
statement of assurance in May 2023.
V. Did
its
Company make
the
reference
international
to
standards or guidelines for the
reports
preparation
in
of
preparing
sustainability
reports and other reports that
non-financial
disclose
information
the
Company? Did the Company
obtain a third-party certification
or
confirmation
agency's
assurance opinion on
said
reports?
about
VI.
If your company has established sustainable development principles based on "Sustainable Development Best
Practice Principles for TWSE/TPEx Listed Companies", please describe differences between the principles and their
implementation:
In December 2014, the Company has established, based on "Sustainable Development Best Practice Principles for
TWSE/TPEx Listed Companies" (Note 4), its Corporate Governance Best Practice Principles, which has also been
approved by the Board of Directors. In line with the amendments to Sustainable Development Best Practice
Principles for TWSE/TPEx Listed Companies, the Board of Directors amended the Corporate Governance Best Practice
Principles in January 2018, April 2020, January 2022, and February 2023. The Corporate Governance Best Practice
Principles serve as the guidelines for the Company to establish and to execute related policies related to corporate
governance, ESH management, customer service and supplier management, green operation, employee relations and
social care. There are no discrepancies between the principles and actual practice.
72
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
VII. Other key information useful for explaining the promotion and execution of sustainable development:
(1) With regard to developing a sustainable environment, please refer to "V. Operating Status, IV. Environmental
Protection Expenditure Status" in the annual report.
(2) With regard to the Company's observing relevant labor regulations by safeguarding the lawful rights and interests of
its employees and providing a safe and healthy work environment for its employees, please refer to "Operating
Status, Labor-Management Relations" in the annual report.
(3) "Growth and integration with the local communities" is the philosophy in the social care of Walsin. It is a continuous
implementation focused in four directions: "Corporate Citizen", "Minority Support", "Environment Conservation",
and "Community Development". The results in 2022 may be summarized as below:
1. Inauguration of Walsin-Taiwan National University Innovation and Research Center
Walsin and National Taiwan University jointly established the Innovation and Research Center to conduct industrial
research on metal materials, invest in green recycling technology issues, develop applications of business-produced
waste, green metal supply chain, green energy, and energy saving and carbon reduction technologies, and cultivate
talents in related fields. In its opening ceremony, the results of the 1st Walsin Lihwa-NTU Technical Exchange Poster
Competition was also accounted, scholarships were awarded to 18 outstanding students, and they had a discussion
with the faculty members of NTU's College of Engineering. We expect that academic resources and industrial
applications will be more closely integrated to contribute to the development of environmental sustainability and
green energy industry.
2. Supporting the Culture Heritage of Traditional Chinese Opera
Traditional Chinese opera, a performing art that is not easily preserved in its entirety, serves as a bridge between
contemporary and ancient times. To support the preservation of this traditional culture, in 2022, we continued to
sponsor the Wei-Hai-Min Foundation for the Arts of Peking Opera to support the traditional arts in a practical way,
so that more people can appreciate the beauty of the art of traditional Chinese opera.
3. Supporting the Screening of a Documentary on Pandemic Prevention
During the COVID-19 pandemic, the HannStar Foundation produced the film "No One Should Be an Isolated Island"
documenting the journey of the staff at HannStar House as the first public quarantine hotel in Taiwan, as they work
together in unity and navigate their way through the pandemic. To thank the pandemic prevention staff for their
dedication and to support Taiwan's excellent cultural arts work, Huaxin sponsored a screening of the film and
invited colleagues and family members to enjoy it together, bringing them to the realization that everyone plays an
integral part in the pandemic prevention work.
4. "Illuminating the Corners of Taiwan":
The Company has initiated the 5-year sponsorship project "Illuminating the Corners of Taiwan" in the end of 2016
to give back to society. The projects hopes to pay it forward by offering 5 elementary and junior high schools in
rural Taiwan with relatively low resources more comprehensive faculty, environment and equipment and to
develop characteristic physical and musical education. The second phase of the five-year plan will be launched in
2022 in cooperation with five existing schools to continue to deepen the various incubation programs.
5. Long-Term Care for Children's Education:
The Company and its employees regularly sponsor 12 child welfare organizations, including World Vision Taiwan,
Taiwan Funds for Children and Families, Child Welfare League Foundation, the Lotus Heart Garden Nursery School
in Houbi District, and Chinese Childrenhome & Shelter Association, in a total of NT$1.6 million in 2022.
6. Taiwan Native Plant Resources Conservation Project:
To promote cultivation of talents for conservation, collection and management of aboriginal Taiwan plant
resources, Walsin Lihwa cooperated with College of Agriculture and Natural Resources, National Chung Hsing
University to install a screen-house and an outdoors nursery, cultivate seedlings for afforestation applications and,
environmental education and promotion for conservation, and protect Taiwan's diverse protected animal and plant
resources. Starting from 2018, the Company and Winbond Electronics Corporation cooperated to incorporate
Huabao Seed Breeding Co., Ltd., responsible for promoting Taiwan's forest germplasm conservation and indigenous
plants revegetation projects. In 2022, we implemented the related planning and technical training.
7. Support Local Agriculture
(1) Organic Kiwifruit Contract Farming:
In order to support environmental ecological conservation and the development of organic agriculture,
starting from 2021, we cooperated with "Jianghao Farm Young Farmers", contracted with them for organically
planted Taiwanese native kiwi fruit that is conducive to soil and water conservation, with the contracted
farmland expanding to 1,000 Ping. We took practical actions to support local small farmers who cultivated in a
friendly environment. .
(2) Support Taiwan's Local Agricultural and Fishery Products:
Every year, in support of local small farmers, Walsin's Employee Welfare Committee purchases natural and
healthy agricultural products as gifts for festivals for all employees in Taiwan. In 2022, we prepared Tainan
fishery and agricultural products from Tainan for the Dragon Boat Festival, selected pure honey from Tainan
73 73
Corporate Governance Report
Actual Implementation
Promotion items
Yes No
Summary description
Deviation from
Sustainable
Development Best
Practice Principles for
TWSE/TPEx Listed
Companies and
reasons therefor
for the Mid-Autumn Festival, and ordered lotus root related products from White River, Tainan as Lunar New
Year gifts for our colleagues, in the hope that all Walsin staff can eat them with peace of mind, become
healthy, and support the local farming industry.
8. "Elementary and Junior High School Newspaper Reading Project":
(1) Starting from 2014, this partnership between Mandarin Daily News sponsors newspapers for primary/junior
high schools in the counties and cities in Taiwan where our plants located. The school teachers led students to
understand the subjects of newspaper reports, and through interactive discussions, expanded their horizons
and laid the foundation for their language skills. In 2022, we sponsored 78 classes in 17 schools in New Taipei
City, Taoyuan City, Taichung City, Tainan City and Kaohsiung City, benefiting 1,230 students. Since 2019, Walsin,
together with the Walsin Technology Foundation and Mandarin Daily News, has launched a bilingual reading
education program. In 2022, we promoted this program in 762 classes in a total of 37 junior high schools in
Taoyuan City and Kaohsiung City, benefiting a total of 20,195 students. With the advantage of the English and
Chinese bilingual texts in "Junior High School Student Daily" offered by Mandarin Daily News, students'
listening, speaking, reading and writing skills in both Chinese and English improved and their interests in the
world and reading were opened.
(2) In November 2022, we also cooperated with Shu-Lin Elementary School, Guanyin District, Taoyuan City to
interact with
organize newspaper reading games and activities, where colleagues volunteered to
schoolchildren and make them understand various useful knowledge in their daily life through the game, with
the view to inspiring children's interest in learning through educational entertainment and visualization of
knowledge.
9. Complimentary Copies of the Book, 50 Questions for Children's Creative Thinking
With the idea that "loving the children in the neighborhood as if they were our own children," we donated the
book, 50 Questions for Children's Creative Thinking, to the libraries of 75 elementary and middle schools around
the area in Taiwan where our plants are located. We hope that children can use the TRIZ Theory of Inventive
Problem Solving to solve problems and develop their creative thinking skills from an early age to develop their
future potential.
10.Community Development and Promotion by Plants:
Each plant continues to care about and evaluate the social and environmental risks or opportunities faced by its
local community through supporting local cultural and activities, cares for the disadvantaged in the community,
and effectively uses plant resources to promote neighborhood development. In 2022, we continued to sponsor
five elementary schools in the Yenshui area of Tainan in the academic mentoring program, and participated in 83
local civil defense, cultural, folklore, respect for the elderly, care for women and children, and environmental
cleanup activities. In addition to our long-term care for nine roads and parks surrounding the plants for cleaning
and making them greener, we also committed to the cleaning of three additional sites.
(4) In 2022, Walsin Lihwa was listed as the top 5% outstanding companies as published by the Taiwan Stock Exchange in
the 8th "Corporate Governance Evaluation." The Company was also awarded the "Model Donation for Education" by
the Yilan County Government for the "Light Up the Corners of Taiwan" project. The Company also received Taiwan's
Top 100 Sustainable Model Business Award and Platinum Corporate Sustainability Report Award for its ESG
performance and Sustainability Report, as well as Bronze Prize for English Sustainability Report for the first time.
(5) For details on the Company's execution of sustainable development, please go to the Walsin Lihwa website
Corporate Sustainability section (https://esg.walsin.com/zh_TW) and read our 2022 Sustainability Report.
Note 1: "Principle of Materiality" refers to environmental, social and corporate governance issues that have a mateiral
impact on the Company's investors and other stakeholders.
Note 2: Management Policies, Strategies or Mechanisms of Risk
Issues
Corporate
Governance and
Economic Issue
Risk Category
• Strategy and
Operations
• Legal
• Capital Expenditure
74
Management Policies, Strategies or Mechanisms
• Business units regularly report strategic issues to the Directors
and therefore reduce strategic risks through the participation,
advice and supervision of board members.
• The Company's culture of "Ethical Management" emphasizes
that all business activities must be conducted in accordance
with local laws and regulations. We also require our employees
to comply with laws and regulations, corporate rules and
procedures, and guide them to conduct themselves in
accordance with laws and regulations and ethical standards
through education, internal audit, internal control and other
management measures.
• Major capital expenditures shall be reported to the Audit
Issues
Risk Category
• Information
Security
• Changes in Interest
Rates
• Changes in
Exchange Rates
• Raw Material
Prices and Supply
Chains
• Technology Risks
Environmental
Issues
Climate Change and
Environmental Risks
Social Issues
• Management Risks
• Occupational
Safety Risks
Management Policies, Strategies or Mechanisms
Committee and the Board of Directors for review and approval.
• The Company continuously introduces advanced information
security solutions, establishes data protection mechanisms,
organizes education and training, promotes new information
security knowledge and raises staff awareness of information
security.
• The Company monitors changes in the interest rate markets,
controls existing long and short term borrowing positions and
uses market instruments to lock in interest rate costs in a timely
manner.
• The Company develops a hedging strategy and carries out
exchange rate hedging in conjunction with relevant hedging
instruments such as spot rate trading and forward rate trading.
Control of risks associated with foreign currency exchange rates
and related hedging operations are performed with respect to
major capital expenditures and capital transfers that may cause
changes in foreign currency positions.
• The Company carries out market risk management of its raw
materials-related operations. It also prudently evaluates and
actively develops new material sources to avoid monopoly by a
few suppliers. In addition, we establish a safe inventory of raw
materials and purchase some raw materials in stock to allow for
flexibility.
• We deeply understand the needs of customers and end-use
applications, and accelerate the technical development of
product materials manufacturing processes and applications, in
order to strengthen our technical capabilities to respond to
rapid changes in the external environment.
• The Company's environment, safety and health and energy
policy is "Green Manufacturing, Happy Enterprise and
Sustainable Development" and is committed to "Compliance
with Regulations, Risk Control, Pollution Prevention, Energy
Saving and Waste Reduction and Performance Enhancement."
• We promote energy management systems to establish energy
management performance indicators, so as to facilitate long-
term energy efficiency control. We also Invest in green
electricity and gradually build up a product carbon footprint, in
order to improve carbon reduction performance and prepare
for carbon rights operations in advance. Besides, we
continuously identify and develop waste reuse technologies to
improve resource recycling efficiency.
• Employees are Walsin's most important asset and major driving
force. Walsin cares about its employees, their families and their
lives, listens to their voices and strengthens the communication
channels between employees and employers to promote
harmonious relationships. We also ensure that the existing
human resources management procedures and related
administrative practices comply with the laws and regulations.
• We maintain the consistency of the environment, safety and
• Corporate Image
•
Risks
health management systems in all plants through ESH
education and training, and implement operational risk factor
checks and regulations to reduce the incidence of occupational
safety incidents. We also require contractors to sign an
Environment, Safety and Health Policy Commitment to jointly
comply with the requirements of the environment, safety and
health law and to reduce occupational safety hazards.
The Company has established in normal times a good crisis
management response mechanism for any operational risks
that may affect its image, as well as simulated possible
events, so that it can immediately initiate the response
mechanism promptly. The spokesman will act as the
external speaker, or clarify false information through the
material information reporting platform, to protect the
Company's image, and to make communications with
various stakeholders.
75 75
Corporate Governance Report
Note 3: The Ethical Conduct Guidelines for Employees and the rules relating thereto include: the Ethical Conduct
Guidelines for Employees and the Guidelines for Suggestions and Complaints by Stakeholders. Information
security policies and the rules relating thereto include: the Information Security Policy, the Internal Audit
Operation for Information Security Management, the Information Security Risk Management Rules, the
Information Security Incident Management Rules, the Information Security Organization Management Rules, the
Service Information Security Policy Formulation Standards, the Information Outsourcing Management Rules, the
Compliance Management Rules, the Personnel Safety Management Rules, the Network Equipment Maintenance
and Operation Standards, the Communication Operation Management Rules, the Access Control Management
Rules, the Account Access Management Standards, the Information Asset Management Rules, the Computer
Room Maintenance and Operation Management Standards, the System Administrator Password Management
Standards, the Entity and Environmental Security Management Rules, the Business Continuity Management Rules,
and the Information System Acquisition, Development and Maintenance Management Standards.
Note 4: The title of the Corporal Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies was
amended to the "Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies" on
December 7, 2021; the title of the Corporate Social Responsibility Report was amended to the "Sustainability
Report."
(6) Fulfillment of ethical management and differences between our ethical management and the Ethical
Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and reason(s)
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
In
line with the
Ethical Corporate
Management Best
Practice Principles
for
TWSE/TPEx
Listed Companies.
Implementation status
Assessment items
Yes No
Summary
Yes
(I)
I.
Establishment
management
solutions
of
policies
ethical
and
(I) Has the Company formulated its
ethical management policies
approved by
the Board of
Directors and stated its ethical
and
management
practices in its internal rules and
external documents? Do the
Board of Directors and senior
management actively fulfill their
ethical
to
commitment
management polices?
policies
to
our
fulfill
effort
the government,
The Company has always insisted on honest
business practices. We abide by the laws set
forth by
implement our
corporate governance principles and make our
corporate
utmost
responsibilities. Our Board passed our "Ethical
Corporate Management Best Practice Principles"
and our "Procedures for Ethical Management
and Guidelines for Conduct" as the Company's
policies for ethical management practices. The
full texts are also disclosed in electronic form on
the Company's website
to showcase our
commitment to implementing and overseeing
ethical management policies.
of
Ethical Management
The directors and senior executives signed a
Statement
to
demonstrate their determination to operate with
integrity. At the same time, information related
to ethical management was published on the
corporate website and internal website for the
directors' reference to convey the importance of
operating with
to actively
implement and monitor the implementation of
the ethical management policy.
integrity and
Yes
(II) Has the Company established an
assessment mechanism for the
risk of unethical conduct to
regularly analyze and evaluate
business activities with a higher
risk of unethical conduct in its
(II) 1. The Company's prevention plan and scope of
Article 6 of the Ethical Corporate Management
Best Practice Principles have specifically covered
the business activities with higher risk of
dishonest behavior or other activities specified in
each paragraph of Paragraph 2 of Article 7 of the
76
Implementation status
Assessment items
Yes No
Summary
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
of
business,
and
scope
formulated a plan based on such
and evaluation
analysis
to
prevent
conduct,
unethical
which should cover at least the
under
preventive measures
Paragraph 2, Article 7 of the
Ethical Corporate Management
Best Practice Principles
for
TWSE/TPEx Listed Companies?
Ethical Corporate Management Best Practice
Principles for TWSE/TPEx Listed Companies. The
Company has
relevant
strengthened
preventive measures through the establishment
of internal rules and regulations and practices,
training, daily promotion,
education and
contractual agreements and inclusion in the
employee performance evaluation.
the
2. The Company established a risk assessment
mechanism for dishonest acts and used the
seven major types of dishonest acts listed in
Paragraph 2 of Article 7 of the Ethical Corporate
Management Best Practice Principles
for
TWSE/TPEx Listed Companies as the scope of
assessment to promote the assessment of
dishonest acts.
for
corporate
In order to
3.
implement the concept of
sustainable management and promote corporate
governance, we have established the Sustainable
the
Development Committee, under which
"Ethical Management Promotion Center"
is
the
responsible
the management of
the
Company's ethical management and
social
of
implementation
integrating
responsibility, while assisting
integrity management
the Company's
business strategy, formulating relevant measures
to ensure ethical management in accordance
laws and regulations, supervising the
with
implementation of ethical management, and
evaluating
its effectiveness. The Sustainable
Development Committee held two meetings in
the annual plan and
2022
to
Ethical
implementation
Management Promotion Center and reported
the implement result in 2022 to the board of
directors meeting on January 10, 2023.
review
results
into
the
of
in
4. On February 27, 2020, the Board of Directors
approved
the "Risk
the establishment of
Management Policies and Procedures" as the
highest guiding principle for the Company's risk
management. The Company will regularly assess
the risks on an annual basis and formulate and
implement management policies for each risk,
which
objectives,
organizational structure, attribution of authority
and
risk management
and
procedures, so as to effectively identify, measure
and control the Company's risks and control the
risks arising from business activities within an
acceptable range.
responsibility
management
cover
5. In respect of the Company's risk management,
each risk management unit and audit unit will
carry out the Company's risk environment
and
management
countermeasures,
and
77 77
Corporate Governance Report
Implementation status
Assessment items
Yes No
Summary
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
the
President will organize and oversee
implementation and
risk
coordination of
management. The risk control measures and risk
management operations will be reported to the
Board of Directors in case of material risk events.
The risk management operations for 2022 were
reported to the Board of Directors on November
4, 2022
the
(III) Has the Company defined and
operating
implemented
procedures, conduct guidelines,
disciplinary
complaint
and
systems for non-compliance in
its unethical conduct prevention
program, and regularly reviewed
and
foregoing
program?
revised
the
Yes
for
Best
Procedures
its Ethical
(III) 1. The Company has formulated
Practice
Corporate Management
Principles
Ethical
and
Management and Guidelines for Conduct
setting forth the operational procedures,
codes of conduct, and training
for the
prevention of unethical behavior. In so doing,
we cause our staff to behave honestly and
uprightly to our stakeholders in compliance
with the ethical management policies. We also
have
system,
punishment policies and a complaint filing
system for employees who violate relevant
regulations, which is linked to the employee
performance evaluation.
established
reporting
2. The Company
daily
implements the prevention
internal education and
measures through
contractual
promotion,
training,
employee
linkage
agreements
It also aims to
performance assessment.
strengthen
such
measures by making periodic review and
revisions thereof.
implementation of
and
the
to
3. In 2022, we continued to steadily implement
the risk assessment of dishonest behavior,
which is data-driven and penetrates from the
management level to the entry level of the
Company, with a view to identifying gaps or
weaknesses in internal control of business
processes and formulating countermeasures
and
processes
accordingly.
operational
improving
Yes
2. Ensuring ethical business practice
(I) Has the Company evaluated the
ethical management practices
records of the companies it does
business with as well as explicitly
included ethical management
practices
the
clauses
contracts?
in
In
line with the
Ethical Corporate
Management Best
Practice Principles
TWSE/TPEx
for
Listed Companies.
(I) 1. The Company prevents
transacting with
companies with unethical management
practice records by adopting the following
approaches:
(1)When selecting a business partner, the
Company reviews the partner’s past trading
history and credit record. When inviting
bids, suppliers shall be informed of the
principle of a fair, open and transparent
supplier selection policy.
(2)Entities we are selling to: Except for
procurement projects from the government,
the Company shall track the
long-term
credit information of distributors, with the
reputation of new distributors obtained
through credit reference agencies and other
78
Implementation status
Assessment items
Yes No
Summary
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
companies in the industry.
2. Including honest practice provisions
in
contracts:
(1)Procurement contracts: We have either had
honest business practices clauses added to
the contracts or have our suppliers make a
undertaking to comply with the ethical
management policy.
(2)Sales contracts: Honest business practices
clauses have been added to all such
contracts.
to
for
advocate
3. The Company also non-periodically holds
supplier conventions for suppliers of different
plants
integrity
management of suppliers. In 2022, a total of
147 companies attended the meetings held by
Wire and Cable Business Group (Dongguan,
Shanghai, Hsinchuang, and Yangmei Plants)
and Stainless Steel Business Group (Yanshui
Plant).
the
Yes
(II) Has the company established a
dedicated
non-dedicated
or
department under the Board of
Directors
to ensure honest
business practices? Does this
department periodically report
their status of implementation
to the Board of Directors?
"Corporate
is responsible
"Corporate
and
(II) The Company's 7th meeting of the Board of
Directors of the 17th term approved the
establishment of
Social
the
Responsibility Committee" in April 29, 2015, and
the 17th meeting of the Board of Directors of the
18th term in November 1, 2019 approved the
establishment and organizational charter of the
"Sustainable Development Committee" by
Social
existing
merging
the
"Ethical
Committee"
Responsibility
Management Committee". The Sustainable
Development Committee
for
developing corporate sustainability strategies
and visions to promote CSR-related work and
management. The Committee is composed of
the Chairman as convener, and the Vice
Chairman and all
independent directors as
members. The Committee has five promotion
centers,
including the Ethical Management
Promotion Center, the Environment, Safety and
Health Management Promotion Center, the
Green Operation Promotion Center,
the
Customer Service and Supplier Management
Promotion Center, and the Employee Relations
and Social Care Promotion Center. The
Company's Ethical Management Promotion
Center is the responsible unit for formulating
and overseeing the
implementation of the
Company's ethical management policies and
preventive measures. It reported to the Board
on the
in 2022 and the
implementation plan for 2023 on January 10,
2023.
implementation
(III) Has the company established
policies to prevent conflicts of
interest,
such
policies and provided adequate
channels of communication?
implemented
Yes
(III) The Company has established
the Ethical
Corporate Management Best Practice Principles
and the Procedures for Ethical Management and
Guidelines for Conduct to regulate Directors,
79 79
Corporate Governance Report
Implementation status
Assessment items
Yes No
Summary
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
of
has
and
(IV) Has the Company established an
effective accounting system and
internal control system for the
ethical
implementation
its
management,
internal audit unit drawn up an
audit plan based on the results
of the assessment of the risk of
unethical conduct, in order to
verify compliance with such plan
for prevention of unethical
conduct, or has it engaged a CPA
firm to perform the audit?
(V) Does
the Company
regularly
conduct
internal and external
educational training on ethical
management?
managers and employees in terms of obligations
to the Company, external business activities,
pecuniary transactions, avoidance of conflicts of
interest and the management of classified
information. The Company has set up a
complaint mailbox on its website that provides a
means for filing complaints about violations of
honest
sexual
harassments, which the Independent Director
may receive in real time. A corporate mailbox
also exists on the employee portal site, thus
providing internal and external personnel with a
means to make suggestions and complaints to
the Company. Information received shall be
handled by the Auditing Office.
business
practice
and
Yes
Yes
(IV) The Company actively works to ensure ethical
business practices. The Auditing Office (or hired
CPA, when necessary) shall regularly audit
relevant compliance statuses according
to
accounting policies, internal control policies, as
well as other relevant regulations. The Auditing
Office will periodically report its auditing results
during Board meetings.
(V) During new-employee training, the Company
periodically states its principles towards ethical
management practices. It also periodically holds
courses on corporate governance as well as
ethical management practices
asks
to participate. The Company's
employees
Procurement Department also informs suppliers
of our ethical management practices principles in
order to prevent unethical business practices.
1. The Company
regularly conducts annual
training on ethical management (including
anti-corruption) and legal compliance, which is
disclosed in the annual CSR report and annual
report.
and
2. Through public commitment,
information
dissemination and education, the Company
deepens
its management philosophy of
integrity and creates a corporate culture of
integrity from top to bottom. In 2022, we
offered directors courses related to ethical
management to sharpen their professional
knowledge and skills, and
the
implementation of ethical management
(including
legal
compliance training, we have established a
culture and
good ethical management
strengthened our commitment to ethical
practices.
anti-corruption)
through
and
80
3. In 2022, we conducted
internal training
Implementation status
Assessment items
Yes No
Summary
courses on topics such as ethical management,
patent education and the TIPS system. The
total number of participants who completed
the training on ethical management (including
anti-corruption),
and
intellectual property rights reached 951, 877,
and 859 respectively. For external promotion,
we invited 149 major suppliers to participate
in the training.
compliance,
legal
Yes
(I)
3.
Status
of
reporting mechanism
the
Company's
(I) Has the Company established
concrete reporting and rewards
set up convenient
systems,
reporting
and
appropriate,
any
appointed
dedicated staffer to deal with
the person who has been
reported?
channels
The Company's website provides a "Reporting
Violations of Ethical Management Practices and
Sexual Harassment" area, which allows people to
file complaints about violations against ethical
management practices, which the Independent
Director may receive in real time. There is also a
"company mailbox" on the employee portal
website, providing
and external
personnel with a means to file complaints. The
for handling
Auditing Office
related recommendations and violations. If the
violations are verified, disciplinary action shall be
taken
the Company's
regulations.
in accordance with
is responsible
internal
Yes
(II) Has the Company established
standard operating procedures
for investigation of, the follow-
up steps after the investigation
information
of, and
confidentiality mechanisms for,
complaints?
related
Yes
Yes
(III) Has the company adopted any
the
to
be
measure
informers
inappropriately treated?
protect
they
lest
4. Improved Information Disclosure
Has the Company disclosed the
content of its Ethical Corporate
Management
Practice
Principles as well as related
implementation results on
its
website and the MOPS?
Best
(II) The Company has formulated the Measures for
Stakeholder Recommendations and Complaints
and Operational Rules for Event Investigations.
Therefore, we have formulated the operational
procedure for investigation and the handling
system, whereby the identity as well as data of
those complainants, whistleblowers, or other
relevant parties will be protected.
(III) All reported cases are filed under the classified
category, with a case opened to handle the issue.
In addition, dedicated personnel are appointed
to handling related tasks and issues in order to
ensure the privacy of reporter and avoid unfair
revenge or treatment.
to disclose
its website
The Company has established a Corporate Governance
page on
its ethical
management-related information; it also discloses the
implementation status and execution results of its
ethical management practice in the annual CSR report
and
Corporate
Management Best Practice Principles, Procedures for
Ethical Management and Guidelines for Conduct, and
Ethical Conduct Guidelines for Directors of the Board
and Managerial Officers on the MOPS.
Company's
Ethical
also
the
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
In
line with the
Ethical Corporate
Management Best
Practice Principles
for
TWSE/TPEx
Listed Companies.
In
line with the
Ethical Corporate
Management Best
Practice Principles
TWSE/TPEx
for
Listed Companies.
5.
If the company has established its ethical corporate management principles in accordance with the "Ethical
Corporate Management Best Practice Principles for TWSE- and TPEx-listed Companies", please state the difference
between such principles and implementation: In line with the "Ethical Corporate Management Best Practice
Principles for TWSE/TPEx Listed Companies."
6. Other key information useful for explaining the status of the implementation of honest business practices: (Such as
the status of the Company's efforts to review and correct its Ethical Corporate Management Best Practice
Principles):
81 81
Corporate Governance Report
Implementation status
Assessment items
Yes No
Summary
Deviation from
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and reasons for
deviation
In order to encourage R&D, protect technology and R&D achievements, optimize processes, promote product
innovation, upgrade and smart manufacturing through the intellectual property rights system, thereby achieving a
high-value transformation strategy for the Company's growth, we introduced the Taiwan Intellectual Property
Management System (TIPS) and passed the certification in 2020. On November 22, 2021, we passed and received
the Taiwan Intellectual Property Management System (TIPS Class A) recertification. The certificate will be valid until
December 31, 2023. The TIPS system was tested in June 2022 and approved by the Institute for Information Industry,
and the Microsoft Sensitive Labeling feature was introduced in August 2022 to enhance the protection of
confidential information. The implementation of the IP management plan and 2023 annual IP management plan
were reported to the Board of Directors on November 4, 2022 (Note 1).
Note 1: The operation of the Company's intellectual property rights management:
https://www.walsin.com/investors/corporate-governance/#pills-information-security
(7)
If the company has formulated corporate governance principles as well as other related regulations,
it should disclose how they can be looked up: For the Company's corporate governance principles as
well as relative regulations, please visit on our Company website:
https://www.walsin.com/investors/corporate-governance/#pills-major-internal-policies.
82
(8) Other important information helpful for improving understanding of the governance of the company:
1. Further education on themes encompassing corporate governance the Company's Directors have received in
Organizer
Course Name
As of December 31, 2022
Training Hours
Total in
2022
On this
date
2022:
Title
Name
Start Date
End Date
Date
2022/04/14
2022/04/14
Chairman
Yu-Lon
Chiao
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/04/14
2022/04/14
Vice
Chairman
Patricia
Chiao
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/09/02
2022/09/02
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/12/27
2022/12/27
Director
Arthur
Yu-
Cheng
Chiao
Director
Yu-Heng
Chiao
2022/10/06
2022/10/06
Director
Andrew
Hsia
2022/10/07
2022/10/07
2022/04/14
2022/04/14
2022/04/22
2022/04/22
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/05/12
2022/05/12
Director
Wei-Shin
Ma
2022/07/27
2022/07/27
2022/09/02
2022/09/02
2022/10/25
2022/10/25
2022/04/14
2022/04/14
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/01/24
2022/01/24
Represent
ative of
Corporate
Director
Pei-Ming
Chen
Independ
ent
Director
Ming-
Ling
Hsueh
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Securities and Futures
Institute
Securities and Futures
Institute
Taiwan Corporate
Governance Association
Taiwan Institute of
Sustainable Energy
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Stock Exchange
Corporation
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Enriching Human Life with Green Semiconductor
Technology
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
Enriching Human Life with Green Semiconductor
Technology
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
From Deep Learning to practical AI application
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
Analysis of the Global Political and Economic Situation
in 2023; the Solution for Enterprises to Moving
Towards Net Zero: Natural Carbon Sinks and Carbon
Rights Trading
Board of Directors' Functions from the Perspective of
Corporate Fraud Prevention, and the Applicability of
the Cyber Security Management Act under the Threat
of Ransomware
Global Risk Awareness - Opportunities and Challenges
for the Next Decade
Enriching Human Life with Green Semiconductor
Technology
Taishin 30 Sustainable Net Zero Summit Forum -
Taking Net Zero Seriously
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
Online Forum for International Twin Summits
Conference
of
Development Road Map for Industries
Promotion
for
Sustainable
From Deep Learning to practical AI application
2022 Important Economic and Trade Issues Study and
Outlook
Enriching Human Life with Green Semiconductor
Technology
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
Sharing of Reference Guide Manual for the Audit
Committee
How to Avoid Risky Stocks - Application of Corporate
Governance Risks
3
3
3
3
3
3
3
3
3
4
3
3
3
3
3
3
3
2
2
3
3
3
3
1
3
1
9
9
13
6
12
10
9
27.5
83 83
2022/02/17
2022/02/17 Taiwan Securities Association
2022/02/25
2022/02/25
Taiwan Corporate
Governance Association
Global and Taiwan Economic Outlook for 2022
Corporate Governance Report
Title
Name
Start Date
End Date
Date
Organizer
Course Name
Training Hours
Total in
2022
On this
date
2022/03/02
2022/03/02
2022/04/28
2022/04/28
Yuanta Financial Holding Co.,
Ltd.
Taiwan Corporate Governance
Association
2022/07/14
2022/07/14 Taiwan Securities Association
2022/08/11
2022/08/11 Taiwan Securities Association
2022/09/22
2022/09/22 Taiwan Securities Association
2022/10/19
2022/10/19
2022/10/25
2022/10/25
2022/10/28
2022/10/28
2022/04/14
2022/04/14
2022/04/27
2022/04/27
Taiwan Corporate Governance
Association
Taiwan Corporate Governance
Association
Taiwan Corporate Governance
Association
Taiwan Corporate Governance
Association
Securities and Futures
Institute
2022/07/27
2022/07/27
Securities and Futures
Institute
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/10/25
2022/10/25
2022/11/04
2022/11/04
2022/02/18
2022/02/18
2022/02/22
2022/02/22
2022/03/09
2022/03/09
2022/04/14
2022/04/14
2022/05/04
2022/05/04
2022/10/25
2022/10/25
2022/11/04
2022/11/04
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate Governance
Association
Taiwan Corporate Governance
Association
Taiwan Corporate Governance
Association
Securities and Futures
Institute
Taiwan Academy of Banking
and Finance
Taiwan Corporate Governance
Association
Taiwan Corporate
Governance Association
Taiwan Corporate
Governance Association
Taiwan Corporate Governance
Association
Independ
ent
Director
King-Ling
Du
Independ
ent
Director
Shiang-
Chung
Chen
Independ
ent
Director
Fu-
Hsiung
Hu
Analysis of the Impact of Taiwan’s Anti-Tax-Avoidance
System and the Global Minimum Tax System
1.5
Digital Transformation
to
Financing
(Including
Latest Trend of Anti-Money Laundering and Anti-
Insider Trading
Terrorism
Prevention and Awareness)
Strengthening the Information Security Resilience and
Risk Management Trends in the Financial Industry
Principles of Fair Treatment and Protection and
Empowerment of Financial Consumers
The 18th Corporate Governance Summit in 2022 -
Enhancing Directors'
Implement
Functions
Sustainable Corporate Governance
2022 Important Economic and Trade Issues Study and
Outlook
Corporate Growth and Mergers & Acquisitions - SAS
Group Case Study
Enriching Human Life with Green Semiconductor
Technology
Applicability of the Cyber Security Management Act
under the Threat of Ransomware
The Latest Practical Development of Taiwan's Insider
Trading and How Enterprises Can Prevent from and
Respond to It
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
Unlocking Key Passwords in Financial Statements
Introduction to Fight Over Corporate Controlling
Power and the Commercial Case Adjudication Act
Corporate Governance Lecture Hall - The Future World
under the US-China Competition
Enriching Human Life with Green Semiconductor
Technology
Case Study on Anti-Money Laundering in Banking
Industry
2022 Important Economic and Trade Issues Study and
Outlook
Walsin Technology’s Growth in Passive Components
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
1
3
3
15
6
19
2. For the attendance of Board meetings by Directors, please refer to "Corporate Governance Report 4. Status of
Corporate Governance."
84
3. Further education in corporate governance participated by the Company's managers (including President, Vice
President, Managers of BUs, Accounting head, Finance head, etc.) in 2022:
Title
Name
Start Date
End Date
Organizer
Course Name
Date
As of December 31, 2022
Training Hours
On this
date
Total in 2022
2022/04/14 2022/04/14
Taiwan
Corporate
Enriching
Human
Life
with
Green
Governance Association
Semiconductor Technology
2022/10/05 2022/10/05
of Industry and Commerce,
Chines National Association
Global Anti-Tax Avoidance
Trends
and
International Audit Examples
President &
President of
Commercial
Fred Pan
and Real
Estate BG
2022/10/27 2022/10/27
2022/10/27 2022/10/27
Taiwan
Taiwan
Corporate
2022 Important Economic and Trade Issues
Governance Association
Study and Outlook
Taiwan
Corporate
Boating on the History of Carbon - The Biology
Governance Association
of Carbon Footprints
2022/10/27 2022/10/27
Taiwan
Corporate
Governance Association
AI Development Opportunities from Software
and Hardware Integration; Digital marketing
3
Trend of Web3+ESG
110/08/06
110/08/06
Taiwan
Corporate
Study on Important Economic and Trade Issues
Governance Association
and Case Study on Ethical Management
2022/04/14 2022/04/14
Taiwan
Corporate
Enriching
Human
Life
with
Green
Governance Association
Semiconductor Technology
3
3
2022/04/22 2022/04/22
Taiwan
Institute
of
Sustainable Energy
Taishin 30 Sustainable Net Zero Summit Forum -
Taking Net Zero Seriously and Fulfilling
3
Sustainability in 2030
2022/04/28 2022/04/28
Taiwan
Institute
of
The 28th TCCS Board Meeting and CEO Lecture
Sustainable Energy
Hall
2022/05/12 2022/05/12
Taiwan
Stock
Exchange
Corporation
Online Forum for International Twin Summits
Head of
Corporate
Governance
Hueiping
Lo
2022/07/08 2022/07/08
Taiwan
Institute
of
Second Half of the 2nd Taiwan Sustainable
Sustainable Energy
Investment Forum
2022/07/27 2022/07/27
Taiwan
Stock
Exchange
Conference
for Promotion of Sustainable
Corporation
Development Road Map for Industries
2022/07/28 2022/07/28
Taiwan
Institute
of
The 29th TCCS Board Meeting and CEO Lecture
Sustainable Energy
Hall
2022/10/21 2022/10/21
Taiwan
Stock
Exchange
Corporation
2022 Insider Trading Prevention Seminar
2022/10/25 2022/10/25
Taiwan
Corporate
2022 Important Economic and Trade Issues
Governance Association
Study and Outlook
13.5
24
3
3
3
1.5
2
2
4
2
2
3
3
Head of
Accounting
Department
Richard
Wu
2022/11/21 2022/11/22
Accounting Research and
Continuing Education Class
for Accounting
Development Foundation
Managers
12
12
85 85
Corporate Governance Report
(10) Implementation Status of Internal Control System
1. Statement on Internal Control
Walsin Lihwa Corporation
Statement on Internal Control System
Date: February 24, 2023
In 2022, the Company conducted an internal examination in accordance with its Internal Control Regulations
and hereby declares as follows:
1. The Company is aware that it is the Board’s and managers' responsibility to establish, implement and
maintain an internal control system, and the Company has set up such a system. The purpose of the
system is to ensure the effectiveness and efficiency (including profitability, performance and protection of
assets) of the Company's operations, compliance with relevant laws and regulations and that its financial
statements are reliable, up to date and easily accessible.
Internal control systems have their inherent limitations. No matter how well they are designed, an
effective internal control system can only reasonably ensure achievement of the three above objectives.
In addition, an internal control system's effectiveness may change as the environment and circumstances
change. The internal control system of the Company features a self-monitoring mechanism. Once
identified, the Company will take actions to rectify any deficiency.
2.
3. The Company determines whether the design and implementation of its internal control system is
effective by referring to the criteria stated in the Regulations Governing Establishment of Internal Control
Systems by Public Companies (hereinafter the "Regulations"). The Regulations provides measures for
judging the effectiveness of the internal control system. There are five components of an internal control
system, as specified in the Regulations, which are broken down based on the management-control
process, namely: (1) control environment, (2) risk evaluation and responses, (3) control operation, (4)
information and communication and (5) monitoring. Each of the elements in turn contains certain audit
items. Refer to the Regulations for details.
4. The Company uses the above criteria to determine whether the design and implementation of its internal
control system is effective.
5. After an evaluation of the Company's internal control system based on the above criteria, the Company is
of the opinion that, as of December 31, 2022, its internal control system (including supervision and
management of subsidiaries) is effective and therefore can reasonably ensure achievement of the above
objectives, which include awareness of the degree to which operating results and goals are achieved,
compliance with the law and that its financial reporting is reliable, up to date and easily accessible.
6. This statement shall become a principal part of the Company's annual report and prospectus and be made
available to the public. Any illegal misrepresentation or omission relating to the public statement above is
subject to the legal consequences under Articles 20, 32, 171 and 174 of the Securities and Exchange Act.
7. This statement has been approved on February 24, 2023 by the Board, with none of the 11 Directors
present opposing it.
Walsin Lihwa Corporation
Chairman: Yu-Lon Chiao
President: Fred Pan
86
2. If CPAs are engaged to review the internal control system, their report shall be disclosed: None.
(10) Where the Company and its personnel have been penalized according to the law, or the Company has
penalized its personnel for having violated its internal control system (and if the result of the penalty
is likely to have a material impact on shareholders' interests or the price of securities) as of the day
when the annual report was prepared in the most recent year, the contents of such penalty, major
deficiencies and corrective actions shall be specified: None.
(11) In the most recent year, resolutions passed at the AGM and board meetings, as of the day the annual
report was prepared.
The Company hosted its 2022 AGM on May 13, 2022 at the 1st Floor Multimedia Conference Room, No.15, Alley
168, Xingshan Road, Neihu District, Taipei City. The following decisions, with implementation details, were made
during the meeting:
Matters for Approval and Discussion :
Proposal No. 1
Description:
Acknowledgement of the Company's 2021 Business Report and financial statements.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation
This was announced as an important resolution on the day of the Shareholders Meeting.
Status:
Proposal No. 2
Description:
Acknowledgement of the Company's 2021 Profit Distribution Table.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation
June 27, 2022 was the ex-dividend record date and the dividends were paid out on July 19,
Status:
2022. (Cash dividend of NT$1.6 was paid per share.)
Proposal No. 3
Description:
Amendments to the Company's Articles of Incorporation.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation
Changes to the corporate registration were handled in accordance with the law and have
Status:
been approved by the Ministry of the Economic Affairs on June 6, 2022 via a letter (Ref. No.:
Jin-So-Shang-Zi-11101093290), and the revised articles were disclosed on our official website.
Proposal No. 4
Description:
Amendments to the Company's Procedures for the Acquisition and Disposal of Assets.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation
Relevant operations were handled in accordance with the amended procedures and the
Status:
revised articles were disclosed on the MOPS website and our official website.
Proposal No. 5
Description:
Amendments to the Company's Rules and Procedures of Shareholders' Meetings.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation Relevant operations were handled in accordance with the amended procedures and the
87 87
Corporate Governance Report
Status:
revised articles were disclosed on our official website.
Proposal No. 6
Description:
Proposal to lift the non-competition ban on directors imposed by Article 209 of the Company
Act.
Resolution:
According to the voting result, the number of affirmative votes exceeded the legal threshold,
so the proposal was passed.
Implementation
This was announced as a piece of material information on the day of the Shareholders'
Status:
Meeting.
Important resolutions adopted by 2022 Board meetings as of the day of this annual report
2022/01/11 (13th Meeting of the 19th Term)
Important
Proposal to approve the Company's 2022 business plan.
Resolution:
Result:
Proposal passed.
Important
Resolution:
Change of CPA in response to the internal rotation mechanism of the CPA firm, Deloitte & Touche,
and evaluation of the annual compensation of the CPA firm and the independence and suitability
of the CPA.
Result:
Important
Resolution:
Result:
Proposal passed.
Proposal to approve the loan of funds by Walsin International Investment Co., Ltd. to the Company
and those between the subsidiaries, in a total amount of US$650 million and RMB1.5 billion
respectively.
The explanatory text was amended as suggested in the summary of the speech by changing the
Important
Resolution:
Result:
Important
Resolution:
Result:
period from February 1, 2022 to January 31, 2023, and the rest was adopted as proposed.
Amendment to certain provisions of the Company's Regulations Governing Board Performance
Evaluation and relevant schedules thereto.
Proposal passed.
Amendment to the Company's Corporate Social Responsibility Practice Principles.
As suggested in the summary of the speech, the subject was change from "Corporate Social
Responsibility Practice Principles" to "Sustainable Development Practice Principles", and the rest
was adopted as proposed.
Important
Proposal to book a theater room to watch a documentary film on the pandemic prevention shot by
Resolution:
HannStar Foundation.
Result:
Recusal:
Important
Resolution:
Result:
Recusal:
Important
Proposal passed.
Wei-Shin Ma.
Proposal for the distribution of the performance bonus for Chairman and Vice Chairman for 2021.
Proposal passed.
Yu-Lon Chiao and Patricia Chiao.
Proposal to review managers' performance evaluation as well as bonuses and compensation for
Resolution:
2021.
Result:
Proposal passed.
Important
Resolution:
Proposal to lift the non-competition ban on the Company's managerial officers.
Result:
Proposal passed.
2022/02/22 (14th Meeting of the 19th Term)
88
Important
Distribution of remuneration to directors and employees (including managerial officers) for 2021.
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Proposal passed.
Proposal of the 2021 Profit Distribution Table.
Proposal passed.
Proposal of the 2021 Internal Control System Statement.
Proposal passed.
Amendment to the Company's Procedures for the Acquisition and Disposal of Assets.
Proposal passed.
Amendments to certain provisions of the Company’s Articles of Incorporation.
Result:
Proposal passed.
Important
Proposal to lift the non-competition ban for the Company’s Directors according to Article 209 of
Resolution:
the Company Act.
Result:
Recusal:
Important
Resolution:
Proposal passed.
Yu-Heng Chiao, Wei-Shin Ma, and Shiang-Chung Chen
Approval for holding the 2022 AGM regularly.
Result:
Proposal passed.
2022/03/18 (15th meeting of the 19th term)
Important
Proposal to acquire land as right-of-use assets required for the development of submarine cable
Resolution:
business.
Result:
Important
Resolution:
Proposal passed, except that certain wording of Articles 14-3 and 22 was amended.
Proposal to issue domestic straight corporate bonds within the amount of NT$10 billion.
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Proposal to amend the Company’s Rules and Procedures of Shareholders' Meetings.
Proposal passed.
Proposal to hold the Company's 2022 Annual General Meeting of Shareholders, both physically and
Resolution:
through video conferencing.
Result:
Proposal passed.
2022/04/11 (16th meeting of the 19th term)
Important
Proposal to acquire 50.1% shareholding in PT. Sunny Metal Industry.
Resolution:
Result:
Proposal passed.
2022/05/24 (18th meeting of the 19th term)
Important
The Company intends to restructure its U.S. subsidiary investments through Borrego Solar Systems,
Resolution:
Inc., which is held by Walsin Lihwa Holdings Limited, a subsidiary of the Company.
Result:
Proposal passed.
Important
Walsin Lihwa Holdings Limited, a subsidiary of the Company, intends to sell its entire shareholding
Resolution:
in 2022 Solar Development, Inc.
Result:
Proposal passed.
89 89
Corporate Governance Report
Important
Resolution:
Result:
Important
Resolution:
Walsin Lihwa Holdings Limited, a subsidiary of the Company, intends to inject capital into its
subsidiary, Borrego Energy, LLC, through Walsin America, LLC and Borrego Energy Holdings, LLC, in
an amount not exceeding US$33 million.
Proposal passed.
The Company intends to sell land in Baoshan Township, Hsinchu County to a related party, HuaBao
Seed Breeding Co., Ltd.
Result:
Proposal passed.
2022/05/31 (19th meeting of the 19th term)
Important
The Company intends to invest in its subsidiary, Walsin Lihwa Europe S.a r.l., in an amount not
Resolution:
exceeding EUR 210.3 million.
Result:
Proposal passed.
Important
Resolution:
The Company intends to acquire 85.032% of the shares of MEG S.A. in Luxembourg through its
wholly-owned subsidiary, Walsin Lihwa Europe S.a r.l.
Result:
Proposal passed.
Important
Resolution:
The Company intends to acquire a 40% shareholding in Innovation West Mantewe Pte.
Result:
Proposal passed.
2022/08/05 (20th Meeting of the 19th Term)
Important
Proposal to amend the Company’s internal control system.
Resolution:
Result:
Proposal passed.
Important
Proposal to amend certain articles of the Company's Corporate Governance Best Practice
Resolution:
Principles.
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Proposal to amend the Company’s Procedures for Major Internal Information Processing
Operations and rename the same as the "Procedures for Handling Internal Material Information
and Prevention of Insider Trading."
Proposal passed.
The Company intends to lend US$175.75 million to PT Sunny Metal Industry Indonesia under a
non-revolving line of credit.
Proposal passed.
Walsin Lihwa (China) Investment Co., Ltd. intends to lend Hangzhou Walsin Power Cable & Wire
RMB 80 million under a non-revolving line of credit.
Proposal passed.
Walsin Lihwa Holdings Limited, a wholly-owned subsidiary of the Company, intends to inject capital
into its wholly-owned subsidiary, Walsin (China) Investment Co., Ltd., in the amount not exceeding
US$36 million, and such company will acquire from its wholly-owned subsidiary, Walsin Specialty
Steel Corp., all of the shares it holds in Changshu Walsin Specialty Steel Co., Ltd.
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Resolution:
Walsin Lihwa Holdings Limited, a wholly-owned subsidiary of the Company, intends to inject capital
into its wholly-owned subsidiary, Walsin (China) Investment Co., Ltd., in the amount not exceeding
US$18 million, and such company will acquire from its wholly-owned subsidiary, Concord
Industries Limited, 30% of the shares it holds in China Steel Precision Materials.
Proposal passed.
The Company intends to acquire 29.5% of the shares in PT. Westrong Metal Industry.
90
Result:
Proposal passed.
2022/11/04 (21th Meeting of the 19th Term)
Important
Proposal to amend the Company’s internal control system.
Resolution:
Result:
Proposal passed.
Important
Proposal to amend the Company’s Procedures for Handling Internal Material Information and
Resolution:
Prevention of Insider Trading.
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Walsin International Investment Co., Ltd. intends to lend PT. Walsin Nickel Industrial Indonesia
US$100 million under a non-revolving line of credit.
Proposal passed.
Proposal to approve the new loan of funds from Walsin Info-Electric Inc. to the Company in the
form of a NT$130 million non-revolving facility.
Proposal passed.
The Company intends to lend PT Sunny Metal Industry US$75 million under a non-revolving line of
credit.
Proposal passed.
The Company intends to lend PT. Westrong Metal Industry US$90 million under a non-revolving
line of credit.
Proposal passed.
The Company intends to transfer 50.1% of the shares in PT. Sunny Metal Industry in Indonesia, 40%
of the shares in Innovation West Mantewe Pte. Ltd., and 29.5% of the shares in PT. Westrong
Metal Industry to Walsin Singapore Pte. Ltd., a wholly-owned subsidiary of the Company, and to
carry out a capital injection into Walsin Singapore Pte. Ltd. in the same amount.
Proposal passed.
The Company intends to inject US$300 million into its wholly-owned Singapore subsidiary, Walsin
Singapore Pte. Ltd.
Proposal passed.
Walsin Lihwa Holdings Limited, a wholly-owned subsidiary of the Company, intends to sell its earn-
out financial assets arising from equity transactions to the Company, and carry out a capital
reduction in the same amount.
Proposal passed.
In order to improve the efficiency of capital utilization, it is propose to reduce the capital of Walsin
Lihwa Holdings Limited by US$140 million in cash.
Result:
Proposal passed.
2023/01/10 (22nd Meeting of the 19th Term)
Important
Evaluation of the independence and qualification of the Company's CPAs and the quality of the
Resolution:
CPA firm's audit for each case, as well as the annual compensation payable to the CPA firm.
Result:
Proposal passed.
Important
Resolution:
Yantai Walsin Stainless Steel Co., Ltd. intends to update its investment plan and amount for its hot
rolling plant and cold finished bar plant due to its investment in automated equipment.
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Proposal to amend certain articles of the Company’s Board of Directors Meeting Regulations.
Proposal passed.
Proposal to amend the Company's Derivatives Trading Procedures.
91 91
Corporate Governance Report
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Recusal:
Proposal passed.
Proposal to amend the Company's Procedures for Lending Funds to Other Parties.
Proposal passed.
Proposal to approve the loan of funds by Walsin International Investment Co., Ltd. to the Company
and those between the subsidiaries in China, in a total amount of US$1 billion and RMB1.48 billion
respectively.
Proposal passed.
Proposal to lift the non-competition ban on the Company's managerial officers.
Proposal passed.
Proposal to review managers' performance evaluation as well as bonuses and compensation for
2022.
Proposal passed.
Proposal for the distribution of the performance bonus for Chairman and Vice Chairman for 2022.
Proposal passed.
Yu-Lon Chiao and Patricia Chiao.
2023/02/24 (23rd Meeting of the 19th Term)
Important
Distribution of remuneration to directors and employees (including managerial officers) for 2022.
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Proposal passed.
Proposal of the 2022 Profit Distribution Table.
Proposal passed.
Proposal of the 2022 Internal Control System Statement.
Proposal passed.
Amendment to certain provisions of the Company's Article of Incorporation.
Proposal passed.
The Company and its subsidiary, Walsin Energy Cable System Co., Ltd., intends to enter into a joint
Resolution:
venture agreement, a technical service agreement, and a technology license agreement with NKT
HV Cables AB (based in Sweden), a wholly-owned subsidiary of NKT Cables Group A/S (based in
Denmark).
Result:
Proposal passed.
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
The Company intends to participate in the capital injection into its subsidiary, Walsin Energy Cable
System Co., Ltd., in the amount of NT$2,699 million.
Proposal passed.
PT. Sunny Metal Industry intends to upgrade its cold nickel production lines at PT. Indonesia Weda
Bay Industrial Park, with a proposed investment amount of USD 93 million.
Proposal passed.
Yantai Walsin Stainless Steel Co., Ltd. intends to invest RMB178 million in the purchase of housing
Resolution:
for experts and talents to meet operational needs.
Result:
Proposal passed.
92
Important
Proposal to issue domestic straight corporate bonds within the amount of NT$10 billion.
Resolution:
Result:
Important
Resolution:
Result:
Important
Proposal passed.
Walsin Singapore Pte. Intents to lend US$175,750,000 to PT. Sunny Metal Industry under a non-
revolving line of credit.
Proposal passed.
Walsin Singapore Pte. Intents to lend US$27,500,000 to PT Westrong Metal Industry under a non-
Resolution:
revolving line of credit.
Result:
Important
Proposal passed.
In order to enhance the efficiency of capital utilization, it is proposed to reduce the capital of
Resolution:
Huaxin International Investment Co., Ltd. and Huaxin Lihua Holdings Limited.
Result:
Important
Proposal passed.
Borrego Energy, LLC, a U.S. subsidiary of the Company, intends to sell the business of its solar
Resolution:
energy and its energy storage, procurement, and trading platform departments.
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Result:
Important
Resolution:
Proposal passed.
Proposal to amend certain articles of the Company's internal control system.
Proposal passed.
Proposal to amend the Company's Sustainable Development Practice Principles.
Proposal passed.
Proposal to amend the Company's Corporate Governance Best Practice Principles.
Proposal passed.
Nomination of the candidates for Company's Directors of the 20th term.
Proposal passed.
Proposal to lift the non-competition ban under Article 209 of the Company Act for the Company’s
Directors.
Proposal passed.
Proposal to convene the Company's regular AGM in 2023, both physically and through video
conferencing.
Proposal passed.
Proposal to lift the non-competition ban for the Company’s managerial officers.
Result:
Proposal passed.
(12)
In the most recent year, as of the day the annual report was prepared, directors held different
opinions (on record or with written statement) about important resolutions passed at Board meetings
and the major contents are: None.
93 93
Corporate Governance Report
(13)
In the most recent year, as of the day the annual report was prepared, any of Chairman, President,
accounting manager, financial manager, internal audit manager, corporate governance manager and
R&D manager resigned or was discharged: None.
5. Information on CPAs' fees
CPA Firm
CPA
Audit Period Audit Fee
Non-Audit
Fee
Total
Remarks
Wen-Yea
Deloitte
Shyu and
2022/01/01~
Taiwan
Ko-Chang
2022/09/30
Wu
NT$14,170 NT$18,751 NT$32,921
analysis of investment projects and consultation
The non-audit fees were mainly for advice on tax
and assurance of sustainability reports.
(I) Change of CPA firm and the audit fees paid in the year of the change are less than those paid in the
previous year: Not applicable.
(II) Audit fees paid in the current year are at least 10% less than those paid in the previous year: Not
applicable.
6. Information on the replacement of CPAs: None.
7. Chairman, President, or managers responsible for financial or accounting affairs who worked for
the firm to which the certifying CPA belongs or its affiliate in the most recent year: None.
94
8. Transfer and pledge of shares of the directors, managers and shareholders holding more than
10% of the company's shares
(I) Changes to the shares of the directors, managers and shareholders holding more than 10% of the
company's shares:
2022
Title
Name
Chairman
Vice Chairman
Yu-Lon Chiao
Patricia Chiao
Director
Director
Director
Director
Director
Independent Director
Independent Director
Independent Director
Independent Director
President and Senior General
Manager of Real Estate BG
Executive Vice President & Vice
President of Finance
President of Insulated Wire &
Cable BG
President of Stainless Steel BG
President of Commodity BG
Yu-Cheng Chiao
Yu-Heng Chiao
Andrew Hsia
Wei-Shin Ma
Chin-Xin Investment Co.,
Ltd.
Representative: Pei-
Ming Chen
Ming-Ling Hsueh
King-Ling Du
Shiang-Chung Chen
Fu-Hsiung Hu
Fred Pan
C.C. Chen
Jin-Renn Leu
Kevin Niu
Josh Chia
Head of Corporate Governance Hueiping Lo
Head of Accounting Dept.
Shareholders holding over 10%
of outstanding shares
Richard Wu
None
No. of shares
held
Increase
(decrease)
3,298,667
16,516,581
(600,000)
340,000
4,271,613
0
0
27,388,375
0
0
0
0
0
507,504
516,487
(180,000)
150,000
(10,000)
300,000
200,000
300,000
(70,000)
307,721
-
(2)
Information on change in the number of shares retained:
Shares pledged
Increase (decrease)
0
0
0
0
0
0
0
0
0
0
0
0
0
500,000
500,000
0
300,000
0
0
0
-
Current fiscal year up
to March 21, 2023
Shares
No. of
pledged
shares held
Increase
Increase
(decrease)
(decrease)
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
(500,000)
0
(45,000)
(12,000)
(100,000)
0
(50,000)
(99,000)
-
0
0
-
Name
Reason for
Transaction
Share Transfer
Date
Counterparty
Relationship between the Counterparty
and the Company, its Directors,
Managerial Officers and Shareholders
Holding More Than 10% of the Shares
March 21, 2023
No. of Shares
Transaction
Price
Patricia
Chiao
Disposal: Gift 2022/11/22 Tzu-En Chiao
Daughter
600,000
NT$42.6
(3) Information on Share Pledges: None.
95 95
Corporate Governance Report
9.
Information on relationships amongst the top ten shareholders and their relationships with
spouses or relatives within the second degree of kinship
Shares Held Themselves
Name
Shares Held by
Spouse and
Underage Children
Shares Held Under
Name of Others
Number of
Shares
Percenta
ge
Number of
Shares
Percent
age
Number of
Shares
Percen
tage
As of March 21, 2023
Name and relationships of related
parties to top ten shareholders
(spouse and relatives within the
second degree) (Note 1)
Name
Relationship
Rem
arks
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Patricia
Chiao
Its chairman is the same
as the chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is the same
as the chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
Second degree of kinship
with the chairman of the
said institutional
shareholder
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is the same
as the chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
-
-
-
-
-
-
-
-
-
-
-
-
-
Winbond
Electronics
Corporation
247,527,493
6.63%
-
-
-
-
Representative of
Winbond
Electronics
Corporation: Yu-
Cheng Chiao
41,001,551
1.10% 19,502,428 0.52%
-
-
Chin-Xin
Investment Co.,
Ltd
247,399,375
6.63%
-
-
-
-
96
Shares Held Themselves
Name
Shares Held by
Spouse and
Underage Children
Shares Held Under
Name of Others
Number of
Shares
Percenta
ge
Number of
Shares
Percent
age
Number of
Shares
Percen
tage
41,001,551
1.10% 19,502,428 0.52%
-
-
Representative of
Chin-Xin
Investment Co.,
Ltd:
Yu-Cheng Chiao
LGT Bank
(Singapore)
Investment Fund
under the
custody of
Business
Department,
Standard
Chartered Bank
(Taiwan) Ltd.
TECO Electric and
238,160,000
6.38%
-
-
-
- -
Machinery Co.,
210,332,690
5.64%
-
-
-
- -
Ltd.
As of March 21, 2023
Name and relationships of related
parties to top ten shareholders
(spouse and relatives within the
second degree) (Note 1)
Name
Relationship
Rem
arks
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Patricia
Chiao
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is the same
as the chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
-
-
-
-
-
-
-
-
-
-
-
-
Note
2
-
97 97
Corporate Governance Report
Shares Held Themselves
Name
Shares Held by
Spouse and
Underage Children
Shares Held Under
Name of Others
Number of
Shares
Percenta
ge
Number of
Shares
Percent
age
Number of
Shares
Percen
tage
As of March 21, 2023
Name and relationships of related
parties to top ten shareholders
(spouse and relatives within the
second degree) (Note 1)
Name
Relationship
Rem
arks
Rong Jiang Co.,
Ltd.
183,515,651
4.92%
-
-
-
- -
-
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Yu-Heng
Chiao
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Yu-Heng
Chiao
Its chairman is a second-
degree relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
He is a second-degree
relative of said
shareholder
She is a first-degree
relative of said
shareholder
He is a second-degree
relative of said
shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is the same as the
chairman of said
institutional shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
Its chairman is a second-
degree relative of the
chairman of said
institutional shareholder
She is a second-degree
relative of the chairman
of said institutional
shareholder
He is a second-degree
relative of the chairman
of said institutional
shareholder
Patricia Chiao
109,085,587
2.92%
-
-
-
-
Huali Investment
Co., Ltd.
106,994,366
2.87%
-
-
-
-
Huali Investment
Co., Ltd.
Representative:
Yu-Chi Chiao
51,635,470
1.38%
244,033 0.01%
-
-
98
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Shares Held Themselves
Name
Shares Held by
Spouse and
Underage Children
Shares Held Under
Name of Others
Number of
Shares
Percenta
ge
Number of
Shares
Percent
age
Number of
Shares
Percen
tage
As of March 21, 2023
Name and relationships of related
parties to top ten shareholders
(spouse and relatives within the
second degree) (Note 1)
Name
Relationship
Rem
arks
Yu-Heng Chiao
65,343,810
1.75%
4,324,192 0.12%
-
-
Pai-Yung Hong
51,940,914
1.39%
-
-
-
-
Yu-Chi Chiao
51,635,470
1.38%
244,033
0.01%
-
-
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Huali
Investment
Co., Ltd.
Pai-Yung
Hong
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Yu-Chi
Chiao
Winbond
Electronics
Corporation
Chin-Xin
Investment
Co., Ltd
Patricia
Chiao
Huali
Investment
Co., Ltd.
Yu-Heng
Chiao
Pai-Yung
Hong
She is a first-degree
relative of the chairman
of said institutional
shareholder
He is the same as the
chairman of said
institutional shareholder
Its chairman is a second-
degree relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
She is a second-degree
relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
She is a first-degree
relative of said
shareholder
He is a second-degree
relative of said
shareholder
Its chairman is a first-
degree relative of said
shareholder
Its chairman is a first-
degree relative of said
shareholder
She is a first-degree
relative of said
shareholder
Its chairman is a first-
degree relative of said
shareholder
He is a first-degree
relative of said
shareholder
He is a first-degree
relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
Its chairman is a second-
degree relative of said
shareholder
She is a second-degree
relative of said
shareholder
Its chairman is the same
as said shareholder
He is a second-degree
relative of said
shareholder
She is a first-degree
relative of said
shareholder
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Note 1: Disclosure of relationship pursuant to rules indicated on the issuer's financial statement.
Note 2: The shareholder was a foreign fund account and inquiries have been made of its representative with relevant information
requested: None.
Note 3: The shareholding ratios are rounded to the nearest hundredth percent.
99 99
Corporate Governance Report
10. The number of shares of the same investee held by the Company, its directors, managers and
which the Company controls directly or indirectly, with the aggregate shareholding
percentages
Re-Investment Companies
(Note 1)
Investment by the Company
As of December 31, 2022; Units: Shares; %
Investment of directors,
managers or enterprises
under their direct or
indirect control.
Combined Investment
Walsin Lihwa Holdings Limited
Walsin Specialty Steel Corp.
Ace Result Global Limited
Min Maw Precision Industry
Corp.
Hua Tuo Green Resources Co.,
Ltd.
Walsin Precision Technology
Sdn. Bhd.
Walsin Singapore Pte. Ltd.
Walsin Lihwa Europe S.a r.l.
PT Walsin Research Innovation
Indonesia
Walsin America, LLC
Chin-Cherng Construction Co.
Walsin Info-Electric Corp.
PT. Walsin Lippo Industries
PT. Walsin Lippo Kabel
PT. Walsin Nickel Industrial
Indonesia
Joint Success Enterprises Limited
Chin-Xin Investment Co., Ltd
Tsai Yi Corporation
PT CNGR Walsin New Energy
and Technology Indonesia
PT. Westrong Metal Industry
Han-You Venture Capital Co.,
Ltd.
Winbond Electronics
Corporation
Walton Advanced Engineering,
Inc.
Walsin Technology Corporation
Powertec Electronic Chemical
Material Corp.
Percentage
Number of
shares
Number of
shares
108,730,393
308,498,375
44,739,988
100.00
100.00
100.00
32,791,149
100.00
1,828,287
100.00
32,178,385
100.00
422,000,000
12,000
100.00
100.00
Percentage
Number of
shares
- 108,730,393
- 308,498,375
44,739,988
-
Percentage
100.00
100.00
100.00
-
-
-
32,791,149
100.00
1,828,287
100.00
32,178,385
100.00
- 422,000,000
12,000
100.00
100.00
-
-
-
-
-
-
-
-
6,930
99.00
70
1.00
7,000
100.00
(Note 2)
577,583,403
29,854,246
10,500
1,050,000
100.00
99.22
99.51
70.00
70.00
-
-
-
-
-
-
(Note 2)
- 577,583,403
29,854,246
-
10,500
-
1,050,000
-
100.00
99.22
99.51
70.00
70.00
500,000
50.00
420,000
42.00
920,000
92.00
36,058,184
179,468,270
49,831,505
49.05 37,461,816
37.00 49,327,824
33.97 12,070,677
59.05
73,520,000
10.17 228,796,094
61,902,182
8.23
100.00
47.17
42.20
140,651
590,000
29.17
29.50
-
-
-
-
140,651
29.17
590,000
29.50
26,670,699
26.67
1,934,486
1.94
28,605,185
28.61
883,848,423
22.21 359,669,285
9.04 1,243,517,708
31.25
109,628,376
21.01 15,187,805
2.94
124,816,181
23.95
88,902,325
18.30 16,719,526
3.44 105,621,851
21.74
318,522,792
22.46 15,880,540
1.12 334,403,332
23.58
Note 1: These are investments by the Company that adopt the equity method of accounting.
Note 2: Walsin America, LLC is a non-stock corporation, with a paid-in capital of USD 81,302,107, which is wholly contributed by the
Company.
100
IV Fundraising Overview
1. The Company’s Capital and Shares
(1) Sources of Share Capital
1. Historical Sources of Share Capital
MM/YY
Issua
nce
Price
Authorized capital
Paid-in capital
Remarks
Shares
Amount
Shares
Amount
Sources of capital
11/02
10
6,500,000,000
65,000,000,000
3,512,976,276
35,129,762,760
06/03
10
6,500,000,000
65,000,000,000
3,412,976,276
34,129,762,760
11/03
10
6,500,000,000
65,000,000,000
3,366,067,276
33,660,672,760
01/04
10
6,500,000,000
65,000,000,000
3,266,067,276
32,660,672,760
04/04
10
6,500,000,000
65,000,000,000
3,174,491,276
31,744,912,760
07/04
10
6,500,000,000
65,000,000,000
3,078,236,276
30,782,362,760
08/04
10
6,500,000,000
65,000,000,000
3,079,012 601
30,790,126,010
05/05
10
6,500,000,000
65,000,000,000
3,006,294,601
30,062,946,010
08/05
10
6,500,000,000
65,000,000,000
3,310,913,261
33,109,132,610
04/06
10
6,500,000,000
65,000,000,000
3,244,314,261
32,443,142,610
11/08
10
6,500,000,000
65,000,000,000
3,194,314,261
31,943,142,610
02/09
10
6,500,000,000
65,000,000,000
3,179,200,422
31,792,004,220
09/09
10
6,500,000,000
65,000,000,000
3,119,200,422
31,192,004,220
11/09
10
6,500,000,000
65,000,000,000
3,069,200,422
30,692,004,220
12/10
10
6,500,000,000
65,000,000,000
3,609,200,422
36,092,004,220
01/11
10
6,500,000,000
65,000,000,000
3,614,890,804
36,148,908,040
04/11
10
6,500,000,000
65,000,000,000
3,616,000,258
36,160,002,580
06/13
10
6,500,000,000
65,000,000,000
3,576,000,258
35,760,002,580
05/15
10
6,500,000,000
65,000,000,000
3,516,000,258
35,160,002,580
10/16
10
6,500,000,000
65,000,000,000
3,396,000,258
33,960,002,580
06/17
10
6,500,000,000
65,000,000,000
3,366,000,258
33,660,002,580
08/18
10
6,500,000,000
65,000,000,000
3,326,000,258
33,260,002,580
09/20
10
6,500,000,000
65,000,000,000
3,286,000,258
32,860,002,580
12/20
10
6,500,000,000
65,000,000,000
3,226,000,258
32,260,002,580
Treasury stock capital decreased
by 100,000,000 shares
Treasury stock capital decreased
by 100,000,000 shares
Treasury stock capital decreased
by 46,909,000 shares
Treasury stock capital decreased
by 100,000,000 shares
Treasury stock capital decreased
by 91,576,000 shares
Treasury stock capital decreased
by 96,255,000 shares
Bond conversion entitlement
certificates converted to common
shares
Treasury stock capital decreased
by 72,718,000 shares
Capital increased by earnings
recapitalization by 304,618,660
shares
Treasury stock capital decreased
by 66,599,000 shares
Treasury stock capital decreased
by 50,000,000 shares
Treasury stock capital decreased
by 27,124,000 shares and
overseas convertible bonds
converted to 12,010,161 common
shares
Treasury stock capital decreased
by 60,000,000 shares
Treasury stock capital decreased
by 50,000,000 shares
Cash capital increased by
540,000,000 shares
Overseas convertible bonds
converted to 5,690,382 shares
Overseas convertible bonds
converted to 1,109,454
Treasury stock capital decreased
by 40,000,000 shares
Treasury stock capital decreased
by 60,000,000 shares
Treasury stock capital decreased
by 120,000,000 shares
Treasury stock capital decreased
by 30,000,000 shares
Treasury stock capital decreased
by 40,000,000 shares
Treasury stock capital decreased
by 40,000,000 shares
Treasury stock capital decreased
by 60,000,000 shares
01/21
10
6,500,000,000
65,000,000,000
3,431,332,948
34,313,329,480 Share swap of 205,332,690 shares
None
09/22
10
6,500,000,000
65,000,000,000
3,731,332,948
37,313,329,480 Cash capital increased by
None
300,000,000 shares
Paid with
property
other than
cash
No
No
No
No
No
No
Other
Note
1
Note
2
Note
3
Note
4
Note
5
Note
6
No
None
No
No
No
No
No
No
No
No
No
No
No
No
None
None
None
None
None
Note
7
Note
8
Note
9
Note
10
Note
11
Note
12
Note
13
Note
14
None
None
Note
15
Note
16
Note
17
Note
18
Note
19
Note
20
Note
21
Note
22
Note
23
101 101
Fundraising Overview
Note 1: Approval letter Tai-Cai-Zheng (3) No. 0910155823, dated
2002.10.16
Note 2: Approval letter Tai-Cai-Zheng (3) No. 0920110106, dated
2003.03.25
Note 3: Approval letter (2001) Tai-Cai-Zheng (3) No. 101196, dated
2001.02.08
Note 4: Approval letter Tai-Cai-Zheng (3) No. 0920159026, dated
2003.12.15
Note 5: Approval letter Tai-Cai-Zheng (3) No. 0930110000, dated
2004.03.24
Note 6: Approval letter Tai-Cai-Zheng (3) No. 0930125152, dated
2004.06.03
Note 7: Approval letter Jin-Guan-Zheng (3) No. 0940110778, dated
2005.03.30
Note 8: Approval letter Jin-Guan-Zheng (1) No. 0940124111, dated
2005.06.16
Note 9: Approval letter Jin-Guan-Zheng (3) No. 0950105881, dated
2006.02.20
Note 10: Letter Jin-Guan-Zheng (3) No. 09700511511, dated
2008.09.24
Note 11: Letter Jin-Guan-Zheng (3) No. 0970065169, dated
2008.11.28
Note 12: Letter Jin-Guan-Zheng (Jiao) No. 0980027679, dated
2009.06.06
Note 13: Letter Jin-Guan-Zheng (Jiao) No. 0980050862, dated
2009.09.21
Note 14: Letter Jin-Guan-Zheng (Fa) No. 0990051578, dated
2010.09.28
Note 15: Letter Jin-Guan-Zheng (Jiao) No. 0990025440, dated
2010.05.12
Note 16: Letter Jin-Guan-Zheng (Jiao) No. 1050021717, dated
2016.05.27
Note 17: Letter Jin-Guan-Zheng (Jiao) No. 1050040371, dated
2016.10.03
Note 18: Letter Jin-Guan-Zheng (Jiao) No. 1030014322, dated
2014.04.17
Note 19: Letter Jin-Guan-Zheng (Jiao) No. 1040026231, dated
2015.07.08
Note 20: Letter Jin-Guan-Zheng (Jiao) No. 1090341078, dated
2020.05.05
Note 21: Letter Jin-Guan-Zheng (Jiao) No. 1090359858, dated
2020.09.29
Note 22: Letter Jin-Guan-Zheng (Fa) No. 1090377120, dated
2020.12.16
Note 23: Letter Jin-Guan-Zheng (Fa) No. 1090377120, dated
2022.03.11
2. Types of Shares
Authorized Capital
Shares Issued and
Outstanding (Note 1)
Unissued Shares
Total
As of March 21, 2023
Remarks
3,731,332,948
2,768,667,052
6,500,000,000
(Note 2)
Types of
Shares
Common
Shares
Note 1: Publicly-traded shares.
Note 2: The Company’s capital includes NT$8,000,000,000 for the issuance of share warrants, corporate bonds with share
warrants or preferred shares with share warrants, up to eight hundred million shares at a par value of NT$10 per
share, which may be issued in separate tranches.
3. Information on Shelf Registration: None.
(2) Shareholder Structure
Shareholders
Numbers
Number
No. of Shares
Held
Government
Financial
Other Legal
Institutions
Institutions
Persons
As of March 21, 2023
Foreign
Individuals
Institutions and
Total
Individuals
8
50
438
183,885
653
185,034
83,587,445
50,678,061 1,351,171,891
1,343,380,365
902,515,186 3,731,332,948
Shareholding
2.24%
1.36%
36.21%
36.00%
24.19%
100%
Note 1: Ratio of shares held by investors in China: 0%.
Note 2: The shareholding ratios are rounded to the nearest hundredth percent.
102
(3) Distribution of Shareholders
1. Distribution of Common Shares:
Shareholding
1 to 999
1,000 to 5,000
5,001 to 10,000
10,001 to 15,000
15,001 to 20,000
20,001 to 30,000
30,001 to 40,000
40,001 to 50,000
50,001 to 100,000
100,001 to 200,000
200,001 to 400,000
400,001 to 600,000
600,001 to 800,000
800,001 to 1,000,000
1,000,001 and more
Total
Number of shareholders
71,836
85,751
13,959
4,516
2,578
2,295
1,023
691
1,154
552
295
105
47
22
210
185,034
Shares Held (Note)
14,741,275
174,862,529
106,617,183
56,517,247
47,114,969
57,381,896
36,258,165
31,690,202
81,928,245
77,725,812
83,315,132
51,595,499
33,074,440
19,606,314
2,858,904,040
3,731,332,948
Note 1: The shareholding ratios are rounded to the nearest hundredth percent.
2. Distribution of Preferred Shares: None.
As of March 15, 2022
Shareholding
0.39%
4.69%
2.86%
1.51%
1.26%
1.54%
0.97%
0.85%
2.20%
2.08%
2.23%
1.38%
0.89%
0.53%
76.62%
100%
(4) List of Major Shareholders
Major Shareholders
Winbond Electronics Corporation
Chin-Xin Investment Co., Ltd
LGT Bank (Singapore) Investment Fund under the custody of Business
Department, Standard Chartered Bank (Taiwan) Ltd.
TECO Electric and Machinery Co., Ltd.
Rong Jiang Co., Ltd.
Patricia Chiao
Huali Investment Corp.
Yu-Heng Chiao
Pai-Yung Hong
Yu-Chi Chiao
Note: The shareholding ratios are rounded to the nearest hundredth percent.
As of March 21, 2023
Shares
Number of Shares
Held
Shareholding (Note)
247,527,493
247,399,375
238,160,000
210,332,690
183,515,651
109,085,587
106,994,366
65,343,810
51,940,914
51,635,470
6.63%
6.63%
6.38%
5.64%
4.92%
2.92%
2.87%
1.75%
1.39%
1.38%
103 103
Fundraising Overview
(5) Stock Price, Net Value, Earnings, Dividends and Related Information for the Past Two Years
Item
Share
Price
(Note 1)
High
Low
Average
Net Value
per Share
(Note 2)
Basic
Diluted
Year
2021
32.35
16.30
26.12
30.86
29.26
2022
49.85
25.10
40.91
33.12
31.32
Weighted average shares
3,428,520,171
3,549,689,000
Earnings
per Share
Dividend
per Share
Earnings per share
Cash dividend (Note 3)
-
-
Stock
Dividend
Accumulated unpaid
dividend (Note 4)
Return
Analysis
Price-earnings ratio (Note 5)
Price-dividend ratio (Note 6)
Cash dividend yield (Note 7)
4.27
1.60
-
-
-
5.68
15.15
0.07
5.45
1.80
-
-
-
6.77
20.48
0.05
Current Year up to
March 21, 2023
59.40
46.00
51.96
-
-
-
-
-
-
-
-
-
* If shares are distributed in connection with a capital increase out of earnings or capital reserves, information on market
prices and cash dividends retroactively adjusted based on the number of shares after distribution shall be disclosed.
Note 1: The highest and lowest share prices for each year are provided, with the average price for the year computed based
on each year’s transaction amount and volume.
Note 2: Use the number of the outstanding issued shares at year’s end and the distribution passed at the following year’s
shareholders' meeting to fill in.
Note 3: If it is necessary to make adjustments retroactively due to situations such as issuance of bonus shares, the earnings
per share before and after the adjustments should be listed.
Note 4: If the conditions of the equity issuance require that dividends not yet distributed for the year be accumulated and
paid out in a later year with positive earnings, the dividends that have been accumulated up to the current year and
not yet distributed shall be disclosed separately.
Note 5: Price-earnings ratio = Average per share closing price for the year / earnings per share.
Note 6: Price-dividend ratio = Average per share closing price for the year / cash dividend per share.
Note 7: Cash dividend yield = Cash dividend per share / average per share closing price for the year.
(6) Dividend Policy and Implementation Status
1. Dividends Policy Specified in the Company's Articles of Incorporation
Article 28 of the Company's Articles of Incorporation:
After the Company has offset its accumulated losses from previous years and paid all tax due, the Company
shall set aside 10% of its net profits as legal reserve, except when the legal reserve equals to the total
authorized capital of the Company. From the remainder calculated above plus the surplus retained earnings of
previous year, the Company shall set aside or reverse the special reserve as stipulated by the law or the
competent authority. Then the Board of Directors shall draft an earning distribution proposal submitted to the
Shareholders' meeting for resolution to distribute shareholder's dividends. If the aforementioned distribution
of earnings is made in cash, the Board of Directors shall be authorized to distribute the earnings with the
presence of at least two-thirds of the Directors and the resolution of a majority of the Directors present, and
to report the distribution to the shareholders' meeting.
The setting aside of the legal reserve set forth in Paragraph 1 of this Article should be based on the "the total
amount of after-tax net income for the period and other profit items adjusted to the current year's
undistributed earnings other than after-tax net income for the period."
Article 28-1 of the Company's Articles of Incorporation:
104
The share dividend policy of the Company should be stable for the purpose of sustainable operation and
development .In case of any earnings on the final account, the Company shall allot as shareholder dividends
no lesser than 40% of the balance of such earnings after offsetting its loss, paying income tax, setting aside the
legal reserve, and setting aside the special reserve as adjusted based on the net decrease in other
shareholders' equity as stipulated in Article 28 hereof, as well as deducting the share of the affiliates' interests
recognized by equity method and adding the cash dividends paid out by the affiliates to the Company
recognized by equity method. Such dividends shall be distributed in cash or in form of shares; cash dividends
shall not be lesser than 70% of the total dividends. To ensure the stability of the financial structure, and based
on the principle of equitable dividend payout, the Company has no earnings to distribute or has earnings but
the amount of earnings is significantly less than the actual earnings distributed previously, the Company may
distribute all or part of the reserves or the undistributed earnings in the previous period .If there is a non-
recurring, material income in the Company's earnings for the year, all or a part of such income may be
retained without being subject to the percentage limitation set forth in Paragraph 1 hereof.(7) Effect of the
proposed stock dividends (to be adopted by the Shareholders' Meeting) on the operating performance and
earnings per share: Not applicable.
To ensure the stability of the financial structure, and based on the principle of equitable dividend payout, if
the Company has no earnings to distribute or has earnings but the amount of earnings is significantly less than
the actual earnings distributed previously, the Company may distribute all or part of the reserves or the
undistributed earnings in the previous period. If there is a non-recurring, material income in the Company's
earnings for the year, all or a part of such income may be retained without being subject to the percentage
limitation set forth in Paragraph 1 hereof.
2. Dividends Distribution to be proposed to the Shareholders’ Meeting
According to the decision of the Company's 23rd board meeting of the 19th term, it is proposed to distribute
cash dividends from the earnings in 2022 to shareholders shall be NT6,716,399,306, with NT$1.8 per share
(which is calculated based on the Company’s 3,731,332,948 issued and outstanding common shares). After
this dividend distribution has been resolve and approved by the Board of Directors, the Chairman of the Board
is authorized to determine the ex-dividend date and the distribution date. In the future, if the Company issues
or repurchases shares, thereby influencing the amount of outstanding shares and changing the distributable
cash dividend per share, it is proposed that the shareholders meeting authorize the chairman of the board to
adjust the number of outstanding stocks on the ex-dividend date.
The smallest unit of the cash dividend is NT$1. The distribution of the cash dividends shall be rounded down
to the nearest New Taiwan Dollar. The aggregate of the remaining cash will be credited to Other Revenue by
the Company.
3. Explanation regarding expected major changes to dividend policy:
It is proposed in the Company's 2023 Annual General Shareholders' Meeting to amend certain wording of Article
28 according to the letter from the Ministry of Economic Affairs dated June 6, 2022 (Ref. No.: Jin-So-Shang-Zi-
11101093290) as follows:
"In case of any net profit in the final accounting, after the Company has offset its accumulated losses from
previous years and paid all tax due, the Company shall set aside 10% of its net profits as legal reserve, except
when the legal reserve equals to the paid-in capital of the Company. From the remainder calculated above plus
the surplus retained earnings of previous year, the Company shall set aside or reverse the special reserve as
stipulated by the law or the competent authority. Then the Board of Directors shall draft an earning distribution
proposal submitted to the Shareholders’ meeting for resolution to distribute shareholder's dividends.
If the aforementioned distribution of earnings is made in cash, the Board of Directors shall be authorized to
distribute the earnings with the presence of at least two-thirds of the Directors and the resolution of a majority
of the Directors present, and to report the distribution to the shareholders' meeting.
The setting aside of the legal reserve set forth in Paragraph 1 of this Article should be based on the "the total
amount of after-tax net income for the period and other profit items adjusted to the current year's undistributed
earnings other than after-tax net income for the period."
(7) Effect of the proposed stock dividends (to be adopted by the Shareholders' Meeting) on the operating
performance and earnings per share: Not applicable.
105 105
Fundraising Overview
(8) Compensation for employees and directors:
1. The Company's Articles of Incorporation includes the amount and coverage of compensation for employees
and directors
Article 25-1:
If the Company turns a profit in a year, no less than 1% of the profit should be distributed to its employees as
compensation and no more than 1% to directors as compensation. The actual amount should be determined
by a board meeting where no less than two-thirds of the directors are present and more than half of the
directors present votes to approve the suggested amounts. The amounts should be reported to the
shareholders meeting. However, if the Company still has accumulated deficit from previous terms, it should
first reserve the amount needed to settle the outstanding balance.
Employee bonuses may be distributed by way of stock or cash dividends and the Company may issue bonuses
to employees of parents or subsidiaries of the Company that meets the conditions set by the board of
directors. The board of directors shall be authorized to determine the method of distribution.
The qualification requirements of or the distribution rules for the employees who are entitled to the treasury
stock transferred, the employee warrants issued, subscription for new shares issued, and the restricted stock
awards issued by the Company, including the employees of parents or subsidiaries of the company meeting
certain specific requirements, shall be formulated by the board of directors as authorized.
2. Basis for estimates of compensations for employees and directors for this term, basis for calculating employee
stock compensation and accounting procedures for when there is a discrepancy between the estimated and
actual amount
(1) Basis for estimates of compensations for employees and directors for this term: Estimated by ratio of the
pre-tax income as determined by the Articles of Incorporation.
(2) Basis for calculating employee stock compensation: Not applicable.
(3) Accounting procedures for when there is a discrepancy between the estimated and actual amount: Please
find relevant accounting procedures in “6. Financial Overview: 4. Financial report of the most recent year
22 NET PROFIT (LOSS) FROM CONTINUING OPERATIONS” of this annual report for further explanation.
3. Information regarding board of directors' approval of employee compensation
(1) Amount to be paid in the form of cash and stocks to employees and directors: The board has approved
NT$252,000,000 to be paid in cash to employees and NT$100,050,000 to directors for 2022.
(2) Difference from estimated amount, reason and actions required: No difference.
(3) The amount of employee compensation in the form of stock and its percentage of the Company's after-tax
income (as reported in the financial statement of this term) and total employee compensation: Not
applicable.
4. Actual payment status (including stocks, cash and stock price) for employee and director compensation from
the previous year; discrepancies (if any) between the actual payment and estimated amount, as well as the
reasons for and actions required by the discrepancies
(1) Cash and stock compensation for employees; compensation amount for directors: for 2021, the Company
issued NT$187,000,000 to employees and NT$75,000,000 to directors.
(2) Differences between the estimated amount of compensation for employees and directors, as well as the
reasons for and actions required by the discrepancies: No differences.
(3) Please find relevant accounting procedures in “VI. Financial Overview: 4. Financial report of the most
recent year: 22 Profits from Continuing Operating Units” of this annual report for further explanation.
(9) Share Repurchases:
1. Those having been executed: None.
2. Those being executed: None.
106
2. Issuance of Corporate Bonds:
Type of Corporate Bonds
Issuance (Processing) Date
Denomination
Issue Price
Lump Sum
Interest Rate
Term
Guarantor
Trustee
Underwriter
Certifying Attorney
Certifying CPA
Repayment Method
Outstanding Principal
Terms of Redemption or Prepayment
Restrictive Clauses
Credit Rating Agency Name, Rating Date,
Rating of Corporate Bonds
Additional
Rights
Amt. of Converted Common
Shares, Global Depositary
Receipts or other Securities
Rules for Issuance and
Conversion
Possible Dilution of Shareholding due to,
and Effect on the Current Shareholders'
Rights and Interests of, Issuance and
Conversion, Rules for Share Swap or
Subscription, or the Issuance Terms
Name of the Custodian Engaged by the
Counterparty of Share Swap
2021 1st Unsecured Straight Corporate Bonds
Octorber 8, 2021.
NT$10,000,000
Issued at denomiatnion
NT$7,500,000,000
A fixed rate of 0.70% per annum
5 years; Expiration date: 2026/10/8
None
Hua Nan Commercial Bank Co., Ltd.
KGI Securities was appointed as lead underwriter
Yicheng United Law Firm
Deloitte Taiwan
Principal shall be repaid upon due in one installment
NT$7,500,000,000
None
None
Rating agency: Taiwan Ratings Corporation
Rated Entity: Walsin Lihwa Corporation
Rating: TwA-
Rating Date:2021/08/06
Not applicable
None
None
None
3. Issuance of Preferred Shares: None.
4. Issuance of Global Depositary Receipts (GDRs)
Item
Date of Issuance
October 3, 1995
November 9, 2010
Place of issue and trading
Issued globally and traded on the Luxembourg Stock Exchange
Total amount
US$121,800,000
Offer price per unit
US$12.18
Total units issued
10,000,000 units
US$290,313,085
US$5.38
53,961,540 units
Source of underlying security
Issuance of new common shares for
Issuance of new common shares for
cash capital increase
cash capital increase
Underlying security
Common stocks: 100,000,000 shares Common stocks: 539,615,400 shares
Rights and obligations
of depositary receipt holder
Conducted in accordance with the laws of the Republic of China and with the
provisions of the Depository Agreement. Refer to the Covenants of
Depository Agreement for the key terms and conditions.
Trustee
None
None
107 107
Fundraising Overview
Depository institution:
Deutsche Bank
Citibank
Custodial bank
Mega International Commercial Bank Citibank (Taiwan)
Balance outstanding
Distribution of fees incurred
from issuance and the
outstanding period of the GDRs
2,224 units of global depositary receipts and 22,248 shares of securities
represented.
1. Issuance fees: The issuing company will be responsible for the entirety of
this fee.
2. Fees during outstanding period: The issuing company will be responsible
for this fee.
Covenants of Depository
Agreement and Custodial
Omitted
Agreement
2022
Current year as of
March 21, 2023
(
U
n
i
t
:
U
S
$
)
M
a
r
k
e
t
p
r
i
c
e
p
e
r
u
n
i
t
High
Low
Average
High
Low
Average
16.61
9.11
12.20
19.00
15.29
16.93
5. Exercise of Employee Stock Option Plan (ESOP) and Restricted Stock: None.
6. Mergers, acquisitions or issuance of new shares for acquisition of shares of other companies:
None.
7. Implementation of capital allocation plan: None.
108
V .. Business Overview
1. Business activities
(1) Scope of Business
1. Primary business content, primary products and revenue ratio.
Business unit
Business activities
Products
Revenue Ratio
The Company and its
merged subsidiaries
Amount
(NT$ million)
%
58,862
32.6
79,025
43.8
and
cables
Bare copper strips, copper
stranded wires, copper cables,
cables, high-voltage
power
their
connectors
and
accessories
copper/
telecommunication
optical
and
fiber
industry power cables.
Billets, slabs, hot-rolled coils,
cold-rolled coils, wire rods,
hot-rolled bars, cold-finished
bars, steel ingot, forged bars,
seamless pipes and
tubes,
pierced billets, steel strands,
reinforcing steel, and valve
steel
Nickel pig iron, nickel matte,
billets, slabs, and HR coils
23,469
13.0
Wire
cables
and
Manufacture and sale of bare
copper wire, various electrical
related
wires,
cables
connection materials
and
the
accessories, as well as
contracting and execution of
high-voltage cable engineering.
and
Stainless
steel
Forging, processing and selling
of stainless steel.
Commodity
Production and sales of stainless
steel upstream raw material,
nickel pig iron, production and
sales of nickel matte (the nickel
raw materials
for batteries),
agency sales of stainless steel
semi-finished
products,
procurement and hedging of
raw materials
other metal
required by the Company for
production
Commercial
real
estate
business
Others
Real estate
Solar power engineering etc.
2. New products under development
Land, housing and parking
space sales; commercial and
office buildings sales
1,973
17,072
1.1
9.5
Business unit
Wire and cables
Stainless steel
New products under development
(1) Cables for Industrial 4.0 applications
(2) High voltage cables used within large offshore wind turbines
(3) Submarine cables for offshore wind sites
(4) Rapid power supplement systems for new energy vehicles
(1) Stainless steel of various types, grades, sizes, conditions and product types.
(2) Stainless steel with high intensity, heat resistance, free-machining, soft
magnetic property, and value-added.
(3) Developing stainless steel for various industrial applications, such as
chemical and
automotive, marine, machinery and equipment,
petrochemical industries, construction, energy, consumer electronics, and
medical applications.
109 109
Business Overview
(2) Industry overview
1. The current status and development of the industry
(1) Wire and Cable Business
According to forecast report issued by the International Copper Study Group (ICSG), global copper
production increased by 3.4% year-on-year in 2022 and is forecast to reach 25.62 million tonnes for the
year 2022. Refined copper consumption increased by 3.3% year-on-year in 2022, which was a significant
growth compared with the previous year, in spite of the extreme climate, energy shortage, inflation, and
the pandemic, suggesting a gradual recovery in the demand for refined copper worldwide. The global
demand for refined copper is forecast to reach 26.04 million tonnes for the year 2022, leaving a
supply/demand gap of 420,000 tonnes. Chinese copper smelters are still expanding their production
capacity, with China's refined copper production still on the rise, which has exceeded 10 million tonnes for
the past 3 consecutive years, reaching an annual record high of 11.06 million tonnes in 2022, a 4.5% year-
on-year increase . In the post-pandemic era, most countries are strengthening their infrastructure, and the
cable market is the largest in terms of purchases by power sector companies, and with the electrification
of means of transportation and green power generation, it is expected that the growth in grid and power
construction will increase the demand for cables.
(2) Stainless Steel Business
According to International Stainless Steel Forum (ISSF), global stainless crude steel production is estimated
at 56.2 million tonnes in 2022. The Russian-Ukrainian war triggered a rise in energy prices, and global
central banks raised interest rates quickly in response to high inflation, resulting in a decrease in both
steel supply and demand. The largest steel production region was Mainland China, which produced 32.3
million tonnes of crude stainless steel, down by 1% from 2021, while Asia (excluding Mainland China and
Korea) produced 7.6 million tonnes, Europe 6.15 million tonnes, and the Americas 2.4 million tonnes,
down by 2%, 14% and 12% respectively from 2021.
In terms of the structure of stain less steel products, the output of plate products in 2022 was 47.3 million
tonnes (consisting of HR coil of 9 million tonnes (19%) and CR coil of 38.3 million tonnes (81%)),
accounting for 84% of the total output, and the output of long steel products was 8.9 million tonnes,
accounting for 16% of the total output. Among the long steel products, the output of HR bars, wire rods
and small steel embryos were 3.8, 2.95, and 2.15 million tonnes respectively, accounting for 43%, 33%,
and 24% of the output of the long products respectively.
About 45% of the end-use applications of long steel products are used for industrial production (such as
machined parts), 29% for industrial production (e.g. machined parts), 12% for consumer durable goods
and 14% for transportation. The top five long-strip stainless steel companies around the world by output
are Tsingshan, Jiangsu Delong, Walsin Lihwa, Viraj and Swiss Steel. (The above output figures are based on
the data from the statistical report for 2022 published by SMR, a marketing agency.)
The increase in production capacity in recent years has been concentrated in China and Indonesia, led by
the world's largest steel plant, Tsingshan Group, with an annual production capacity of over 10 million
tonnes. In addition, Jiangsu Delong is also expanding its production capacity, and with successive mergers
and alliances among Baosteel, Wuhan Iron and Steel, Taiyuan Iron and Steel, Shagang, more 10 million
tonnes steel maker groups will emerge in the future. Benefiting from its cost advantage thanks to RKEF
integration, Tsingshan and Jiangsu Delong dominated the general supplies market; Baowu Steel Group
entered the Indonesian nickel iron market; Beihai Chengde takes the advantage of its own nickel iron
110
production capacity and cooperates with the Philippine nickel miners; therefore, steel groups in the
northern and southern parts of China are working together to compete those in the middle part of China.
(3) Resources Business
Global nickel pig iron production capacity is mainly concentrated in Mainland China and Indonesia. In 2020,
due to Indonesia's ban on ore exports, the movement of the nickel pig iron industry chains from Mainland
China to Indonesia accelerated, and Indonesia has become the world's largest nickel pig iron producer. In
2022, high nickel pig iron production capacity in China and Indonesia reached 2.35 million tonnes of nickel
and the production reached 1.48 million tonnes of nickel, with the production capacity and the
production up by 28% and 19%, respectively, compared with 2021. Among them, total high nickel pig iron
production in Mainland China was 330,000 tonnes of nickel, down by 7% from 2021, mainly because the
raw material supply restrictions and high products costs continued to weaken China's overall
competitiveness in high nickel pig iron, while the total high nickel pig iron production in Indonesia was
1,150,000 tonnes of nickel, up by 29% from 2021.
We expect that, in 2023, China's nickel pig iron production will continue to be constrained by the
uneconomic production caused by the decline in imported nickel ore grade, changes in Philippines' export
policies, and other supplementary materials. With a significant number of new production lines being
planned, we expect that new capacity in Indonesia will continue to be commissioned. In response to the
green energy transformation and the booming development of the downstream of the new energy
industry chain, a large amount of capital has been injected into Indonesia since 2020, and the production
capacity of intermediate nickel products for batteries, such as nickel matte and mixed nickel‑cobalt
hydroxide precipitate (MHP), has been released since 2021 and grew at an accelerated speed in 2022.
Indonesia's MHP production reached 86,000 tonnes of nickel in 2022, six times that in 2021; the
production of high nickel matte reached 207,000 tonnes of nickel, three times that in 2021. A large
amount of intermediate production capacity was still being planned in Indonesia in the following years. It
is expected that the new production capacity will continue to be developed at a high speed in 2023, and
the overall industrial chain will gradually expand downstream.
(4) Commercial Real Estate Business
In 2022, the total commercial residential sales area in Nanjing exceeded 7.6 million square meters, down
by over 37% from 2021, due to the effect of the lockdown in the pandemic. The average transaction price,
however, exceeded about RMB31,800 per square meter, an increase of about 8% compared to 2021. The
slowdown in property market transactions has corrected the price distortions caused by the overheated
market. However, the value of projects in core urban areas has been recognized by the market, with both
transaction volume and transaction prices remaining stable, taking the lead in the recovery after the lifting
of the property purchase restriction policy at the end of 2022, which lays a solid foundation for the steady
development of developers. With private property developers' growing debt defaults and shrinking
development capacity, the demand for land tilted toward state-owned enterprises. This situation brings
more new development opportunities for foreign-invested enterprises with abundant cash flow, whose
strength is increasingly prominent.
111 111
Business Overview
2. Relationships with suppliers in the industry's supply chain:
(1) Wire and Cable Business
Electrolytic Copper plates (imported)
PVC/PC plastic materials
Bare copper strips (wires)
Chemical coatings
Wire and cable
Telecommunication cables
Electric wires
Enamel insulated wires
Computer assembly
Home appliances
Home appliances
Electromechanical machines
Power generation, Power
transmission & distribution,
Electromechanical &
engineering,
Transportation & buildings,
New Energy
Telecommunications
engineering
Network engineering
(2) Stainless Steel Business
112
(3) Resources Business
3. Product development trends and competition
(1) Wire and Cable Business
Development trend: In addition to the traditional construction and infrastructure cables, there are many
green energy related cable applications and products that have emerged in response to the global trend of
net zero emission. For example, in the field of energy creation and transmission, solar power cables that
need to prevent UV degradation, wind turbine cables that can withstand harsh environments, and
submarine cables that transmit power from offshore wind turbines back to land or transfer power across
borders between countries, are all products that are actively developed by major cable manufacturers
around the world. In addition, in the area of energy storage and use, the electrification of transport
equipment and smart power allocation, cable sets for power replenishment systems, and cables for
energy storage equipment are all new generation products that our peers are competing for development.
Competition: From the historical output of Taiwan's power cable market, there is still an oversupply of
capacity in the overall cable market and competition is relatively fierce. However, benefited from the
regional supply chain integration of Taiwan businessmen back to Taiwan to drive the demand for plant
expansion, and a large number of residential, commercial office and public works projects, coupled with
the government's active promotion of green energy policy and Taipower's grid reinforcement plan to
accelerate the deployment and construction of regional grids, market demand is expected to grow at a
stable pace.
(2) Stainless Steel Business
Development trend: In terms of product development, apart from actively developing nickel-free steel
grades, major stainless steel makers are also developing the most suitable materials for specific
applications. For example, in response to the demand for automation, the demand for wear-resistant,
high-precision and zero-defect materials has increased. In the past, key technologies were held in Japan,
Europe and other countries, but Asian steel makers have also continued to invest in research and
development in recent years, and to refine their own technological capabilities. At the same time, with the
rising awareness of environmental protection, stainless steel is more widely used in various fields, and
there are many cases of replacing carbon steel with stainless steel in the construction, transportation and
other industries. In the renewable energy industry, stainless steel components can also be found in wind
turbines and renewable energy vehicles.
113 113
Business Overview
Competition: Indonesian steel mills will dominate the Asian market with the advantage of low-cost raw
materials; with the promotion of carbon emission control policy in Mainland China, the steel mills have
shifted from incremental to value-added and started to consolidate with the strategy of eliminating the
weak and leaving the strong; the rest of the steel makers will focus on niche industrial applications with
high certification thresholds to add value to their products through end-use differentiation.
(3) Resources Business
Development trend: Stainless steel plants in Mainland China and Indonesia are expanding their
production capacity, and the demand for nickel pig iron and scrap steel will continue to rise, while
nickel pig iron in Indonesia has a cost advantage and is economical for downstream steel plants. In
the following years, there will still be new manufacturers entering Indonesia to invest in RKEF
production line. In addition, in response to the continuous growth of the new energy industry chain,
some of the RKEF production lines have started to change their processes in 2022 to make their
output more flexible to switch between nickel pig iron and nickel matte. In addition, due to the
significant price difference between different nickel products this year, the "nickel matte - nickel
sulfate - pure nickel" process has emerged. Therefore, if manufacturers continue to extend to the
downstream nickel sulfate production, their sales portfolios will be more diversified, and the overall
nickel market will reach a dynamic balance between supply and demand.
Competition: Indonesia's RKEF production lines have grown significantly since 2021 and will continue
to open up significant capacity. In addition to continuing to provide additional stainless steel
production capacity in Indonesia, the production lines will also make up for the possible decline in
nickel pig iron supply in China. In addition, in response to the continuous growth of the new energy
industry chain, some of the RKEF production lines have started to change their processes to make
their output more flexible since 2022, so that they can flexibly switch between iron pig nickel and
nickel matte.
(4) Commercial Real Estate Business
Development Trends: After nearly 20 years of rapid development, China's real estate industry is now at a
new stage of development and has once again become a key pillar industry whose development is
encouraged by the state. Real estate development has been concentrated rapidly to the three urban
clusters: the Yangtze River Delta, the Pearl River Delta, and the Circum-Bohai Sea Area. Nanjing is one of
the three major cities in the Yangtze River Delta, with a regional GDP of RMB 1.7 trillion in 2022. With a
strong economic base, developing manufacturing industries, active financial and trade activities,
continuous population inflow, and high consumption potential, Nanjing has become a core city for major
property development in China. Therefore, the development prospect and continuous profitability of the
property industry in Nanjing are quite promising. The focus of development in the city center area is still
on high quality and large volume complexes, the integration of commercial, office and residential multi-
styles, and on experiential and
leisure,
entertainment and other experiential consumption become the focus of business revenue. In terms of
residential property, high-end and even top-tier blocks continue to be the main development trend,
driving the continuous upgrading of urban living quality, while in terms of office property, landmark
international Grade A offices lead the development of high-end business areas.
interactive products. Children's playground, catering,
Competition: The central part of the city is the focus of the real estate market, where land supply has
always been rare and projects have been launched relatively rarely. After a major slowdown in the real
estate market in 2022, a number of enterprises with high gearing and insufficient cash flow will be
eliminated, and the industry pattern will further develop in the direction of "stronger is stronger". Stable
and strong companies with low gearing ratios and strong cash flow will have more advantages and
opportunities in acquiring new development projects.
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(3) Overview of Technology and R&D
1. R&D Expenses and Results
R&D Expenses
From Jan. 1, 2022 to March 21, 2023, the R&D expenses were around NT$ 300
million.
(A) Technology Research & Development
(1) Develop 200 amp charging gun series
(2) Develop 8MW offshore wind turbine cables
(3) Develop lightweight power cables for harbor machinery
(4) Aanti-rodent and anti-ant high voltage cables
(5) Expand the development of stainless steel material types, sizes, conditions and product types.
(6) Innovative research and development of functional stainless steel with high strength, high heat
resistance, and easy turning characteristics to increase added value.
(7) Continue to invest in the development of stainless steel for automotive components, aiming at energy
conservation, environmental protection and high efficiency to meet market demand.
(8) Deepen research on stainless steel for welding, and increase the service life of materials in harsh
environments such as high temperature resistance, corrosion resistance and high temperature
resistance.
(9) Cooperate with domestic universities and research institutions to jointly promote various industry-
university cooperation and outsourcing research projects, and expand the depth and breadth of process
technology through the combination of theoretical knowledge and practical experience, thereby
increasing the capacity of research and development.
(B) Intelligent Manufacturing
(1) Smart Power Consumption:
Collect and analyze equipment power consumption data, improve the accuracy of power consumption
estimation, and reduce wasted power consumption.
(2) Development of Intelligent Crane Automatic Storage System:
New intelligent cranes are adopted to establish an automatic transportation and storage system for steel
billets, which improves the space utilization rate, assists in optimizing the inventory management of
incoming materials in the factories, automatically dispatches shipments and loads materials without
interruption, improves production efficiency, avoids human operations, and improves work safety.
(3) Establishment of Automated Guided Vehicles (AGV) System:
A composite automated guided system is adopted to overcome the outdoor climate, realize outdoor
unmanned automatic cross-factory transportation, improve transportation efficiency, and reduce forklift
operations and operating manpower.
(C) Energy and Environmental Protection
(1) Replacing Traditional Preheaters:
Replace traditional preheaters with pure oxygen preheaters to reduce fuel consumption, improve
combustion efficiency, and reduce greenhouse gas emissions.
(2) Slag Recycling:
The by-product slag produced by the steelmaking electric furnace can be converted into a variety of high-
value recycled products after classification and screening, such as low-carbon concrete, red bricks as
building materials, and pervious asphalt.
115 115
Business Overview
2. Present and future R&D projects, as well as the estimated R&D investment expenditure
Plan for the most recent
year
Current progress
We plan to invest NT$168,000,000 for R&D, including:
Mass
production
completion
time
Main reasons that future development
will succeed
Trial manufacturing stage 2023
Trial manufacturing stage 2023
Component design, hot rolling process
parameter setting, heat treatment
parameter setting
Hot rolling process parameter setting,
heat treatment parameter setting
Trial production in a
limited capacity
2023
Hot rolling process parameter setting,
heat treatment parameter setting
Highly machinable soft
magnetic stainless steel
High heat resistant stainless
steel for automotive parts
and components
High strength, wear
resistant, high processability
stainless steel
High strength and high
corrosion resistant stainless
steel
hot rolling process parameter setting,
heat treatment parameter setting
Component design, hot rolling process
parameter setting, heat treatment
parameter setting
We have the ability to independently
develop and certify the materials
(1) We are the only player in Taiwan
with complete dynamic cable
development and testing
capabilities
(2) We have completed UL/IEC full
range of charging cable certification
(3) We have the ability to
independently develop and certify
materials
(1) We are the only player in Taiwan
with complete dynamic cable
development and testing
capabilities
(2) We have the ability to
independently evaluate and certify
materials
(1) We are the only player in Taiwan
with complete power cable testing
and certification capabilities and
equipment
(2) We have the ability to
independently develop and certify
materials
Trial production stage
2023
Highly weldable and high
heat resistant stainless steel Trial production stage
2023
Cables for energy storage
applications
Materials have been
developed and certified
2023
Wire harness for renewable
energy vehicles and power
replenishment system
Development of high-
voltage cables within wind
turbines
Development of
environmentally friendly
cable materials
(1) We have obtained the
certification of DC 300A
charging gun/cable set
series
(2) Development and
design of super-fast
charging gun/cable set
(3) Structure design of
cables for high-current
electric vehicle
applications
(1) Cable development
and design
(2) Dynamic test and
certification of cables in
low temperatures
2024
2024
Development of low-
carbon footprint,
environmentally friendly
cable insulation materials
and certification of cable
electrical performance
2025
116
(4) Business Plan – Long-term and Short-term
1. Wire and Cable Business
Short-Term: In response to the end-customer demand for building construction, we will be able to precisely
supply goods with the help of smart manufacturing to enhance customer satisfaction with delicate services
and bolster our leadership in Taiwan. We also aim to reserve our capacity, in order to expand our share of
solar cables in the market, and to respond to the government's policy for domestic production of core
components for offshore wind power plants, with the goal of exclusively manufacturing cables for offshore
wind turbines in Taiwan. Following the global trend of popularizing electric vehicles and speeding up the
construction of supporting infrastructure, we are developing wire harnesses for new energy vehicles and
power replenishment systems that meet global standards.
Long-Term: We will seize the business opportunities brought by the global smart grid and new energy
industries by expanding our business scope of Energy Solution. We will focus on the demand for special cables
and cable engineering services for the construction of solar power, energy storage and offshore wind power
plants.
2. Stainless Steel Business
Short-Term: Taiwan: In response to the trend of small amount but diversified products in the high-value
market, Walsin has adjusted its direction and gradually built up its product and service capabilities to meet the
needs of different customer segments. For the wire rod, we will actively expand niche steel sales portfolio in
line with market conditions to expand the volume of orders of favorable steel grades, while continuing the
research and development and the capital expenditure to increase the application of new steel types and new
industries and stabilize product quality. For cold finished bars, we will focus on the development of direct
customer channels and the expansion of available specifications in order to expand our market share; for
plate products, we will use digital analysis to assist in material preparation and production scheduling, so that
the delivery time can be close to customer expectations.
Mainland China: The new intelligent production lines for hot rolled bars/wire rods will be commissioned,
which utilize advanced manufacturing process and intelligent production to supply high precision and quality
stainless steel products. In this way, we will effectively achieve import substitution, increase our market share,
and reach the goal of selling all of the products we produce. We will continue to develop high-value steel
grades for hot rolled bars and seamless steel pipes in the hope of increasing value added to our products. For
the cold refined rods, we will increase the volume of orders from direct customers and strengthen the
collaboration between marketing/technology/business for serving customers, to ensure the completion of the
integrated material application supply chain, so that the upstream and downstream can work more closely
together.
Europe: We acquired Cogne Acciai Speciali S.p.A., a leading stainless steel bar and wire rod manufacturer, in
an attempt to expand Walsin's global sales base with its existing production capacity and over 20 sales
locations in 15 countries.
Long-term: Taiwan: We will grasp upstream raw materials to enhance the competitiveness of Walsin's
stainless steel products. For bar materials, in addition to maintaining the major customers with high demand,
the Company will actively develop new customer bases and expand suitable markets for export. For cold
finished bars, in addition to continuing to strengthen the advantages in our integrated production lines, we
will increase the quality and output of deep-processed products. For wire rods, the long-term goal is to
increase the proportion of niche steel grades in our sales mix. In terms of operations, we are strengthening
our competitiveness by accelerating internal process improvement and Industry 4.0 automation projects.
Mainland China: We will focus on certification application markets, such as transportation, petrochemical,
boiler, nuclear power, and food, as key development industries, in cooperation with China's nationalization
policy and industry development potentials. We will also expand our technical service capacity and market
117 117
Business Overview
management, hoping to enhance the added value of our products and brands. We will set up distribution
centers in major markets to enhance our market penetration in each region through rapid logistics and
distribution.
Europe: Cogne Acciai Speciali complements and integrates with our Taiwan and China plants in terms of
products, technology, equipment, channels and customers. Therefore, we will leverage its experience in
developing high-end niche products and industrial certification markets, to strengthen our ability to expand
into mid- and high-end markets and to accelerate our development of high-value stainless steel business.
3. Resources Business
Short-term: PT. Walsin Nickel Industrial Indonesia's nickel pig iron production lines were fully commissioned.
We will continue to ensure that those production lies have stable capacity utilization rates and are fully in
operation for production, and to strengthen the stability of upstream raw materials for stainless steel, so as to
enhance our competitiveness. The nickel matte production lines acquired from PT. Sunny Metal Industry in
the second half of 2022 was commissioned for trial production at the end of the same year, and with the
commissioning of the power plant, all production lines will enter full production operation in 2023. Regarding
our agency services, considering the uncertainty of competing global markets and international political and
economic conditions, we continue to actively negotiate with Indonesian suppliers in order to source
competitive raw materials in terms of costs, stable supply, and accurate delivery, to meet the needs of our
customers and to strengthen the cooperative relationship between the Taiwanese industry and upstream
suppliers, thereby enhancing the competitiveness of Taiwan stainless steel players in the international
markets and further increasing the volume of orders received by our agency services.
Long-term: In response to the trend of climate change and sustainable development, we will continue to pay
attention to the development of environmental protection policies and the trend of the industry. In addition
to continuing to promote the production of nickel resources products, we will also promote the green cycle
projects towards energy creation, energy storage and circular economy, to create a win-win situation for both
the economy and the environment. Regarding our agency service, we will leverage our agency advantage to
ensure stable supplies for the demand in the Taiwan stainless steel market, provide a stable source of
materials with competitive costs, avoid the risk of price fluctuations and reduce the pressure on inventory
capital (i.e., value-added services) to promote the overall effectiveness of the value chain of the stainless steel
industry in Taiwan, and strive to achieve the long-term goal of simultaneous growth in the volume of orders
received by the agency and the price of the stainless steel industry in Taiwan. In addition, with our Indonesia
production lines being commissioned for mass production, we expect to expand into nickel pig iron, nickel
matte and other service items.
4. Commercial Real Estate Business
Short-Term: For the second phase of the Company's real estate business, Phase II Lot AB, Building No. 6, the
office spaces on the 5th to 12th floors have been fully leased and operating, and the leasing and opening of
high-end restaurants on the 1st to 4th floors has been completed, generating stable rental income. Building No.
1, which meets the International Grade A Office Standards, was built and delivered in July 2022 and received
LEED & WELL double gold international certification, with leasing contracts for 15,000 square meters of the
offices being executed, generating effective rental income flows in the year of its construction.
Long-term: Walsin Centro
integrates various residential, commercial and office properties with a
complementary relationships and we will increase overall brand value and create economies of scale through
integrated marketing. High-end residential will bring brand reputation and market influence to the
commercial, while high-quality commercial will bring support and services to the office. The landmark Grade A
office will further enhance the brand status of the commercial and residential sectors, bringing abundant
traffic and consumption to the commercial sector and better services to the residential customers. The
maturation of each new industry is consolidating the competitive advantage of the existing industry and
118
enhancing the value of the existing industry. After more than ten years of continuous development, Walsin
Centro has become a new urban landmark in Nanjing and the Walsin Centro project has become a successful
model for commercial development in Nanjing, with its market influence and brand reputation continuing to
expand and its commercial and business value continuing to rise.
2. Market Analysis and Sales Overview
(1) Market Analysis
1. Sales region(s) and market share of main products
(1) Wire and Cable Business
The Company is focused on the development of the wire and cable business and offers a one-stop
comprehensive production series from the upstream bare copper wire, copper rod production, to the
research and production of all types of cables such as power cables, communication copper cables and
fiber optic cables. The main sales regions include Taiwan and Mainland China. In 2022, the sales of the
Company's power cable products was approximately NT$21.6 billion, and that of bare copper wise was
about NT$38.2 billion. According to the Department of Statistics of the Ministry of Economic Affairs, the
domestic sales of power cable products in Taiwan in 2022 was estimated at NT$72.3 billion. Therefore, the
Company maintains a market share of 25% or more and of 30% or more in Taiwan's power cable and
copper bar markets, respectively.
(2) Stainless Steel Business
The Company is a major global stainless steel material company, with stainless steel products such as
stainless steel billet, cold- and hot-rolled steel coils, wire rods, cold finished bars, seamless steel pipe and
precision roll bonding steel. The main sales regions include Taiwan, Mainland China, Korea, Southeast Asia,
Australia, Europe and North America, etc. Our stainless steel wire rod and cold finished bars occupy a
significant position on the global market and we offer customers optimal lead times and services with
sales offices distributed across the Taiwan Strait, a vertically integrated supply chain and a standardized
production process.
For the sales of stainless steel products made by the Company in 2022, its domestic market shares reach
65% (wire rods), 25% (hot-rolled steel coils), 35% (cold-rolled steel coils) and 35% (cold finished bars); its
market shares in China are 7% (hot-rolled steel bars) and 8% (cold finished bars); the Company’s global
market shares are 6% (wire rods), 7% (hot-rolled steel coils) and 4% (cold finished bars).
Note: The above market shares are estimated only in respect of the territories to which we sell products
and our available specifications.
(3) Resources Business
Nickel pig iron produced by PT. Walsin Nickel Industrial Indonesia is the upstream raw material for
stainless steel manufacturing, which is mainly supplied to local steel mills in Indonesia for smelting
stainless steel. The sales of nickel pig iron in 2022 were 41,000 tonnes, with full production and sales.
According to SMM's research report, the Company's 2022 nickel pig iron production accounted for
approximately 3.5% of Indonesia's total production. According to SMM's research report, the nickel-iron
to high nickel matte production lines are running smoothly, with a total production capacity of 326,000
nickel tonnes of high nickel matte in 2022, of which 221,000 nickel tonnes were added to the production
capacity.
In terms of agency service, the Company has been acting as an agent for the sales of Indonesia Tsingshan
since May 2020, with the aim of maintaining the international competitiveness of Taiwan's stainless steel
plate products and promoting the overall efficiency of the value chain of the stainless steel industry. We
sell as an agent mainly stainless steel products, such as stainless steel billets, slabs and hot rolled steel
119 119
Business Overview
coils, to mainly Taiwan and Taiwan-invested overseas enterprises. The Company received orders of about
680,000 tonnes in 2020, about 980,000 tonnes in 2021, and about 820,000 tonnes in 2022. We estimate
that the orders accounted for more than 80% of Taiwan's 300 series hot rolled stainless steel imports in
2022.
(4) Real Estate Business
In 2022, the area of business land transactions in Nanjing totaled 4.996 million square meters, down by
39% year-on-year, with the total transaction amount of RMB133.45 billion, down by 36% year-on-year,
which signals a greater reduction in and the bottoming out of supply and sales. The development scale of
Walsin Centro in Nanjing Hexi is 1 million square meters, and the finished residential units have been sold
out. The commercial shopping center has been successfully opened and operated. Currently, the main
products are the opening and operation of Office Building No. 1 and the design and planning of Office
Building No. 2.
2. Overview of supply and demand and projected growth
(1) Wire and Cable Business
According to the global copper production forecast by the International Copper Study Group (ICSG), global
copper supply will grow by about 5.3% in 2023. In terms of refined copper production, ICSG expects
refined copper production to grow by 3.3% in 2023. In terms of the refined copper consumption, despite
a challenging global economic outlook, continued infrastructure development in major countries and the
global trend towards clean energy and electric vehicle development will continue to support copper
demand and help sustain growth in copper demand, with refined copper consumption forecast to grow by
1.4% in 2023.
After the reopening in mainland China, it is expected that more infrastructure constructions will drive
demand for infrastructure. From the perspective of demand for copper end-products, we expect
investment in power grid projects to rise, and that emerging industries such as new energy vehicles will
still develop at a high rate, which will better drive copper consumption and support copper prices. As for
the real estate industry, China is still focusing on "ensuring the delivery of buildings, people's livelihood
and stability," and the real estate market is expected to stabilize in 2023 under the promotion of relevant
policies. In summary, mainland China's economy is expected to rebound in 2023, which means that the
demand for cable-related products is expected to stabilize and grow.
In view of the shift of global supply chains and the change of regionalization in Taiwan, the number of
Taiwanese businesses returning to Taiwan to build factories continues to increase. The Executive Yuan has
approved to extend the period of acceptance of the Action Plan for Welcoming Taiwan Businesses to
Invest in Taiwan to 2024, in order to maintain the strength of private investment. According to the
government's 2050 Net Zero Emissions Pathway and Strategy, the government will adopt 12 key strategies
to integrate inter-ministerial resources, including NT$210.7 billion for renewable energy and hydrogen
energy, NT$207.8 billion for power grids and storage energy, and NT$168.3 billion for vehicle
electrification. In addition, after Taiwan's 303 Blackout in 2022, the public has once again raised concerns
about the over-concentration of Taiwan's power grids and the increasing proportion of green power, and
how to avoid its instability and intermittency from affecting the quality of power supply has also become
the focus of public attention, driving Taipower to promote a 10-year NT$564.5 billion plan to strengthen
the resilience of its power grids, in which the decentralized power grids accounts for the highest
percentage of the budget, and 17 electric networks will be built for renewable energy. The increasing
number of substations, energy storage stations and new energy grids will need to be connected by cables,
which will benefit Taiwan's wire and cable industry. With the demand generated by the government's
various projects, future orders for the cable will be highly predicable for us.
120
(2) Stainless Steel Business
The expansion of global stainless steel and crude steel production capacity has reached a plateau. Under
the carbon emission control policy in mainland China, factories are replacing old instead of creating new
capacity, while steel mills in Europe and the United States did not add new capacity after years of
consolidation. In the future, except for Indonesia, which still has new investment plans for the stainless
steel business, stainless steel makers in the rest of the countries around the world will operate only
through the development of steelmaking technology, so that the existing capacity may be slightly
increased; therefore, we will not see the previous annual growth of capacity in double-digits any longer.
On the demand side, the International Stainless Steel Forum (ISSF) estimates that global stainless steel
consumption will grow by 3.2% in 2023, maintaining a positive growth rate. However, considering the
impact of the current global economic uncertainty, such growth may be very limited. Although the
increase or decrease in stainless steel consumption is susceptible to fluctuations due to changes in the
current year's economy, the compound annual growth rate of stainless steel consumption during the past
10 years is about 2% to 3%, and we expect this trend to be maintained in the coming years.
The growth of demand also varies depending on the product type. Flat panel products account for more
than 80% of the total stainless steel usage and are widely used in various end-use applications, with a high
correlation between the increase or decrease in demand and the economic conditions. The application of
long strip products are industry-specific; if we take mainland China as an example, with the end of
pandemic control, the Chinese government's economic stimulus policy and the expansion of private
investment, it is expected that the robust development of infrastructure, machinery and equipment,
transportation, and new energy will drive the demand for long strip products, which will increase at a rate
faster than the flat panel products in the next few years.
(3) Resources Business
According to SMM's research report, Indonesia's nickel pig iron production will increase by 300,000
tonnes of nickel in 2023. The production of nickel pig iron by smelters in mainland China reduced by 8.5%
in 2022 due to unfavorable factors such as rising electricity prices, and is expected to further reduce in
2023. As far as the demand side is concerned, it is obviously economic for stainless steel mills to use nickel
pig iron; therefore, we expect that the proportion of China's use of nickel pig iron to produce stainless
steel will continue to increase, while Japan, South Korea, India and other countries are also likely to
increase the use of nickel pig iron from Indonesia, coupled with the possible smooth transition of nickel
pig iron to nickel matte production lines, it is expected that nickel pig iron supply and demand will be in a
dynamic balance. According to the SMM research report, the total global high nickel matte production
capacity in 2023 is projected at 412,000 tonnes of nickel, with about additional 94,000 tonnes of nickel,
and the production capacity of high nickel matte and MHP continues to be released. The recent
emergence of the nickel matte - nickel sulfate - pure nickel process will make sales options more
diversified, so that the overall market supply and demand may also achieve a dynamic balance.
In terms of our agency services, in 2022, the supply chain anomalies normalized, and the quantity of 300
series hot rolled stainless steel imported into Taiwan was about 900,000 to 950,000 tonnes, which is
almost the same as the import quantity in 2020. This level of import volume is equivalent to the rigid
demand for the Taiwan market and is expected to remain at this level in 2023. We expect that, due to the
cost advantage of and stabile supply from Indonesian players, Taiwan will still highly depend on
Indonesian stainless steel imports in 2023.
(4) Real Estate Business
Nanjing Jiangyou District is building a Yuantong shopping district centered on the Yuantong subway
station to create a "demonstration area of international consumer center city." Yuantong is becoming the
business office center with the highest standard of construction and the largest number of new projects in
121 121
Business Overview
Nanjing, and the position of the Jiangyou District and the business center of Hexi in the urban structure of
Nanjing has become more solid. After becoming a financial center, the core area of Yuantong will also
become the center of business offices and commercial consumption in Nanjing.
Looking ahead to the development of Walsin Centro, the opening of No. One Office Building will bring new
opportunities for Walsin Centro projects and establish Walsin's position as the first tier and leading brand
in Nanjing's quality business office industry. The arrival of many headquarters-type office enterprises in
the future will provide stable rental income and bring sufficient customer flow and stable consumption to
the shopping center of One Mall, thus promoting the steady development of the real estate sector.
3. Competitive niche, favorable and unfavorable factors for long-term growth and response measures
Competitive
Niche
Wire and Cable Business
(1) We have the advantage of stable internal supply of important raw materials of copper
metal and can give full play to the benefits from the upstream and downstream
integration.
(2) Long-term supply of products and services related to demand for project engineering,
accumulating rich supplier experience and having brand advantages.
(3) Advantages such as local supply and branding will help to enter the industrial cable field
such as solar energy, offshore wind power and port infrastructure.
(1 The performance of quality, service and delivery is highly satisfactory to customers and we
have brand power in the Taiwanese engineering market.
Favorable
Factors
(2) The high-voltage cable demand in the public sector may grow steadily, driven by
Taipower's construction initiative to reinforce the resilience of its power grids.
(3) The increase in investment from Taiwanese business back in Taiwan is driving cable
demand for factory expansion, commercial offices and housing.
(1) Real estate is susceptible to recessions, inflation, interest rate hikes, stock market
labor shortages, as well as the government's
volatility, high material prices and
implementation of policies to combat property speculation. Therefore, in a strong wait-
and-see atmosphere, the recovery of property purchases is delayed in the market, and the
fluctuations in demand have intensified and are hard to predict.
(2) The private sector faces oversupply and price competition.
(1) We will make focused research on technology applications and change the nature of our
services by being service-oriented. Through Industry 4.0 and production and sales
intelligence, we expect to improve our efficiency and service capacity.
(2) We will actively cooperate with the government's policy for net zero and carbon reduction
by being technology-oriented, and grasp the infrastructure business opportunities such as
renewable energy, new energy vehicles and grid renewal and expansion.
Unfavorable
Factors
Response
Measures
Stainess Steel Business
Competitive
Niche
Favorable
Factors
(1) We have three integrated production bases in Taiwan, China, and Italy for the long strips,
with a stable quality and delivery period, so that we can supply to each market nearby and
support each other for any shortage of products.
(2) Plate materials have the advantage of short delivery period. We can cooperate with players
in ASEAN countries to develop OEM to expand the available specifications.
(3) We invest in upstream raw materials by building a nickel pig iron plant in Indonesia to
improve the international competitiveness of stainless steel products and increase the
hedging capacity for raw materials.
(1) Taiwan's cold-rolled steel coils are protected by anti-dumping duties.
(2) China's environmental protection policies have increased their momentum, gradually
improving the overcapacity of crude steel.
(3) Trade wars, regional economies, and geopolitics have led to de-globalization/short supply
chains, so the industry is paying more attention to local supply sources.
Unfavorable
Factors
(1) China-based steel manufacturers have set up integrated production lines from nickel raw
materials to products in China and Indonesia, significantly cutting production costs and
122
Stainess Steel Business
reducing the general supplies market to pure price competition.
(2) Global trade protectionism, frequent anti-dumping cases, EU steel defense measures and
China's increase in exports affect global steel liquidity and reduce the Company's export
volume.
(3) Increasing awareness of environmental protection and the initiatives of many countries to
impose carbon tariffs will increase the operating costs of, and weaken profit margins of,
the steel industry.
(1) In addition to continuing to strengthen the advantages in our integrated production lines,
we will gradually develop product specifications and high value-added steel grades, as well
as actively expand the sales volume of niche steel and increase the quality of processed
products.
(2) Maintaining major customers, actively developing new customer bases and expanding
suitable markets for export
(3) Continuing to improve internal processes and carrying out industrial 4.0 automation
projects to improve the efficiency and reducing costs.
(4) Utilizing the synergy of horizontal integration among plants, increasing the scale and
efficiency of our sales, and positioning ourselves for high-value products, so as to enhance
our overall competitiveness.
(5) Actively investing in energy-saving and environmental protection equipment and deploying
green power industry to enhance our competitiveness in environmental protection costs.
Response
Measures
Resources Business
Competitive
Niche
(1) Nickel pig iron and nickel matte production line are located in Indonesia, which is a major
producer of nickel ore in the world and has advantages in raw material prices and
production costs.
(2) The production lines are equipped with its own power plant, which can supply electricity
Favorable
Factors
for full production without any issue.
(1) With Mainland China's continuous dual control of energy consumption, Indonesia nickel pig
iron is expected to make up for the possible production reduction gap in Mainland China.
China's abolition of export tax has increased the cost of exports, and our agency service has
a cost advantage over the the steel coils produced by Tsingshan Indonesia.
(2) The Indonesian government continues to ban the export of nickel ore, and the local raw
material has a cost advantage. The Indonesian government may subsequently restrict the
issuance of licenses for ferro-nickel smelting, which will raise the barrier of entry for later
competitors.
Unfavorable
Factors
Response
Measures
As environmental awareness is increasing, carbon reduction has become a common issue
worldwide. Governments and economies around the world continue to adopt policies to
strengthen environmental controls and carbon reduction efforts. We expect that related taxes,
charges and other expenses will be unavoidable.
In addition to stabilizing capacity utilization and refining production plans, we will continue to
research on and promote the development of the most suitable green energy and carbon
reduction projects.
Competitive
Niche
Real Estate Business
(1) Walsin Centro is located in the core area of Nanjing Hexi New City, including office
buildings, commercial centers, quality houses and other types of products, with the floors
under development reaching more than 1 million square meters; thus, Walsin Centro has
become a landmark project in Nanjing, with location, business and scale advantages.
(2) Office Building No. 1 officially opened for business and passed LEED & WELL double gold
international certification. In line with the new trend of market demand, energy-saving and
environmentally-friendly new materials and new technologies are widely used, attention is
paid to the humanization of our design and the durability and maintainability of our
products from the details.
123 123
Business Overview
Favorable
Factors
Real Estate Business
(1) The economy promoted by the Chinese government has continued to develop for many
years. The central city has great ability to promote and control the economy, which makes
the high-end office building market stable for a long time, and demand growth can be
expected.
(2) With the delivery of residential housing in the project, the resident population is growing
rapidly; transportation facilities and public ancillary services have been completed, the
market is fully mature, and business demand continues to grow steadily.
(3) The development of CBD is close to completion, and the further concentrated demand for
high-end office buildings in the central area of Hexi will lead that in Nanjing.
Unfavorable
Factors
Response
Measures
The office buildings under construction in the science park nearby the project, which benefit
from a large volume and low land costs, which has an indirect impact on the overall office
building markets.
Tracking and responding in advance the policy trends of government departments governing
relevant industries in a timely manner, and timely seizing the best timing for lease and sales
according to market changes, in order to expand our client base.
(2) Key applications and production processes of main products
1. Key Applications of Main Products
Main Products
Key Applications
Copper material
Wire and cable conductor, home appliances, electrical and electronic devices,
transformers, etc.
Power cables
Primarily used for power plants, power transmission and distribution, plant
facilities, transportation construction, construction of power transmission lines,
etc.
Steel billets
Hot-rolled wire rods, hot-rolled straight rods, flanges, seamless steel pipes, etc.
Flat billet
Wire rods
Hot-rolled steel coils, hot-rolled plates, heavy forgings, etc.
Screws and nuts, springs, welding rods, steel wires, braids and hardware wires, etc.
Hot-rolled coil (flat
panel category)
Chemical tanks, pipes for industry and building and pipes for petrochemical
industry
Cold rolled coil (flat
panel category)
Building decoration, kitchen utensils, appliances, medical equipment, electronic
communications, chemical tanks and steel tubes
Peeled straight rods
Forging materials, turning parts, electric machine accessories, etc.
Cold finish straight
rods
Shafts, medical equipment, furniture decoration items, turning parts, electric
machine accessories, etc.
Stainless steel
seamless pipe
Petrochemical heat exchanger; fluid pipe and instrument pipe boiler station pipe;
nuclear power station pipe; shipboard fluid pipe and instrument pipe; turning pipe.
Nickle pig iron
Nickel matte
Our products are mainly supplied to and used by steel mills to smelt stainless steel,
and processed into semi-finished stainless steel products such as billets, slabs, HR
coils and HR straight bars.
We supply the product to mainly nickel sulfate factories for processing into nickel
sulfate, which can continue to go downstream for the production of electrolytic
nickel or ternary cathode materials for batteries.
Real estate
Housing, office buildings and shopping malls
124
2. Production Process
(1) Wire and Cable Business
Copper plate
Shaft furnace
Casting machine
Pull-in rolling
Dissolution
Casting / rolling
Cable
Extruder
Collection
machine
Extruder
Coating / extrusion
Collection
Insulation / extrusion
Reduction
Copper bar
Wire drawing
machine
Wire drawing
Wire stranding
machine
Wire stranding
(2) Stainless Steel Business
Billet/Slab
Hot-Rolled Bar
Pickling Line
Die Casting
Ingot
Forging Machine
(Outsourced)
Forged straight bar
Wire Rod
Refining Furnace
Billet
Reheating
Furnace
HRM 200
RB 200
Intermediate 3-
Roll Block
Pre-Finishing 3-
Roll Block
Finishing Block
Raw Material
EAF
VOD
Billet/ Slab
CC
Cold/Hot-Rolled Coil
MRP
Hot-Rolled-Black Coil
Hot-Rolled Coil
Hot Rolling Mill
Reheating
Furnace
Outsourced
HR/CR Annealing Pickling Line
Slab
Wire rod
HR Wire Rod
Dual-Module
Block
Bar in coil
Pickling Line
Annealing
Furnace
HR Bar in Coil
Peeling &
Reeling Bar
Peeling &
Reeling
Straightening
Annealing
Furnace
HR straight bar
6-Rolled Cold Rolling Mill
Coil Preparation Line
Hot-Rolled No.1 Coil
Coating
Cold Drawing
HR/CR Annealing Pickling Line
Round Bar
Hex
Square
Shaped Bar
Cold-Drawn Bar
Centerless
Grinding
CG Bar
Seamless Steel Pipe
2D Coil
Skin Leveling Line
Skin Leveling Line
2D Coil
Hot Extrusion
Precision Foil
Materials
Inspection
Billet
Billet
Preparation
Preparation
Hot Perforation
Pierced Billets
Inspection
Cold Rolling/Cold
Drawing
Slitting
Rolling
Cleaning
Annealing
Pickling
Straightening
Heat Treatment
De-Oiling
Shipping
Packing
Precision Foil
Slitting
Tension Leveling
Lossless
Inspection/Physical &
Chemical Trial
Water Pressure
Trial/ Infiltration
Seamless Steel Pipe
Final
Inspection
Packing &
Shipping
125 125
Business Overview
(3) Resources Business
Nickel Pig
Iron
Laterite nickel ore
Shredding &
Sieving
Ballast
Reducing Agent
Drying
Dry Kiln
Pre-Reduction
Rotary Kiln
Nickel
Matte
Sulphidizing Reagent
Sieving &
Shredding
Electric Furnace
Smelting in Electric
Furnace
Electric Furnace
Nickel-Iron Alloy
Blowing in Rotary
Furnace
Rotary Furnace
Nickel Matte
(3) Supply Status of Main Raw Materials
Business Unit
Main Raw Materials
Description of Supply Status
Wire and
cables
Copper plates
Polyethylene
Other chemical materials
Pure nickel, high carbon nickel
iron, high carbon ferrochrome,
stainless steel scraps, grade 1
steel scraps, molybdenum iron,
etc.
Stainless
Steel
Commodity
Laterite nickel ore
Land
Construction Projects and
Materials
Commercial
Real Estate
Retailers
The main sources are Japan, Australia, Chile and Southeast
Asia by signing long-term annual contracts, which sources are
supplemented by spot purchases. Therefore, the supply is
stable.
Purchased by quarterly quantity bargaining, mainly imported
from Middle East, Europe and Japan.
Adopts monthly/quarterly quantity bargaining method and
raw materials should mainly be locally sourced.
We seek
long-term partnerships with well-established,
reputable suppliers and allocate the appropriate proportion
of supply sources to diversify risks and enhance the resilience
of the supply chain. In addition to being sourced from
Taiwan, raw materials are also from Indonesia, Japan,
Australia, New Caledonia, South Africa, Europe, United States
and China.
All laterite nickel ore used for nickel pig iron and nickel matte
is sourced from local suppliers in Indonesia, and the supply is
stable.
Implement land reserves pursuant to the Company’s real
estate development strategy and participate in government
land auction tenders.
reduces costs and enhances
The Company
effectiveness by
selecting good quality construction
companies and as well as material and equipment suppliers
through tenders.
Integrating resources and doing a good job of gathering high-
end enterprises and small but beautiful, refined quality
customers office demand and signing contract with
merchants according to the Company's project positioning,
business objectives and development ideas for the phase 2 of
the office building on Plot AB.
further
126
(4) The names, procurement (sales) amounts and ratio of our clients whose total procurement (sales) for
any year in the last two years reached 10% or more.
1. Major supplier information for the last two years
Year
2021
Item
Name
Amount
Supplier A 21,718,879
Other
(Note)
Net
Purchases
110,511,261
132,230,140
Percentage of
Total
Purchases (%)
16.4
83.6
100.0
Relationsh
ip with
Issuer
-
-
-
Unit: NT$ thousands
Name
Amount
2022
Percentage of
Total
Purchases (%)
Supplier A
Other
(Note)
Net
Purchases
20,022,193
141,099,498
161,121,691
12.4
87.6
100
Relations
hip with
Issuer
-
-
-
Reason for the change: 10% of purchases were from a single vendor in 2021, due to the advantages offered by
the vendor.
Note: There is no supplier accounting for more than 10% of total amount of purchases.
2. Major customer information for the last two years
Year
2021
2022
Unit: NT$ thousands
Item Name
Amount
Percentage of
Net Sales (%)
Name
Amount
Net Sales
180,400,719
Note: There is no customer accounting for more than 10% of the total sales amount.
156,664,766
Net Sales
100.0
Relations
hip with
Issuer
-
Percentage of
Net Sales (%)
100.0
Relations
hip with
Issuer
-
(5) Output volume and value for the last two years
Year
Production
value/main product
Production
capacity
2021
Production
volume
Value
Production
capacity
Volume Unit: Tonne
Currency Unit: NT$1,000
2022
Production
volume
Value
Bare copper wire
252,000
201,646
44,078,147
252,000
165,794
43,760,292
Wire and cables
Steel strands
Stainless steel strips
and bars
Stainless steel coils
Seamless steel pipes
Nickle pig iron
Total
52,920
140,000
48,143
75,911
14,445,559
2,094,465
58,920
81,200
45,537
66,806
14,640,970
1,836,131
562,200
454,596
33,907,526
600,000
519,215
42,635,582
311,000
27,308
36,000
355,397
16,229
14,258
24,810,636
300,000
189,943
16,970,241
2,403,736
4,397,473
126,137,542
14,400
40,956
14,093
40,956
3,193,241
12,118,333
135,154,790
Note1: Product capacity means the quantity that can be produced under normal operation with the existing
production equipment while taking into account factors such as work stoppage and holidays.
127 127
Business Overview
(6) Sales volume and value for the last two years
2021
2022
Volume Unit: Tonne
Currency Unit: NT$ 1,000
Domestic Sales
Exports
Domestic Sales
Exports
Year
Value of
Main
Products/
Sales
volume and
value
Main
Products
volume
Sales
Sales value
Sales
volume
Sales value
Sales
volume
Sales value
Sales
volume
Sales value
Bare copper
wire
Wire and
cables
Steel
strands
Stainless
steel strips
and bars
Stainless
steel coils
Seamless
steel pipes
Nickel pig
iron
Others
(Note)
Total
124,428
24,434,199
73,114 19,390,778
96,909
19,904,276
64,331 17,370,198
46,484
15,739,654
2,942
781,564
48,167
18,671,101
2,643
753,425
74,081
2,038,377
2,984
80,171
64,299
1,939,353
2,956
80,766
316,417
23,423,375 122,845 11,195,453 357,027
31,431,087 112,568 13,786,290
279,445
21,658,072
73,332
5,802,001 213,100
18,563,523 100,498
9,259,867
7,567
1,247,585
8,429
1,294,987
7,120
1,877,398
7,263
1,748,933
14,258
7,201,148
-
21,828,321
-
-
-
40,956
22,086,992
549,081
-
23,804,434
-
749,247
117,570,731
39,094,035
138,278,164
43,748,726
Note 1: “Others" include sales of non-core business products as well as real estate business, rental and product
income revenues.
128
3. Employee Data
(1) Employees of Walsin Lihwa Holdings Limited:
Year
Number of employees
Average age
Average years of service
Education
background
(%)
Ph.D.
Master's
University/College
High school
Below high school
2021
6,995
36.5
6.0
0.4
7.7
39.2
38.3
14.4
As of March 21, 2023
Current Year as of
March 21, 2023
10,066
36.9
6.8
0.3
6.1
37.3
40.6
15.7
2022
9,691
37.1
6.9
0.3
6.3
37.6
39.8
16.0
Note: Walsin Lihwa Group includes all of Walsin Lihwa's business divisions and subsidiaries.
(2) Employees of Walsin Lihwa Corp.:
Year
Number of employees
Average age
Average years of service
Education
background
(%)
Ph.D.
Master's
University/College
High school
Below high school
2021
2,805
39.0
9.9
0.9
18.2
43.0
25.5
12.4
As of March 21, 2023
Current Year as of
March 21, 2023
3,029
39.0
9.5
1.0
18.7
42.5
23.1
14.7
2022
2,981
39.0
9.6
1.0
18.7
42.8
23.6
14.0
129 129
Business Overview
4. Environmental Protection Expenditure Information
(1) For the most recent year and up to the date of publication of the annual report, the losses suffered
by the Company as a result of environmental pollution (including compensations and violations of
environmental protection laws and regulations found in environmental protection inspections; the
punishment date, the letter number, the legal basis for the punishment, the legal provision and the
content of the punishment shall be specified), and the estimated amount of such losses that may
occur now and in the future and the countermeasures against them; if they are not reasonably
possible to estimate, the facts that they cannot be reasonably estimated should be stated.
Taiwan Plants: Yenshui Plant
Punishment Date
September 5, 2022
Punishment Letter
No.
Punishing Unit
Reason
Punishment
for
Countermeasures
Basis
Legal
Punishment
for
Violations
Huan-Kong-Gu-Cai-Zi-No. 111090154
Environmental Protection Bureau, Tainan City Government
(1) No air pollution control measures were adopted in the plant (X002, X001)
stacking area.
(2) There was road color difference in the path of transportation vehicles.
1. Regularly washing the floor every day to keep the road wet.
2. Covering the materials in the stockpile with dustproof cloth to prevent dust from
dispersing.
Violation of Paragraph 2, Article 23 of the Air Pollution Control Act as well as
Paragraph 1, Article 4 and Subparagraph 2, Paragraph 1, Article 6 of the Management
Regulations for Facilities to Control Fugitive Dust Air Pollution from Stationary
Pollution Sources.
(1) Public or private premises that pile fugitive dust shall establish or adopt facilities
in order to effectively suppress the fugitive emission of particulate pollutants.
(2) A public or private premise using vehicles to transport fugitive dust shall establish
or adopt facilities to effectively suppress the fugitive emission of particulate
pollutants: Routes and spaces within public or private premises where transport
vehicles may pass must not have a color difference from the road.
Amount of Penalty
NT$150,000
Taiwan Plants: Yenshui Plant
Punishment Date
October 14, 2022
Punishment Letter
No.
Punishing Unit
Reason
Punishment
for
Countermeasures
Huan-Kong-Gu-Cai-Zi-No. 111100166
Environmental Protection Bureau, Tainan City Government
After visiting the plant to inspect the continuous automatic monitoring facilities for air
pollutants from stationary pollution sources, the EPB found that the M01 process did
not perform daily zero-point offset and full-amplitude offset tests from 2022/8/1 to
2022/8/29.
The improvement countermeasures are to simultaneously improve the following
three aspects of software, hardware, and management, and the improvements are as
follows:
1. Software: We set in the software an alarm mechanism allowing it to independently
confirm whether the calibration is performed normally, and sends an alarm letter if
it is not performed.
2. Hardware: We replaced uninterruptible power system to avoid recurrence of
power failure problems.
3. Management: We included the same in our daily, monthly, and quarterly work
management items from then on.
130
Basis
Legal
Punishment
for
Violations
Violation of Article 23 of the Air Pollution Control Act as well as Paragraph 1, Article
14 of the Management Regulations for Continuous Automatic Monitoring Facilities for
Air Pollutants from Stationary Sources.
(1) Zero-point offset and full-scale offset tests should be carried out once a day and
after performing monitoring facility maintenance operations.
(2) The percentage of effective monitoring hours in each quarter should be more
Amount of Penalty
NT$150,000
than 95%.
The above-mentioned defects have been corrected and improved and have been reviewed and documented by
regulatory authorities. The Company will continue to enhance its environmental management around its
factories. We also plan to prevent the recurrence of violation via internal control, environmental education &
training, as well as our annual KPI evaluation system.
(2) Future response measures (including improvement measures) and possible expenses:
Despite the large amount of manpower, materials and funding invested in environmental protection to comply
with international benchmarks over the years, Walsin Holdings was still fined for pollution. To keep pollution
under adequate control, the Company requires factories in Taiwan and overseas to step up self-regulation to
avoid human errors and to implement economically feasible environmental management projects. Internal audit
and environmental education & training (including regulatory identification) will also be applied to assist in
reinforcing self-regulation and horizontal development at various factories. Environmental investment plans and
management measures are as follows:
1. Obtained ISO-14001 certification for system management:
In line with international environmental conventions, factories in both Taiwan (Hsinchuang plant 1,
Hsinchuang plant 2, Yangmei plant, Taichung plant and Yenshui plant) and mainland China (Shanghai Walsin
Lihwa Power Wire & Cable plant, Nanjing plant, Jiangyin plant, Yantai plant and Changshu plant) have all
obtained "Environmental Management System" certification. In order to ensure the operational effectiveness
of Walsin's environmental management system, the Company hired a professional consulting team in 2017 to
instruct 10 domestic and overseas factories to transition to ISO 14001:2015. Basic operation for ISO 45001
was also introduced as a pilot program, as environmental protection and vocational safety & health
management system are integrated into a universal operating model across the entire group while on-site
guidance is also provided. Consistency in documentation and stability in system operation are required of
these factories. Through educational training at various factories, the spirit of the management system is
deeply ingrained in actual factory operation after multiple training sessions focusing on topics ranging from
regulatory interpretation to actual operation. Furthermore, with a proactive attitude, we will continue to
improve our overall environmental protection efforts and vocational safety & health condition. We will strive
to enhance environmental performance, reduce environmental loss, improve corporate image and boost our
international competitiveness. Walsin has completed the
its
management system at all of its factories at home and abroad in 2018; after the expiration of the certificates
in 2021, the management system was maintained and those certificates were renewed at each plant, with the
certificates being valid for three years from 2021 to 2024. The relevant certificate documents are placed in the
document management section of Walsin Lihwua website
integration and version conversion of
2. Air pollution management:
Comply with the air pollution control laws in Taiwan and in China and apply for permits for fixed (atmospheric)
pollution source ranges that are progressively announced. The various plants in Taiwan and in China have
obtained operating (emission of pollutants) permits for various manufacturing processes and facilities,
reducing atmospheric emissions.
3. Greenhouse gas emission and campaign for reduction:
To counter climate change and global warming, reduction in greenhouse gas emission is a necessary measure.
GHGs inventories provide compliance basis for efforts to reduce greenhouse gas emission.
Since 2015, the Company has established the "Safe Environment Information Platform--the ability to conduct
GHGs inventories and to calculate carbon emission for products" to collect greenhouse gas emissions at home
and abroad. Through continuous review every year and smart system management, the Company keeps
optimizing its greenhouse gas emissions. Through the electronic system, we can grasp the current year's
131 131
Business Overview
quarterly emissions and compare them with the same period last year, and further produce the trend graph
for the quarterly meeting of the Environmental, Safety and Health Management Committee to review the
carbon emissions regularly, so as to effectively review and manage the Company's carbon emissions. In
addition, in order to improve the company-wise operation of the greenhouse gas control system, we also plan
to promote the implementation of ISO 14064-1 in each plant. In 2015, our Taichung and Yenshui plants in
Taiwan have obtained ISO 14064-1 certification, and the latest certificates and expiration dates are regularly
posted on our CSR website every August. Hsinchuang, Yangmei, Taichung, and Yenshui Plants have also
obtained the new version of ISO 14064:2018 certification in 2022, and at the same time, we plan to promote
the introduction of ISO 14064-1 in overseas plants and obtain such certification in 2022; we expect to obtain
and pass the certification of ISO 14064-1 from a third party in 2023. At the same time, we are also actively
participating in overseas carbon emission trading to integrate into China’s carbon trading market, which can
not only ensure that the Company has sufficient carbon allowance in the future, but also promote measures
such as energy conservation through advanced technology, thereby laying a good foundation for the
Company's long-term operation and development.
Greenhouse Gas Emission and Intensity Analysis of Plants in Taiwan and Overseas
Emission (CO2e in metric tons)
Product volume (metric tons)
Intensity (CO2e in metric tons /Product volume in metric tons)
988,484
895,250
1,058,845
1,045,778
1,021,880
855,378
850,267
866,022
888,209 904,500
789,641
0.42
0.37
0.38
0.35
0.40
0.39
0.41
0.40
0.40
0.61
0.54
811,425
0.45
948,618
0.58
0.55
828,147
0.42
0.42
0.7
0.6
0.5
0.4
1200000
1000000
800000
600000
400000
331,760
278,337
0.31
369,650
0.29
398,245
251,884
413,876
422,140
301,196
334,703
200000
0
353,325 364,590
421,178
366,881
391,899
396,225
397,647
350,687
445,571
0.3
227,751
225,795
219,841
271,079
0.2
0.1
0
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2014
2015
2016
2017
2018
2019
2020
2021
2022
4. Wastewater treatment:
The wastewater from each of Walsin Lihwa's plants has been properly treated and discharged through
wastewater treatment facilities in the plant site and the wastewater quality testing has been regularly
conducted to avoid the impact of wastewater discharge on the environment. Management at source is most
important in water conservation. Based on water quality characteristics, the treatment procedures were
designed and recycling units were installed, so the wastewater has been discharged to nearby rivers according
to regulations or piped to recycling units in order to effectively use limited water resources. Each plant site
has adjusted equipment and process to reduce water consumption and improve wastewater recycling system,
so as to enhance the recycling ratio of the process water.
The average pollutant concentration in wastewater discharged by the factories in 2022 met the effluent
criteria. The recycling ratio of Taiwan plants reached as high as 94%.
5. Strict control of industrial waste:
Walsin Lihwa upholds the idea of circular economy; therefore, the 4Rs (reduce, reuse, recycle and recovery)
have constituted the foundation for our company's waste production and control. Our overall waste recycling
rate of copper wire, wire and cable and stainless steel reached 94.56%, of which the non-hazardous waste
recycling rate was 94.23% to 98.72%; hazardous waste was 68.43% to 99.59%. Except for some of the waste
produced by self-recycling and reuse, the rest are entrusted to qualified manufacturers for removal,
132
y
t
i
s
n
e
t
n
強
度
I
treatment or reuse. In 2022, the output of waste in Taiwan and overseas factories decreased by 17.92%
compared with 2021, mainly because of improved capacity and waste refractory bricks generated from
furnace repair and maintenance; in 2022, for the Taiwan plants, the waste recycling rate of harmful waste
increased by 0.11% compared with 2021, mainly because all the waste acid from Yenshui Plant was
transported to the Taichung Plant for waste acid treatment and reuse and process improvement and
adjustment, thereby reducing the output of dust collection ash and sludge, and the landfill rate of plants in
Taiwan and overseas regions is maintained at <1% target. Aside from continuing to promote source reduction
of waste and recycling of waste in the plant, the Company will, in conjunction with the strength of the overall
supply chain, reduce the amount of raw materials and reduce the harm that production may bring to the
environment. The Company will continue to implement the circular economy concept by innovating the
environmental protection technology. In addition to continuously strengthening the sustainable growth, the
Company has established strict control and auditing mechanisms for waste flow and screening of qualified
vendors to ensure that waste flows are proper and legal.
Waste output and disposal by Taiwan and overseas plants in 2022 (Unit: Tonne):
Plant
Taiwan
Overseas
Disposal
Non-hazardous
Hazardous
Total
Non-hazardous
Hazardous
Total
Recycling (for
reuse)
Incineration
Burial
Other treatment
(e.g., physical
treatment)
Total
Recycling rate
Incineration rate
93,544.19
58,917.80
152, 461.99
60,517.69
9,996.31
70,514.00
766.86
33.16
-
237.74
766.86
270.90
104.41
591.58
3,310.84
3.56
3,415.25
595.14
4936.41
4.40
4940.81
89.96
1,297.97
1,387.93
99,280.62
59,159.94
158,440.56
61,303.64
14,608.68
75,912.32
94.22%
0.77%
99.59%
0.00%
96.23%
0.48%
98.72%
0.17%
68.43%
22.66%
0.03%
Burial rate
Other treatment
(e.g., physical
treatment)
Note: Except for the hazardous waste from dust collection by Yenshui Plant and Yantai Plant, which are
4.97%
0.02%
0.17%
3.12%
8.88%
0.40%
0.15%
0.01%
0.96%
92.89%
4.50%
0.78%
1.83%
recycled in the plant, and the waste acid from Taichung Plant, which is disposed of and recycled in the
plant (30,794.19 tonnes in total), all hazardous and non-hazardous waste generated by our plants is
disposed of outside of the plants.
6. Improving energy use efficiency:
Walsin Lihwa upholds the business philosophy of "Green Manufacturing, Happy Enterprise and Sustainable
Management". In addition to committing to quality management, pollution prevention, environmental
protection, safety and health, our company adopts "Enhancing energy efficiency and promoting clean energy"
as its energy management guidelines to fulfill its social responsibility in energy conservation and carbon
reduction. We aggressively incorporate energy-saving equipment, efficient technologies, environment-friendly
facilities and environmental protection designs and green process into promoting improvement of energy
efficiency at source. In response to the governments' energy policies and measures, we educate our
employees about energy conservation and inventory the energy consumed by equipment and facilities to seek
opportunities for improving our energy performance and to also effectively implement our energy saving
plans.
7. Energy conservation and carbon reduction:
With the announcement of net-zero carbon emissions by 2050 by many countries, the EU carbon border
adjustment mechanism, Taiwan's net-zero carbon emissions roadmap published in March 2022, and the
introduction of carbon fees starting from 2024, promoting a low-carbon economy and society in response to
global climate change and the trend towards net-zero has become a major policy guidance for governments
around the worlds and a major challenge for corporations in terms of sustainability. How to improve the
company's carbon asset management capability has been an important business strategy for Walsin Lihwa in
response to low carbon emission requirements to reduce their economic impact.
133 133
Business Overview
In order to achieve its goal of "net zero carbon emission," the Company applies set reduction targets by
applying scientific methods and adopts transparent and effective measures in response to climate change. In
addition to the change in the mindset within the Company, energy saving and emission reduction is also
carried out in conjunction with its overall external supply chain. At the same time, with the common vision
and objectives of internal and external environmental safety and health, energy management, and carbon
management issues, we adopt the strategic thinking of "internal and external differentiation, gradual progress,
and win-win situation," so that the Company and its partnering suppliers can jointly move towards the
direction of sustainable green supply chain, in the hope of implementing strategies and solutions to promote
energy saving, carbon reduction, and carbon neutrality.
Energy saving and carbon reduction has become the hottest sustainability issue internationally. To reduce
energy consumption and greenhouse gas emissions, since 2015, Walsin Lihwa has set up an energy saving and
carbon reduction management organization in each plant, set annual targets and various energy saving and
carbon reduction measures, and held regular meetings to review and set up an energy management E-system
for real-time management.
There are four plants in Taiwan that are required to report annual energy-related data, and all of them met
the 1% energy conservation rate required by the Bureau of Energy, Ministry of Economic Affairs, with an
average electricity saving rate of 2.02%. In 2022, the total energy saving rate of Taiwan and China plants
reached 4.62%, and a total of 110 carbon reduction initiatives were proposed, with a total carbon reduction of
22,028.80 metric tons of CO2e/year. Taiwan plant saved approximately NT$29,534,359 and the overseas
plants saved RMB8,214,553 (equivalent to NT$36,233,077) and MYR9,935 (equivalent to NT$64,567).
In order to effectively manage the efficiency of energy use, the Environmental Safety and Health Management
Committee flexibly adjusted its five-year energy management plan, setting the goal of continuous annual
energy savings and carbon reduction of 1.5%. The Company is expected to reasonably and efficiently use
energy and reduce greenhouse gas emissions, to meet the challenges of climate change.
134
How to Achieve Net Zero
Examination &
Energy Conservation
Energy management systems and information platforms
Improve production and equipment efficiency
Energy saving solutions to reduce energy consumption
by 15%
(Energy saving measures - motors/waste heat/boilers...)
Internal Carbon Pricing
Unit carbon emissions and internal carbon pricing
Strengthen carbon reduction management efforts
Carbon
Management
Net Zero by 2050
Externalization of low carbon technologies
Low carbon production & new technologies
Green Energy Trading
Energy Creation
Examination & Energy Conservation
Energy Creation
Solar power (PV)
Biomass/hydrogen energy
Green Energy Trading
Wind power
Opportunities for Low
Carbon Technology
Recycling &
Sustainable Green
Waste reduction and recycling
Sustainable green supply chain
Externalize carbon reduction
Understand and introduce new technologies
1) Equipment electrification / low carbon-free
power introduction
2) Hydrogen energy, negative carbon emission
technology (CCUS)
Develop low carbon products, raw materials and
materials
2021 Energy Saving Plans for our plants in various regions
Plant site Project type
Energy-saving
type
Quantities
planned
Energy
conserved
Energy-saving
calorific value
(megajoule)
Carbon
reduction
(CO2e
tonnes)
Costs saved from
carbon reduction
Taiwan
Energy
Saving
through
manufacturi
ng process /
in offices
Electricity (1000
kWh)
Natural gas
(1000 m3)
Overseas
Energy
Saving
through
manufacturi
ng process
Total
Electricity (1000
kWh)
Natural gas
(1000 m3)
Diesel (1000 l)
Steam (metric
tons)
72
8,340.94
72,265,904.16
4,282.18
10
82
18
8
1
1
794.66
29,934,842.20
1,653.25
NTD 29,534,359
- 102,200,746.36
5,935.43
17,781.42 154,058,222.90
15,441.60
416.69
15,696,712.30
609.93
3.17
111,450.86
9.84
108.08
297,868.48
32.00
RMB8,214,553
(NT$36,233,077)
MYR9,935
(NT$64,567)
Total
28
- 170,164,254.54
16,093.37 NTD 36,297,644
135 135
Business Overview
8. Primary pollution control facilities purchased in the most recent year as well as their applications and benefits
possible: (Listing only those valued at NT$100,000/RMB20,000 and above)
In 2022, our plants' investment in environmental protection equipment totaled NT$90,588,000:
2022 Environmental protection
accounting expenses
Taiwan plants (NT$1,000)
Mainland China plants
(RMB1,000)
Malaysian plant
(MYR1,000)
Environment protection
cost item
Expenses
Capital
expenditures
Expenses
Capital
expenditures
Expenses
Capital
expenditures
E01-01
prevention expenses
Pollution
0
72,470
0
18,118
Green
Natural
Resource
Educational
E02-01
circulation fee
E02-02
resources fee
E02-03
procurement
E02-04
training fee
E02-05 Test-derived fee
E02-06 Monitoring fee
E02-07 R&D cost
E02-08 Social activities
cost
E02-09
compensation cost
E02-10 Fees charged by
governments
Subtotal
Total
Damage
559,972
0
326
38
1,034
2,355
3,928
0
0
8,453
0
0
0
0
0
0
0
0
0
0
9,064
21
0
0
228
669
0
35
0
95
0
0
0
0
0
0
0
0
0
0
0
20
0
0
0
0
8
0
0
0
9
0
0
0
0
0
0
0
0
0
0
0
Environment
protection
cost
Category
Environment
Equipment
cost
Environment
protection
related
management
fee
Other
environment
protection
related fees
Sum
10,113
576,107
72,470
0
648,577
37
When Walsin Lihwa sets up (expands) its plants, it always considers the types and quantities of pollutants that
may be generated and assesses and sets up relevant pollution prevention equipment to avoid environmental
pollution. In 2022, for the purposes of the process improvements, all of its plants invested in pollution
prevention for a total of capital expenditure of NT$72,470,000 (Taiwanese plants) and RMB18,118,000
(overseas plants). They include the pollution prevention equipment valued at NT$100,000/RMB20,000 and
above and are listed as follows:
18,118
28,230
37
(1) Taiwanese plants
Plant area
Equipment name
Quantity
Yenshui
Yenshui
Yenshui
Yenshui
Yenshui
Yenshui
Yenshui
Taichung
SCR catalyst replacement
Addition of washing equipment for
ballast oxide grinding
Acid C Line tank Replacement
Spray dust suppression equipment
for C warehouse slag plant
Addition of an iron remover
Installation of pickling sludge
cleaning equipment
Addition of automatic backwash
filter (automatic cleaning filter)
Addition of sludge drying cake to
the filter press in the sodium
sulfate regeneration plant
1
1
1
1
1
1
1
1
Investmen
t cost
(Currency:
NT$1,000)
Anticipated benefits
2,300 Improve the efficiency of waste disposal
44,000 Waste reuse
5,100 Replace the old with the new
5,300 Reduce dust
3,000 Waste reduction and reuse
4,750 Waste reduction
3,500 Compliance with regulations
4,520 Improve the efficiency of waste disposal
136
(2) Plants in Mainland China
Plant area
Equipment name
Quantity
Investment cost
(Currency: RMB
1,000)
Anticipated benefits
Changshu Leakage maintenance in the
factory area and renovation of
downpipes in the plant
Changshu 1 set of degreasing treatment
system
Yantai
Jiangyin
Changshu Standardized rectification and
improvement of operation in a
limited space of sewage pool
Steel cable – Upgrade of pickling
and phosphating waste gas
treatment tower
Yantai: Installation of emergency
cut-off system for rainwater
pipes and incident pools
Yantai: Renovation of noise
insulation for scrap steel factory
Yantai: Rectification and
improvement of rain and sewage
diversion in the factory area
Yantai
Yantai
1
1
1
1
1
1
1
3,000
Environmental improvement and
water recycling
1,500 Wastewater recycling
1,000 Compliance with regulations
220
Improve waste gas treatment
efficiency
350 Compliance with regulations
2,400
and
reduction
Noise
improvement in the environment
850
Compliance with regulations and
water reuse
5. Employees-employer relations
(1) Worker-Management Relations and Welfare
The pursuit of excellence, innovation and learning and friendly environment form the basis of sustainable
development at Walsin Lihwa. Its respect and attention to "people" is reflected in its human resources
management systems and various worker-management relations mechanisms, which are described as follows:
1. Smooth worker-management communication channels
(1) In 1976 the Company established an industry union to advocate suitable policies and the voice and
proposals of workers are communicated using an employer and employee dual-channel communication
method.
(2) The union's negotiation meetings between employer and employee representatives are held each quarter.
Union representative conferences are held every year to establish a good bridge of communication
between employers and employees.
(3) The Company publishes the "Walsin People Digital Newsletter" to share information on critical business
operations and management. The company has also established an international communication platform
to hold online events and opinion surveys.
2. The Company's remuneration is established on the principle of being able to attract and retain talent as
follows:
(1) Salary: The Company ensures that its overall remuneration is competitive in the market through regular
market salary surveys every year. The Company's remuneration policy is based on the following
principles:
• A reasonable and competitive overall remuneration based on the market value of each
professional function and the employee's contribution to their responsibilities.
• Bonus payments are made in accordance with the Company's operational performance, the
achievement of team objectives and the employee's personal contribution and performance.
• Employees are paid and compensated on the basis of their academic experience, technical
expertise, professional seniority and personal performance, without discrimination based on
gender, race, religion, political affiliation, marital status or union affiliation.
137 137
Business Overview
• The starting salary standards for fresh graduates and foreign workers comply with local laws and
regulations.
• We create harmonious labor relations within the scope of the law, in accordance with the
relevant local laws and regulations.
(2) Bonuses and Rewards: The reward and compensation system offered by the Company is designed to
motivate employees who perform well in their work. Performance bonuses and
production bonuses are granted based on the Company's operational
performance, achievement of team goals and individual performance, and
employees are remunerated according to the Company's profitability.
3. We also provide a diverse welfare system that includes the following:
Insurance & Protection
Subsidies
Other Benefits
insurance
(life
injury
hospitalization
insurance,
• Labor insurance
• Health insurance
• Group
insurance, accidental
insurance,
insurance, cancer
etc.)
• Overseas Travel and Expatriate
Insurance
• Regular health checks for all
staff
• Monthly pension payment
• Severance payments, pensions
• Travel Subsidies
• Subsidies for club activities
• Wedding and Funeral Grant
• Maternity benefit
• Supervisor's Health Benefits
• Hospitalization condolences
• Scholarship
Children
• Various
loans
interest-free
(emergency loans, education
loans for employees' children,
home purchase loans)
for Staff and
• Birthday Gift Vouchers
• 3 Festival Gift Money (Voucher)
• Labor's Day Souvenirs
• Staff dorms (for some factories)
• Commuter Bus (Factories)
• Annual leave of absence on a pro
rata basis upon onboarding, which
is better than what is provided by
law
• We invite experts and scholars to
give
life,
lectures on quality of
financial
mindfulness,
management,
to
colleagues
• Discount for employees by signing
contracts with vendors
• Gold medal for senior staff
• Corner of Massage
travel
and
4. Under the "Walsin Lihwa Employee Learning and Development System," each employee is incorporated into
the Company's operating strategies, policies and target objectives based on his/her capabilities, job
performance and career development. This enables employees, job performance and the organization to be
fully integrated and to achieve synergies in employee learning and development. The content of the system
includes the following:
(1) Professional talent training in all levels
(2) Management talent training
(3) New employee orientation
(4) Employee general education courses
(5) Self-motivation course
(6) Quality and safety awareness course
In 2022, the Company spent a total of NT$15,401,000 on employee education and training. Details are as
follows:
Total training participation
Total training hours
47,881
120,869.51
Average training hours per
employee
22.79
Training statistics above include data from Taiwan and the subsidiaries in China.
138
5. Retirement system:
To provide job security to employees, the Company has established a retirement system pursuant to
regulatory requirements with specific measures as follow:
(1) Established a "Pension Oversight Committee" in 1986, whereby workers' pension funds are deposited
monthly into a pension account at the Bank of Taiwan.
(2) The Company has commissioned external consultants to prepare a pension fund actuarial report annually
since 1994 and set aside a pension reserve fund each month based on the actuarial report in order to
satisfy pension applications made by employees eligible for retirement.
(3) In line with the implementation of the new pension system in 2005, the company has continued the
issuance of the pension fund to retired employees who have elected to receive the pension under the old
system. As for employees adopting the new system, 6% of their salary will be monthly withdrawn as
retirement pension and deposited into each employee's personal account at Labor Insurance Bureau.
Employees may voluntarily contribute within the 6% to satisfy personal demand in retirement preparation
based on personal needs.
(4) According to the revisions of the Labor Standards Act in 2015, the Company assesses the balance in the
designated labor pension reserve funds account, calculate required labor pension funds for the laborers
who meet the legal retire criteria in the follow following year and make up the difference before the end of
March the following year.
(5) In addition to compliance with the aforementioned retirement regulations and in recognition of the
contributions made by retired employees, the company also issues commemorative medals and awards to
retired employees. Meanwhile, the Employee Welfare Committee as well as the industry union has also
issued retirement souvenirs to fully reflect the company's gratitude towards retired employees.
(6) For employees in China, the subsidiaries enroll their employees in pension plans as required by law and
make monthly contributions to the pension plans according to the local regulations in order to provide
adequate retirement protection for the employees.
6. Employee Code of Conduct:
To ensure that employees comply with obligations to the Company, customers, competitors and suppliers
during business operations, the Company has established an Employee Code of Conduct in order to regulate
employee behavior. The highlights of this Code are as follows:
(1) Obligation to the Company: All Company employees must be dedicated, studious, conform to all rules of
the Company and ensure confidentiality.
(2) Obligation to customers: When conducting business dealings in representation of this Company, the
employee's attitude must be humble and without any arrogance or pride lest damaging the Company's
image.
(3) Obligation to competitors: The Company's employees should gather competitor information to serve as a
reference for Company strategy in a legal and open manner.
(4) Obligation to suppliers: Negotiations and transactions with suppliers by employees must uphold the
principles of fairness, reasonableness and reciprocity in order to achieve a win-win result.
As a guide for employees to follow ethical standards and corporate governance, the Company has established
additionally an Employee Code of Ethical Conduct. The highlights of this Code are as follows:
(1) Prevention of conflicts of interests
(2) Prevention of opportunities to obtain personal gains
(3) Duty of confidentiality
(4) Fair trade
(5) Protection and appropriate use of Company assets
(6) Legal compliance
139 139
Business Overview
(7) Prohibition of gifts, bribes or any improper benefits
(8) Prohibition of external communication of information against the Company
(9) Equal employment opportunity and prohibition of discrimination
(10) Health and safety in workplace
(11) Correctly prepared documents and duty to maintain records
(12) Respect for intellectual property
(2) Protective measures taken to ensure a safe working environment and maintain employees' personal
safety
Walsin Lihwa's ESH and energy policy is "Green Manufacturing, Happy Enterprise and Sustainable Management".
The health and safety system and administrative measures are as follows:
1. We comprehensively implemented ISO45001 international certification for occupational safety and health
management system and safety management system (based on Taiwan Occupational Safety and Health
Management System (TOSHMS) in Taiwan and work safety standardization in China). Each plant makes good
use of the PDCA method and continues to carry out internal auditing drills to plan and implement according
to the current year's occupational safety and health performance indicators and in compliance with the law.
The performance indicators are categorized into two types: active (promotion of key systems, support from
the top management of each plant, and disclosure of management systems, etc.) and passive (work-related
accidents and penalties from the competent authorities). In addition, through the frequency of general
(special) health checkups and testing items for employees, we have implemented measures that are better
than those stipulated by the regulations to enhance employee work safety and promote health care, and to
establish and move toward an all-around safe and friendly Walsin Lihwa workplace through the management
mechanism.
2. Designated health and safety and environmental management units or staff
Each of Walsin Lihwa's domestic and overseas plants also has its own Occupational Safety and Health
Committee (in Taiwan)/Safety Production Committee (in China). Those committees include certain labor
representatives to participate in and discuss matters relating to occupational safety and health. The number
of labor representatives in the safety and health committees set up in Taiwan factories in accordance with the
law are in line with the regulatory requirements. These committees hold meetings every quarter. In addition
to the passing down of practical experience and the dissemination of ethical principles in occupational safety,
we provide a platform for the exclusive Environmental Safety and Health Committee meeting minutes system
and an electronic signature system for quarterly meeting results, and send internal newsletters through the
intranet with work-safety-related emails to share our experiences.
Plants
Taiwan
China
Malaysia
Indonesia
General Members
Labor Representatives
Meetings Times
57
95
12
11
36
13
10
2
28
39
4
4
3. Safe Workplace and Friendly Management
In 2022, there were 68 incidents (including minor injuries; Note 1) and 100 near miss incidents (the near miss
frequency rate was 126.59%; Note 2) company-wide. After our risk assessment, in order to raise the safety
awareness of all personnel, we adopt mobile management methods, with the four main goals of Contractor
Management, License Management, Risk Management and Hazard Forecasting. In addition to revising the
relevant safety standards, in order to prevent the recurrence of occupational disasters, we adopt the TPS
spirit to promote KYT activities and combine them with the SJP (Safe Job Procedure), facilitating the
examination of high-risk operations and simplification of the potential hazards. This year, Taichung and
Yenshui Plants will run this preliminary drill and implement it in the daily operation to enhance the overall
140
hazard identification. It is scheduled to be fully implemented in all plants throughout the Company in 2023 to
enhance safety awareness.
Note 1: Minor injury: refers to the non-temporarily incapacitated state: unable to work on the day of injury,
but can resume normal operation the next day.
Note 2: Work-related near miss frequency rate (NMFR) = number of near miss events * 200,000/total hours
experienced.
4. Training on occupational safety and health for workers
In order to protect the health and safety of employees, Walsin Lihwa Group has identified four important
training needs in each business division according to important indicators such as process type and operating
environment: "New Recruits", "In-Service Personnel (internal training)", "In-Service Personnel (external
training)", and "Pre-site Training for Outsourcing Contractors". Training is arranged based on the degree of
impact on the company's operation and the serious rate and proportion of disasters. In 2022, 21,213
attendees took part in physical occupational safety and health courses for employees, and a total of 3,561
attendees from our contractors participated in the training.
Occupational Safety
and Health
Educational Training
Plants
Plants in Taiwan
Plants in China
Plants in Malaysia
Plants in Indoneisa
Subtotal
New Recruit
Training
In-Service Personnel
Training (internal training)
In-Service Personnel
Training (external training,
including for license
acquisition)
Pre-Site Training for
Contractors
Number of
Persons
Number of
Times
Number of
Persons
Number of
Times
Number of
Persons
Number of
Times
Number of
Persons
504
703
15
187
1409
323
233
24
56
636
9515
6729
229
1854
18327
174
95
9
17
295
574
423
39
441
1477
188
531
0
20
739
1686
1804
0
161
3651
5. Optimization of Contractor Management
The Company has launched its Contract Management System, in which 453 suppliers have joined so far. In
2022, 13,113 persons of contractors entered our plants. Each plant implements the Walsin Lihwa Contractor
Safety and Hygiene Bluebook, Contractor Management Regulations Standardization and Contractor Insurance
Regulations and relevant control measures, with a total of 694 notices for improvement and 75 fines being
issued and imposed, achieving zero work-related injuries (this year, there was only one minor injury accident
in Yenshui Plant). During 2022, in view of the cumbersome contracting regulations in the past, the Contracting
Instructions-Related Code of Conduct, Non-Engineering (Including Transportation) Contractor Hazard
Notification, Operating Risk and Insurance Amount Adjustment have been revised, and unnecessary
procedures have been simplified, to accelerate on-site management. At the same time, all contractors are
required to download the Contracting Instructions on Walsin's official website before applying for
collaboration with us, and sign the Contractor Commitment Letter and perform relevant regulatory
responsibilities for occupational safety and health. In addition, a complete contractor front-desk system has
been established, where suppliers must provide necessary documents such as their work rules, insurance
information, hazard notification, and negotiation/organization meetings by themselves; we then take
measures to evaluate and screen those suppliers, invest a lot of resources in coaching and training contractors,
and implement contract management to reduce Walsin's external risks and impacts by ensuring the health
and safety of all workers
6. Compliance with Occupational Safety and Health Regulations
In 2022, there were four major violations of occupational safety and health regulations in Taiwan and China,
with total fines of NT$230,000 and RMB131,300.
We will continue to review each accident and penalty event, as well as high-risk hazardous operations, high-
frequency near miss events by focusing on hidden dangers based on projects, and we will, through
information systems, gradually help improve personnel safety awareness, with real-time control of machinery
141 141
Business Overview
and equipment, (raw) materials and chemicals control, and construction of a regulatory cloud information
system, to continuously improve the overall operating environment. In 2022, the Company did not have any
chemical leakage.
7. Establish friendly, safe and healthy workplace through health promotion
(1) Occupational Safety and Health Activity Highlights
Employees are an important asset of a company, and Walsin designs feasible employee health promotion
plans every year. We actively integrate resources from all parties, introduce external physical fitness
testing, yoga courses, and aerobic exercise resources, build an internal supportive environment, and set
up medical kits and tunnel-type blood pressure monitors, in order for employees to replace bad lifestyles
with healthy ones and proactively manage their personal health. The Company is committed to creating a
safe and healthy environment to ensure that women can work worry-free during pregnancy and one year
after childbirth and achieve a work-life balance. Therefore, a breastfeeding room is set up in our plants,
and our nurse works with the on-site physician to carry out hazard identification, risk assessment and
work content confirmation through face-to-face interviews with pregnant employees, and provide
relevant health and educational information during pregnancy and after delivery. In 2022, a total of 8
pregnant female employees received occupational health education and assistance for pregnant workers.
The Company conducts annual health inspections and analysis of results based on risk management, as
well as on hazardous operations and special groups of hazardous operations (such as noise, free radiation,
dust, high temperature, lead, manganese, nickel, and hexane operations) in the plants, and establishes
health protection plans for hazardous operations, to ensure that employees have a good working
environment and avoid occupational diseases.
(2) Results of Health Promotion Activities
Health Promotion
Number of Times
Number of Attendees
Health Promotion - Dynamic Activities
Health Issues - Static Lectures
Safety First Aid Education and Training
Blood donation for charity
16
101
52
3
582
1,068
1,237
291 (490 bags of blood donated)
(3) 2022 Promotion of Healthy Workplaces
Hsinchuang Plant won 2022 CHR Healthy Corporate Citizenship Golden Award from Common Health
Magazine
Taichung Plant won 2022 CHR Healthy Corporate Citizenship Bronze Award from Common Health
Magazine
Hsinchuang Plant was awarded 2022 Sports Enterprise Certification by the Sports Administration,
Ministry of Education
Hsinchuang Plant Nurse – Chang, Huieh-Ting was awarded 2022 Health Workplace Excellence and Good
Promoter Award from the Health Promotion Administration, MOHW
Taipei Headquarters received the certification of Excellent Breastfeeding Rooms from the Department of
Health, Taipei City Government
Yangmei Plant won 2022 Healthy Workplace Certification-Health Promotion Badge
(4) From the most recent year to the date of publication of this Annual Report, any labor-
management disputes and resulting losses suffered by the Company and its countermeasures:
None.
142
6. Information Security Management
(1) Describe the risk management framework for information and communications security, information
and communications security policies, specific management plans, and resources devoted to
information and communications security management.
1. Risk management framework for information and communications security
Walsin has established its information security risk management framework with a dedicated information
security organization, senior executive participation, and alignment with international information security
standards, specifying relevant information security policies and regulations to implement information security
management.
(1) In response to the corporate transformation and enhancement of information security management,
Walsin Lihwa has established a dedicated information security organization - "Big Data and Information
Security Division" in 2017, which is responsible for formulating information security policies, planning,
coordinating and implementing information security protection measures, performing information security
risk assessment and management, developing a complete information security plan, and promoting
information security management and solutions year by year.
(2) The Company has established the IT Steering Committee, which is the information security management
and decision-making body for the head office and business units, and is responsible for reviewing and
deciding on matters related to information security management.
(3) In 2022, Walsin Lihwa implemented ISO 27001 Information Security Management System (ISMS) and
obtained certification from a third-party certification body to fulfill its commitment to information security
through PDCA. We have built up the confidentiality, integrity, and availability of information security
management system of our organizations comprehensively, and strengthened our information security
management continuously through different management plans in such aspects as prevention beforehand,
monitoring during the event, and response after the event.
2. Information Security Policy
The goal of information security at Walsin is to maintain the confidentiality, integrity and availability of
sensitive information, such as customer data and business information. Therefore, all of our employees,
internal and external information service users and third-party outsourced service providers should work
together to follow and achieve the following policies and objectives:
(1) To protect the Company's confidential information from being accessed, altered, or damaged in an
unauthorized way or improperly disclosed, in accordance with various laws and regulations.
(2) To protect information on the Company's business activities from unauthorized access or disclosure, and to
ensure the accuracy of all business information.
(3) To establish a complete business continuity plan and information security incident management
procedures, to ensure that incidents are responded to, controlled and handled properly, and by conducting
regular drills, to ensure the continuous operation of information systems or services.
(3) To establish information security requirements for system development and maintenance, implement
information security testing and monitoring, and avoid unauthorized access, unauthorized modification,
and destruction to ensure the integrity of information assets.
(4) To handle and protect personal information and intellectual property rights in a prudent manner in
accordance with the relevant domestic and foreign regulations in respect of the Personal Information
Protection Act and the intellectual property law.
(5) To perform regular information security compliance audits to review the implementation of the
information security management system.
(6) All employees shall maintain a high level of information security awareness at all times, and supervisors at
all levels shall assume ultimate responsibility for information security supervision, management and
143 143
Business Overview
training, to achieve the goal of reducing the risk of information use through various activities, such as
management review, risk assessment, internal audit, education and training, and information security drills.
(7) All staff of the Company shall follow information security policies, management practices and standard
procedures, and violations of information security policies and related regulations shall be handled in
accordance with relevant laws and regulations or the Company's regulations.
3. Construction of the resilience of corporate information security and implementation of information security
management
We have drafted information security plan to promote information security policy year by year, to introduce
information security system and process specification, and to continuously establish complete information
security technical protection measures.
The specific management plan will be gradually achieved in five stages, "Internal and External Segregation",
"Physical Fitness", "Insight", "Smart Security", and "Behavior Analysis", with four components, "IT
Governance", "Data and Device Protection", "Network and System Control", and "Boundary Defense".
The management plan includes:
(1) Implementing appropriate access authorization and protection according to the confidentiality level of
information assets, to reduce risk exposure.
(2) Continuously introducing advanced information security solutions to effectively protect and manage
system, host and network behavior.
(3) Regularly organizing educational training to promote new information security knowledge and to raise
employees' awareness of information security.
(4) Regularly conducting disaster preparedness drills for important systems, so that in the event of a disaster,
operations may be quickly resumed to ensure the company's operational sustainability.
(5) Evaluating and improving the protection capability of endpoints, servers and network devices, and
introducing third-party professional services.
(6) Building the ability to respond quickly to information security incidents, by early detection of problems,
rapid response, containment of attacks, and restoration of damaged data and critical system services in the
shortest possible time.
(2) Any losses, possible impacts and responses to major information security incidents suffered in 2022 and up to
the date of printing of the annual report: None.
144
7. Material Contracts
(1) Walsin Lihwa Corporation
Nature of
Contract
Contracting
Parties
Contract
Term Dates
Main Content
Restrictive Clauses
Loan
Agreement
DBS Bank
Share
Purchase
Agreement
Share
Purchase
Agreement
Share
Subscription
Agreement
Ever Rising
Limited and
Berg Holding
Limited
Glory Merry
Limited and
natural persons
who are not a
related party
PT Westrong
Metal Industry,
Prime
Investment
Capital Limited,
and PT Harum
Nickel Industry
The agreement
was signed on
March 23, 2020,
with the
maturity of the
loan falling on
April 15, 2025
The agreement
was signed on
April 11, 2022
The agreement
was signed on
May 31, 2022
The loan is a five-year
facility in a total amount
of USD 300 million.
Acquired 51,000 common
shares of PT Sunny Metal
Industry for a total
amount of
US$200,000,000.
Acquired 40 common
shares of Innovation West
Mantewe Pte. Ltd. for a
total amount of
US$79,200,000.
The agreement
was signed on
December 12,
2022
Subscribed for 590,000
common shares of PT
Westrong Metal Industry
for a total amount of
US$146,000,000.
1. Current ratio >=100%
2. Debt ratio<=120%
(Net
indebtedness/Tangible
Net Worth)
3. Interest coverage ratio
>=150%
4. Net tangible assets >= NT$55
billion
None
None.
None.
Land Lease
Agreement
Taiwan
International
Ports
Corporation,
Ltd., Kaohsiung
Port Branch
Effective from
March 21, 2022;
20 years after
the
commencement
of operation
Stock
Trading
Walsin Lihwa
Holdings
Limited
The agreement
was signed on
May 24, 2022,
and the
transaction was
closed on July
28, 2022
Stock
Trading
Walsin Lihwa
Europe S.a r.l.
May 31, 2022
1. Lease of approximately
18.38 hectares of land in
A6 of the first phase of
the Kaohsiung Port
Intercontinental
Container Center;
2. The annual rent is
about NT$13,790,000,
and the annual
management fee is
NT$82,750,000.
1. Disposed of all of the
shares in 2022 Solar
Development, Inc. held by
the Company;
2. Disposal price:
US$411,237,000.
1. Walsin Lihwa Europe
S.a r.l.acquired an 85.03%
shareholding in MEG S.A.
(Luxembourg) and
indirectly holds an 82.32%
shareholding in Cogne
Acciai Speciali S.p.A.
(Italy), resulting in a
consolidated shareholding
of 70% in Cogne Acciai
Speciali S.p.A.
2. Total acquisition price:
Base price of EUR
207,004,000, plus an
Earn-Out of EUR
15,000,000 three years
after closing.
No rights under the agreement
may be transferred without the
consent of the Lessor.
None.
None.
145 145
Business Overview
Nature of
Contract
Construction
Agreement
Contracting
Parties
Chung-Lu
Construction
Co., Ltd.
Joint
Venture
Agreement
WALSIN
ENERGY CABLE
SYSTEM CO.,
LTD. and NKT
HV Cables AB
Contract
Term Dates
July 5, 2021
May 15, 2023
The agreement
was signed on
March 1, 2023
(2) Walsin (Nanjing) Development Co., LTD.
Main Content
Restrictive Clauses
NT$3,249,750,000 for a
high-efficiency factory
None
To jointly develop the
submarine cable business,
Walsin Lihwa Corporation
and NKT HV Cables AB set
up a joint venture,
WALSIN ENERGY CABLE
SYSTEM CO., LTD.
Nature of
Contract
Construction
Agreement
Contracting
Parties
38 companies,
including
Nanjing
Construction
Design Research
Institute Co., Ltd.
Contract
Term Dates
Main Content
Restrictive Clauses
2022/01/06 -
2028/06/30
Design, consultancy, and
construction for Walsin
Centro Plot AB, Phases II & III,
in a total of RMB50,250,000.
None
(3) Yantai Walsin Stainless Steel Co., Ltd.
Nature of
Contract
Construction
Agreement
Contracting
Parties
25 companies,
including
China
Construction
Eighth
Engineering
Division. Corp.
LTD
Contract
Term Dates
Main Content
Restrictive Clauses
2022/01/12 -
2023/12/31
Civil construction for Yantai
Plant, in a total of
RMB689,879,000.
None
(4) Walsin Nickel Industrial Indonesia
Nature of
Contract
Engineering
Agreement
Contracting
Parties
Contract
Term Dates
Main Content
Restrictive Clauses
PT. Plenty
Bumi
International
and ETERNAL
TSINGSHAN
GROUP
LIMITED
2020/04/22 -
2022/01/31
Design and construction of a
self-built plant including
ferro-nickel smelting and
thermal power generation
projects. The total contract
price is approximately US$93
million. The construction was
completed in January 2023.
None
146
(5) PT Sunny Metal Industry
Nature of
Contract
Contracting
Parties
Equipment
Purchase and
Sale Agreement
Eternal
Tsingshan
Group Limited
Contract
Term Dates
2022/01/04
– present
Engineering
Agreement
Eternal
Tsingshan
Group Limited
2022/01/04
– present
2022/01/04
– present
Engineering
Agreement
Engineering
Agreement
PT Plenty
Bumi
International
and Eternal
Tsingshan
Group Limited
PT
Perintis
Makmur
Indonesia and
Eternal
Tsingshan
Group Limited
Main Content
Restrictive Clauses
Procurement of nickel-iron
rotary kiln, drying kiln, ore
smelting furnace, high-
efficiency pulverized coal
furnace, generator set, and
other equipment, with the
contract price of
US$325,000,000.
The architectural design of
the ferronickel smelter and
power plant built on our own
land, with a total amount of
USD 15,000,000.
The construction and related
auxiliary works of the
ferronickel smelter built on
our own land, with a total
amount of USD 60,942,000.
None
None
None
2022/7/19–
present
The construction of the
generator plant built on our
own land, with a total
amount of US$49,856,000.
None
(6) WALSIN ENERGY CABLE SYSTEM CO., LTD.
Nature of
Contract
Contracting
Parties
NKT HV
Cables AB
Technical
Consulting
Agreement and
Technology
Licensing
Agreement
Contract
Term Dates
Execution
date:
2023/03/01
Main Content
Restrictive Clauses
In order to jointly develop the
submarine cable business,
NKT HV Cables AB provides
technical consultation and
licenses its technology to
WALSIN ENERGY CABLE
SYSTEM CO., LTD.
None
147 147
Financial Information
VI Financial Information
1. Brief Balance Sheets and Comprehensive Income Statements of Recent Five Years
(1) Condensed Balance Sheet – Consolidated (Based on IFRSs)
Unit：NT $Thousands
Year
Financial Summary for the Last Five Years
Items
2018
2019
2020
2021
2022
Current Assets
58,726,913
60,789,794
56,176,808
69,320,640
92,707,385
Property, Plant and
Equipment
25,083,436
27,845,109
34,294,221
41,474,488
65,656,466
Intangible Assets
164,451
168,134
175,000
173,430
4,966,534
Other Assets
Total Assets
Current
Liabilities
Before
Distribution
After
Distribution
48,679,310
49,263,365
60,917,977
72,066,340
89,194,468
132,654,110
138,066,402
151,564,006
183,034,898
252,524,853
32,146,970
40,743,553
31,458,157
38,852,513
60,869,368
36,138,170
42,406,553
34,546,357
44,342,646
67,585,767
Non-current Liabilities
21,242,797
18,756,735
32,825,019
36,236,117
61,834,273
Total
Liabilities
Before
Distribution
After
Distribution
Equity Attributable to
owners of the Company
Capital Stock
Capital Surplus
Retained
Earnings
Before
Distribution
After
Distribution
Other Equity
Treasury Stock
53,389,767
59,500,288
64,283,176
75,088,630
122,703,641
57,380,967
61,163,288
67,371,376
80,578,763
129,420,040
77,328,012
77,384,341
84,468,235
105,883,524
123,580,876
33,260,002
33,260,002
32,260,002
34,313,329
37,313,329
15,966,420
16,055,238
15,690,406
18,440,875
24,672,454
32,144,727
31,179,511
36,330,187
47,787,207
62,038,398
28,153,527
29,516,511
33,241,987
42,297,074
55,321,999
(4,043,137)
(3,110,410)
187,640
5,342,113
(443,305)
0
0
0
0
0
Non-controlling Interests
1,936,331
1,181,773
2,812,595
2,062,744
6,240,336
Total Equity
Before
Distribution
After
Distribution
79,264,343
78,566,114
87,280,830
107,946,268
129,821,212
75,273,143
76,903,114
84,192,630
102,456,135
123,104,813
148
(2) Condensed Balance Sheet - Unconsolidated (Based on IFRSs)
Year
Financial Summary for the Last Five Years
Items
2018
2019
2020
2021
2022
Current Assets
16,809,906
16,615,466
18,421,337
28,943,268
37,348,050
Unit：NT $Thousands
Property,Plant and
Equipment
Intangible Assets
Other Assets
Total Assets
Current
Liabilities
Before
Distribution
After
Distribution
16,432,206
17,621,858
17,493,296
17,411,273
18,760,190
-
-
-
-
0
86,063,522
86,140,209
104,556,223
118,325,438
144,973,880
119,305,634
120,377,533
140,470,856
164,679,979
201,082,120
21,561,638
25,700,349
24,192,375
23,762,737
23,723,277
25,552,838
27,363,349
27,280,575
29,252,870
30,439,676
Non-current Liabilities
20,415,984
17,292,843
31,810,246
35,033,718
53,777,967
Total
Liabilities
Before
Distribution
After
Distribution
41,977,622
42,993,192
56,002,621
58,796,455
77,501,244
45,968,822
44,656,192
59,090,821
64,286,588
84,217,643
Capital Stock
33,260,002
33,260,002
32,260,002
34,313,329
37,313,329
Capital Surplus
15,966,420
16,055,238
15,690,406
18,440,875
24,672,454
Retained
Earnings
Before
Distribution
After
Distribution
Other Equity
Treasury Stock
Total Equity
Before
Distribution
After
Distribution
32,144,727
31,179,511
36,330,187
47,787,207
62,038,398
28,153,527
29,516,511
33,241,987
42,297,074
55,321,999
(4,043,137)
(3,110,410)
187,640
5,342,113
(443,305)
0
0
0
0
0
77,328,012
77,384,341
84,468,235
105,883,524
123,580,876
73,336,812
75,721,341
81,380,035
100,393,391
116,864,477
149 149
Financial Information
(3) Condensed Statements of Comprehensive Income - Consolidated (Based on IFRSs)
Year
Financial Summary for the Last Five Years
Unit：NT $Thousands (Excpet EPS:NT$)
Items
Net Sales
Gross Profit
Operating Income
Non-operating
Revenue and Expense
Profit before Taxes
Gain from Continued
Operations
Loss from
Discontinued
Operations
Profit for the year
Other comprehensive
income,net of income
tax
Total comprehensive
income for the year
Profit for the year
attributable to owners
of the company
Profit for the year
attributable to non-
controlling interests
Total comprehensive
income for the year
attributable to owners
of the company
Total comprehensive
income for the year
attributable to non-
controlling interests
Earnings Per Share
2018
2019
2020
2021
2022
190,915,137
134,804,405
112,546,603
156,664,766
180,400,719
15,935,365
9,390,566
12,468,338
19,809,465
17,346,305
11,026,209
4,059,474
7,385,062
13,345,552
9,498,714
5,644,765
680,793
1,865,603
5,776,946
13,903,299
16,670,974
4,740,267
9,250,665
19,122,498
23,402,013
11,959,287
3,783,324
7,005,801
15,257,314
19,140,076
-
-
-
-
-
11,959,287
3,783,324
7,005,801
15,257,314
19,140,076
(3,142,772)
915,620
3,338,209
5,113,693
(2,619,430)
8,816,515
4,698,944
10,344,010
20,371,007
16,520,646
11,756,781
3,149,679
6,691,149
14,642,629
19,352,097
202,506
633,645
314,652
614,685
(212,021)
8,612,785
4,082,661
10,114,207
19,791,160
16,639,046
203,730
616,283
229,803
579,847
(118,400)
3.53
0.95
2.04
4.27
5.45
150
(4) Condensed Statements of Comprehensive Income - Unconsolidated (Based on IFRSs)
Year
Financial Summary for the Last Five Years
Unit：NT $Thousands (Excpet EPS:NT$)
Items
Net Sales
Gross Profit
Operating Income
Non-operating
Revenue and Expense
Profit before Taxes
Gain from Continued
Operations
Loss from Discontinued
Operations
Profit for the year
Other comprehensive
income,net of income
tax
Total comprehensive
income for the year
Earnings Per Share
2018
2019
2020
2021
2022
85,099,970
71,596,648
64,097,690
97,789,648
98,420,045
3,840,250
4,155,851
4,457,566
12,894,560
11,207,400
2,122,510
2,445,178
2,681,141
10,197,929
7,741,047
10,123,522
644,517
3,982,969
8,195,530
16,915,494
12,246,032
3,089,695
6,664,110
18,393,459
24,656,541
11,756,781
3,149,679
6,691,149
14,642,629
19,352,097
-
-
-
-
-
11,756,781
3,149,679
6,691,149
14,642,629
19,352,097
(3,143,996)
932,982
3,423,058
5,148,531
(2,713,051)
8,612,785
4,082,661
10,114,207
19,791,160
16,639,046
3.53
0.95
2.04
4.27
5.45
(5) Auditors’ Opinion from 2018 to 2022
Year
2018
2019
2020
2021
2022
CPA
Deloitte & Touche
Kenny Hong, Ming-Yu Chiu
Deloitte & Touche
Wen-Yea, Shyu, Kwan-Chung, Lai
Deloitte & Touche
Wen-Yea, Shyu, Kwan-Chung, Lai
Deloitte & Touche
Wen-Yea, Shyu, Ker-Chang Wu
Deloitte & Touche
Wen-Yea, Shyu, Ker-Chang Wu
Audit Opinion
An Unmodified Opinion with an Other
Matter Paragraph
An Unmodified Opinion with an Other
Matter Paragraph
An Unmodified Opinion with an Other
Matter Paragraph
An Unmodified Opinion with an Other
Matter Paragraph
An Unmodified Opinion with an Other
Matter Paragraph
151 151
Financial Information
2.Financial Analysis of Recent Five Years
(1) Financial Analysis – Consolidated (Based on IFRSs)
Analysis Items
Capital
structure (％)
Liquidity
analysis (%)
Year
Financial Analysis for the Last Five Years
2018
2019
2020
2021
2022
Debt Ratio
40.24
43.09
42.41
41.02
48.59
Ratio of long-term Capital to Property,
Plant and Equipment
Current Ratio
Quick Ratio
400.69
349.51
350.22
347.64
291.90
182.68
149.20
178.57
178.41
152.30
94.86
89.96
93.02
81.32
79.18
Interest Coverage Ratio (times)
2,536.69
947.08
1,813.14
4,675.29
2,927.30
Accounts Receivable Turnover (Times)
Average Collection Period
Inventory Turnover (Times)
Operating
Accounts Payable Turnover (times)
Performance
Average Days in Sales
Property, plant and equipment
Turnover (Times)
Total Assets Turnover (Times)
Return on Total Assets (%)
Profitability
Return on Stockholders’ equity (%)
Pre-tax Income to Paid-in Capital (%)
analysis
Profit Ratio (%)
Earnings (loss) Per Share (NT$)
(Note 1)
Cash Flow Ratio (%)
Cash Flow Adequacy Ratio (%)
Cash Reinvestment Ratio (%)
Cash
Flow(Note 2)
Leverage
Operating Leverage
Financial Leverage
12.56
29.06
5.99
18.67
60.93
8.28
1.45
9.47
15.78
50.12
6.26
3.53
9.39
62.30
0.00
1.48
1.06
10.06
36.28
5.21
15.32
70.05
5.09
0.99
3.12
4.79
14.25
2.80
10.35
35.26
4.64
13.30
78.66
3.62
0.77
5.12
8.44
28.67
6.22
12.95
28.18
5.18
16.51
70.46
4.13
0.93
9.31
15.63
55.72
9.73
10.16
35.92
4.81
12.10
75.88
3.36
0.82
9.09
16.09
62.71
10.60
0.95
2.04
4.27
5.45
21.17
72.07
4.51
2.93
1.15
22.72
68.03
4.58
2.06
1.07
3.38
45.36
0.00
1.72
1.03
22.84
42.40
4.41
2.27
1.09
Analysis of financial ratio difference for the last two years (Not required if the difference does not exceed 20%)
A. Compared to 2021 interest coverage ratio in 2022 show a decrease. It’s because that interest expence for the
year ended December 31, 2022 increased.
B. Compared to 2021, accounts receivable turnover in 2022 show a decrease; average collection period in 2022
shows an increase. It’s because the acquisition of MEG S.A. on December 2022.
C. Compared to 2021, accounts payable turnover in 2022 shows a decrease. It’s because that accounts payable
for the year ended December 31, 2022 increased.
D. Compared to 2021 Earnings Per Share in 2022 show an increase. It’s because that net income after tax for the
year 2022 increased.
E. Compared to 2021, cash flow ratio in 2022 show an increase. It’s because that increased in cashflows from
operation activities.
F. Compared to 2021 Operating Leverage in 2022 show an increase. It’s because that Operating Income for the
year 2022 decreased.
Note : Financial analysis formulas show as the following：
1.Financial Structure：
(1)Debt Ratio＝Total liabilities／Total assets
152
(2)Ratio of Long-term Capital to Property, plant and equipment＝(Stockholders’ equity＋non-current
liabilities)／net worth of Property, plant and equipment
2.Solvency：
(1)Current Ratio＝Current assets／Current liabilities
(2)Quick Ratio＝(Current assets－inventories－prepaid expenses)／Current liabilities
(3)Interest Coverage Ratio＝Income before tax and interest expenses／Current Interest expenses
3.Operating Performance：
(1)Receivable (included trade receivables and operating notes receivable) Turnover＝ Net sales／
Average receivables for each period (included trade receivables and operating notes receivable)
(2)Average Collection Period Turnover Days＝365／Receivable turnover
(3)Inventory Turnover＝Cost of sales／Average inventories
(4) Payables (included trade payables and operating notes payable) Turnover＝Cost of sales／
Average payables for each period (included trade payables and operating notes payable)
(5)Average Days in Sales＝365／Inventory turnover
(6)Property, Plant and Equipment Turnover＝Net sales／Average of property, plant and equipment,
net
(7)Total Assets Turnover＝Net sales／Average of total assets
4.Profitability：
(1)Return on Total Assets＝〔Net income after tax＋interest expense×（1－tax rate）〕／ Average
of total assets
(2)Return on Stockholders’ equity＝Net income after tax／Average of stockholders’ equity
(3)Profit Ratio＝Net income after tax／Net sales
(4)Earnings (loss) Per Share＝Net income attributable to owners－stock dividend -preferred）／
Weighted average of outstanding shares
5.Cash Flow：
(1)Cash Flow Ratio＝Net cash provided by operating activities／Current liabilities
(2)Cash Flow Adequacy Ratio＝Net cash provided by operating activities in recently five years／
Recently five years of ( capital expenses＋increase of inventories+ cash dividend)
(3)Cash Reinvestment Ratio＝(Net cash provided by operating activities- cash dividend)／ (Property,
plant and equipment, gross +long-term investment + other non-current assets + working capital)
6.Leverage：
(1)Operating Leverage＝(Net sales－variable operating cost and expense)／Operating income
(2)Financial Leverage＝Operating income／(Operating income－interest expense)
153 153
Financial Information
(2) Financial Analysis –Unconsolidated (Based on IFRSs)
Year
Financial Analysis for the Last Five Years
Analysis Items
Capital
structure (％)
Liquidity
analysis (%)
Debt Ratio
Ratio of Long-term Capital to Property,
plant and equipment
Current Ratio
Quick Ratio
2018
2019
2020
2021
2022
35.18
35.71
39.86
35.70
38.54
594.83
537.27
664.70
809.34
945.40
77.96
22.20
64.65
26.77
76.14
30.89
121.80
157.43
47.65
98.92
Interest Coverage Ratio (times)
2,652.81
676.50
1,571.22
4,424.13
3,488.06
Accounts Receivable Turnover (Times)
Average Collection Period
Inventory Turnover (Times)
Operating
Accounts Payable turnover (times)
Performance
Average Days in Sales
Property, plant and equipment
Turnover (Times)
Total Assets Turnover (Times)
Return on Total Assets (%)
Return on Stockholders’ equity (%)
Profitability
Pre-tax Income to Paid-in Capital (%)
analysis
Profit Ratio (%)
Earnings (loss) Per Share (NT$)
(Note 1)
Cash Flow Ratio (%)
Cash Flow Adequacy Ratio (%)
Cash Reinvestment Ratio (%)
Cash
Flow(Note 2)
Leverage
Operating Leverage
Financial Leverage
31.71
11.51
7.94
20.33
45.96
5.52
0.75
10.86
15.90
36.81
13.81
3.53
9.03
34.25
0.00
2.55
1.29
32.56
11.21
6.53
21.25
55.89
4.20
0.59
3.08
4.07
9.28
4.39
0.95
18.90
46.95
0.89
2.63
1.28
32.75
11.14
6.67
23.75
54.72
3.65
0.49
5.47
8.26
20.65
10.43
28.78
12.68
7.05
30.51
51.77
5.60
0.64
9.81
15.38
53.60
14.97
23.99
15.21
6.36
27.83
57.38
5.44
0.53
10.89
16.86
66.07
19.66
2.04
4.27
5.45
16.21
45.79
2.10
2.52
1.20
14.69
36.49
0.29
1.48
1.04
62.70
41.63
5.41
1.73
1.10
Analysis of financial ratio difference for the last two years (Not required if the difference does not exceed 20%)
A. Compared to 2021, current ratio, quick ratio in 2022 shows an increase. It’s because that accounts receivable
increased.
B. Compared to 2021, interest coverage ratio in 2022 shows a decrease. It’s because that interest expense
increased.
C. Compared to 2021, pre-tax income to paid-in capital,profit ratio and earnings per share in 2022 show an
increase. It’s because that profit before tax and profit for the year ended December 31, 2022 increased.
D. Compared to 2021, cash flow ratio and cash reinvestment ratio in 2022 shows an increase. It’s because that
operating cash flow increased.
Note 1: Financial analysis formulas see Table (1).
154
3. Audit Committee’s Review Report for the Recent Year
Audit Committee’s Review Report
The Board of Directors has prepared the Company’s 2022 Business Report, Financial
Statements, and proposal for allocation of earnings. The Financial Statements had been
audited by Deloitte & Touche Accountants, Wen-Yea, Shyu and Ker-Chang Wu and has
issued an audit report.
The Business Report, Financial Statements, and earnings allocation proposal have
been reviewed and determined to be correct and accurate by the Audit Committee
members of Walsin Lihwa Corporation. According to Article 14-4 of the Securities and
Exchange Act and Article 219 of the Company Law, we hereby submit this report.
Walsin Lihwa Corporation
Chairman of the Audit Committee：Ming-Ling Hsueh
February 24, 2023
155 155
Financial Information
4.Financial Statements of Recent Years
INDEPENDENT AUDITORS’ REPORT
The Board of Directors and Shareholders
Walsin Lihwa Corporation
Opinion
We have audited the accompanying consolidated financial statements of Walsin Lihwa Corporation
and its subsidiaries (the “Group”), which comprise the consolidated balance sheets as of December 31,
2022 and 2021, and the consolidated statements of comprehensive income, changes in equity and cash
flows for the years then ended, and the notes to the consolidated financial statements, including a
summary of significant accounting policies.
In our opinion, based on our audits and the reports of other auditors (as set out in the Other Matter
section of our report), the accompanying consolidated financial statements present fairly, in all
material respects, the consolidated financial position of the Group as of December 31, 2022 and 2021,
and its consolidated financial performance and its consolidated cash flows for the years then ended in
accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers
and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS),
IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the
Financial Supervisory Commission of the Republic of China.
Basis for Opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of
Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic
of China. Our responsibilities under those standards are further described in the Auditors’
Responsibilities for the Audit of the Financial Statements section of our report. We are independent of
the Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of
the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. Based on our audits and the reports of other auditors, we believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the consolidated financial statements as of and for the year ended December 31, 2022.
These matters were addressed in the context of our audit of the consolidated financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The following are the key audit matters of the consolidated financial statements of the Group as of and
for the year ended December 31, 2022:
Sales Revenue Recognition
In 2022, the main products of the Group's wires and cables business unit include bare copper wires,
wires and cables. The fluctuation in prices of bare copper wires is often subject to the movement in
156
prices of raw materials, and thus some of the sales prices are set according to the market prices agreed
under the contracts at the time of shipments. The Group prepares reports on point of sale transactions
by referring to the actual shipments and market price adjustments as the basis for revenue recognition.
Due to the large number of transactions and different market prices that have been agreed upon by
customers, the processing, recording and maintenance of such reports are performed manually in
which their amounts are significant to the consolidated financial statements. Therefore, the accuracy of
revenue recognized from sales of bare copper wires was considered as a key audit matter. Refer to
Notes 4 and 26 to the consolidated financial statements for related accounting policies and disclosure
of information relating to revenue recognition.
Our audit procedures performed in respect of the above key audit matter were as follows:
1. We obtained an understanding and tested the reasonableness of revenue recognition policy and
internal control procedures over the sales of bare copper wires, and evaluated the effectiveness of
relevant internal controls.
2. We performed sampling and reconciliation of sales prices and quantities with their respective
amounts in the contracts and verified the accuracy of market price adjustments.
3. We verified the accuracy of monthly reports by recalculating the sales revenue and confirmed that
the recognized amounts were consistent with those recorded in the general ledger.
Other Matter
The financial statements of certain subsidiaries included in the consolidated financial statements as of
and for the years ended December 31, 2022 and 2021 were audited by other auditors. Our opinion,
insofar as it relates to such subsidiaries, is based solely on the reports of other auditors. The total assets
of such subsidiaries amounted to NT$27,113,218 thousand and NT$10,292,042 thousand, which
constituted 10.74% and 5.62% of the Group’s consolidated total assets, as of December 31, 2022 and
2021, respectively, and the total net operating revenue of such subsidiaries amounted to NT$3,409,851
thousand and NT$17,799,306 thousand, which constituted 1.89% and 11.36% of the Group’s
consolidated total net operating revenue, for the years ended December 31, 2022 and 2021,
respectively.
We did not audit the financial statements of some associates accounted for using the equity method
included in the consolidated financial statements of the Group, but such statements were audited by
other auditors. As of December 31, 2022 and 2021, the carrying amount of investments accounted for
using the equity method were NT$4,869,105 thousand and NT$1,053,790 thousand, representing
1.93% and 0.58% of the consolidated total assets, respectively, and the share of losses of these
associates were NT$313 thousand NT$5,936 thousand, representing (0.00%) and (0.03%) of the
consolidated income before income tax, respectively.
We have also audited the parent company only financial statements of Walsin Lihwa Corporation as of
and for the years ended December 31, 2022 and 2021 on which we have issued an unmodified opinion
with other matter.
Responsibilities of Management and Those Charged with Governance for the Consolidated
Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with the Regulations Governing the Preparation of Financial Reports by
Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting
Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued
157
Financial Information
into effect by the Financial Supervisory Commission of the Republic of China, and for such internal
control as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to liquidate
the Group or to cease operations, or has no realistic alternative but to do so.
Those charged with governance (including the Audit Committee) are responsible for overseeing the
Group’s financial reporting process.
Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with the Standards on Auditing of the Republic of
China will always detect a material misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
1.
Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
4. Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’
report to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditors’ report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.
158
6. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or
business activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision, and performance of the group audit. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the consolidated financial statements for the year ended
December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditors’
report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
The engagement partners on the audit resulting in this independent auditors’ report are Wen-Yea Shyu
and Ker-Chang Wu.
Deloitte & Touche
Taipei, Taiwan
Republic of China
February 24, 2023
Notice to Readers
The accompanying consolidated financial statements are intended only to present the consolidated
financial position, financial performance and cash flows in accordance with accounting principles and
practices generally accepted in the Republic of China and not those of any other jurisdictions. The
standards, procedures and practices to audit such consolidated financial statements are those
generally applied in the Republic of China.
For the convenience of readers, the independent auditors’ report and the accompanying consolidated
financial statements have been translated into English from the original Chinese version prepared and
used in the Republic of China. If there is any conflict between the English version and the original
Chinese version or any difference in the interpretation of the two versions, the Chinese-language
independent auditors’ report and consolidated financial statements shall prevail.
159
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4 and 7)
Financial assets at amortized cost - current (Notes 4 and 9)
Financial assets for hedging - current (Notes 4 and 8)
Contract assets - current (Notes 4 and 10)
Notes receivable (Notes 4, 11 and 36)
Trade receivables (Notes 4, 11 and 36)
Finance lease receivables - current (Notes 4, 12 and 37)
Other receivables (Note 31)
Inventories (Notes 4 and 13)
Other financial assets - current (Notes 6 and 37)
Other current assets (Note 21)
Total current assets
NON-CURRENT ASSETS
Financial assets at fair value through profit or loss - non-current (Notes 4 and 7)
Financial assets at fair value through other comprehensive income - non-current (Notes 4 and 14)
Financial assets at amortized cost - non-current (Notes 4 and 9)
Financial assets for hedging - non-current (Notes 4 and 8)
Investments accounted for using the equity method (Notes 4 and 16)
Property, plant and equipment (Notes 4 and 17)
Right-of-use assets (Notes 4 and 18)
Investment properties (Notes 4 and 19)
Goodwill (Notes 4 and 20)
Other intangible assets (Notes 4 and 31)
Deferred tax assets (Notes 4 and 28)
Refundable deposits (Note 6)
Finance lease receivables - non-current (Notes 4, 12 and 37)
Other non-current assets (Notes 6, 21, 28 and 37)
Total non-current assets
TOTAL
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 22)
Financial liabilities at fair value through profit or loss - current (Notes 4 and 7)
Financial liabilities for hedging - current (Notes 4 and 8)
Contract liabilities - current
Notes payable (Note 36)
Trade payables (Note 36)
Other payables
Current tax liabilities (Notes 4 and 28)
Lease liabilities - current (Notes 4 and 18)
Current portion of long-term borrowings (Notes 22 and 23)
Other current liabilities
Total current liabilities
NON-CURRENT LIABILITIES
Financial liabilities at fair value through profit or loss - non-current (Notes 4 and 7)
Bonds payable (Note 23)
Long-term borrowings (Note 22)
Long-term notes and bills payable (Note 22)
Deferred tax liabilities (Notes 4 and 28)
Lease liabilities - non-current (Notes 4 and 18)
Net defined benefit liabilities - non-current (Notes 4 and 24)
Other non-current liabilities (Note 33)
Total non-current liabilities
Total liabilities
EQUITY ATTRIBUTABLE TO OWNERS OF WLC (Note 25)
Share capital
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings
Total retained earnings
Other equity
Exchange differences on translation of the financial statements of foreign operations
Unrealized gain on financial assets at fair value through other comprehensive income
Loss on hedging instruments
Other equity - other
Total other equity
Total equity attributable to owners of WLC
NON-CONTROLLING INTERESTS
Total equity
TOTAL
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
160
2022
2021
Amount
%
Amount
%
$ 19,397,973
7,631
2,202
20,615
3,022,237
4,537,322
17,294,990
60,020
3,857,091
36,080,291
546,126
7,880,887
92,707,385
2,639,755
12,342,232
189,242
144,404
46,189,399
65,656,466
4,309,355
16,123,806
83,393
4,883,141
3,448,277
288,948
602,523
2,916,527
159,817,468
8
-
-
-
1
2
7
-
2
14
-
3
37
1
5
-
-
18
26
2
7
-
2
1
-
-
1
63
$ 10,387,581
16,147
-
89,232
5,750,344
2,627,411
11,045,689
58,042
1,620,595
31,659,723
530,650
5,535,226
69,320,640
-
16,290,587
-
-
39,451,117
41,474,488
1,803,510
10,431,063
152,771
20,659
2,818,549
207,622
662,543
401,349
113,714,258
6
-
-
-
3
2
6
-
1
17
-
3
38
-
9
-
-
22
23
1
6
-
-
1
-
-
-
62
$ 252,524,853
100
$ 183,034,898
100
$ 22,496,307
64,772
222,272
6,014
591,536
17,497,315
9,939,969
6,103,462
245,223
1,207,209
2,495,289
60,869,368
363,192
7,742,955
40,820,860
1,497,914
5,797,938
2,309,732
348,779
2,952,903
61,834,273
122,703,641
37,313,329
24,672,454
7,564,090
2,712,250
51,762,058
62,038,398
(4,256,774 )
6,693,877
(105,801 )
(2,774,607 )
(443,305 )
123,580,876
6,240,336
129,821,212
9
-
-
-
-
7
4
2
-
1
1
24
-
3
16
1
3
1
-
1
25
49
15
10
3
1
20
24
(2 )
3
-
(1 )
-
49
2
51
$
7,108,766
37,439
-
3,426
346,947
8,493,921
4,861,341
6,082,152
71,470
10,719,081
1,127,970
38,852,513
-
7,500,000
24,785,952
-
2,214,650
243,676
560,362
931,477
36,236,117
75,088,630
34,313,329
18,440,875
6,109,568
2,712,250
38,965,389
47,787,207
(6,100,687 )
11,534,267
-
(91,467 )
5,342,113
105,883,524
2,062,744
107,946,268
4
-
-
-
-
5
3
3
-
6
-
21
-
4
14
-
1
-
-
1
20
41
19
10
3
2
21
26
(3 )
6
-
-
3
58
1
59
$ 252,524,853
100
$ 183,034,898
100
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars)
ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4 and 7)
Financial assets at amortized cost - current (Notes 4 and 9)
Financial assets for hedging - current (Notes 4 and 8)
Contract assets - current (Notes 4 and 10)
Notes receivable (Notes 4, 11 and 36)
Trade receivables (Notes 4, 11 and 36)
Finance lease receivables - current (Notes 4, 12 and 37)
Other receivables (Note 31)
Inventories (Notes 4 and 13)
Other financial assets - current (Notes 6 and 37)
Other current assets (Note 21)
Total current assets
NON-CURRENT ASSETS
Financial assets at fair value through profit or loss - non-current (Notes 4 and 7)
Financial assets at fair value through other comprehensive income - non-current (Notes 4 and 14)
Financial assets at amortized cost - non-current (Notes 4 and 9)
Financial assets for hedging - non-current (Notes 4 and 8)
Investments accounted for using the equity method (Notes 4 and 16)
Property, plant and equipment (Notes 4 and 17)
Right-of-use assets (Notes 4 and 18)
Investment properties (Notes 4 and 19)
Goodwill (Notes 4 and 20)
Other intangible assets (Notes 4 and 31)
Deferred tax assets (Notes 4 and 28)
Refundable deposits (Note 6)
Finance lease receivables - non-current (Notes 4, 12 and 37)
Other non-current assets (Notes 6, 21, 28 and 37)
Total non-current assets
TOTAL
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 22)
Financial liabilities at fair value through profit or loss - current (Notes 4 and 7)
Financial liabilities for hedging - current (Notes 4 and 8)
Contract liabilities - current
Notes payable (Note 36)
Trade payables (Note 36)
Other payables
Current tax liabilities (Notes 4 and 28)
Lease liabilities - current (Notes 4 and 18)
Current portion of long-term borrowings (Notes 22 and 23)
Other current liabilities
Total current liabilities
NON-CURRENT LIABILITIES
Financial liabilities at fair value through profit or loss - non-current (Notes 4 and 7)
Bonds payable (Note 23)
Long-term borrowings (Note 22)
Long-term notes and bills payable (Note 22)
Deferred tax liabilities (Notes 4 and 28)
Lease liabilities - non-current (Notes 4 and 18)
Net defined benefit liabilities - non-current (Notes 4 and 24)
Other non-current liabilities (Note 33)
Total non-current liabilities
Total liabilities
EQUITY ATTRIBUTABLE TO OWNERS OF WLC (Note 25)
Share capital
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings
Total retained earnings
Other equity
Exchange differences on translation of the financial statements of foreign operations
Unrealized gain on financial assets at fair value through other comprehensive income
Loss on hedging instruments
Other equity - other
Total other equity
Total equity attributable to owners of WLC
NON-CONTROLLING INTERESTS
Total equity
TOTAL
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
2022
2021
Amount
%
Amount
%
$
631,650
248
72
671
98,412
147,747
563,171
1,954
125,597
1,174,871
17,783
256,622
3,018,798
85,958
401,896
6,162
4,702
1,504,051
2,137,951
140,324
525,034
2,715
159,008
112,285
9,409
19,620
94,974
5,204,089
8
-
-
-
1
2
7
-
2
14
-
3
37
1
5
-
-
18
26
2
7
-
2
1
-
-
1
63
$
338,248
526
-
2,906
187,247
85,556
359,677
1,890
52,771
1,030,926
17,279
180,242
2,257,268
-
530,465
-
-
1,284,634
1,350,521
58,727
339,663
-
5,647
91,780
6,761
21,574
13,067
3,702,839
6
-
-
-
3
2
6
-
1
17
-
3
38
-
9
-
-
22
23
1
6
-
-
1
-
-
-
62
$ 8,222,887
100
$ 5,960,107
100
$
732,540
2,109
7,238
196
19,262
569,760
323,672
198,745
7,985
39,310
81,253
1,982,070
11,827
252,131
1,329,237
48,776
188,796
75,211
11,357
96,154
2,013,489
3,995,559
1,215,022
803,401
246,307
88,318
1,685,511
2,020,136
(138,611 )
217,971
(3,445 )
(90,348 )
(14,433 )
4,024,126
203,202
4,227,328
9
-
-
-
-
7
4
2
-
1
1
24
-
3
16
1
3
1
-
1
25
49
15
10
3
1
20
24
(2 )
3
-
(1 )
-
49
2
51
$
231,480
1,219
-
112
11,298
276,585
158,298
198,051
2,327
349,042
36,730
1,265,142
-
244,220
807,097
-
72,115
7,935
18,247
30,331
1,179,945
2,445,087
1,117,334
600,484
198,944
88,318
1,268,818
1,556,080
(198,655 )
375,587
-
(2,978 )
173,954
3,447,852
67,168
3,515,020
4
-
-
-
-
5
3
3
-
6
-
21
-
4
14
-
1
-
-
1
20
41
19
10
3
2
21
26
(3 )
6
-
-
3
58
1
59
$ 8,222,887
100
$ 5,960,107
100
161
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)
2022
2021
Amount
%
Amount
%
OPERATING REVENUE (Notes 4 and 26)
$ 180,400,719
100
$ 156,664,766
100
OPERATING COSTS (Note 13)
(163,054,414) (91)
(136,855,301) (88)
GROSS PROFIT
17,346,305
OPERATING EXPENSES
Selling and marketing expenses
General and administrative expenses
Research and development expenses
Total operating expenses
PROFIT FROM OPERATIONS
NON-OPERATING INCOME AND EXPENSES
Interest income
Dividend income
Other income
Gain on disposal of property, plant and
equipment
Gain on disposal of investments (Note 27)
Foreign exchange gains (loss), net
Gain on valuation of financial assets and
liabilities at fair value through profit or loss
Other expenses
Recognition of impairment loss (Note 27)
Interest expense
Share of profit of associates accounted for
using the equity method
2,880,008
4,748,280
219,303
7,847,591
9,498,714
240,793
766,857
1,130,256
68,051
7,210,043
1,748,708
265,134
(305,781)
(87)
(827,715)
3,607,040
Total non-operating income and expenses
13,903,299
9
1
3
-
4
5
-
-
1
-
4
1
-
-
-
-
2
8
19,809,465
12
2,487,342
3,784,683
191,888
6,463,913
13,345,552
91,952
561,499
549,102
20,468
679,207
(237,222)
647,228
(231,656)
(693,892)
(417,951)
4,808,211
5,776,946
2
2
-
4
8
-
-
-
-
1
-
-
-
-
-
3
4
PROFIT BEFORE INCOME TAX FROM
CONTINUING OPERATIONS
23,402,013
13
19,122,498
12
INCOME TAX EXPENSE (Notes 4 and 28)
(4,261,937)
(2)
(3,865,184)
(2)
NET PROFIT FOR THE YEAR
19,140,076
11
15,257,314
10
OTHER COMPREHENSIVE INCOME (LOSS)
(Continued)
162
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)
Items that will not be reclassified subsequently
to profit or loss:
Remeasurement of defined benefit plans
Unrealized (loss) gain on investments in
equity instruments at fair value through
other comprehensive income
Share of the other comprehensive (loss)
income of associates accounted for using
the equity method
Items that may be reclassified subsequently to
profit or loss:
Exchange differences on translating the
financial statements of foreign operations
Loss on hedging instruments
Share of the other comprehensive income
(loss) of associates accounted for using the
equity method
2022
2021
Amount
%
Amount
%
260,538
-
(153,272)
-
(4,067,542)
(2)
2,594,208
(644,358)
(4,451,362)
(1)
(3)
2,906,573
5,347,509
1,757,704
(105,801)
180,029
1,831,932
1
-
-
1
(105,982)
-
(127,834)
(233,816)
1
2
3
-
-
-
-
3
Other comprehensive (loss) income for the
year
(2,619,430)
(2)
5,113,693
TOTAL COMPREHENSIVE INCOME FOR THE
YEAR
$
16,520,646
9
$
20,371,007
13
NET PROFIT ATTRIBUTABLE TO:
Owners of WLC
Non-controlling interests
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO:
Owners of WLC
Non-controlling interests
$
19,352,097
(212,021)
11
-
$
14,642,629
614,685
9
1
$
19,140,076
11
$
15,257,314
10
$
16,639,046
(118,400)
$
9
-
19,791,160
579,847
13
-
$
16,520,646
9
$
20,371,007
13
EARNINGS PER SHARE (Note 29)
Basic
Diluted
$
$
5.45
5.44
$
$
4.27
4.26
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
(Concluded)
163
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars, Except Earnings Per Share)
2022
2021
Amount
%
Amount
%
OPERATING REVENUE (Notes 4 and 26)
$ 5,874,331
100
$ 5,101,425
100
OPERATING COSTS (Note 13)
(5,309,489)
(91)
(4,456,376)
(88)
GROSS PROFIT
OPERATING EXPENSES
Selling and marketing expenses
General and administrative expenses
Research and development expenses
Total operating expenses
PROFIT FROM OPERATIONS
NON-OPERATING INCOME AND EXPENSES
Interest income
Dividend income
Other income
Gain on disposal of property, plant and
equipment
Gain on disposal of investments (Note 27)
Foreign exchange gain (loss), net
Gain on valuation of financial assets and
liabilities at fair value through profit or loss
Other expenses
Recognition of impairment loss (Note 27)
Interest expense
Share of profit of associates accounted for using
the equity method
Total non-operating income and expenses
PROFIT BEFORE INCOME TAX FROM
CONTINUING OPERATIONS
564,842
93,781
154,617
7,141
255,539
309,303
7,841
24,971
36,804
2,216
234,778
56,945
8,633
(9,957)
(3)
(26,953)
117,455
452,730
9
1
3
-
4
5
-
-
1
-
4
1
-
-
-
-
2
8
645,049
12
80,995
123,239
6,248
210,482
434,567
2,994
18,284
17,880
666
22,117
(7,723)
21,075
(7,543)
(22,595)
(13,610)
156,568
188,113
2
2
-
4
8
-
-
-
-
1
-
-
-
-
-
3
4
762,033
13
622,680
12
INCOME TAX EXPENSE (Notes 4 and 28)
(138,781)
(2)
(125,861)
(2)
NET PROFIT FOR THE YEAR
623,252
11
496,819
10
OTHER COMPREHENSIVE INCOME (LOSS)
(Continued)
164
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars, Except Earnings Per Share)
2022
2021
Amount
%
Amount
%
Items that will not be reclassified subsequently
to profit or loss:
Remeasurement of defined benefit plans
Unrealized (loss) gain on investments in
equity instruments at fair value through
other comprehensive income
Share of the other comprehensive (loss)
income of associates accounted for using
the equity method
Items that may be reclassified subsequently to
profit or loss:
Exchange differences on translating the
financial statements of foreign operations
Loss on hedging instruments
Share of the other comprehensive income
(loss) of associates accounted for using
the equity method
8,484
-
(4,991)
(132,450)
(2)
84,474
(20,982)
(144,948)
(1)
(3)
94,646
174,129
57,236
(3,445)
5,862
59,653
1
-
-
1
(3,451)
-
(4,163)
(7,614)
Other comprehensive (loss) income for
the year
(85,295)
(2)
166,515
-
1
2
3
-
-
-
-
3
TOTAL COMPREHENSIVE INCOME FOR THE
YEAR
$
537,957
9
$
663,334
13
NET PROFIT ATTRIBUTABLE TO:
Owners of WLC
Non-controlling interests
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO:
Owners of WLC
Non-controlling interests
$
630,156
(6,904)
11
-
$
476,803
20,016
9
1
$
623,252
11
$
496,819
10
$
541,812
(3,855)
$
9
-
644,453
18,881
13
-
$
537,957
9
$
663,334
13
EARNINGS PER SHARE (Note 29)
Basic
Diluted
$
$
0.18
0.18
$
$
0.14
0.14
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
(Concluded)
165
1
6
6
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
Share Capital
Capital Surplus
Legal Reserve
Special Reserve
Unappropriated
Earnings
Retained Earnings
Exchange
Differences on
Translation the
Financial Statement
of Foreign
Operations
Other Equity
Unrealized
Valuation Gain
(Loss) on Financial
Assets at Fair Value
through Other
Comprehensive
Income
Equity Attributable to Owners of WLC
Loss on Hedging
Instrument
Others
Total
Non-controlling
Interests
Total Equity
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
BALANCE AT JANUARY 1, 2021
$ 32,260,002
$ 15,690,406
$ 5,428,200
$ 3,110,410
$ 27,791,577
$
(5,905,135 )
$
6,092,775
$
Appropriation of 2020 earnings (Note 25)
Legal reserve
Special reserve
Cash dividends distributed by WLC
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Changes in capital surplus from investments in associates accounted for
using the equity method
-
-
-
-
-
-
-
-
3,124
(26,782 )
Issuance of new shares in exchange for the shares of another company
2,053,327
2,771,798
Net profit for the year ended December 31, 2021
Other comprehensive (loss) income for the year ended December 31,
2021
Total comprehensive income (loss) for the year ended December 31,
2021
Others
Changes in non-controlling interests
-
-
-
-
-
-
-
-
2,329
-
681,368
-
-
-
-
-
-
-
-
-
-
-
(398,160 )
-
-
-
-
-
-
-
-
-
(681,368 )
398,160
(3,088,200 )
-
77,160
-
14,642,629
-
-
-
-
-
-
-
-
-
-
-
(77,160 )
-
-
(174,569 )
(195,552 )
5,518,652
14,468,060
(195,552 )
5,518,652
-
-
-
-
-
-
BALANCE, DECEMBER 31, 2021
34,313,329
18,440,875
6,109,568
2,712,250
38,965,389
(6,100,687 )
11,534,267
Appropriation of 2021 earnings (Note 25)
Legal reserve
Cash dividends distributed by WLC
Changes in ownership interests in subsidiaries
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Disposal of equity instrument measured at fair value through other
comprehensive income
Changes in capital surplus from investments in associates accounted for
using the equity method
-
-
-
-
-
-
-
-
-
(994 )
-
887
Issuance of ordinary shares for cash
3,000,000
6,000,000
Net profit for the year ended December 31, 2022
Other comprehensive income (loss) for the year ended December 31,
2022
Total comprehensive income (loss) for the year ended December 31,
2022
Share-based payment
Others
Changes in non-controlling interests
-
-
-
-
-
-
-
-
-
225,000
6,686
-
1,454,522
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,454,522 )
(5,490,133 )
-
-
(3,589 )
79,546
-
19,352,097
-
-
-
-
-
-
-
-
-
-
-
-
3,589
(79,546 )
-
-
313,270
1,843,913
(4,764,433 )
(105,801 )
19,665,367
1,843,913
(4,764,433 )
(105,801 )
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$ 84,468,235
$ 2,812,595
$ 87,280,830
$
-
-
-
-
-
-
-
(3,088,200 )
3,124
4,825,125
(91,467 )
(118,249 )
-
-
-
-
-
-
-
-
(3,088,200 )
3,124
(118,249 )
4,825,125
14,642,629
614,685
15,257,314
5,148,531
(34,838)
5,113,693
19,791,160
579,847
20,371,007
2,329
-
2,329
-
(1,329,698)
(1,329,698 )
(91,467 )
105,883,524
2,062,744
107,946,268
-
-
-
(5,490,133 )
(2,683,140 )
(2,683,140 )
(994 )
-
887
9,000,000
-
-
-
-
-
-
-
-
(5,490,133 )
(2,683,140 )
(994 )
-
887
9,000,000
19,352,097
(212,021)
19,140,076
(2,713,051 )
93,621
(2,619,430 )
16,639,046
(118,400)
16,520,646
225,000
6,686
-
-
225,000
6,686
-
4,295,992
4,295,992
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
BALANCE, DECEMBER 31, 2022
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
$ 37,313,329
$ 24,672,454
$ 7,564,090
$ 2,712,250
$ 51,762,058
$
(4,256,774 )
$
6,693,877
$
(105,801 )
$ (2,774,607 )
$ 123,580,876
$ 6,240,336
$ 129,821,212
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars)
Share Capital
Capital Surplus
Legal Reserve
Special Reserve
Unappropriated
Earnings
Retained Earnings
Exchange
Differences on
Translation the
Financial Statement
of Foreign
Operations
Other Equity
Unrealized
Valuation Gain
(Loss) on Financial
Assets at Fair Value
through Other
Comprehensive
Income
Equity Attributable to Owners of WLC
Loss on Hedging
Instrument
Others
Total
Non-controlling
Interests
Total Equity
BALANCE AT JANUARY 1, 2021
$ 1,050,472
$
510,921
$
176,757
$
101,283
$
904,969
$
(192,287 )
$
198,398
$
Appropriation of 2020 earnings (Note 25)
Legal reserve
Special reserve
Cash dividends distributed by WLC
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Changes in capital surplus from investments in associates accounted for
using the equity method
-
-
-
-
-
-
-
-
102
(872 )
Issuance of new shares in exchange for the shares of another company
66,862
90,257
Net profit for the year ended December 31, 2021
Other comprehensive (loss) income for the year ended December 31,
2021
Total comprehensive income (loss) for the year ended December 31,
2021
Others
Changes in non-controlling interests
-
-
-
-
-
-
-
-
76
-
22,187
-
-
-
-
-
-
-
-
-
-
-
(12,965 )
-
-
-
-
-
-
-
-
-
(22,187 )
12,965
(100,560 )
-
2,512
-
476,803
-
-
-
-
-
-
-
-
-
-
-
(2,513 )
-
-
(5,684 )
(6,368 )
179,702
471,119
(6,368 )
179,702
-
-
-
-
-
-
BALANCE, DECEMBER 31, 2021
1,117,334
600,484
198,944
88,318
1,268,818
(198,655 )
375,587
Appropriation of 2021 earnings (Note 25)
Legal reserve
Cash dividends distributed by WLC
Changes in ownership interests in subsidiaries
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Disposal of equity instrument measured at fair value through other
comprehensive income
Changes in capital surplus from investments in associates accounted for
using the equity method
-
-
-
-
-
-
-
-
-
(32 )
-
29
Issuance of ordinary shares for cash
97,688
195,376
Net profit for the year ended December 31, 2022
Other comprehensive income (loss) for the year ended December 31,
2022
Total comprehensive income (loss) for the year ended December 31,
2022
Share-based payment
Others
Changes in non-controlling interests
-
-
-
-
-
-
-
-
-
7,327
217
-
47,363
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(47,363 )
(178,773 )
-
-
(117 )
2,590
-
630,156
-
-
-
-
-
-
-
-
-
-
-
-
117
(2,590 )
-
-
10,200
60,044
(155,143 )
(3,445 )
640,356
60,044
(155,143 )
(3,445 )
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
(2,978 )
(3,851 )
$ 2,750,513
$
91,586
$ 2,842,099
-
-
(100,560 )
102
157,119
476,803
-
-
-
-
-
-
20,016
-
-
(100,560 )
102
(3,851 )
157,119
496,819
167,650
(1,135 )
166,515
644,453
18,881
663,334
76
-
-
76
(43,299 )
(43,299 )
(2,978 )
3,447,852
67,168
3,515,020
-
-
-
(178,773 )
(87,370 )
(87,370 )
-
-
-
-
-
-
-
(6,904 )
-
(178,773 )
(87,370 )
(32 )
-
29
293,064
623,252
(32 )
-
29
293,064
630,156
(88,344 )
3,049
(85,295 )
541,812
7,327
217
-
(3,855 )
537,957
-
-
7,327
217
139,889
139,889
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
BALANCE, DECEMBER 31, 2022
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
$ 1,215,022
$
803,401
$
246,307
$
88,318
$ 1,685,511
$
(138,611 )
$
217,971
$
(3,445 )
$
(90,348 )
$ 4,024,126
$
203,202
$ 4,227,328
1
6
7
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax
Adjustments for:
2022
2021
$ 23,402,013
$ 19,122,498
Depreciation expenses
Amortization expenses
Expected credit loss recognized (reversed) on trade receivables
Net gain on fair value changes of financial assets and liabilities
at fair value through profit or loss
Interest expenses
Interest income
Dividend income
Compensation costs of employee share options
Share of profit of associates accounted for using the equity
method
Gain on disposal of property, plant and equipment
Loss on lease modification
Gain on disposal of investments
Impairment loss recognized on non-financial assets
Unrealized loss on foreign currency exchange
Gain on bargain purchase
Changes in operating assets and liabilities
Increase in contract assets
(Increase) decrease in notes receivable
Decrease (increase) in trade receivables
Increase in other receivables
Increase in inventories
Decrease (increase) in other current assets
(Increase) decrease in other financial assets
Increase in other operating assets
(Decrease) increase in financial liabilities held for trading
Increase in contract liabilities
Increase in notes payable
Increase in trade payables
Increase in other payables
Increase (decrease) in other current liabilities
(Decrease) increase in net defined benefit liabilities
(Decrease) increase in other operating liabilities
Cash generated from operations
Interest received
Dividends received
Interest paid
Income tax paid
4,385,647
65,655
105,680
(265,134)
827,715
(240,793)
(766,857)
233,077
(3,607,040)
(68,051)
6
(7,210,043)
87
183,114
(339,526)
(581,544)
(1,909,911)
100,992
(1,225,918)
(2,101,272)
631,447
(15,476)
(446,591)
(823,192)
-
244,589
3,673,923
1,094,617
273,773
(211,583)
(556,293)
14,853,111
357,042
2,166,803
(740,191)
(2,731,958)
2,799,315
31,498
(7,901)
(647,228)
417,951
(91,952)
(561,499)
11,490
(4,808,211)
(20,468)
-
(679,207)
693,892
89,472
-
(1,289,352)
346,721
(3,494,657)
(775,485)
(11,987,254)
(45,654)
174,627
(626,734)
513,105
1,927
111,689
999,450
674,668
(60,224)
176,063
565,146
1,633,686
69,679
1,359,121
(491,575)
(1,254,756)
Net cash generated from operating activities
13,904,807
1,316,155
CASH FLOWS FROM INVESTING ACTIVITIES
(Continued)
168
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
2022
2021
Purchase of financial assets at fair value through other comprehensive
income
Disposal of financial assets at fair value through other comprehensive
income
Capital reduction and refund from financial assets at fair value through
other comprehensive income
Purchase of financial assets at amortized cost
Proceeds from sale of financial assets at amortized cost
Disposal of financial assets at fair value through profit or loss
Acquisition of investments accounted for using the equity method
Increase in prepaid long-term investments
Acquisition of additional interests in subsidiaries
Net cash inflow on disposal of subsidiaries
Payments for property, plant and equipment
Proceeds from disposal of property, plant and equipment
(Increase) decrease in refundable deposits
Purchase of intangible assets
Purchase of investment properties
Acquisition of right-of-use assets
Other investing activities
(140,417 )
(1,985,957 )
24,004
-
(183,665 )
-
-
(4,980,030 )
(2,204,073 )
(11,037,204 )
9,242,576
(15,499,282 )
154,162
(68,728 )
(141,056 )
(182 )
(283,745 )
(1,228,906 )
-
3,615
-
1,325,403
4,948,895
(3,227 )
-
-
-
(6,415,398 )
50,410
13,208
(6,248 )
(2,362 )
(222,330 )
1,308,017
Net cash used in investing activities
(26,346,546 )
(985,974 )
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Proceeds from bonds payable
Repayment of bonds payable
Proceeds from long-term borrowings
Repayment of long-term borrowings
Increase in long-term notes and bills payable
Repayment of the principal portion of lease liabilities
Cash dividends paid
Proceeds from issuance of ordinary shares
Acquisition of subsidiaries
Changes in non-controlling interests
Other financing activities
13,088,885
-
(46,684 )
21,755,400
(19,732,834 )
1,497,914
(120,625 )
(5,489,781 )
9,000,000
-
359,522
6,685
485,651
7,500,000
-
4,000,000
(6,064,196 )
-
(89,794 )
(3,088,030 )
-
(5,003,810 )
(21,666 )
2,329
Net cash generated from (used in) financing activities
20,318,482
(2,279,516 )
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF
CASH HELD IN FOREIGN CURRENCIES
1,133,649
392,508
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
9,010,392
(1,556,827 )
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE
YEAR
10,387,581
11,944,408
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
$ 19,397,973
$ 10,387,581
(Concluded)
169
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax
Adjustments for:
Depreciation expenses
Amortization expenses
Expected credit loss recognized (reversed) on trade receivables
Net gain on fair value changes of financial assets and liabilities at fair value
through profit or loss
Interest expenses
Interest income
Dividend income
Compensation costs of employee share options
Share of profit of associates accounted for using the equity method
Gain on disposal of property, plant and equipment
Gain on disposal of investments
Impairment loss recognized on non-financial assets
Unrealized loss on foreign currency exchange
Gain on bargain purchase
Changes in operating assets and liabilities
Increase in contract assets
(Increase) decrease in notes receivable
Decrease (increase) in trade receivables
Increase in other receivables
Increase in inventories
Decrease (increase) in other current assets
(Increase) decrease in other financial assets
Increase in other operating assets
(Decrease) increase in financial liabilities held for trading
Increase in contract liabilities
Increase in notes payable
Increase in trade payables
Increase in other payables
Increase (decrease) increase in other current liabilities
(Decrease) increase in net defined benefit liabilities
(Decrease) increase in other operating liabilities
Cash generated from operations
Interest received
Dividends received
Interest paid
Income tax paid
Net cash generated from (used in) operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
2022
2021
$ 762,033
$ 622,680
142,808
2,138
3,441
(8,633)
26,953
(7,841)
(24,971)
7,590
(117,455)
(2,216)
(234,778)
3
5,963
(11,056)
(18,937)
(62,192)
3,289
(39,919)
(68,423)
20,562
(504)
(14,542)
(26,805)
-
7,964
119,633
35,644
8,915
(6,890)
(18,114)
483,660
11,626
70,557
(24,103)
(88,960)
452,780
91,153
1,026
(257)
(21,075)
13,610
(2,994)
(18,284)
374
(156,568)
(666)
(22,117)
22,595
2,913
-
(41,985)
11,290
(113,795)
(25,252)
(390,337)
(1,487)
5,686
(20,408)
16,708
63
3,637
32,545
21,969
(1,961)
5,733
18,403
53,199
2,269
44,257
(16,007)
(40,858)
42,860
(Continued)
170
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of U.S. Dollars)
Purchase of financial assets at fair value through other comprehensive
income
Disposal of financial assets at fair value through other comprehensive
income
Capital reduction and refund from financial assets at fair value through
other comprehensive income
Purchase of financial assets at amortized cost
Proceeds from sale of financial assets at amortized cost
Disposal of financial assets at fair value through profit or loss
Acquisition of investments accounted for using the equity method
Increase in prepaid long-term investments
Acquisition of additional interests in subsidiaries
Net cash inflow on disposal of subsidiaries
Payments for property, plant and equipment
Proceeds from disposal of property, plant and equipment
(Increase) decrease in refundable deposits
Purchase of intangible assets
Purchase of investment properties
Acquisition of right-of-use assets
Other investing activities
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in short-term borrowings
Proceeds from bonds payable
Repayment of bonds payable
Proceeds from long-term borrowings
Repayment of long-term borrowings
Increase in long-term notes and bills payable
Repayment of the principal portion of lease liabilities
Cash dividends paid
Proceeds from issuance of ordinary shares
Acquisition of subsidiaries
Changes in non-controlling interests
Other financing activities
2022
2021
(4,572 )
(64,668 )
782
-
-
(5,981 )
-
-
(162,163 )
(71,771 )
(359,401 )
300,963
(504,698 )
5,020
(2,238 )
(4,593 )
(6 )
(9,239 )
(40,016 )
118
-
43,159
161,149
(105 )
-
-
-
(208,903 )
1,641
430
(203 )
(77 )
(7,240 )
42,593
(857,913 )
(32,106 )
426,209
(1,520 )
-
708,414
(642,554 )
48,776
(3,928 )
(178,762 )
293,064
-
11,707
218
15,814
244,220
-
130,251
(197,466 )
-
(2,924 )
(100,555 )
-
(162,937 )
(706 )
76
Net cash generated from (used in) financing activities
661,624
(74,227 )
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF
CASH HELD IN FOREIGN CURRENCIES
36,911
12,779
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
293,402
(50,694 )
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
338,248
388,942
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
$ 631,650
$ 338,248
The accompanying notes are an integral part of the consolidated financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
(Concluded)
171
Financial Information
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
1. GENERAL INFORMATION
Walsin Lihwa Corporation (“WLC”) was incorporated in December 1966 and commenced
operations in December 1966. To diversify its operations, WLC made various investments in
construction, electronics, material science, real estate, etc. WLC’s main products are wires,
cables, stainless steel, resource business and real estate.
WLC’s shares have been listed on the Taiwan Stock Exchange (TWSE) since November 1972. In
October 1995 and November 2010, WLC increased its share capital and issued Global Depositary
Receipts (GDRs), which were listed on the Luxembourg Stock Exchange under stock number
168527.
The consolidated financial statements are presented in WLC’s functional currency, the New
Taiwan dollar.
2. APPROVAL OF CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements of WLC and its subsidiaries (collectively, the “Group”)
were approved by the board of directors of WLC on February 24, 2023.
3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND
INTERPRETATIONS
a. Initial application of the amendments to the International Financial Reporting Standards
(IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC
Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the
Financial Supervisory Commission (FSC)
The initial application of the IFRSs endorsed and issued into effect by the FSC did not have a
material impact on the Group’s accounting policies.
b. The IFRSs endorsed by the FSC for application starting from 2023
New, Amended and Revised Standards and
Interpretations
Effective Date
Announced by IASB
Amendments to IAS 1 “Disclosure of Accounting Policies”
Amendments to IAS 8 “Definition of Accounting Estimates”
Amendments to IAS 12 “Deferred Tax related to Assets and
January 1, 2023 (Note 1)
January 1, 2023 (Note 2)
January 1, 2023 (Note 3)
Liabilities arising from a Single Transaction”
Note 1: The amendments will be applied prospectively for annual reporting periods
beginning on or after January 1, 2023.
172
Note 2: The amendments will be applicable to changes in accounting estimates and changes
in accounting policies that occur on or after the beginning of the annual reporting
period beginning on or after January 1, 2023.
Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary
the
differences associated with
amendments were applied prospectively to transactions that occurred on or after
January 1, 2022.
leases and decommissioning obligations,
1) Amendments to IAS 1 “Disclosure of Accounting Policies”
The amendments specify that the Group should refer to the definition of material to
determine its material accounting policy information to be disclosed. Accounting policy
information is material if it can reasonably be expected to influence decisions that the
primary users of general purpose financial statements make on the basis of those financial
statements. The amendments also clarify that:
Accounting policy information that relates to immaterial transactions, other events or
conditions is immaterial and need not be disclosed;
The Group may consider the accounting policy information as material because of the
nature of the related transactions, other events or conditions, even if the amounts are
immaterial; and
Not all accounting policy information relating to material transactions, other events or
conditions is itself material.
The amendments also illustrate that accounting policy information is likely to be
considered as material to the financial statements if that information relates to material
transactions, other events or conditions and:
a) The Group changed its accounting policy during the reporting period and this change
resulted in a material change to the information in the financial statements;
b) The Group chose the accounting policy from options permitted by the standards;
c) The accounting policy was developed in accordance with IAS 8 “Accounting Policies,
Changes in Accounting Estimates and Errors” in the absence of an IFRS that
specifically applies;
d) The accounting policy relates to an area for which the Group is required to make
significant judgements or assumptions in applying an accounting policy, and the
Group discloses those judgements or assumptions; or
e) The accounting is complex and users of the financial statements would otherwise not
understand those material transactions, other events or conditions.
2) Amendments to IAS 8 “Definition of Accounting Estimates”
The amendments define that accounting estimates are monetary amounts in financial
statements that are subject to measurement uncertainty. In applying accounting policies,
the Group may be required to measure items at monetary amounts that cannot be observed
173
Financial Information
directly and must instead be estimated. In such a case, the Group uses measurement
techniques and inputs to develop accounting estimates to achieve the objective. The
effects on an accounting estimate of a change in a measurement technique or a change in
an input are changes in accounting estimates unless they result from the correction of prior
period errors.
3) Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a
Single Transaction”
The amendments clarify that the initial recognition exemption under IAS 12 does not
apply to transactions in which equal taxable and deductible temporary differences arise on
initial recognition. The Group shall recognize a deferred tax asset (to the extent that it is
probable that taxable profit will be available against which the deductible temporary
difference can be utilized) and a deferred tax liability for all deductible and taxable
temporary differences associated with leases and decommissioning obligations on January
1, 2022, and the Group shall recognize the cumulative effect of initial application in
retained earnings at that date. The Group shall apply the amendments prospectively to
transactions other than leases and decommissioning obligations that occur on or after
January 1, 2022.
Except for the above impact, as of the date the consolidated financial statements were
authorized for issue, the Group has assessed that the application of other standards and
interpretations will not have a material impact on the Group’s financial position and financial
performance.
c. The IFRSs in issue but not yet endorsed and issued into effect by the FSC
New, Amended and Revised Standards and
Interpretations
Effective Date
Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution
of Assets between an Investor and its Associate or Joint
Venture”
To be determined by IASB
Amendments to IFRS 16 “Leases Liability in a Sale and
January 1, 2024 (Note 2)
Leaseback”
IFRS 17 “Insurance Contracts”
Amendments to IFRS 17
Amendments to IFRS 17 “Initial Application of IFRS 9 and
January 1, 2023
January 1, 2023
January 1, 2023
IFRS 17 - Comparative Information”
Amendments to IAS 1 “Classification of Liabilities as
January 1, 2024
Current or Non-current”
Amendments to IAS 1 “Non-current Liabilities with
January 1, 2024
Covenants”
Note 1: Unless stated otherwise, the above IFRSs are effective for annual reporting periods
beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and
leaseback transactions entered into after the date of initial application of IFRS 16.
1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor
and its Associate or Joint Venture”
174
The amendments stipulate that, when the Group sells or contributes assets that constitute a
business (as defined in IFRS 3) to an associate or joint venture, the gain or loss resulting
from the transaction is recognized in full. Also, when the Group loses control of a
subsidiary that contains a business but retains significant influence or joint control, the
gain or loss resulting from the transaction is recognized in full.
Conversely, when the Group sells or contributes assets that do not constitute a business to
an associate or joint venture, the gain or loss resulting from the transaction is recognized
only to the extent of the Group’s interest as an unrelated investor in the associate or joint
venture, i.e., the Group’s share of the gain or loss is eliminated. Also, when the Group
loses control of a subsidiary that does not contain a business but retains significant
influence or joint control over an associate or a joint venture, the gain or loss resulting
from the transaction is recognized only to the extent of the Group’s interest as an
unrelated investor in the associate or joint venture, i.e., the Group’s share of the gain or
loss is eliminated.
2) Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” (referred
to as the “2020 amendments”) and “Non-current Liabilities with Covenants” (referred to
as the “2022 amendments”)
The 2020 amendments clarify that for a liability to be classified as non-current, the Group
shall assess whether it has the right at the end of the reporting period to defer settlement of
the liability for at least twelve months after the reporting period. If such rights are in
existence at the end of the reporting period, the liability is classified as non-current
regardless of whether the Group will exercise that right.
The 2020 amendments also stipulate that, if the right to defer settlement is subject to
compliance with specified conditions, the Group must comply with those conditions at the
end of the reporting period even if the lender does not test compliance until a later date.
The 2022 amendments further clarify that only covenants with which an entity is required
to comply on or before the reporting date should affect the classification of a liability as
current or non-current. Although the covenants to be complied with within twelve months
after the reporting period do not affect the classification of a liability, the Group shall
disclose information that enables users of financial statements to understand the risk of the
Group that may have difficulty complying with the covenants and repay its liabilities
within twelve months after the reporting period.
The 2020 amendments stipulate that, for the purpose of liability classification, the
aforementioned settlement refers to a transfer of cash, other economic resources or the
Group’s own equity instruments to the counterparty that results in the extinguishment of
the liability. However, if the terms of a liability that could, at the option of the
counterparty, result in its settlement by a transfer of the Group’s own equity instruments,
and if such option is recognized separately as equity in accordance with IAS 32: Financial
Instruments: Presentation, the aforementioned terms would not affect the classification of
the liability.
3) Amendments to IFRS 16 “Leases Liability in a Sale and leaseback”
The amendments clarify that the liability that arises from a sale and leaseback transaction -
that satisfies the requirements in IFRS 15 to be accounted for as a sale - is a lease liability
to which IFRS 16 applies. However, if the lease in a leaseback that includes variable lease
payments that do not depend on an index or rate, the seller-lessee shall measure lease
liabilities arising from a leaseback in a way that it does not recognize any amount of the
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Financial Information
gain or loss that relates to the right of use it retains. Seller-lessee subsequently recognizes
in profit or loss the difference between the payments made for the lease and the lease
payments that reduce the carrying amount of the lease liability.
Except for the above impact, as of the date the consolidated financial statements were
authorized for issue, the Group is continuously assessing the possible impact that the
application of other standards and interpretations will have on the Group’s financial position
and financial performance and will disclose the relevant impact when the assessment is
completed.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Statement of compliance
The consolidated financial statements have been prepared in accordance with the Regulations
Governing the Preparation of Financial Reports by Securities Issuers, related regulations and
IFRSs as endorsed and issued into effect by the FSC.
b. Basic of preparation
The consolidated financial statements have been prepared on the historical cost basis except
for financial instruments, which are measured at fair value and net defined benefit liabilities
which are measured at the present value of the defined benefit obligation less the fair value of
plan assets. Historical cost is generally based on the fair value of the consideration given in
exchange for assets.
The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to
which the fair value measurement inputs are observable and based on the significance of the
inputs to the fair value measurement in its entirety, which are described as follows:
1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are
observable for an asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived
from prices); and
3) Level 3 inputs are unobservable inputs for the asset or liability.
c. Classification of current and non-current assets and liabilities
Current assets include:
Assets held primarily for the purpose of trading;
Assets expected to be realized within 12 months after the reporting period; and
Cash and cash equivalents unless the asset is restricted from being exchanged or used to
settle a liability for at least 12 months after the reporting period.
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Current liabilities include:
Liabilities held primarily for the purpose of trading;
Liabilities due to be settled within 12 months after the reporting period; and
Liabilities for which the Group does not have an unconditional right to defer settlement
for at least 12 months after the reporting period. Terms of a liability that could, at the
option of the counterparty, result in its settlement by the issue of equity instruments do not
affect its classification.
Assets and liabilities that are not classified as current are classified as non-current.
d. Basis of consolidation
The consolidated financial statements incorporate the financial statements of WLC and the
entities controlled by WLC. Control is achieved when the Group has the power to govern the
financial and operating policies of an entity so as to obtain benefits from its activities.
Income and expenses of subsidiaries acquired or disposed of during the period are included in
the consolidated statement of comprehensive income from the effective date of acquisition up
to the effective date of disposals, as appropriate.
When necessary, adjustments are made to the financial statements of subsidiaries to bring
their accounting policies into line with those used by the Group.
All intra-group transactions, balances, income and expenses are eliminated in full upon
consolidation.
Total comprehensive income of subsidiaries is attributed to the owners of WLC and to the
non-controlling interests even if this results in the non-controlling interests having a deficit
balance.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group
losing control over the subsidiaries are accounted for as equity transactions. The carrying
amounts of the interests of the Group and the non-controlling interests are adjusted to reflect
the changes in their relative interests in the subsidiaries. Any difference between the amount
by which the non-controlling interests are adjusted and the fair value of the consideration paid
or received is recognized directly in equity and attributed to the owners of the WLC.
When the Group loses control of a subsidiary, a gain or loss is recognized in profit or loss and
is calculated as the difference between (i) the aggregate of the fair value of the consideration
received and any investment retained in the former subsidiary at its fair value at the date when
control is lost and (ii) the assets (including any goodwill) and liabilities and any
non-controlling interests of the former subsidiary at their carrying amounts at the date when
control is lost. The Group accounts for all amounts recognized in other comprehensive income
in relation to that subsidiary on the same basis as would be required had the Group directly
disposed of the related assets or liabilities.
Refer to Note 15 and Table 8 for the percentage of ownership, main businesses and details of
the subsidiaries.
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Financial Information
e. Foreign currencies
In preparing the financial statements of each individual company entity, transactions in
currencies other than the entity’s functional currency are recognized at the rates of exchange
prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are
retranslated at the rates prevailing at that date. Exchange differences on monetary items
arising from settlement or translation are recognized in profit or loss in the period in which
they arise except for exchange differences on transactions entered into in order to hedge
certain foreign currency risks.
Non-monetary items denominated in foreign currencies that are measured at fair value are
retranslated at the rates prevailing at the date when the fair value is determined. Exchange
differences arising from the retranslation of non-monetary items are included in profit or loss
for the period except for exchange differences arising from the retranslation of non-monetary
items in respect of which gains and losses are recognized directly in other comprehensive
income, in which cases, the exchange differences are also recognized directly in other
comprehensive income.
Non-monetary item denominated in a foreign currency and measured at historical cost is
stated at the reporting currency as originally translated from the foreign currency.
For the purpose of presenting consolidated financial statements, the financial statements of the
Group’s foreign operations (including subsidiaries and associates in other countries) that are
prepared using functional currencies which are different from the currency of WLC are
translated into the presentation currency, the New Taiwan dollar, as follows: Assets and
liabilities are translated at the exchange rates prevailing at the end of the reporting period; and
income and expense items are translated at the average exchange rates for the period. The
resulting currency translation differences are recognized in other comprehensive income
(attributed to the owners of WLC and non-controlling interests as appropriate).
On the disposal of a foreign operation (i.e., a disposal of the Group’s entire interest in a
foreign operation, or a disposal involving the loss of control over a subsidiary that includes a
foreign operation, or a partial disposal of an interest in an associate that includes a foreign
operation of which the retained interest becomes a financial asset), all of the exchange
differences accumulated in equity in respect of that operation attributable to the owners of the
Group are reclassified to profit or loss.
In a partial disposal of a subsidiary that does not result in the Group losing control over the
subsidiary, the proportionate share of accumulated exchange differences is re-attributed to the
non-controlling interests of the subsidiary and is not recognized in profit or loss. For all other
partial disposals, the proportionate share of the accumulated exchange differences recognized
in other comprehensive income is reclassified to profit or loss.
f.
Inventories
Inventories consist of raw materials, supplies, finished goods and work-in-process and are
stated at the lower of cost or net realizable value. Inventory write-downs are made by item,
except where it may be appropriate to group similar or related items. The net realizable value
is the estimated selling price of inventories less all estimated costs of completion and costs
necessary to make the sale. Inventories are recorded at the weighted-average cost on the
balance sheet date.
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Inventories of construction
land held for construction site and
include
constructions-in-progress, which are recorded based on acquisition costs or construction costs
depends on the type of the construction. Interest expenses on constructions-in-progress are
capitalized as part of the construction costs.
industry
g. Investment in associates
An associate is an entity over which the Group has significant influence and which is neither a
subsidiary nor an interest in a joint venture.
Under the equity method, investments in an associate are initially recognized at cost and
adjusted thereafter to recognize the Group’s share of the profit or loss and other
comprehensive income of the associate. The Group also recognizes the changes in the Group’s
share of the equity of associates.
Any excess of the cost of acquisition over the Group’s share of the net fair value of the
identifiable assets and liabilities of an associate at the date of acquisition is recognized as
goodwill, which is included within the carrying amount of the investment and is not
amortized. Any excess of the Group’s share of the net fair value of the identifiable assets and
liabilities over the cost of acquisition, after reassessment, is recognized immediately in profit
or loss.
When the Group subscribes for additional new shares of the associate, at a percentage
different from its existing ownership percentage, the resulting carrying amount of the
investment differs from the amount of the Group’s proportionate interest in the associate. The
Group records such a difference as an adjustment to investments with the corresponding
amount charged or credited to capital surplus - changes in the group’s share of equity of
associates. If the Group’s ownership interest is reduced due to its additional subscription of
the new shares of associate, the proportionate amount of the gains or losses previously
recognized in other comprehensive income in relation to that associate is reclassified to profit
or loss on the same basis as would be required had the investee had directly disposed of the
related assets or liabilities. When the adjustment should be debited to capital surplus, but the
capital surplus recognized from investments accounted for using the equity method is
insufficient, the shortage is debited to retained earnings.
When the Group’s share of losses of an associate equals or exceeds its interest in that
associate, the Group discontinues recognizing its share of further losses. Additional losses and
liabilities are recognized only to the extent that the Group has incurred legal obligations, or
constructive obligations, or made payments on behalf of that associate.
The entire carrying amount of the investment (including goodwill) is tested for impairment as
a single asset by comparing its recoverable amount with its carrying amount. Any impairment
loss recognized is not allocated to any asset, including goodwill, that forms part of the
carrying amount of the investment. Any reversal of that impairment loss is recognized to the
extent that the recoverable amount of the investment subsequently increases.
The Group discontinues the use of the equity method from the date on which its investment
ceases to be an associate. Any retained investment is measured at fair value at that date, and
the fair value is regarded as the investment’s fair value on initial recognition as a financial
asset. The difference between the previous carrying amount of the associate attributable to the
retained interest and its fair value is included in the determination of the gain or loss on
disposal of the associate. The Group accounts for all amounts previously recognized in other
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Financial Information
comprehensive income in relation to that associate on the same basis as would be required had
that associate directly disposed of the related assets or liabilities.
When the Group transacts with its associate, profits and losses resulting from the transactions
with the associate are recognized in the Group’s consolidated financial statements only to the
extent of interests in the associate that are not related to the Group.
h. Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at
cost less accumulated depreciation and accumulated impairment loss.
Property, plant and equipment in the course of construction are measured at cost less any
recognized impairment loss. Cost includes professional fees and borrowing costs eligible for
capitalization. Such assets are depreciated and classified to the appropriate categories of
property, plant and equipment when completed and ready for their intended use.
The depreciation of property, plant and equipment is recognized using the straight-line
method. Each significant part is depreciated separately. The estimated useful lives, residual
values and depreciation methods are reviewed at the end of each reporting period, with the
effects of any changes in the estimates accounted for on a prospective basis.
On derecognition of an item of property, plant and equipment, the difference between the
sales proceeds and the carrying amount of the asset is recognized in profit or loss.
i.
Investment properties
Investment properties are properties held to earn rentals and/or for capital appreciation.
Investment properties also include land held for a currently undetermined future use.
Investment properties are measured initially at cost, including transaction costs. Subsequent to
initial recognition, investment properties are measured at cost less accumulated depreciation
and accumulated impairment loss. Depreciation is recognized using the straight-line method.
For a transfer of classification from investment properties to property, plant and equipment,
the deemed cost of the property for subsequent accounting is its carrying amount at the
commencement of owner-occupation.
For a transfer of classification from property, plant and equipment to investment properties,
the deemed cost of the property for subsequent accounting is its carrying amount at the end of
owner-occupation.
On derecognition of an investment property, the difference between the net disposal proceeds
and the carrying amount of the asset is included in profit or loss.
j.
Intangible assets
Intangible assets with finite useful lives that are acquired separately are initially measured at
cost and subsequently measured at cost less accumulated amortization and accumulated
impairment loss. Amortization is recognized on a straight-line basis. The estimated useful
lives, residual values, and amortization methods are reviewed at the end of each reporting
period, with the effect of any changes in the estimates accounted for on a prospective basis.
180
Intangible assets are derecognized when they are disposed or are not expected to generate
future economic benefits through usage or through disposal.
On derecognition of an intangible asset, the difference between the net disposal proceeds and
the carrying amount of the asset is recognized in profit or loss.
k. Impairment of property, plant and equipment, right-of-use asset, investment properties,
intangible assets other than goodwill and assets related to contract costs
At the end of each reporting period, the Group reviews the carrying amounts of its property,
plant and equipment, right-of-use asset and intangible assets excluding goodwill, to determine
whether there is any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order to determine the
extent of the impairment loss. When it is not possible to estimate the recoverable amount of an
individual asset, the Group estimates the recoverable amount of the cash-generating unit to
which the asset belongs. Corporate assets are allocated to the individual cash-generating units
on a reasonable and consistent basis of allocation.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are
tested for impairment at least annually and whenever there is an indication that the assets may
be impaired.
The recoverable amount is the higher of fair value less costs to sell and value in use. If the
recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying
amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable
amount, with the resulting impairment loss recognized in profit or loss.
When an impairment loss is subsequently reversed, the carrying amount of the corresponding
asset or cash-generating unit is increased to the revised estimate of its recoverable amount, but
only to the extent of the carrying amount that would have been determined had no impairment
loss been recognized for the asset or cash-generating unit in prior years. A reversal of an
impairment loss is recognized in profit or loss.
l. Financial instruments
Financial assets and financial liabilities are recognized when the Group becomes a party to the
contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs
that are directly attributable to the acquisition or issuance of financial assets and financial
liabilities (other than financial assets and financial liabilities at FVTPL) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on
initial recognition. Transaction costs directly attributable to the acquisition of financial assets
or financial liabilities at FVTPL are recognized immediately in profit or loss.
Financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a
trade date basis.
1) Measurement categories
Financial assets are classified into the following categories: Financial assets at FVTPL,
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Financial Information
financial assets at amortized cost and equity instruments at FVTOCI.
a) Financial assets at FVTPL
Financial assets are classified as at FVTPL when such financial assets are mandatorily
classified or designated as at FVTPL. Financial assets mandatorily classified as at
FVTPL include investments in equity instruments which are not designated as at
FVTOCI and debt instruments that do not meet the amortized cost criteria or the
FVTOCI criteria.
Financial assets at FVTPL are subsequently measured at fair value, and any
remeasurement gains or losses are recognized in profit or loss. The net gain or loss
recognized in profit or loss. Fair value is determined in the manner described in Note
35.
b) Financial assets at amortized cost
Financial assets that meet the following conditions are subsequently measured at
amortized cost:
i. The financial assets are held within a business model whose objective is to hold
financial assets in order to collect contractual cash flows; and
ii. The contractual terms of the financial assets give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal amount
outstanding.
Subsequent to initial recognition, financial assets at amortized cost, including cash and
cash equivalents, trade receivables at amortized cost are measured at amortized cost,
which equals the gross carrying amount determined using the effective interest method
less any impairment loss. Exchange differences are recognized in profit or loss.
Interest income is calculated by applying the effective interest rate to the gross
carrying amount of such a financial asset, except for:
i. Purchased or originated credit-impaired financial assets, for which interest income
is calculated by applying the credit-adjusted effective interest rate to the amortized
cost of such financial assets; and
ii. Financial asset that is not credit impaired on purchase or origination but has
subsequently become credit impaired, for which interest income is calculated by
applying the effective interest rate to the amortized cost of such financial assets in
subsequent reporting periods.
Cash equivalents include time deposits with original maturities within 3 months from
the date of acquisition or time deposits with original maturities within 3-12 months
from the date of acquisition and the interest paid to deposits which is terminated
before maturity is higher than demand deposits, which are highly liquid, readily
convertible to a known amount of cash and are subject to an insignificant risk of
changes in value. These cash equivalents are held for the purpose of meeting
short-term cash commitments.
182
c) Investments in equity instruments at FVTOCI
On initial recognition, the Group may make an irrevocable election to designate
investments in equity instruments as at FVTOCI. Designation as at FVTOCI is not
permitted if the equity investment is held for trading or if it is contingent consideration
recognized by an acquirer in a business combination.
Investments in equity instruments at FVTOCI are subsequently measured at fair value
with gains and losses arising from changes in fair value recognized in other
comprehensive income and accumulated in other equity. The cumulative gain or loss
will not be reclassified to profit or loss on disposal of the equity investments, instead,
they will be transferred to retained earnings.
Dividends on these investments in equity instruments are recognized in profit or loss
when the Group’s right to receive the dividends is established, unless the dividends
clearly represent a recovery of part of the cost of the investment.
2) Impairment of financial assets
The Group recognizes a loss allowance for expected credit losses on financial assets at
amortized cost (including trade receivables), investments in debt instruments that are
measured at FVTOCI, operating/finance lease receivables, as well as contract assets.
The Group always recognizes lifetime Expected Credit Losses (ECLs) for trade
receivables and operating/finance lease receivables and contract assets. For all other
financial instruments, the Group recognizes lifetime ECLs when there has been a
significant increase in credit risk since initial recognition. If, on the other hand, the credit
risk on the financial instrument has not increased significantly since initial recognition, the
Group measures the loss allowance for that financial instrument at an amount equal to
12-month ECLs.
Expected credit losses reflect the weighted average of credit losses with the respective
risks of default occurring as the weights. Lifetime ECLs represents the expected credit
losses that will result from all possible default events over the expected life of a financial
instrument. In contrast, 12-month ECLs represents the portion of lifetime ECLs that is
expected to result from default events on a financial instrument that are possible within 12
months after the reporting date.
For internal credit risk management purposes, the Group considers the following
situations as indication that a financial asset is in default (without taking into account any
collateral held by the Group):
a) Internal or external information shows that the debtor is unlikely to pay its creditors.
b) Financial asset is more than 90 days past due unless the Group has reasonable and
corroborative information to support a more lagged default criterion.
The impairment loss of all financial assets is recognized in profit or loss by a reduction in
their carrying amounts through a loss allowance account, except for investments in debt
instruments that are measured at FVTOCI, for which the loss allowance is recognized in
other comprehensive income and the carrying amounts of such financial assets are not
reduced.
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Financial Information
3) Derecognition of financial assets
The Group derecognizes a financial asset only when the contractual rights to the cash
flows from the asset expire or when it transfers the financial asset and substantially all the
risks and rewards of ownership of the asset to another party.
On derecognition of a financial asset at amortized cost in its entirety, the difference
between the asset’s carrying amount and the sum of the consideration received and
receivable is recognized in profit or loss. On derecognition of an investment in a debt
instrument at FVTOCI, the difference between the asset’s carrying amount and the sum of
the consideration received and receivable and the cumulative gain or loss which had been
recognized in other comprehensive income is recognized in profit or loss. However, on
derecognition of an investment in an equity instrument at FVTOCI, the difference
between the asset’s carrying amount and the sum of the consideration received and
receivable is recognized in profit or loss, and the cumulative gain or loss which had been
recognized in other comprehensive income is transferred directly to retained earnings,
without recycling through profit or loss.
Equity instruments
Equity instruments issued by the Group are recognized at the proceeds received, net of direct
issue costs.
The repurchase of WLC’s own equity instruments is recognized in and deducted directly from
equity. No gain or loss is recognized in profit or loss on the purchase, sale, issuance or
cancellation of WLC’s own equity instruments.
Financial liabilities
1) Subsequent measurement
Except the following situation, all the financial liabilities are measured at amortized cost
using the effective interest method:
a) Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL when such financial liabilities are either
held for trading or are designated as at FVTPL.
Financial liabilities held for trading are stated at fair value, and any remeasurement
gains or losses are recognized in profit or loss. Fair value is determined in the manner
described in Note 35.
b) Financial guarantee contracts
Financial guarantee contracts issued by the Group, if not designated as at FVTPL, are
subsequently measured at the higher of:
i. The amount of the loss allowance reflecting expected credit losses; and
ii. The amount initially recognized less, where appropriate, the cumulative amount of
income recognized in accordance with the revenue recognition policies.
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2) Derecognition of financial liabilities
The difference between the carrying amount of a financial liability derecognized and the
consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognized in profit or loss.
Derivative financial instruments
The Group enters into a variety of derivative financial instruments to manage its exposure to
interest rate and foreign exchange rate risks, including foreign exchange forward contracts and
interest rate swaps.
Derivatives are initially recognized at fair value at the date on which the derivative contracts
are entered into and are subsequently remeasured to their fair value at the end of each
reporting period. The resulting gain or loss is recognized in profit or loss immediately unless
the derivative is designated and effective as a hedging instrument; in which event, the timing
of the recognition in profit or loss depends on the nature of the hedging relationship. When the
fair value of a derivative financial instrument is positive, the derivative is recognized as a
financial asset; when the fair value of a derivative financial instrument is negative, the
derivative is recognized as a financial liability.
Derivatives embedded in hybrid contracts that contain financial asset hosts that is within the
scope of IFRS 9 are not separated; instead, the classification is determined in accordance with
the entire hybrid contract. Derivatives embedded in non-derivative host contracts that are not
financial assets within the scope of IFRS 9 (e.g. financial liabilities) are treated as separate
derivatives when they meet the definition of a derivative; their risks and characteristics are not
closely related to those of the host contracts; and the host contracts are not measured at
FVTPL.
m. Hedge accounting
The Group designates certain hedging instruments, which include derivatives, embedded
derivatives and non-derivatives in respect of foreign currency risk, as either fair value hedges
or cash flow hedges. Hedges of foreign exchange risk on firm commitments are accounted for
as cash flow hedges.
1) Fair value hedges
Gain or losses on derivatives that are designated and qualify as fair value hedges are
recognized in profit or loss immediately, together with any changes in the fair value of the
hedged asset or liability that are attributable to the hedged risk. The change in the fair
value of the hedging instrument and the change in the hedged item attributable to the
hedged risk are recognized in profit or loss in the line item relating to the hedged item.
The Group discontinues hedge accounting only when the hedging relationship ceases to
meet the qualifying criteria; for instance, when the hedging instrument expires or is sold,
terminated or exercised.
2) Cash flow hedges
The effective portion of gains or losses on derivatives that are designated and qualify as
cash flow hedges is recognized in other comprehensive income. The gain or loss relating
to the ineffective portion is recognized immediately in profit or loss.
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Financial Information
The associated gains or losses that were recognized in other comprehensive income are
reclassified from equity to profit or loss as reclassification adjustment in the line item
relating to the hedged item in the same period when the hedged item affects profit or loss.
If a hedge of a forecast transaction subsequently results in the recognition of a
non-financial asset or a non-financial liability, the associated gains and losses that were
recognized in other comprehensive income are removed from equity and included in the
initial cost of the non-financial asset or non-financial liability.
The Group discontinues hedge accounting only when the hedging relationship ceases to
meet the qualifying criteria; for instance, when the hedging instrument expires or is sold,
terminated or exercised. The cumulative gain or loss on the hedging instrument that has
been previously recognized in other comprehensive income (from the period when the
hedge was effective) remains separately in equity until the forecast transaction occurs.
When a forecast transaction is no longer expected to occur, the gain or loss accumulated in
equity is recognized immediately in profit or loss.
n. Levies
Levies imposed by a government are accrued as other liabilities when the transactions or
activities that trigger the payment of such levies occur. If the obligating event occurs over a
period of time, the liability is recognized progressively. If an obligation to pay a levy is
triggered upon reaching a minimum threshold, the liability is recognized when that minimum
threshold is reached.
o. Provisions
Provisions are recognized when the Group has a present obligation (legal or constructive) as a
result of a past event and it is probable that the Group will be required to settle the obligation
and the amount of the obligation can be measured reliably.
p. Revenue recognition
The Group identifies contracts with the customers, allocates the transaction price to the
performance obligations and recognizes revenue when performance obligations are satisfied.
1) Revenue from the sale of goods and real estate
Revenue from the sale of goods and real estate comes from sales of wires, cables, stainless
steel and real estate. Sales of wires, cables and stainless steel are recognized as revenue
when the customer has full discretion over the manner of distribution and the price to sell
the goods, has the primary responsibility for sales to future customers and bears the risks
of obsolescence. Trade receivables are recognized concurrently.
The Group does not recognize revenue on materials delivered to subcontractors because
this delivery does not involve a transfer of control.
For contracts to sell properties in the ordinary course of business, the fixed transaction
price is received in instalments and recognized as a contract liability. The transaction
price, after adjusting for the effect of the significant financing component, is recognized as
revenue when the construction is completed and the property is transferred to the buyer.
186
2) Revenue from the others
a) Revenue from the rendering of services
Service income is recognized when services are rendered. Revenue should be
recognized over time by measuring the progress toward complete satisfaction of the
performance obligation.
b) Construction contract revenue
Contract assets are recognized during construction and are reclassified to trade
receivables at the point at which the customer is invoiced. If the milestone payment
exceeds the revenue recognized to date, then the Group recognizes a contract
liabilities for the difference. Certain payments, which are retained by the customer as
specified in the contract, are intended to ensure that the Group adequately completes
all of its contractual obligations. Such retention receivables are recognized as contract
assets until the Group satisfies its performance obligations.
When the outcome of a performance obligation cannot be reasonably measured,
contract revenue is recognized only to the extent of contract costs incurred in
satisfying the performance obligation for which recovery is expected.
q. Leases
At the inception of a contract, the Group assesses whether the contract is, or contains, a
lease.
a) The Group as lessor
Leases are classified as finance leases whenever the terms of a lease transfer
substantially all the risks and rewards of ownership to the lessee. All other leases are
classified as operating leases.
Under finance leases, the lease payments comprise fixed payments and variable lease
payments which depend on an index or a rate. The net investment in a lease is
measured at (a) the present value of the sum of the lease payments receivable by a
lessor and any unguaranteed residual value accrued to the lessor plus (b) initial direct
costs and is presented as a finance lease receivable. Finance lease income is allocated
to the relevant accounting periods so as to reflect a constant, periodic rate of return on
the Group’s net investment outstanding in respect of leases.
Lease payments less any lease incentives payable from operating leases are recognized
as income on a straight-line basis over the terms of the relevant leases. Initial direct
costs incurred in obtaining operating leases are added to the carrying amounts of the
underlying assets and recognized as expenses on a straight-line basis over the lease
terms.
b) The Group as lessee
The Group recognizes right-of-use assets and lease liabilities for all leases at the
commencement date of a lease, except for short-term leases and low-value asset leases
accounted for by applying a recognition exemption where lease payments are
recognized as expenses on a straight-line basis over the lease terms.
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Financial Information
Right-of-use assets are initially measured at cost, which comprises the initial
measurement of lease liabilities adjusted for lease payments made at or before the
commencement date, plus any initial direct costs incurred and an estimate of costs
needed to restore the underlying assets, and less any lease incentives received.
Right-of-use assets are subsequently measured at cost less accumulated depreciation
and impairment losses and adjusted for any remeasurement of the lease liabilities.
Right-of-use assets are depreciated using the straight-line method from the
commencement dates to the earlier of the end of the useful lives of the right-of-use
assets or the end of the lease terms.
Lease liabilities are initially measured at the present value of the lease payments,
which comprise fixed payments, in-substance fixed payments, variable lease payments
which depend on an index or a rate, residual value guarantees, the exercise price of a
purchase option if the Group is reasonably certain to exercise that option, and
payments of penalties for terminating a lease if the lease term reflects such
termination, less any lease incentives receivable. The lease payments are discounted
using the interest rate implicit in a lease, if that rate can be readily determined. If that
rate cannot be readily determined, the lessee’s incremental borrowing rate will be
used.
Subsequently, lease liabilities are measured at amortized cost using the effective
interest method, with interest expense recognized over the lease terms. When there is a
change in a lease term, a change in the amounts expected to be payable under a
residual value guarantee, a change in the assessment of an option to purchase an
underlying asset, or a change in future lease payments resulting from a change in an
index or a rate used to determine those payments, the Group remeasures the lease
liabilities with a corresponding adjustment to the right-of-use-assets. However, if the
carrying amount of the right-of-use assets is reduced to zero, any remaining amount of
the remeasurement is recognized in profit or loss. Lease liabilities are presented on a
separate line in the consolidated balance sheets.
Variable lease payments that do not depend on an index or a rate are recognized as
expenses in the periods in which they are incurred.
r. Government grants
Government grants are not recognized until there is reasonable assurance that the Group will
comply with the conditions attached to them and that the grants will be received.
Government grants are recognized in profit or loss on a systematic basis over the periods in
which the Group recognizes as expenses the related costs that the grants intend to compensate.
Government grants that are receivable as compensation for expenses or losses already
incurred or for the purpose of giving immediate financial support to the Group with no future
related costs are recognized in profit or loss in the period in which they are received.
The benefit of a government loan received at a below-market rate of interest is treated as a
government grant measured as the difference between the proceeds received and the fair value
of the loan based on prevailing market interest rates.
188
s. Employee benefits
1) Short-term employee benefits
Liabilities recognized in respect of short-term employee benefits are measured at the
undiscounted amount of the benefits expected to be paid in exchange for the related
service.
2) Retirement benefits
Payments to defined contribution retirement benefit plans are recognized as expenses
when employees have rendered services entitling them to the contributions.
Defined benefit costs (including service cost, net interest and remeasurement) under
defined benefit retirement benefit plans are determined using the projected unit credit
method. Service cost (including current service cost) and net interest on the net defined
benefit liabilities (assets) are recognized as employee benefits expense in the period in
which they occur. Remeasurement, comprising actuarial gains and losses and the return on
plan assets (excluding interest), is recognized in other comprehensive income in the period
in which it occurs. Remeasurement recognized in other comprehensive income is reflected
immediately in retained earnings and will not be reclassified to profit or loss.
Net defined benefit liabilities (assets) represent the actual deficit (surplus) in the Group’s
defined benefit plans. Any surplus resulting from this calculation is limited to the present
value of any refunds from the plans or reductions in future contributions to the plans.
t. Share-based payment arrangements
Employee share options granted to employees and others providing similar services.
The fair value at the grant date of the employee share options is expensed on a straight-line
basis over the vesting period, based on the Group’s best estimates of the number of shares or
options that are expected to ultimately vest, with a corresponding increase in capital surplus -
employee share options. The expense is recognized in full at the grant date if the grants are
vested immediately. The grant date of issued ordinary shares for cash which are reserved for
employees is the date on which the number of shares that the employees purchase is
confirmed.
u. Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
1) Current tax
Income tax payable (recoverable) is based on taxable profit (loss) for the year determined
according to the applicable tax laws of each tax jurisdiction.
According to the Income Tax Act in the ROC, an additional tax on unappropriated
earnings is provided for in the year the shareholders approve to retain earnings.
Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s
tax provision.
189
Financial Information
2) Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of
assets and liabilities and the corresponding tax bases used in the computation of taxable
profit.
Deferred tax liabilities are generally recognized for all taxable temporary differences.
Deferred tax assets are generally recognized for all deductible temporary differences and
unused loss carryforwards to the extent that it is probable that taxable profits will be
available against which those deductible temporary differences can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries and associates and interests in joint ventures, except where the
Group is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets arising
from deductible temporary differences associated with such investments and interests are
recognized only to the extent that it is probable that there will be sufficient taxable profits
against which to utilize the benefits of the temporary differences and they are expected to
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period
and reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered. A previously unrecognized
deferred tax asset is also reviewed at the end of each reporting period and recognized to
the to the extent that it has become probable that future taxable profit will allow the
deferred tax asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply
in the period in which the liabilities are settled or the assets are realized, based on tax rates
(and tax laws) that have been enacted or substantively enacted by the end of the reporting
period. The measurement of deferred tax liabilities and assets reflects the tax
consequences that would follow from the manner in which the Group expects, at the end
of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION
UNCERTAINTY
In the application of the Group’s accounting policies, management is required to make judgments,
estimates and assumptions on the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical
experience and other factors that are considered relevant. Actual results may differ from these
estimates.
The Group considers the possible impact when making its critical accounting estimates. The
estimates and underlying assumptions are audited on an ongoing basis. Revisions to accounting
estimates are recognized in the period in which the estimates are revised if the revisions affect
only that period or in the period of the revisions and future periods if the revisions affect both
current and future periods.
190
6. CASH AND CASH EQUIVALENTS
Cash on hand
Checking accounts and cash in banks
Cash equivalents
Time deposits
Short-term bills
December 31
2022
2021
$
4,413
15,013,929
$
2,926
8,473,267
4,265,727
113,904
1,801,526
109,862
$ 19,397,973
$ 10,387,581
The market rate intervals of cash in the bank at the end of the year were as follows (except for the
checking accounts’ interest rate of 0.00%):
Bank balance
Short-term bills
December 31
2022
2021
0.001%-3.8%
0.4%-0.5%
0.001%-2.75%
0.16%
Other bank deposits have been reclassified to other accounts for the following purposes:
Other financial assets - current
Restricted deposits
To meet contract requirements for completing
$ 34,648
$ 18,139
construction
To secure short-term borrowings and letters of
167,546
370,054
Purpose
December 31
2022
2021
Refundable deposits
Refundable deposits
credit
Repatriation of offshore funds and project grants
Futures deposits
40,786
303,146
546,126
80,493
61,964
530,650
Other - pledged time deposits
To meet contract requirements for completing
51,718
51,667
construction
To meet required security deposit
268
867
Other non-current assets - other
Restricted deposits
To meet construction project and performance
Pledged time deposits
To meet required security deposit
letter of guarantee
11,023
1,439
64,448
10,854
-
63,388
$ 610,574
$ 594,038
191
Financial Information
7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
December 31
2022
2021
Financial assets mandatorily classified as at FVTPL
Derivative financial assets (not under hedge accounting)
Commodity futures contracts
Foreign exchange forward contracts
Options
Interest rate swap contracts
Non-derivative financial assets
Contingent consideration (Note 32)
Foreign unlisted shares
$
$
-
-
7,629
2
2,567,786
71,969
1,940
14,207
-
-
-
-
Financial assets at FVTPL
$ 2,647,386
$
16,147
Current
Non-current
Financial liabilities held for trading
Derivative financial liabilities (not under hedge
accounting)
Commodity futures contracts
Foreign exchange forward contracts
Exchange rate swap contracts
Non-derivative financial liabilities
Contingent consideration (Note 31)
$
7,631
2,639,755
$
16,147
-
$ 2,647,386
$
16,147
$
$
21,189
21,470
22,113
363,192
-
-
37,439
-
Financial liabilities at FVTPL
$
427,964
$
37,439
Current
Non-current
$
64,772
363,192
$
37,439
-
$
427,964
$
37,439
a. As of December 31, 2022 and 2021, outstanding commodity futures not under hedge
accounting were as follows:
Type of
Transaction
Quantity
(Tons)
Trade Date
Maturity
Date
Exercise Price
(In Thousands)
Market Price
(In Thousands)
Valuation
(Loss) Gain
(In Thousands)
December 31, 2022
Commodity futures
contracts
Copper
Copper
Copper
192
Buy
Buy
Sell
5,900
555
25
2022.08.15-
2022.12.30
2022.11.11-
2022.12.30
2022.12.02
2023.01.08-
2023.06.21
2023.01.31-
2023.03.31
2023.03.02
US$ 48,178
US$ 49,332
US$
1,154
RMB 36,816
RMB 36,797
RMB
(19 )
US$
210
US$
209
US$
1
(Continued)
Type of
Transaction
Quantity
(Tons)
Trade Date
Maturity
Date
Exercise Price
(In Thousands)
Market Price
(In Thousands)
Valuation
(Loss) Gain
(In Thousands)
Nickel
Zinc
December 31, 2021
Commodity futures
contracts
Copper
Copper
Nickel
Copper
Zinc
Sell
Buy
Buy
Sell
Sell
Buy
Buy
4,188
25
2022.11.15-
2022.12.30
2022.12.05
2023.01.18-
2023.03.20
2023.02.28
US$ 122,940
US$ 124,780
US$
(1,840 )
RMB
613
RMB
593
RMB
(20)
9,925
3,050
2,238
1,770
275
2021.09.01-
2021.12.31
2021.12.10-
2021.12.31
2021.11.04-
2021.12.31
2021.09.07-
2021.12.31
2021.10.14-
2021.12.10
2022.01.19-
2022.04.20
2022.01.19-
2022.03.31
2022.02.04-
2022.03.31
2022.01.31-
2022.06.30
2022.03.31
US$ 94,424
US$ 96,834
US$
2,410
US$ 29,229
US$ 29,846
US$
(617 )
US$ 44,698
US$ 46,459
US$
(1,761 )
RMB 124,483
RMB 124,618
RMB
135
RMB 6,520
RMB 6,630
RMB
110
(Concluded)
b. As of December 31, 2022 and 2021, outstanding foreign exchange forward contracts not
under hedge accounting were as follows:
Currency
Maturity Date
Notional Amount
(In Thousands)
December 31, 2022
Sell
Buy
USD to RMB
EUR to MYR
EUR to USD
USD to IDR
USD to JPY
USD to RMB
EUR to USD
USD to SGD
EUR to KRW
EUR to TRY
EUR to ZAR
EUR to GBP
EUR to BRL
2023.01.31-2023.05.05 USD2,543/RMB17,228
2023.01.31-2023.06.30 EUR1,499/MYR7,048
2023.01.03-2023.01.10 EUR7,987/USD8,500
2023.01.31
USD91,000/IDR1,429,633,10
0
2023.01.05
2023.01.05
2023.01.05
USD3,000/JPY412,605
USD16,571/RMB116,504
EUR15,834/USD16,571
2023.01.30-2023.02.01 USD13,127/SGD17,778
2023.01.31-2023.02.28 EUR434/KRW592,638
2023.01.31
EUR292/TRY6,000
2023.01.18-2023.02.17 EUR710/ZAR12,483
2023.01.31-2023.03.31 EUR4,944/GBP4,340
2023.01.17-2023.03.15 EUR5,485/BRL29,982
December 31, 2021
Sell
Buy
EUR to USD
USD to NTD
USD to RMB
EUR to MYR
USD to NTD
USD to JPY
EUR to USD
USD to SGD
USD to RMB
2022.01.18-2022.02.17 EUR18,000/USD20,326
2022.01.07-2022.02.10 USD100,000/NTD2,776,800
2022.01.13-2022.07.20 USD83,643/RMB536,528
2022.01.14-2022.03.02 EUR1,160/MYR5,590
2022.01.06-2022.02.21 USD129,363/NTD3,579,887
2022.01.12-2022.01.24 USD9,430/JPY1,077,970
EUR25,405/USD28,694
USD20,207/SGD27,651
USD10,000/RMB63,611
2022.01.10
2022.01.12
2022.01.13
193
Financial Information
c. As of December 31, 2022 and 2021, outstanding exchange rate swap contracts not under
hedge accounting were as follows:
Currency
Maturity Date
Notional Amount
(In Thousands)
December 31, 2022 USD to RMB
EUR to USD
EUR to ZAR
2023.01.18
2023.01.17
2023.01.18
USD75,000/RMB516,585
EUR15,955/USD17,000
EUR133/ZAR2,390
December 31, 2021 USD to NTD
USD to NTD
USD to NTD
2022.01.12
2022.01.12
2022.01.14
USD75,000/NTD2,097,188
USD70,000/NTD1,957,375
USD40,000/NTD1,109,600
d. As of December 31, 2022, outstanding commodity futures option contracts not under hedge
accounting were as follows:
Notional Amount
Type of
Transaction
Buyer/Seller
Premium Paid
Fair Value
USD29,118
Put
Buyer
USD672
USD249
e. As of December 31, 2022, outstanding interest rate swap contracts not under hedge
accounting were as follows:
Notional
Amount
Maturity Date
Range of
Interest Rates
Paid
Range of
Interest Rates
Received
December 31, 2022 EUR19,934
2023.02.01
-0.433%
Note
Note:
It is the three-month interest rate of Euro Interbank Offered Rate (Euribor) on the
second business day before the issuance date.
f. For the years ended December 31, 2022 and 2021, the Group’s strategies for commodity
futures contracts, foreign exchange forward contracts, exchange rate swap contracts and
interest rate swap contracts were to hedge exposures to fluctuations in the prices of raw
material, foreign exchange rates and interest rates. However, those derivative financial
instruments did not meet the criteria of hedge effectiveness; therefore, they were not
accounted for hedge accounting.
g. Financial Assets - contingent consideration is the amount of consideration to be received by
the Group from the acquirer in the disposal of the subsidiary (the “Target Company”) on July
27, 2022. In accordance with the agreement of contingent consideration, the acquirer shall
respectively pay additional payments when the gross profit of Target Company during the
period starting from the settlement date to December 31, 2023 and the gross profit in the year
2024 meet the amount agreed upon by Target Company.
h. Financial liabilities - contingent consideration according to the agreement of acquisition, the
Group is required to make additional payments to the seller if Cogne Acciai Speciali S.p.A.’s
earnings before interest, income tax, depreciation and amortization from the settlement date to
2025 meet the contract requirements. The fair value of this obligation at the acquisition date is
194
estimated to be $355,089 thousand.
8. DERIVATIVE FINANCIAL INSTRUMENTS FOR HEDGING
December 31
2022
2021
Financial assets
Fair value hedges - exchange rate swap contracts
Cash flow hedges - interest rate swap contracts
-
$
165,019
$ 89,232
-
Current
Non-current
Financial liabilities
Cash flow hedges - gas swap contracts
Current
Non-current
$ 165,019
$ 89,232
$ 20,615
144,404
$ 89,232
-
$ 165,019
$ 89,232
$ 222,272
$ 222,272
-
$ 222,272
$
$
$
-
-
-
-
a. The Group entered into exchange rate swap contracts to avoid exchange rate exposure of its
foreign-currency trade receivables and trade payables. The conditions of the exchange rate
swaps are the same as the one of the corresponding financial assets, so the management
believes that the exchange rate swaps are highly effective hedging instruments. The
outstanding exchange rate swap contracts of the Group at the end of the year were as follows:
Currency
Maturity Date
Notional Amount
(In Thousands)
December 31, 2021
Exchange rate swap
USD to RMB
contracts
USD to RMB
USD to RMB
USD to RMB
2022.01.14
2022.01.14
2022.06.08
2022.06.08
USD75,000/RMB488,325
USD70,000/RMB455,700
USD20,000/RMB129,220
USD15,000/RMB96,921
Gain on the hedging instruments
Loss on the hedged items
For the Year
Ended
December 31,
2021
$ 89,232
$ 52,963
195
Financial Information
b. The Group converts some of the issued floating rate financial liabilities from floating rate to
fixed rate through the interest rate swap contracts in order to reduce the risk of the cash flow
of the issued floating rate financial liabilities due to changes in interest rates. The conditions
of the interest rate swap contracts are the same as the one of the related financial liabilities,
therefore, the management of the Group considers they can be highly effective hedging
instruments. The outstanding interest rate swap contracts of the Group at the end of the year
were as follows:
December 31, 2022
Notional
Amount
(In Thousands)
Maturity Date
Range of Interest
Rates Paid
Range of Interest Rates
Received
Exchange rate swap
EUR95,177
2023.05.31-2030.12.18 -0.255%-3.120% Euribor three to six
contracts
months
c. The Group is exposed to the risk that the future cash flows of the assets and liabilities may
fluctuate due to changes in market prices of gas that are required for the Group’s operations.
The Group assesses that the risk may be significant and therefore enters into gas swap
contracts for hedging purposes. The breakdown of the cash flow hedge items and derivative
financial instruments designated for hedging as of December 31, 2022 were as follows:
Financial
Commodity
Type of
Transaction
Quantity
(Tons)
Trade Date
Maturity
Date
Notional
Amount
(In Thousands)
Market Price
(In Thousands)
Valuation
(Loss) Gain
(In Thousands)
December 31, 2022
Gas
Buy
139,800
2022.04.22-
2022.12.28
2023.01.31-
2023.12.31
EUR17,700
EUR10,907
EUR(6,793)
9. FINANCIAL ASSETS AT AMORTIZED COST
Current
Foreign investments
Structured deposit
Non-current
Foreign investments
Government bonds
December 31
2022
2021
$
2,202
$
$ 189,242
$
-
-
The interest rates for the government bonds the Group purchased was 4.45% as of December 31,
2022.
196
10. CONTRACT ASSETS
As of December 31, 2022 and 2021, contract balances were as follows:
December 31
2022
2021
Contract assets
Cable installation and steel cable sales contract
Solar power systems installation
Less: Allowance for impairment loss
$ 1,242,468
1,779,769
-
$
840,341
4,910,003
-
Contract assets - current
$ 3,022,237
$ 5,750,344
The changes in the balance of contract assets primarily resulted from the timing differences
between the Group’s satisfaction of performance obligations and the respective customer’s
payment.
11. NOTES RECEIVABLE AND TRADE RECEIVABLES
Notes receivable
Notes receivable
Trade receivables
Trade receivables
Less: Allowance for impairment loss
a. Notes receivable
December 31
2022
2021
$ 4,537,322
$ 2,627,411
$ 17,575,200
(280,210)
$ 11,138,592
(92,903)
$ 17,294,990
$ 11,045,689
The Group entered into a factoring agreement with financial institutions to sell its discounted
notes receivable. Although the Group has transferred the contractual rights to receive cash
flows, the Group is still obligated to bear the default risk of such discounted notes receivable.
Thus, it did not meet the conditions for derecognition of financial assets. The related
information is as follows:
December 31, 2022
Factoring Partners
Shanghai Pudong Development Bank
Notes
Receivable
Transferred
(Note)
Amount
Advanced
Interest Rate
Co., Ltd.
China Minsheng Banking Corp., Ltd.
$ 1,425,350
128,663
$ 1,425,350
128,663
1.25%-2.20%
1.57%-2.10%
$ 1,554,013
$ 1,554,013
197
Financial Information
Note: Classified under short-term borrowings; for related information on guarantee and
short-term borrowings, refer to Notes 22 and 37.
b. Trade receivable
The average credit period on the sales of goods was 60 days. In determining the collectability
of a trade receivable, the Group considered any change in the credit quality of the trade
receivable since the date credit was initially granted to the end of the reporting period. When
the Group dealt with new entities, the Group reviewed the credit ratings of the entities and
obtained sufficient collateral, where appropriate, as a means of mitigating the risk of financial
loss from defaults. The Group uses other publicly available financial information or its own
trading records to rate its major customers. The Group’s exposure and the credit ratings of its
counterparties are continuously monitored, and the aggregate value of transactions concluded
is spread amongst approved counterparties. Credit exposure is controlled by counterparty
limits that are reviewed and approved by the risk management committee annually. In this
regard, the management believes the Group’s credit risk is significantly reduced.
The Group permits the use of a lifetime expected credit losses allowance for all trade
receivables. The expected credit losses on trade receivables are estimated using a provision
matrix by reference to the past default experience with the respective debtors and an analysis
of the debtors’ current financial positions. As the Group’s historical credit loss experience
does not show significantly different loss patterns for different customer segments, the loss
allowance based on the past due status of receivables is not further distinguished according to
different segments of the Group’s customer base.
The Group writes off a trade receivable when there is information indicating that the debtor is
experiencing severe financial difficulty and there is no realistic prospect of recovery of the
receivable. For trade receivables that have been written off, the Group continues to engage in
enforcement activity to attempt to recover the receivables which are due. Where recoveries are
made, they are recognized in profit or loss.
The following table details the loss allowance of trade receivables based on the Group’s
provision matrix.
December 31, 2022
Not Past Due
Less than 90
Days
91 to 180 Days 181 to 365 Days Over 365 Days
Total
Expected credit loss rate
0%-1%
0%-2%
0%-50%
0%-100%
50%-100%
Gross carrying amount
Loss allowance (lifetime
ECLs)
$ 14,708,361
$ 2,274,401
$
255,547
$
172,148
$
164,743
$ 17,575,200
(8,432 )
(31,422 )
(26,064 )
(71,707 )
(142,585 )
280,210 )
Amortized cost
$ 14,699,929
$ 2,242,979
$
229,483
$
100,441
$
22,158
$ 17,294,990
198
December 31, 2021
Not Past Due
Less than 90
Days
91 to 180 Days 181 to 365 Days Over 365 Days
Total
Expected credit loss rate
0%
0%-2%
0%-50%
0%-100%
50%-100%
Gross carrying amount
Loss allowance (lifetime
ECLs)
$ 9,374,469
$ 1,373,270
$
224,201
$
74,105
$
92,547
$ 11,138,592
-
(2,081 )
(12,786 )
(10,688 )
(67,348 )
(92,903 )
Amortized cost
$ 9,374,469
$ 1,371,189
$
211,415
$
63,417
$
25,199
$ 11,045,689
The movements of the loss allowance of trade receivables were as follows:
For the Year Ended December 31
2022
2021
Balance at January 1
Add: Amounts recovered
Add (less): Net remeasurement of loss allowance
Add: Acquisition through merger
Less: Amounts written off
Foreign exchange gains and losses
$ 92,903
-
105,680
91,508
(17,859)
7,978
$ 94,022
8,764
(7,900)
-
(508)
(1,475)
Balance at December 31
$ 280,210
$ 92,903
12. FINANCE LEASE RECEIVABLES
Undiscounted lease payments
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6 onwards
Less: Unearned finance income
Net investment in leases presented as finance lease
receivables
Current
Non-current
December 31
2022
2021
$ 81,359
81,359
81,359
81,359
81,359
369,017
775,812
(113,269)
$ 81,359
81,359
81,359
81,359
81,359
450,376
857,171
(136,586)
$ 662,543
$ 720,585
$ 60,020
602,523
$ 58,042
662,543
$ 662,543
$ 720,585
The power supply contracts of solar power equipment are processed according to the finance
leases accounting policy. The average term of finance leases entered into was 20 years.
199
Financial Information
The interest rate inherent in the leases was fixed at the contract date for the entire lease term. The
average effective interest rate contracted was 3.30% per annum as of December 31, 2022 and
2021.
The finance lease receivables as of December 31, 2022 and 2021 were neither past due nor
impaired.
The amounts of finance lease receivables pledged as collateral or for security are set out in Note
37.
13. INVENTORIES
Manufacturing and trading industries
Raw materials
Raw materials in transit
Supplies
Work-in-process
Finished goods and merchandise
Contracts in progress
Real estate development industry
Undeveloped land
Buildings and land held for sale
Contracts in progress
December 31
2022
2021
$ 7,852,613
1,871,877
2,256,735
8,652,837
12,807,714
462,456
33,904,232
$ 6,753,215
2,609,416
1,780,788
3,726,215
9,435,648
229,425
24,534,707
3,434
208,551
1,964,074
2,176,059
3,434
211,858
6,909,724
7,125,016
$ 36,080,291
$ 31,659,723
a. The cost of goods sold related to inventories for the years ended December 31, 2022 and 2021
were NT$162,026,574 thousand and NT$135,868,487 thousand, respectively.
b. The cost of goods sold for the years ended December 31, 2022 and 2021 included inventory
write-downs of NT$101,667 thousand and reversals of inventory write-downs of NT$38,114
thousand, respectively. The reversals of previous write-downs for the years ended December
31, 2021 resulted from the inventory closeout.
c. The inventory for the real estate development business are primarily land and construction
costs for future construction and contracts in progress of WLC subsidiary Walsin (Nanjing)
Development Co., Ltd.
d. Walsin (Nanjing) Development Co., Ltd. entered into an agreement with third parties for the
sale of real estate as of December 31, 2022 and 2021; the selling prices for the related
residential buildings and office buildings were RMB4,710 thousand and RMB2,400 thousand,
respectively. The sale of the real estate in the amounts of NT$19,786 thousand and NT$9,918
thousand were recognized as operating revenue for the years ended December 31, 2022 and
2021, respectively.
200
14. FINANCIAL ASSETS MEASURED AT FAIR VALUE THROUGH OTHER
COMPREHENSIVE INCOME
Domestic listed ordinary shares
HannStar Display Corp.
HannStar Board Corp.
TECO Electric & Machinery Co., Ltd.
Global PMX Co., Ltd.
K. S. Terminals Inc.
Domestic unlisted ordinary shares
Foreign unlisted ordinary shares
Current
Non-current
December 31
2022
2021
$ 3,340,899
2,017,812
6,348,587
-
10,179
564,148
60,607
$ 5,423,342
2,894,429
7,293,386
15,928
-
560,757
102,745
$ 12,342,232
$ 16,290,587
-
12,342,232
-
16,290,587
$ 12,342,232
$ 16,290,587
These investments in equity instruments are held for medium- to long-term strategic purposes.
Accordingly, the management selected to designate these investments in equity instruments as at
FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value
in profit or loss would not be consistent with the Group’s strategy of holding these investments
for long-term purposes. On December 31, 2022 and 2021, the unrealized valuation (losses) gains
resulting from these investments in equity instruments were NT$(4,067,542) thousand and
NT$2,594,208 thousand, respectively, recognized in other comprehensive income (loss).
On January 6, 2021, the Group issued 205,333 thousand shares in exchange for 171,104 thousand
shares of TECO Electric & Machinery Co., Ltd. WLC and TECO agreed to build a strategic
alliance to enhance competitiveness and cooperation in next generation smart grid, smart
manufacturing, and green energy industry. In addition, the Group also acquired the shares of
TECO Electric & Machinery Co., Ltd. from the open market. As of December 31, 2022 and 2021,
the Group held a total of 230,439 thousand shares of TECO Electric & Machinery Co., Ltd.
15. SUBSIDIARIES
a. Subsidiaries included in the consolidated financial statements
The consolidated entities as of December 31, 2022 and 2021 were as follows:
Percentage of Ownership (%)
December 31
Investor
Investee
Main Business
2022
Walsin Lihwa Corporation Walsin Lihwa Holdings Limited (WLHL)
Concord Industries Limited (CIL)
Ace Result Global Limited
Min Maw Precision Industry Corp. (Min
Maw)
Investment holding
Investment holding
Investment holding
Solar power systems management, design, and
installation
Walsin Info-Electric Corp. (Walsin
Mechanical and electrical, communications, and
Info-Electric)
power systems
Chin-Cherng Construction Co. (Chin-Cherng)
Investment in the construction of residential and sale
of commercial buildings, rental design and interior
decoration business
Joint Success Enterprises Limited
P.T. Walsin Lippo Industries (P.T. Walsin)
Investments
Manufacture and sale of cables and wires
100.00
100.00
100.00
100.00
99.51
99.22
49.05
70.00
2021
100.00
100.00
100.00
100.00
99.51
99.22
49.05
70.00
(Continued)
201
Financial Information
Percentage of Ownership (%)
December 31
Investor
Investee
Main Business
PT. Walsin Lippo Kabel
Waltuo Green Resources Corp.
Cables and wires
Waste disposal, resource recovery and cement
PT. Walsin Nickel Industrial Indonesia
Manufacture and sale of nickel pig iron
products
Walsin Precision Technology Sdn. Bhd.
Walsin Singapore Pte. Ltd. (former name: New
Hono Investment Pte. Ltd.)
Walsin America, LLC
Manufacture and sale of stainless steel
Investment holding
Investment holding
Walsin Lihwa Europe S.a r.l.
Investment holding
PT. Walsin Research Innovation Indonesia
Consulting and Management
Walsin Singapore Pte. Ltd. PT. Walsin Nickel Industrial Indonesia
Manufacture and sale of nickel pig iron
PT. Sunny Metal Industry
Manufacture and sale of nickel matte
WLHL
Walsin (China) Investment Co., Ltd.
Jiangyin Walsin Steel Cable Co., Ltd. (JHS)
Shanghai Walsin Lihwa Power Wire & Cable
Investment holding
Manufacture and sale of steel cables and wires
Manufacture and sale of cables and wires
Co., Ltd.
Dongguan Walsin Wire & Cable Co., Ltd.
Manufacture and sale of bare copper cables and
Walsin International Investments Limited
Borrego Solar System, Inc.
wires
Investments
Solar power system
Nanjing Taiwan Trade Mart Management Co.,
Business and assets management, consulting and
Ltd.
advertising services
Jiangyin Walsin Specialty Alloy Materials Co.,
Manufacture and sale of cold-rolled stainless steel
Ltd.
and flat-rolled products
CIL
Walsin Specialty Steel Corp.
Sale of specialty steel products and investment
2022
70.00
100.00
50.00
(Note 1)
100.00
100.00
(Note 1)
100.00
(Notes 3 and
4)
100.00
(Note 5)
99.00
(Note 6)
42.00
(Note 1)
50.10
(Note 7)
100.00
100.00
95.71
100.00
100.00
-
(Note 2)
100.00
18.37
100.00
Changshu Walsin Specialty Steel Co., Ltd.
Manufacture and sale of specialized steel tubes, rods
100.00
holding
Shanghai Baihe Walsin Lihwa Specialty Steel
Manufacture and sale of stainless steel
and wires
Co., Ltd.
Yantai Walsin Stainless Steel Co., Ltd.
Jiangyin Walsin Specialty Alloy Materials Co.,
Production and sale of new-type alloy materials
Manufacture and sale of cold-rolled stainless steel
Ltd.
and flat-rolled products
XiAn Walsin Metal Product Co., Ltd.
Production and sale of medium and heavy specialty
Chin-Cherng Construction
Joint Success Enterprises Limited
Co.
steel plates
Investments
Walsin (Nanjing) Development Co., Ltd.
Construction, rental and sale of buildings and
industrial factories
Nanjing Walsin Property Management Co.,
Property management, business management and
Ltd.
housing leasing
Min Maw Precision
PT. Walsin Research Innovation Indonesia
Consulting and management
Industry Corp. (Min
Maw)
Walsin America, LLC
Borrego Energy Holdings, LLC
Solar power system
Borrego Energy Holdings,
Borrego Energy, LLC
Solar power system
LLC
Walsin Lihwa Europe S.a
MEG S.A.
Investment holding
r.l.
MEG S.A.
Cogne Acciai Speciali S.p.A.
Manufacture and sale of stainless steel
-
(Note 8)
100.00
81.63
100.00
50.95
100.00
100.00
1.00
(Note 6)
72.55
(Note 2)
100.00
85.03
(Note 5)
82.32
2021
70.00
100.00
50.00
(Note 1)
100.00
100.00
(Note 1)
-
-
-
42.00
(Note 1)
-
100.00
100.00
95.71
100.00
100.00
73.49
100.00
18.37
100.00
100.00
100.00
(Note 8)
100.00
81.63
100.00
50.95
100.00
100.00
-
-
(Note 2)
-
-
-
(Concluded)
Note 1: In January 2020, the Group invested capital to establish PT. Walsin Nickel Industrial
Indonesia (“WNII”). Walsin Singapore Pte. Ltd. (“WLS”) formerly known as New
Hono Investment Pte. Ltd. held 42% equity of WNII. According to the joint venture
agreement signed by the Group and WLS in January 2020, the Group had the right
to purchase 100% of WLS’s shares on the terms agreed by all parties to acquire 42%
equity of WNII indirectly. On June 25, 2021, the board of directors of the Group
resolved to acquire 100% of WLS’s shares and the Group acquired 100% of WLS’s
shares at a price US$178,500 thousand on July 30, 2021. After the transaction, the
Group directly and indirectly acquired 92% of WNII’s shares. The Investment
Commission of the Ministry of Economic Affairs has approved the investment to
pay by the Group’s own foreign exchange. Therefore, the Group communicated with
Golden Harbour International Pte. Ltd. to exercise the early redemption and to pay
back the US-currency bonds. The Group will pay the purchase of WLS’s shares by
the redemption of the bonds. As of December 31, 2021, US$178,500 thousand has
been paid.
202
Note 2: On May 24, 2022, WLC’s board of directors resolved that the subsidiary, Borrego
Solar Systems, Inc. would split its business into its 100% subsidiaries New Leaf
Energy, Inc. (original name of the announcement: 2022 Solar Development, Inc.)
and Borrego Energy, LLC, and sold its subsidiary New Leaf Energy, Inc. The
transaction was completed on July 28, 2022 (United States local time July 27, 2022).
Note 3: On May 24, 2022, WLC’s board of directors resolved to establish Walsin America,
LLC. After the Group’s organizational restructuring, Walsin America, LLC acquired
72.55% shares of Borrego Energy Holdings, LLC’s shares. Borrego Energy
Holdings, LLC owns 100% of Borrego Energy Holdings, LLC’s shares.
Note 4: Due to the adjustment of the investment structure of the Group, it was transferred
from WLHL to WLC in December 2022.
Note 5: On May 31, 2022, WLC’s board of directors resolved to establish Walsin Lihwa
Europe S.a r.l. and Walsin Lihwa Europe S.a r.l. acquired 85.03% shares of
Luxembourg MEG S.A.
Note 6: The Group established PT. Walsin Research Innovation Indonesia on November 4,
2022.
Note 7: On September 23, 2022, the Group acquired 50.10% shares of PT. Sunny Metal
Industry from Ever Rising Limited and Berg Holding Limited at the price of
US$200,000 thousand. On November 4, 2022, WLC’s board of directors resolved to
transfer PT. Sunny Metal Industry to Walsin Singapore Pte. Ltd.
Note 8: Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd was dissolved on July 13,
2022.
b. The following entities were excluded from consolidation as of December 31, 2022 and 2021:
Percentage of Ownership
(%)
December 31
Investor
Investee
Main Business
2022
2021
Note
WLHL
Walcom Chemicals Industrial
Commerce
65.00
65.00
Note
Limited
Note: The investee has a capital of HK$500 thousand and total assets of HK$1 thousand. As
of December 31, 2022 and 2021, the investee had no sales, and its total assets were
less than 1% of the Group’s consolidated total assets.
The financial statements of certain subsidiaries included in the consolidated financial
statements, namely P.T. Walsin Lippo Industries, Walsin Precision Technology Sdn, Bhd. and
Cogne Acciai Speciali S.p.A. for the year ended December 31, 2022 and P.T. Walsin Lippo
Industries, Walsin Precision Technology Sdn, Bhd. and WLHL’s subsidiary Borrego Solar
Systems, Inc. for the year ended December 31, 2021 were not audited by the auditor of WLC
but by other auditors. As of December 31, 2022 and 2021, the combined total assets of those
subsidiaries were NT$27,113,218 thousand and NT$10,292,042 thousand, respectively; for
the years ended December 31, 2022 and 2021, the combined net operating revenues of these
subsidiaries were NT$3,409,851 thousand and NT$17,799,306 thousand, respectively.
203
Financial Information
16. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Investments in associates:
December 31
2022
2021
Carrying
Amount
Ownership
Percentage
(%)
Carrying
Amount
Ownership
Percentage
(%)
$ 20,953,105 22.21
$ 18,357,864
22.21
21.01
2,109,400
8,147,080 18.30
2,322,664
8,166,415
21.01
18.30
Name of Associate
Material associates
Winbond Electronics Corp.
Walton Advanced Engineering,
Inc.
Walsin Technology Corp.
Associates that are not
Individually material
Others
14,979,814
10,604,174
$ 46,189,399
$ 39,451,117
Refer to Table 8 “Information on Investees” and Table 9 “Information on Investments in
Mainland China” for the nature of activities, principal places of business and countries of
incorporation of the associates.
The Group is the single largest shareholder of the abovementioned material associates in which
the Group has an ownership percentage of less than 50%. Considering the relative size and wide
dispersion of the voting rights owned by other shareholders, the Group has no ability to direct the
relevant activities of the associates and therefore has no control over these associates.
Fair values (Level 1) of investments in associates with available published price quotation are
summarized as follows:
Name of Associate
Winbond Electronics Corp.
Walton Advanced Engineering, Inc.
Walsin Technology Corp.
December 31
2022
2021
$ 17,323,429
$ 1,244,282
$ 7,023,284
$ 30,050,846
$ 2,066,495
$ 14,846,688
All the associates were accounted for using the equity method.
The Group’s share of profit and other comprehensive income of associates for the years ended
December 31, 2022 and 2021 were based on the associates’ financial statements audited by
independent auditors for the same period.
204
a. Material associates
December 31, 2022
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Non-controlling interests
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
$ 68,537,523 $
115,627,470
(27,776,754)
(53,654,523)
102,733,716
(8,570,720)
8,080,399 $ 42,078,074
49,653,421
11,240,954
(19,230,081)
(5,110,938)
(18,917,380)
(3,970,323)
53,584,034
10,240,092
(9,303,110)
(200,109)
$ 94,162,996 $ 10,039,983 $ 44,280,924
Proportion of the Group’s
ownership
22.21%
21.01%
18.30%
Equity attributable to the Group
Other adjustments
$ 20,913,601 $
2,109,400 $
39,504
-
8,103,409
43,671
Carrying amount
$ 20,953,105 $
2,109,400 $
8,147,080
Operating revenue
$ 94,529,790 $
9,506,348 $ 35,297,163
Net profit for the year
Other comprehensive income (loss)
$ 14,986,552 $
156,098 $
2,717,903
(1,186,315)
2,295,275
218,387
Total comprehensive income for the
year
$ 17,704,455
$
(1,030,217)
$
2,513,662
December 31, 2021
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Non-controlling interests
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
$ 72,506,733
80,233,551
(28,644,931)
(34,061,841)
90,033,512
$ 8,361,878
13,155,507
$ 41,187,886
52,910,618
(5,019,961) (21,557,433)
(5,259,172) (19,062,857)
53,478,214
(9,089,372)
(297,416)
11,238,252
(7,589,399)
$ 82,444,113
$ 10,940,836
$ 44,388,842
(Continued)
205
Financial Information
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
Proportion of the Group’s
ownership
22.21%
21.01%
18.30%
Equity attributable to the Group
Other adjustments
$ 18,310,837
47,027
$ 2,298,670
23,994
$ 8,123,158
43,257
Carrying amount
$ 18,357,864
$ 2,322,664
$ 8,166,415
Operating revenue
$ 99,569,924
$ 8,118,256
$ 42,108,708
Net profit for the year
Other comprehensive income (loss)
$ 15,000,122
4,186,931
$
118,732
(892,554)
$ 8,961,076
1,157,156
Total comprehensive income for the
year
$ 19,187,053
$
(773,822)
$ 10,118,232
(Concluded)
b. Associates that are not individually material
For the Year Ended December 31
2022
2021
The Group’s share of:
Net profit from continuing operations
Other comprehensive (loss) income
$
389,057
(893,111)
$
327,147
1,839,778
Total comprehensive income for the year
$
(504,054)
$ 2,166,925
The Group’s share of profit and other comprehensive income of the associates for the years
ended December 31, 2022 and 2021 was based on the associates’ financial statements audited
by independent auditors for the same period. PT. Westrong Metal Industry and PT. CNGR
Walsin New Energy and Technology Indonesia for the year ended 2022 and Tsai Yi
Corporation (formerly known as Walsin Color Co., Ltd.) for the year ended 2021 were not
audited by the auditor of WLC but by other auditors. As of December 31, 2022 and 2021, the
carrying amounts of investments accounted for using the equity method were NT$4,869,105
thousand and NT$1,053,790 thousand, respectively; for the years ended December 31, 2022
and 2021, the amounts of the share of loss were NT$313 thousand and NT$5,936 thousand,
respectively.
17. PROPERTY, PLANT AND EQUIPMENT
Assets used by the Group
$ 65,656,466
$ 41,474,488
December 31
2022
2021
206
Land
Buildings and
Improvements
Machinery and
Equipment
Other
Equipment
Construction in
Progress
Total
$ 3,611,025
80,867
(50,357 )
$ 18,671,274
38,133
(12,016 )
$ 34,969,055
456,243
(294,063 )
$ 7,783,638
558,271
(208,508 )
$ 6,305,375
12,079,434
$ 71,340,367
13,212,948
(565,345 )
(401 )
27,303
107,209
2,117,040
316,857
11,468,941
2,574,412
126,563
429,784
8,905,089
(3,428,262 )
22,644,936
-
-
-
87,958
1,291,378
-
-
(100,679 )
-
-
-
(12,721 )
1,291,378
623
354,562
1,254,274
17,936
1,404
1,628,799
Cost
Balance at January 1, 2022
Additions
Disposals
Acquisition through
business combination
Reclassified
Transfers from (to)
investment properties
Transfers from inventories
Effects of foreign currency
exchange differences
Balance at December 31,
2022
$ 3,776,670
$ 22,865,186
$ 50,428,862
$ 8,607,005
$ 23,862,639
$ 109,540,362
Accumulated depreciation
and impairment
$
Balance at January 1, 2022
Depreciation expenses
Disposals
Reclassified
Impairment losses reversed
Transfers from (to)
investment properties
Acquisition through
business combination
Effects of foreign currency
exchange differences
Balance at December 31,
8,067
-
-
-
-
-
-
-
$ 7,102,766
879,711
(9,863 )
$ 17,527,744
2,423,403
(273,116 )
(344,870 )
(111 )
$
$ 5,227,302
589,329
(196,262 )
187,894
(44 )
156,976
-
5,223
-
(17,082 )
1,566,907
8,513,323
88,355
325,815
70,907
51,522
-
-
-
-
-
-
$ 29,865,879
3,892,443
(479,241 )
-
(155 )
(11,859 )
-
10,151,137
-
465,692
2022
$
8,067
$ 9,790,075
$ 28,172,188
$ 5,913,566
$
-
$ 43,883,896
Carrying amount at
December 31, 2022
Cost
Balance at January 1, 2021
Additions
Disposals
Reclassified
Transfers from inventories
Effects of foreign currency
exchange differences
Balance at December 31,
$ 3,768,603
$ 13,075,111
$ 22,256,674
$ 2,693,439
$ 23,862,639
$ 65,656,466
$ 3,483,995
78,421
(1,164 )
49,773
-
$ 16,545,654
90,205
(41,482 )
1,463,134
682,342
$ 25,806,284
1,600,733
(323,350 )
8,021,006
-
$ 7,133,130
648,730
(178,162 )
209,169
-
$ 8,576,988
7,592,258
(60 )
(9,743,082 )
$ 61,546,051
10,010,347
(544,218 )
-
682,342
-
-
(68,579 )
(135,618 )
(29,229 )
(120,729 )
(354,155 )
2021
$ 3,611,025
$ 18,671,274
$ 34,969,055
$ 7,783,638
$ 6,305,375
$ 71,340,367
Accumulated depreciation
and impairment
Balance at January 1, 2021
Depreciation expenses
Disposals
Reclassified
Impairment losses
recognized (reversed)
Effects of foreign currency
exchange differences
Balance at December 31,
$
8,067
-
-
-
-
-
$ 6,265,972
760,482
(37,511 )
55,108
$ 15,948,131
1,288,451
(305,754 )
4,583
$ 5,029,660
450,632
(171,011 )
(59,691 )
$
71,468
630,232
(7,899 )
(12,753 )
(37,899 )
(14,389 )
-
-
-
-
-
-
$ 27,251,830
2,499,565
(514,276 )
-
693,801
(65,041 )
2021
$
8,067
$ 7,102,766
$ 17,527,744
$ 5,227,302
$
-
$ 29,865,879
Carrying amount at
December 31, 2021
$ 3,602,958
$ 11,568,508
$ 17,441,311
$ 2,556,336
$ 6,305,375
$ 41,474,488
207
Financial Information
The machinery equipment of property, plant, and equipment of PT. Walsin Nickel Industrial
Indonesia which is the subsidiary of the Group is depreciated on an accelerated basis over their
estimated useful lives for 16 years.
Apart from stated above, the above items of property, plant and equipment are depreciated on a
straight-line basis over their estimated useful lives as follows:
Buildings and improvements
Machinery and equipment
Other equipment
3-50 years
3-20 years
3-15 years
The Group’s main buildings, office buildings and electrical and mechanical power equipment are
depreciated over their estimated useful lives of 20-50 years and 18-20 years, respectively.
The Group owns parcels of land which were registered in the name of certain individuals because
of certain regulatory restrictions. To secure its ownership of such parcels of land, WLC keeps in
its possession the land titles with the annotation of the land being pledged to WLC. As of
December 31, 2022 and 2021, the recorded total carrying amount of such parcels of land
amounted to NT$491,917 thousand and NT$542,274 thousand, respectively.
After appropriate evaluation, the Group recognized a reversal of impairment loss on property,
plant and equipment of NT$155 thousand and NT$(693,801) thousand for the years ended
December 31, 2022 and 2021, respectively.
18. LEASE ARRANGEMENTS
a. Right-of-use assets
Carrying amounts
Land
Buildings
Machinery equipment
Office equipment
Transportation equipment
Additions to right-of-use assets
Acquisition through business combination
Disposals
208
December 31
2022
2021
$ 3,443,726
506,666
263,942
61,617
33,404
$ 1,643,343
124,948
-
-
35,219
$ 4,309,355
$ 1,803,510
For the Year Ended December 31
2022
2021
$ 1,751,920
933,182
$
(48,913)
$
$
$
$
291,861
-
(7,762)
(Continued)
Depreciation charge for right-of-use assets
Land
Buildings
Machinery equipment
Office equipment
Transportation equipment
b. Lease liabilities
Carrying amounts
Current
Non-current
For the Year Ended December 31
2022
2021
$
$
115,110
61,748
3,357
762
18,211
57,774
57,569
-
-
16,964
$
199,188
$
132,307
(Concluded)
December 31
2022
2021
$
245,223
$ 2,309,732
$
$
71,470
243,676
Range of discount rate for lease liabilities was as follows:
Land
Buildings
Machinery equipment
Office equipment
Transportation equipment
c. Other lease information
December 31
2022
2021
0.83%-6.123% 0.83%-6.123%
1.198%-8%
3.00%-3.90%
3.00%-3.90%
1.964%-5.75% 3.038%-5.75%
1.409%-8%
-
-
For the Year Ended December 31
2022
2021
Expenses relating to short-term leases
Expenses relating to low-value asset leases
Expenses relating to variable lease payments not
included in the measurement of lease liabilities
Total cash outflow for leases
$ 52,133
936
$
$ 45,453
722
$
$
9,052
$ (182,746)
$
8,688
$ (144,657)
209
Financial Information
19. INVESTMENT PROPERTIES
Completed investment properties
$ 16,123,806
$ 10,431,063
December 31
2022
2021
Cost
Balance at January 1, 2022
Additions
Reclassification from property, plant and equipment
Others
Transferred from inventories
Effects of foreign currency exchange differences
Balance at December 31, 2022
Balance at January 1, 2021
Additions
Transferred from inventories
Effects of foreign currency exchange differences
Balance at December 31, 2021
Accumulated depreciation and impairment
Balance at January 1, 2022
Depreciation expenses
Reclassification from property, plant and equipment
Others
Effects of foreign currency exchange differences
Balance at December 31, 2022
Balance at January 1, 2021
Depreciation expenses
Effects of foreign currency exchange differences
Balance at December 31, 2021
Completed
Investment
Properties
$ 12,991,354
182
12,721
72,339
5,968,587
33,660
$ 19,078,843
$ 12,271,365
2,362
725,571
(7,944)
$ 12,991,354
$ 2,560,291
294,016
11,859
76,950
11,921
$ 2,955,037
$ 2,396,439
167,443
(3,591)
$ 2,560,291
The completed investment properties are depreciated on a straight-line method over their
estimated useful lives of 20 to 50 years.
The investment properties of the Group increased because the Group changed the purpose of use
of the completed commercial building of Walsin (Nanjing) Development Co., Ltd. and transferred
it to investment property. The main investment properties of the Group are Walsin Xin Yi
Building and the completed investment properties of Walsin (Nanjing) Development Co., Ltd.
210
The building’s valuation was commissioned by independent appraisal agencies (third parties). As
of December 31, 2022 and 2021, the fair values of the investment properties were NT$45,032,010
thousand and NT$35,173,881 thousand, respectively.
20. GOODWILL
Cost
For the Year Ended December 31
2022
2021
Opening balance
Acquisition through business combination (Note 31)
Disposal of subsidiary (Note 32)
Effects of foreign currency exchange differences
$ 152,771
85,585
(157,359)
2,396
$ 153,589
-
-
(818)
Balance at December 31, 2022
$ 83,393
$ 152,771
Accumulated impairment
Opening balance
Balance at December 31, 2022
$
$
-
-
$
$
-
-
Carrying amount at December 31, 2022
$ 83,393
$ 152,771
The Group acquired PT. Sunny Metal Industry on September 23, 2022 and recognized the
goodwill of NT$85,585 thousand. As of the issuance date of the financial statements, the Group
has not obtained the formal valuation reports. The amount may be subject for adjustments after
obtaining the official results. Refer to Note 31.
21. OTHER ASSETS
Prepayment for purchases
Prepaid expense
Prepaid sales tax
Prepayment for investments
Others
Current
Non-current
December 31
2022
2021
$ 3,694,957
999,406
3,142,781
2,204,073
756,197
$ 2,502,327
1,241,926
1,789,340
-
402,982
$ 10,797,414
$ 5,936,575
$ 7,880,887
2,916,527
$ 5,535,226
401,349
$ 10,797,414
$ 5,936,575
211
Financial Information
22. BORROWINGS
Short-term borrowings
Current portion of long-term borrowings
Long-term borrowings
Long-term notes and bills payable
December 31
2022
2021
$ 22,496,307
$ 1,109,049
$ 40,820,860
$ 1,497,914
$ 7,108,766
$ 10,719,081
$ 24,785,952
-
$
a. Short-term borrowings as of December 31, 2022 and 2021 were as follows:
December 31
2022
2021
Interest Rate
%
Amount
Interest Rate
%
Amount
Procurement loans
Bank lines of credit
Discounted notes
receivable
Other loans
-
$
0.95%-6.42% 15,566,558 0.69%-3.50%
1.25%-2.20%
1,554,013
- 0.64%-0.70% $ 2,111,447
4,997,319
-
-
3.384%-5.21%
5,375,736
-
-
$ 22,496,307
$ 7,108,766
Notes receivable financing is based on notes receivable of the Group which are used to apply
for a discounted loan. Refer to Note 35 for the amount of discounted notes receivable and
relevant terms with recourse rights.
Refer to Notes 6 and 37 for collaterals pledged for short-term borrowings as of December 31,
2022 and 2021.
b. Long-term borrowings as of December 31, 2022 and 2021 were as follows:
December 31
2022
Significant Covenant
Amount
2021
Amount
Long-term secured loan
Cathay United Bank
From December 15, 2011 to September 27,
$
233,439
$
287,677
2027; after the grace period, repayments are
due monthly
From December 25, 2013 to October 11, 2023;
after the grace period, repayments are due in
stages
From January 12, 2019 to December 18, 2030;
repayments are due according to contracts
Taipei Fubon Commercial
Bank
Other long-term secured
loan
Long-term credit loan
Bank of Taiwan
Principal repayment at maturity, from March 4,
2019 to March 4, 2022
Taipei Fubon Commercial
Principal repayment at maturity, from June 3,
Bank
2019 to June 3, 2022
Chinatrust Commercial
Principal repayment at maturity, from
Bank
September 3, 2019 to September 3, 2022
67,375
77,342
78,365
-
379,179
365,019
-
-
-
3,000,000
1,000,000
1,500,000
(Continued)
212
December 31
2022
Significant Covenant
Amount
2021
Amount
Taiwan Cooperative Bank
Principal repayment at maturity, from March 4,
2019 to March 4, 2022
Cathay United Bank
Principal repayment at maturity, from March 4,
KGI Bank
Principal repayment at maturity, from June 3,
2019 to March 4, 2022
2019 to June 3, 2022
Standard Chartered Bank
Principal repayment at maturity, from
September 27, 2021 to December 31, 2023
Standard Chartered Bank
Principal repayment at maturity, from
Chang Hwa Commercial
Bank
The Export-Import Bank
of the Republic of China
Bank of Taiwan
Taiwan Cooperative Bank
September 27, 2021 to December 31, 2023
Principal repayment at maturity, from June 3,
2019 to June 3, 2022
Loan from December 4, 2020 to December 4,
2027; principal to be repaid evenly in seven
phases; 1st repayment is due 48 months after
the drawdown date, after which repayments
are due once every six months
From September 22, 2020 to October 4, 2027;
principal to be repaid in two phases: From
the 5th year, repayments are due once every
six months; at rates of 20% and 80%,
respectively
From June 28, 2021 to June 28, 2026; principal
to be repaid in two phases: 1st repayment
due 48 months after the drawdown date, 2nd
repayment due maturity date
-
-
-
-
-
-
1,000,000
1,500,000
1,500,000
5,352,144
2,093,000
1,000,000
1,137,770
1,137,770
9,000,000
3,000,000
2,000,000
2,000,000
DBS Bank
Principal repayment at maturity, from March
7,552,100
9,057,100
Hua Nan Commercial
From March 29, 2021 to March 29, 2026;
2,000,000
2,000,000
30, 2020 to April 15, 2025
Bank
principal to be repaid in two phases: From
the 5th year, repayments are due once every
six months
Chinatrust Commercial
Principal repayment at maturity, from October
1,500,000
Bank
4, 2022 to October 3, 2025
Taiwan Cooperative Bank
From October 4, 2022 to October 4, 2027;
principal to be repaid in two phases: 1st
repayment due 48 months after the
drawdown date, 2nd repayment due maturity
date
3,000,000
KGI Bank
Principal repayment at maturity, from October
1,500,000
24, 2022 to April 24, 2027
Standard Chartered Bank
Principal repayment at maturity, from
1,555,400
Hua Nan Commercial
Bank
November 16, 2022 to December 31, 2024
Principal repayment at maturity, from March 8,
2,500,000
2022 to March 28, 2027
Agricultural Bank of
Principal repayment at maturity, from October
1,000,000
Taiwan
31, 2022 to October 31, 2025
Chang Hwa Commercial
Principal repayment at maturity, from March 8,
3,000,000
Bank
Intesa Sanpaolo S.p.A
2022 to October 4, 2027
Principal repayment at maturity, from
December 8, 2019 to June 4, 2025
Other long-term credit
loans
From April 30, 2019 to September 4, 2029;
repayments are due according to contracts
1,007,776
4,797,684
-
-
-
-
-
-
-
-
-
Less: Current portion of
long-term borrowings
41,550,730
41,929,909
35,139,984
35,505,033
(1,109,049) (10,719,081)
$ 40,820,860
$ 24,785,952
(Concluded)
213
Financial Information
1) Under the loan agreements with DBS Bank, WLC should maintain certain financial ratios
during the loan term, which are based on the annual and semi-annual consolidated
financial statements audited by the independent auditors. The financial ratios are as
follows:
a) Ratio of current assets to current liabilities not less than 100%;
b) Ratio of total liabilities less cash and cash equivalents to tangible net worth not more
than 120%;
c) Ratio of Interest Coverage Ratio which included net income before interest expenses,
taxation, depreciation and amortization to interest expenses not less than 150%; and
d) Tangible net worth (net worth less intangible assets) not less than NT$55,000,000
thousand.
2) As of December 31, 2022 and 2021, the effective interest rate ranges of the credit
borrowings were 0.10%-5.56% and 0.85%-1.20% per annum, respectively. As of
December 31, 2022 and 2021, the effective interest rate ranges of the secured borrowings
were 0.55%-4.70% and 1.66%-2.07% per annum, respectively.
3) As of December 31, 2022 and 2021, the Group’s current portion of long-term borrowings
under the loan agreements were NT$1,109,049 thousand and NT$10,719,081 thousand,
respectively. The Group’s consolidated financial statements for the years ended December
31, 2022 and 2021 showed that the Group was in compliance with the aforementioned
financial ratio requirements.
4) Refer to Note 37 for collaterals pledged on bank borrowings as of December 31, 2022 and
2021.
c. Long-term notes and bills payables as of December 31, 2022 was as follows:
December 31, 2022
Acceptance Agency
Type
Interest Rate
Amount
China Bills and International Bills
Less: Discount on short-term bills
payable
23. BONDS PAYABLE
Unsecured
1.395-1.50
$ 1,500,000
(2,086)
$ 1,497,914
December 31
2022
2021
Domestic unsecured bonds in 2021
Overseas unsecured bonds
Less: Current portion of long-term borrowings
$ 7,500,000
341,115
(98,160)
$ 7,500,000
-
-
$ 7,742,955
$ 7,500,000
214
On October 8, 2021, the Company issued the first unsecured bonds for NT$7.5 billion, each with
a face value of NT$10 million. The issuance period is 5 years, and the maturity date is on October
8, 2026. The annual rate is 0.7%. Since the issuance date, the interest will be paid once a year, and
the principal will be repaid once due.
The overseas unsecured bonds were acquired through business combination and were issued on
June 24, 2019 in the amount of EUR15,000 thousand, each with a face value of EUR100
thousand. The insurance period is 7 years, and the maturity date is on June 24, 2026. The annual
percentage rate is 3.5%. Since the insurance date, the interest will be paid in half a year, and the
principal will be repaid in 10 installments from the second year.
24. RETIREMENT BENEFIT PLANS
a. Defined contribution plan
WLC and its subsidiaries in the ROC adopted a pension plan under the Labor Pension Act
(LPA), which is a state-managed defined contribution plan. Under the LPA, WLC and its
subsidiaries in the ROC make monthly contributions to employees’ individual pension
accounts at 6% of monthly salaries and wages.
The Group recognized expenses of NT$109,019 thousand and NT$95,977 thousand for the
years ended December 31, 2022 and 2021, respectively, which is based on the specified ratio
in defined contributions plan.
b. Defined benefit plans
The defined benefit plans adopted by WLC in accordance with the Labor Standards Act are
operated by the government of the ROC. Pension benefits are calculated on the basis of the
length of service and average monthly salaries of the 6 months before retirement. WLC
contributes amounts equal to 2% of total monthly salaries and wages to a pension fund
administered by the pension fund monitoring committee. Pension contributions are deposited
in the Bank of Taiwan in the committee’s name. Before the end of each year, the Group
assesses the balance in the pension fund. If the amount of the balance in the pension fund is
inadequate to pay retirement benefits for employees who conform to retirement requirements
in the next year, the Group is required to fund the difference in one appropriation that should
be made before the end of March of the next year. The pension fund is managed by the
Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Group has no right to influence
the investment policy and strategy.
Cogne Acciai Speciali S.p.A. of the Group also adopts defined benefit plan.
The amounts included in the consolidated balance sheets in respect of the Group’s defined
benefit plans are as follows:
December 31
2022
2021
Present value of defined benefit obligation
Fair value of plan assets
$ 1,332,167
(1,060,075)
$ 1,487,554
(1,037,916)
Net defined benefit liabilities
$
272,092
$
449,638
215
Financial Information
Balance at January 1, 2020
Service cost
Current service cost
Net interest expense (income)
Recognized in profit or loss
Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial loss - changes in
demographic assumptions
Actuarial gain - changes in
financial assumptions
Actuarial loss - experience
adjustments
Present Value of
Defined Benefit
Obligation
Fair Value of
Plan Assets
Net Defined
Benefit
Liability (Asset)
$ 1,371,774
$ (1,083,800)
$
287,974
10,917
6,801
17,718
-
(5,366)
(5,366)
10,917
1,435
12,352
-
(13,584)
(13,584)
38,641
(15,729)
151,322
-
-
-
38,641
(15,729)
151,322
160,650
(11,338)
-
449,638
10,455
3,279
13,734
Recognized in other comprehensive
loss
Contributions from the employer
Benefits paid
Balance at December 31, 2021
174,234
-
(76,172)
1,487,554
(13,584)
(11,338)
76,172
(1,037,916)
Service cost
Current service cost
Net interest expense (income)
Recognized in profit or loss
Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial gain - changes in
financial assumptions
Actuarial gain - experience
adjustments
Recognized in other comprehensive
loss
Contributions from the employer
Benefits paid
Acquisition of subsidiaries through
business combination
Exchange difference
10,455
9,721
20,176
-
(6,442)
(6,442)
-
(82,973)
(82,973)
(63,850)
(113,715)
(177,565)
-
(119,731)
118,977
2,756
-
-
(82,973)
(52,475)
119,731
-
-
(63,850)
(113,715)
(260,538)
(52,475)
-
118,977
2,756
Balance at December 31, 2022
$ 1,332,167
$ (1,060,345)
$
272,092
216
An analysis by function of the amounts recognized in profit or loss in respect of the defined
benefit plans are as follows:
Operating costs
Selling and marketing expenses
General and administrative expenses
Research and development expenses
For the Year Ended December 31
2022
2021
$ 6,982
914
5,638
200
$ 6,240
945
4,918
249
$ 13,734
$ 12,352
Through the defined benefit plans under the Labor Standards Act, the Group is exposed to the
following risks:
1) Investment risk: The plan assets are invested in domestic and foreign equity and debt
securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau
or under the mandated management. However, in accordance with relevant regulations,
the return generated by plan assets shall not be below the interest rate for a 2-year time
deposit with local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present
value of the defined benefit obligation; however, this will be partially offset by an increase
in the return on the plans’ debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated using the
future salaries of plan participants. As such, an increase in the salaries of the plan
participants will increase the present value of the defined benefit obligation.
The actuarial valuations of the present value of the defined benefit obligation were carried out
by qualified actuaries. The significant assumptions used for the purposes of the actuarial
valuations were as follows:
Discount rates
Expected rates of salary increase
December 31
2022
1.25%-3.00%
2.25%-2.80%
2021
0.625%
2.25%
If possible reasonable change in each of the significant actuarial assumptions occur and all
other assumptions remain constant, the present value of the defined benefit obligation will
increase (decrease) as follows:
Discount rates
0.5% increase
0.5% decrease
Expected rates of salary increase
0.5% increase
0.5% decrease
December 31
2022
2021
$ (47,681)
$ 50,683
$ 49,149
$ (46,718)
$ (61,945)
$ 66,092
$ 63,726
$ (60,375)
217
Financial Information
The above sensitivity analysis may not be representative of the actual changes in the present
value of the defined benefit obligation as it is unlikely that the changes in assumptions will
occur in isolation of one another as some of the assumptions may be correlated.
25. EQUITY
Share capital
Ordinary shares
Capital surplus
Retained earnings
Others
Non-controlling interests
a. Share capital
Ordinary shares
December 31
2022
2021
$ 37,313,329
24,672,454
62,038,398
(443,305)
6,240,336
$ 34,313,329
18,440,875
47,787,207
5,342,113
2,062,744
$ 129,821,212
$ 107,946,268
December 31
2022
2021
Number of authorized shares (in thousands)
Amount of authorized shares
Number of issued and fully paid shares (in thousands)
Amount of issued shares
6,500,000
$ 65,000,000
3,731,333
$ 37,313,329
6,500,000
$ 65,000,000
3,431,333
$ 34,313,329
As of January 1, 2021, the balances of WLC’s capital account were NT$32,260,002 thousand,
which consisted of 3,226,000 thousand shares at par value of NT$10.
The Group issued 205,333 thousand shares in exchange shares of TECO Electric &
Machinery Co., Ltd. in January 2021. On June 6, 2022, WLC’s board of directors resolved to
issue 300,000 thousand ordinary shares at a price of NT$33 per share with August 10, 2022 as
the base date for capital increase. On July 21, 2022 WLC chairman of the board adjusted the
new share issuing price from NT$33 to NT$30, which authorized by the board. As of
December 31, 2022, the paid-in capital was NT$37,313,329 thousand, divided into 3,731,333
thousand ordinary shares at par value of NT$10.
As of December 31, 2022, 2 thousand GDRs of WLC were traded on the Luxembourg Stock
Exchange. The number of ordinary shares represented by the GDRs was 22 thousand shares
(one GDR represents 10 ordinary shares).
218
b. Capital surplus
May be used to offset a deficit, distributed as cash
dividend or transferred to share capital (Note)
Issuance of ordinary shares
The difference between the consideration received or
paid and the carrying amount of the subsidiaries’ net
assets during actual disposal or acquisition
Share of changes in capital surplus of associates
Treasury share transactions
Gain on disposal of property, plant and equipment
Others
December 31
2022
2021
$ 18,864,452
$ 12,639,452
2,130
441,175
2,254,074
2,074,231
1,036,392
3,124
440,288
2,254,074
2,074,231
1,029,706
$ 24,672,454
$ 18,440,875
Note: The premium from shares issued in excess of par (share premium from issuance of
ordinary shares, conversion of bonds and treasury share transactions) and donations
may be used to offset a deficit; in addition, when the Group has no deficit, such
capital surplus may be distributed as cash dividends or transferred to share capital
(limited to a certain percentage of the Group’s capital surplus and to once a year).
c. Retained earnings and dividend policy
The shareholders of WLC have held their regular meeting on May 13, 2022, and in that
meeting, have resolved the amendments to WLC’s Articles of Incorporation (the “Articles”).
Under the dividends policy as set forth in the amended Articles, where WLC made a profit in
a fiscal year, the profit shall be first utilized for paying taxes, offsetting losses of previous
years, setting aside as legal reserve 10% of the remaining profit this requirement is not
applicable when the legal reserve has reached the total capital, and then any remaining profit
together with prior unappropriated earnings shall be appropriated for special reserve or
appropriate reversal of special reserve in accordance with the laws and regulations, and then
the balance shall be used by WLC’s board of directors as the basis for proposing a distribution
plan, which should be resolved in the shareholders’ meeting for the distribution of dividends
to shareholders. If appropriated earnings are distributed in cash, the cash distribution shall be
resolved by WLC’s board of directors and reported in the shareholders’ meeting. Other than
the aforementioned regulations, the distribution shall be after deducting the share of profit of
associates accounted for using the equity method and adding cash dividends of associates
accounted for using the equity method. WLC shall reserve no lesser than 40% of the balance
amount as shareholders’ profit after offsetting its loss and tax payments in the previous year,
capital reserve, and special reserve adjusted by the accumulated net deduction of other equity.
The profits shall be distributed in cash or in form of shares; cash dividends shall not be lesser
than 70% of the total dividends.
Before the amendments, where WLC made a profit in a fiscal year, the profit shall be first
utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve 10%
of the remaining profit (this requirement is not applicable when the legal reserve has reached
the total capital) and then any remaining profit together with prior unappropriated earnings
shall be appropriated for setting aside or reversing a special reserve in accordance with the
laws and regulations, and then shall be used by WLC’s board of directors as the basis for
219
Financial Information
proposing a distribution plan, which should be resolved in the shareholders’ meeting for the
distribution of dividends to shareholders. Other than the aforementioned regulations, WLC
shall reserve no lesser than 40% of the balance amount as shareholders’ profit after offsetting
its loss and tax payments in the previous year, capital reserve and special reserve. The profits
shall be distributed in cash or in form of shares; cash dividends shall not be lesser than 70% of
the total dividends.
Appropriation of earnings to the legal reserve shall be made until the legal reserve equals
WLC’s paid-in capital. The legal reserve may be used to offset any deficits. If WLC has no
deficit and the legal reserve has exceeded 25% of WLC’s paid-in capital, the excess may be
transferred to capital or distributed in cash.
Items referred to under Rule No. 1010012865, Rule No. 1010047490 and Rule No.
1030006415 issued by the FSC and in the directive titled “Questions and Answers for Special
Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed
from a special reserve by WLC.
Refer to Note 25 for the policies on the distribution of employees’ compensation and
remuneration of directors and supervisors.
The appropriation of earnings for 2021 and 2020, which were approved in the shareholders’
meeting on May 13, 2022 and July 15, 2021, respectively, were as follows:
Appropriation of Earnings
Dividends Per Share (NT$)
2021
2020
2021
2020
Legal reserve
Special reserve
Cash dividends
$ 1,454,522
-
5,490,133
$
681,368
(398,160)
$
3,088,200
-
-
1.6
$
-
-
0.9
$ 6,944,655
$ 3,371,408
The appropriation of earnings for 2022, which were resolved by WLC’s board of directors on
February 24, 2023, were as follows:
Legal reserve
Cash dividends
d. Special reserve
Appropriation
of Earnings
Dividends Per
Share (NT$)
$ 1,974,132
6,716,399
$
-
1.8
$ 8,690,531
December 31
2022
2021
Special reserve
$ 2,712,250
$ 2,712,250
220
Information regarding above special reserve changes as follows:
Balance at January 1
Reversals
For the Year Ended December 31
2022
2021
$ 2,712,250
-
$ 3,110,410
(398,160)
Balance at December 31
$ 2,712,250
$ 2,712,250
e. Other equity items
1) Exchange differences on the translation of the financial statements of foreign operations
For the Year Ended December 31
2022
2021
Balance at January 1
Share from subsidiaries and associates accounted
$ (6,100,687)
$ (5,905,135)
for using the equity method
1,843,913
(195,552)
Balance at December 31
$ (4,256,774)
$ (6,100,687)
Exchange differences relating to the translation of the results and net assets of the Group’s
foreign operations from their functional currencies to the Group’s presentation currency
(the New Taiwan dollar) were recognized directly in other comprehensive income and
accumulated in the exchange differences on the translation of the financial statements of
foreign operations. Exchange differences previously accumulated in the exchange
differences on the translation of the financial statements of foreign operations were
reclassified to profit or loss when disposing foreign operation.
2) Unrealized valuation gain (loss) on financial assets at FVOCI
For the Year Ended December 31
2022
2021
Balance at January 1
Unrealized (loss) gain - equity instruments
Share from associates accounted for using the
equity method
Cumulative unrealized loss of equity instruments
transferred to retained earnings due to disposal
$ 11,534,267
(4,067,542)
$ 6,092,775
2,611,742
(696,891)
2,906,910
(75,957)
(77,160)
Balance at December 31
$ 6,693,877
$ 11,534,267
221
Financial Information
3) Loss on hedging instruments
Cash flow hedges
Balance at January 1
Loss on hedging instruments
Balance at December 31
4) Other equity - others
Balance at January 1
Originally recognized equity items arising from the
acquisition of subsidiary equity instrument put
options
Other comprehensive loss from associates
accounted for using the equity method
For the Year Ended December 31
2022
2021
$
-
(105,801)
$
$ (105,801)
$
-
-
-
For the Year Ended December 31
2022
2021
$
(91,467)
$
(2,683,140)
-
-
-
(91,467)
Balance at December 31
$ (2,774,607)
$
(91,467)
26. OPERATING REVENUE
Sales revenue
Sales of real estate
Other revenue
For the Year Ended December 31
2022
2021
$ 175,754,340
19,786
4,626,593
$ 152,001,410
9,918
4,653,438
$ 180,400,719
$ 156,664,766
27. NET PROFIT FROM CONTINUING OPERATIONS
Non-operating Income and Expense - Gain (Loss) on Disposal of Investment
For the Year Ended December 31
2022
2021
(Loss) gain on disposal of investments - commodity futures $
Gain on disposal of investments - foreign exchange forward
(646,558)
$
513,703
contracts
(Loss) gain on disposal of investment - exchange rate swap
contracts
152,471
167,227
(169,573)
14,301
(Continued)
222
For the Year Ended December 31
2022
2021
Loss on disposal of investment - options
Gain on disposals of investments - subsidiaries
(25,673)
7,899,376
(16,024)
-
$ 7,210,043
$
679,207
(Concluded)
Non-operating Income and Expense - Impairment Losses (Recognized) Reversed
Impairment loss reversed (recognized) on property, plant
and equipments
Others
For the Year Ended December 31
2022
2021
$
155
(242)
$ (693,801)
(91)
$
(87)
$ (693,892)
Employee Benefits Expense, Depreciation and Amortization
For the Year Ended December 31, 2022
Operating
Costs
Operating
Expenses
Non-operating
Expenses and
Losses
Total
Short-term employment
benefits
Post-employment benefits $
$
Other employee benefits
$ 4,430,500
202,994
602,524
$ 2,906,207
103,448
$
789,918
$
$
$
$
-
-
-
$ 7,336,707
306,442
$
$ 1,392,442
Depreciation
Property, plant and
equipments
Right-of-use assets
Investment properties
$ 3,458,410
44,479
291,837
$
$
431,174
154,709
2,179
2,859
-
-
$ 3,892,443
199,188
294,016
$ 3,794,726
$
588,062
$
2,859
$ 4,385,647
Amortization
$
23,497
$
42,158
$
-
$
65,655
For the Year Ended December 31, 2021
Operating
Costs
Operating
Expenses
Non-operating
Expenses and
Losses
Total
Short-term employment
benefits
Post-employment benefits $
$
Other employee benefits
$ 3,540,027
190,141
439,493
$ 2,529,250
115,367
$
301,869
$
$
$
$
-
-
-
$ 6,069,277
305,508
$
741,362
$
(Continued)
223
Financial Information
For the Year Ended December 31, 2021
Operating
Costs
Operating
Expenses
Non-operating
Expenses and
Losses
Total
Depreciation
Property, plant and
equipments
Right-of-use assets
Investment properties
$ 1,918,969
32,101
165,918
$
$
577,770
100,206
1,525
2,826
-
-
$ 2,499,565
132,307
167,443
$ 2,116,988
$
679,501
$
2,826
$ 2,799,315
Amortization
$
4,225
$
27,273
$
-
$
31,498
(Concluded)
According to the Company’s Articles, the Company accrued employees’ compensation and
remuneration of directors and supervisors at rates of no less than 1% and no higher than 1%,
respectively, of net profit before income tax, employees’ compensation, and remuneration of
directors and supervisors. For the years ended December 31, 2022 and 2021, the employees’
compensation amounted to NT$252,000 thousand and NT$187,000 thousand, respectively, and
the remuneration of directors amounted to NT$100,050 thousand and NT$75,000 thousand,
respectively. The compensation of employees and the remuneration of directors and supervisors
for the years ended December 31, 2022 and 2021 were approved by the Group’s board of
directors on February 24, 2023 and February 22, 2022, respectively.
If there is a change in the amounts before the annual consolidated financial statements are
authorized for issue, the differences are recorded in the expenses as an adjustment.
The employees’ compensation and the remuneration of directors and supervisors for the years
ended December 31, 2021 and 2020 resolved by WLC’s board of directors on February 22, 2022
and February 26, 2021, respectively are the same as the amounts recognized in the 2021 and 2020
consolidated financial statements.
Information on the employees’ compensation and remuneration of directors and supervisors
resolved by WLC’s board of directors in 2023 and 2022 is available at the Market Observation
Post System website of the Taiwan Stock Exchange.
28. INCOME TAXES RELATING TO CONTINUING OPERATIONS
a. Income tax recognized in profit or loss
Major components of income tax expense are as follows:
Current tax
In respect of the current year
Income tax on unappropriated earnings
Adjustments for prior year
For the Year Ended December 31
2022
2021
$
792,895
321,642
17,976
$ 2,173,361
83,446
(7,968)
(Continued)
224
Land value-added tax
Deferred tax
In respect of the current year
Adjustments for prior year
For the Year Ended December 31
2022
2021
175,864
1,308,377
6,156
2,254,995
2,916,207
37,353
2,953,560
1,615,411
(5,222)
1,610,189
Income tax expense recognized in profit or loss
$ 4,261,937
$ 3,865,184
(Concluded)
A reconciliation of accounting profit and income tax expense is as follows:
Profit before tax from continuing operations
$ 23,402,013
$ 19,122,498
For the Year Ended December 31
2022
2021
Income tax expense calculated at the statutory rate
Investment income accounted for using equity method
Tax-exempt dividend income
Loss on investments
Others
Unrecognized loss carryforwards/deductible temporary
$ 4,097,945
262,151
(183,234)
(2,630)
(58,684)
$ 3,931,277
481,251
(111,889)
(384,000)
(23,339)
differences
Adjustments for prior years’
Income tax on unappropriated earnings
Land value-added tax
(406,446)
55,329
321,642
175,864
(104,528)
(13,190)
83,446
6,156
Income tax expense recognized in profit or loss
$ 4,261,937
$ 3,865,184
b. Current tax assets and liabilities
Current tax assets
Tax refund receivable (recorded under other
non-current assets - others)
$
397,168
$
28,619
Current tax liabilities
Income tax payable
$ 6,103,462
$ 6,082,152
December 31
2022
2021
225
Financial Information
c. Deferred tax assets and liabilities
December 31
2022
2021
Deferred tax assets
$
Loss carryforwards
Pension expense overlimit
Unrealized loss on inventories write-down
Impairment loss on idle assets
Unrealized deferred gross profit
Unrealized impairment loss on long-term investments
Difference between financial and tax accounting of the
depreciation of property, plant and equipment
Prepaid expense
Loss on liquidation of investments
Other
$ 1,001,877
23,000
140,047
15,000
-
7,000
22,149
1,165,401
591,000
482,803
119,774
32,000
42,307
10,000
2,000
547,000
21,583
899,015
384,000
760,870
$ 3,448,277
$ 2,818,549
Deferred tax liabilities
Difference between financial and tax accounting of the
depreciation of property, plant and equipment
Provision for land value-added tax
Unrealized gain on investments
Others
$
(81,836)
(147,215)
(5,364,542)
(204,345)
$
(67,388)
(153,214)
(2,020,432)
26,384
$ (5,797,938)
$ (2,214,650)
d. Deductible temporary differences and unused loss carryforwards for which no deferred tax
assets have been recognized in the consolidated balance sheets were as follows:
Loss Carryforwards
Expiry in 2022
Expiry in 2023
Expiry in 2024
Expiry in 2025
Expiry in 2026
Expiry in 2027
December 31
2022
2021
$
-
98
3,898
3,439
6,032
24,897
$ 44,883
75,676
85,267
82,435
2,186
-
$ 38,364
$ 290,447
226
e. As of December 31, 2022, the Group’s tax loss carryforwards were as follows:
Expiry Year
2023
2024
2025
2026
2027
2028
2031
2032
Tax Loss
Carryforwards
$
44,924
90,495
17,700
221,283
511,143
41,729
102,199
10,768
$ 1,040,241
f. WLC’s income tax returns through 2020, except 2019, have been assessed by the tax
authorities.
29. EARNINGS PER SHARE
For the Year Ended December 31
2022
2021
Amounts
(Numerator)
After Income
Tax
(Attributable
to Parent’s
Shareholders)
Shares
(Denominator)
(In Thousands)
Earnings Per
Share (In
Dollars)
After Income
Tax
(Attributable
to Parent’s
Shareholders)
Amounts
(Numerator)
After Income
Tax
(Attributable
to Parent’s
Shareholders)
Earnings Per
Share (In
Dollars)
After Income
Tax
(Attributable
to Parent’s
Shareholders)
Shares
(Denominator)
(In Thousands)
Basic earnings per
share
Net income
$
19,352,097
3,549,689
$
5.45
$ 14,642,629
3,428,520
$ 4.27
Effect of potentially
dilutive ordinary
shares
Employee bonus
-
5,690
-
7,632
$
19,352,097
3,555,379
$
5.44
$ 14,642,629
3,436,152
$ 4.26
30. SHARE-BASED PAYMENT AGREEMENTS
Employee Share Option Plan for Cash Capital Increase
WLC was approved by the Securities and Futures Bureau (FSC) on March 11, 2022 to issue
300,000 thousand shares for cash capital increase. The board of directors resolved to retain 10%
of the issued shares for employees’ subscription. The number of shares retained for employees’
subscription and the subscription price were confirmed on June 27, 2022. WLC recognized the
capital surplus of NT$157,800 thousand on the grant date at the fair value computed based on the
Black-Scholes option evaluation model.
227
Financial Information
a. The share-based payment arrangement of WLC as of December 31, 2022 is as follows:
Type of Agreement
Grant Date
Quantity Granted
Vesting Conditions
Shares retained for
2022.6.27
30,000 thousand shares Vesting immediately
employees to subscribe
b. WLC used the Black-Scholes option evaluation model to calculate the fair value of employee
subscriptions for cash capital increase on June 27, 2022. Relevant information is as follows:
Share Price on
the Grant Date
(In Dollars)
Exercise
Price
(In Dollars)
Expected
Ratio of
Stock Price
Fluctuation
Expected
Duration
Expected
Dividend
Rate
Risk-Free
Interest
Rate
Fair Value
Per Share
(In Dollars)
$37.45
$33
52.95%
38 days
0.00%
0.52%
$5.26
c. In view of the dramatic changes in the capital market environment, in order to maintain the
shareholders’ rights and ensure the completion of the fundraising, the chairman of the
Company, authorized by the board of directors, adjusted the new share issuing price from
NT$33 to NT$30 on July 21, 2022. In addition, due to the price adjustment, the remuneration
cost of the relevant share-based payment agreement increased by NT$67,200 thousand.
WLC used the Black-Scholes option evaluation model to calculate the fair value of employee
subscriptions for cash capital increase as remeasurement on July 21, 2022. Relevant
information is as follows:
Share Price on
the Grant Date
(In Dollars)
Exercise
Price
(In Dollars)
Expected
Ratio of
Stock Price
Fluctuation
Expected
Duration
Expected
Dividend
Rate
Risk-Free
Interest
Rate
Fair Value
Per Share
(In Dollars)
$34.05
$30
54.13%
14 days
0.00%
0.72%
$2.24
31. BUSINESS COMBINATIONS
a. Subsidiaries acquired
Subsidiary
Principal Activity
Proportion of
Voting Equity
Interests
Acquired (%)
Date of
Acquisition
Consideration
Transferred
PT. Sunny
Metal
Industry
MEG S.A.
Manufacture and sale
of nickel matte
September 23,
50.10
$ 6,016,800
2022
Manufacture and sale
of stainless steel
December 1,
2022
85.03
$ 6,497,972
To deploy new energy industry, the Group acquired PT. Sunny Metal Industry and increased
its investment in Matte and Nickel Pig Iron to increase production capacity.
To combine the acquired company’s products, technologies and market advantages and
228
expand its stainless steel business, the Group acquired 85.03% of the shares of MEG S.A. at a
consideration of $6,497,972 thousand on December 1, 2022 and held 82.32% of the shares of
Cogne Acciai Speciali S.p.A. through MEG S.A. The Group finally held 70% of the shares of
Cogne Acciai Speciali S.p.A.
b. Consideration transferred
PT. Sunny
Metal Industry MEG S.A.
Cash
Contingent consideration arrangement (Note 1)
Issue option (Note 2)
$ 6,016,800
-
-
$ 6,497,972
355,089
(137,557)
$ 6,016,800
$ 6,715,504
1) According to the agreement of acquisition, the Group is required to pay additional
EUR15,000 thousand if MEG S.A.’s earnings before interest, tax, depreciation and
amortization from the settlement date to 2025 exceed EUR180,000 thousand. Based on the
results of the financial forecast, the management of the Group believes that it is probable
to make this payment. The fair value of this obligation at the date of acquisition was
estimated at $355,089 thousand.
2) According to the agreement of acquisition, the Group has the right to acquire the
remaining equity interest from the minority shareholders for a period of 6.5 to 7 years
from the settlement date. The fair value of this option at the acquisition date was estimated
to be $137,557 thousand.
c. Assets acquired and liabilities assumed at the date of acquisition
Current assets
Cash and cash equivalents
Financial asset at fair value through profit - current
Hedging derivative financial assets - current
Financial assets at amortised cost - current
Net trade receivables
Other receivables
Inventories
Other current assets
Non-current assets
Financial asset at fair value through profit -
non-current
Property, plant and equipment
Right-of-use assets
Other intangible assets
Deferred tax assets
Other non-current assets
PT. Sunny
Metal Industry MEG S.A.
$
103,771
-
-
-
-
4,904
29,021
1,603,712
$ 1,373,797
10,456
175,136
2,153
6,455,973
-
9,550,240
648,923
-
7,853,727
-
4,814,767
-
-
71,200
4,640,072
933,182
85,076
137,536
15,494
(Continued)
229
Financial Information
Current liabilities
Short-term borrowings
Financial liabilities at fair value through profit -
current
Hedging derivative financial liabilities - current
Trade payables
Other payables
Current tax liabilities
Lease liabilities - current
Other current liabilities
Non-current liabilities
Bonds payable
Long-term payable
Deferred tax liabilities
Lease liabilities - non-current
Defined benefit liabilities
Other current liabilities
PT. Sunny
Metal Industry MEG S.A.
$
(587,375) $ (1,420,750)
-
-
(232,779)
(5,610,735)
-
-
(2,480)
-
-
(134,396)
-
-
-
(4,909)
(42,710)
(5,244,797)
(3,885)
(617,198)
(137,417)
(1,761,848)
(285,159)
(3,347,986)
(112,229)
(710,774)
(118,977)
(14,515)
(Concluded)
At the issuance date of the consolidated financial statements, the market valuations and other
calculations have not been finalized, and they may change after publishing official assessment
report.
$ 7,842,137
$ 10,276,084
d. Non-controlling interests
The non-controlling interests of PT. Sunny Metal Industry is based on the carrying value on
the acquisition date and the amount was NT$1,577,723 thousand. The carrying value is based
on the assigned proportionate of the identifiable net assets on the acquisition date. At the
issuance date of the consolidated financial statements, the market valuations and other
calculations have not been finalized.
The non-controlling interests of MEG S.A. are based on the carrying value on the acquisition
date, the amount was NT$3,082,995 thousand. The carrying value is based on the assigned
proportionate of the identifiable net assets on the acquisition date. At the issuance date of the
consolidated financial statements, the market valuations and other calculations have not been
finalized.
e. Goodwill recognized on acquisitions
PT. Sunny
Metal Industry MEG S.A.
Consideration transferred
Plus: Non-controlling interests
Less: Carrying value of identifiable net assets acquired
Exchange difference
$ 6,715,504
$ 6,016,800
1,577,723
3,082,995
(7,842,137) (10,276,084)
138,059
333,199
Goodwill recognized on acquisitions (gain on bargain
purchase)
$
85,585
$
(339,526)
230
The goodwill from the merger was expected not to be recognized as tax deductible.
f. Net cash outflow on the acquisition of subsidiaries
PT. Sunny
Metal Industry MEG S.A.
Consideration paid in cash
Less: Cash and cash equivalent acquired
$ 6,016,800
(103,771)
$ 6,497,972
(1,373,797)
$ 5,913,029
$ 5,124,175
g. Impact of business combination on the results of the Group
The financial results of the acquired company since the acquisition dates, were as follows:
Operating revenue
Net profit
PT. Sunny
Metal Industry MEG S.A.
$
$
-
(14,280)
$ 1,626,172
(273,406)
$
If the acquisitions of PT. Sunny Metal Industry and MEG S.A. in September and December
2022 had occurred on January 1, 2022, the Group’s proposed operating revenue and net profit
for fiscal 2022 would have been $210,605,160 thousand and $20,786,576 thousand,
respectively. These amounts cannot reflect the actual revenue and operating results of the
Group, if the business combination is completed on the beginning date of the acquisition year
and should not be used to forecast future operating results.
32. DISPOSAL OF SUBSIDIARIES
The Group entered into a sale agreement with ECP (third party) to dispose of its subsidiary New
Leaf Energy, Inc. (original name of the announcement: 2022 Solar Development, Inc.) and
completed the transaction on July 28, 2022. (United States local time July 27, 2022)
a. Consideration received from disposals
Consideration received in cash and cash equivalents
Contingent consideration (Note)
Total consideration received
Amount
$ 10,029,371
2,195,677
$ 12,225,048
Note:
In accordance with the agreement of contingent consideration, the acquirer shall
respectively pay additional payments when the gross profit of Target Company during
the period starting from the settlement date to December 31, 2023 and the gross profit
in the year of 2024 meet the amount agreed upon by Target Company. The fair value
of this obligation on the acquisition date is estimated to be NT$2,195,677 thousand.
231
Financial Information
b. Analysis of assets and liabilities on the date control was lost:
Current assets
Cash and cash equivalents
Contract assets
Other current assets
Tax assets
Non-current assets
Deferred tax assets
Goodwill
Total assets
Current liabilities
Notes payable and trade payables
Other payables
Total current liabilities
Net assets disposed of
c. Gain on disposal of subsidiaries
Consideration received
Contingent consideration
Net assets disposed of
Costs of disposal
Non-controlling interests
Exchange difference
Employee compensation costs - disposal related
Gain on disposals
Amount
$
22,836
3,356,257
59,784
48,384
274,265
157,359
$ 3,918,885
$
(150,190)
(313,081)
(463,271)
$ 3,455,614
Amount
$ 10,029,371
2,195,677
(3,455,614)
(217,679)
905,234
35,417
(1,039,328)
$ 8,453,078
The above gain on disposal of equity, which is NT$8,453,078 thousand, deduced the loss due
to the reduction of operation after disposal, which is NT$553,702 thousand and the remaining
amount of NT$7,899,376 thousand was recognized under “gain on disposal of investments” in
2022.
d. Net cash inflow on disposals of subsidiaries
Consideration received in cash and cash equivalents
Less: Cash and cash equivalent balances disposed of
Net cash inflow on disposals of subsidiaries
Less: Employee compensation costs and costs of disposal paid
Net cash inflow on disposals of subsidiaries
Amount
$ 10,029,371
(22,519)
10,006,852
(764,276)
$ 9,242,576
232
The above share transaction was completed on July 28, 2022. (United States local time July
27, 2022)
33. OPERATING LEASE ARRANGEMENTS
Operating leases related to leases of investment properties owned by the Group with lease terms
between 5 and 10 years and the Group has an option to extend for another 10 years. All operating
lease contracts contain market review clauses in the event that the lessees exercise their options to
renew. The lessees do not have bargain purchase options to acquire the properties at the expiry of
the lease periods.
As of December 31, 2022 and 2021, deposits received under operating leases amounted to
NT$339,128 thousand and NT$329,321 thousand, respectively (recorded under other non-current
liabilities).
As of December 31, 2022, the Group’s future minimum lease receivables on non-cancelable
operating lease commitments are as follows:
2023
2024-2027
After 2028
34. CAPITAL MANAGEMENT
Amount
$ 1,271,481
1,921,321
210,070
$ 3,402,872
The Group’s capital management objective is to ensure that it has the necessary financial
resources and operational plan so that it can cope with the next 12 months working capital
requirements, capital expenditures, debt repayments and dividends spending.
The capital structure of the Group consists of net debt (borrowings offset by cash and cash
equivalents) and equity attributable to owners of the Group (comprising issued capital, reserves,
retained earnings and other equity).
Key management personnel of the Group review the capital structure on a quarterly basis. As part
of this review, the key management personnel, consider the cost of capital and the risks associated
with each class of capital. Based on recommendations of the key management personnel, in order
to balance the overall capital structure, the Group may adjust the amount of dividends paid to
shareholders, the number of new shares issued or repurchased, and/or the amount of new debt
issued or existing debt redeemed.
35. FINANCIAL INSTRUMENTS
a. Fair value of financial instruments that are not measured at fair value
Except the following assets and liabilities, the management considers that the carrying
amounts of financial assets and financial liabilities not recognized at fair value approximate to
their fair values.
233
Financial Information
December 31, 2022
Financial assets
Financial assets at amortized
cost
Structured deposit
Government bonds
Financial liabilities
Financial liabilities at amortized
cost
Carrying
Amount
Level 1
Level 2
Level 3
Total
Fair Value
$
2,202
189,242
$
$
-
-
$
-
-
2,202
189,242
$
2,202
189,242
$ 191,444
$
-
$
-
$ 191,444
$ 191,444
Bonds payable
$ 7,742,955
$
-
$ 7,386,233
$
-
$ 7,386,233
December 31, 2021
Financial liabilities
Financial liabilities at amortized
cost
Carrying
Amount
Level 1
Level 2
Level 3
Total
Fair Value
Bonds payable
$ 7,500,000
$
-
$ 7,500,000
$
-
$ 7,500,000
The fair values of the financial assets and financial liabilities included in the Level 2 and
Level 3 categories above have been determined in accordance with the income approach
based on a discounted cash flow analysis. The observable inputs included bond duration, bond
interest rates and credit rating. The significant unobservable input used in Level 3 is the
discount rate that reflects the credit risk of counterparties.
b. Fair value of financial instruments that are measured at fair value on a recurring basis
1) Fair value hierarchy
December 31, 2022
Financial assets at FVTPL
Derivatives not designated as
hedging instruments
Foreign unlisted shares
Contingent consideration
Derivatives financial assets
for hedging
$
Level 1
Level 2
Level 3
Total
- $
-
-
7,631 $
-
-
- $
71,969
2,567,786
7,631
71,969
2,567,786
-
165,019
-
165,019
$
- $
172,650 $ 2,639,755 $ 2,812,405
(Continued)
234
Level 1
Level 2
Level 3
Total
$ 11,717,477 $
-
- $
-
- $ 11,717,477
624,755
624,755
$ 11,717,477 $
- $
624,755 $ 12,342,232
$
21,189 $
-
43,583 $
-
- $
363,192
64,772
363,192
-
222,272
-
222,272
$
21,189 $
265,855 $
363,192 $
650,236
(Concluded)
Level 1
Level 2
Level 3
Total
$
1,940 $
14,207 $
- $
16,147
-
89,232
-
89,232
$
1,940 $
103,439 $
- $
105,379
$ 15,627,085 $
-
- $
-
- $ 15,627,085
663,502
663,502
$ 15,627,085 $
- $
663,502 $ 16,290,587
Financial assets at FVTOCI
Investments in equity
instruments
Listed securities in ROC
Unlisted securities
Financial liabilities at
FVTPL
Derivatives not designated as
hedging instruments
Contingent consideration
Hedging derivative financial
liabilities
December 31, 2021
Financial assets at FVTPL
Derivatives not designated as
hedging instruments
Derivatives financial assets
for hedging
Financial assets at fair value
FVTOCI
Investments in equity
instruments
Listed securities in ROC
Unlisted securities
Financial liabilities at
FVTPL
Derivatives not designated as
hedging instruments
$
- $
37,439 $
- $
37,439
235
Financial Information
2) There were no transfers between Levels 1, 2 and 3 for the years ended December 31, 2022
and 2021.
3) Reconciliation of Level 3 fair value measurements of financial instruments.
For the year ended December 31, 2022
Financial Assets
Balance at January 1, 2022
Additions
Capital reduction and refund
Recognized in other comprehensive loss
Effects of exchange difference
Balance at December 31, 2022
Financial Assets
at FVTOCI
Equity
Instruments
$ 663,502
120,000
(335)
(159,580)
1,168
$ 624,755
Balance at January 1, 2022
Additions
Recognized in profit or loss
Effects of exchange difference
Financial Assets at FVTPL
Financial
Liabilities
Financial Assets
$
$
-
2,267,373
372,109
273
-
355,089
-
8,103
Balance at December 31, 2022
$ 2,639,755
$
363,192
For the year ended December 31, 2021
Balance at January 1, 2021
Additions
Capital reduction and refund
Recognized in other comprehensive income
Effects of exchange rate changes
Balance at December 31, 2021
Financial Assets
at FVTOCI
Equity
Instruments
$ 435,056
177,887
(3,615)
54,678
(504)
$ 663,502
236
4) Valuation technique and inputs applied for Level 2 fair value measurement
Financial Instruments
Valuation Technique and Inputs
Derivatives - foreign exchange
Discounted cash flow. Future cash flows are
forward contracts
estimated based on observable forward exchange
rates at the end of the reporting period and contract
forward rates and discounted at a rate that reflects
the credit risk of various counterparties.
Derivatives - exchange rate swap
Discounted cash flow. Future cash flows are
contracts
estimated based on observable forward exchange
rates at the end of the reporting period and contract
forward rates and discounted at a rate that reflects
the credit risk of various counterparties.
Derivatives - interest rate
Discounted cash flow. Future cash flows are
contracts
Derivatives - option
estimated based on observable floating rates at the
end of the reporting period and fixed interest rates
under contracts.
Black-Scholes Model. The significant unobservable
input value is the market price volatility of the
commodity.
Derivatives - gas swap contracts
Discounted cash flow. Future cash flows are
estimated based on observable forward gas prices
at the end of the reporting period and fixed gas
prices under contract.
5) Valuation technique and inputs applied for Level 3 fair value measurement
Financial Instruments
Valuation Technique and Inputs
Unlisted equity securities
Market approach. Fair values are determined based on
observable and comparable companies’ fair values
at the end of the reporting period, adjusted by price
earnings ratio and price-to-book ratio of the
investees.
Net asset method. Fair values are determined based
on the book value of companies.
Discounted cash flow. Present values are determined
based on future cash flows discounted at market
yield.
Hybrid instruments - bonds
Discounted cash flow. Future cash flows are
estimated based on contract rates and discounted at
a rate that reflects the credit risk of various
counterparties.
237
Financial Information
Financial Instruments
Contingent consideration
Valuation Technique and Inputs
The estimated fair value is discounted according to
the probability of reaching the agreed conditions
and based on the credit risk discount rate and other
information.
c. Categories of financial instruments
Financial assets
Financial assets at amortized cost
Cash and cash equivalents
Contract assets - current
Notes receivable and trade receivables (including
related parties)
Finance lease receivables (current and non-current)
Other receivables
Other financial assets
Refundable deposits
Financial assets at amortized cost - (current and
non-current)
Derivative financial assets for hedging (current and
December 31
2022
2021
$ 19,397,973
3,022,237
$ 10,387,581
5,750,344
21,832,312
662,543
3,857,091
546,126
288,948
13,673,100
720,585
1,620,595
530,650
207,622
191,444
-
non-current)
Financial assets at FVTPL (current and non-current)
Financial assets at FVTOCI (current and non-current)
165,019
2,647,386
12,342,232
89,232
16,147
16,290,587
Financial liabilities
Financial liabilities at FVTPL (current and non-current)
Derivative financial liabilities for hedging (current and
non-current)
Financial liabilities at amortized cost
Short-term borrowings
Contract liabilities
Notes payable and trade payables
Other payables
Bonds payable
Long-term borrowings (including current portion of
427,964
222,272
22,496,307
6,014
18,088,851
9,939,969
7,742,955
37,439
-
7,108,766
3,426
8,840,868
4,861,341
7,500,000
notes payable)
43,525,983
35,505,033
Deposits received (recorded under other current and
non-current liabilities)
385,210
920,410
d. Financial risk management objectives and policies
The Group’s major financial instruments included equity and investments, borrowings, trade
receivables, and trade payables. The Group’s corporate treasury function provides services to
the business, coordinates access to domestic and international financial markets, and monitors
and manages the financial risks relating to the operations of the Group through internal risk
238
reports that analyze exposures by degree and magnitude of risks. These risks include market
risk, credit risk and liquidity risk.
The Group seeks to minimize the effects of these risks by using derivative financial
instruments to hedge risk exposures. The use of financial derivatives is governed by the
Group’s policies approved by the board of directors, which provides written principles on
foreign exchange risk, interest rate risk and credit risk, the use of financial derivatives and
non-derivative financial instruments, and the investment of excess liquidity. Compliance with
policies and exposure limits is reviewed by the internal auditors on a continuous basis. The
Group did not enter into or trade financial instruments for speculative purposes.
1) Market risk
The Group’s activities exposed is primarily to the financial risks of changes in foreign
currency exchange rates and interest rates. The Group entered into foreign exchange
forward contracts and interest rate swaps contracts to hedge foreign currency risk and
interest rate risk.
There has been no change to the Group’s exposure to market risks or the manner in which
these risks were managed and measured.
a) Foreign currency risk
The Group has foreign currency sales and purchases, which exposed the Group to
foreign currency risk. Exchange rate exposures were managed within approved policy
parameters utilizing foreign exchange forward contracts.
It is the Group’s policy to make the terms of the derivatives instruments match the
terms of the hedged items and to maximize the hedge effectiveness.
The carrying amounts of the Group’s foreign currency denominated monetary assets
and monetary liabilities (including those eliminated on consolidation) at the end of the
period are set out in Note 39.
The carrying amounts of the Group’s derivatives exposed to foreign currency risk at
the end of the reporting period were as follows:
Assets
U.S. dollar
Euro
Liabilities
U.S. dollar
Euro
December 31
2022
2021
$ 3,798,744
1,432,653
$ 9,660,314
795,675
2,381,338
310,405
10,204,046
600,096
239
Financial Information
Sensitivity analysis
The Group is mainly exposed to the U.S. dollars.
The following table details the Group’s sensitivity to a 1% increase and decrease in
the New Taiwan dollar (i.e. functional currency) against the relevant foreign
currencies. The sensitivity analysis includes only outstanding foreign currency
denominated monetary items and adjusts their translation at the end of the year for a
1% change in foreign currency rates.
U.S. Dollar Impact
For the Year Ended December 31
2022
2021
Profit or loss
$
(7,848)
$ 155,355
Euro Impact
For the Year Ended December 31
2022
2021
$ 23,330
$ 11,482
Profit or loss
Hedge accounting
For the year ended December 31, 2021
The Group’s hedging strategy is to enter into foreign exchange forward contracts to
avoid exchange rate exposure on 100% of the fair value of its foreign currency
receipts and payments and to manage exchange rate exposure. Those transactions are
designated as fair value hedges. Adjustments are recognized directly in profit or loss
and are presented as hedged items on the consolidated statements of comprehensive
income.
Hedging
Instrument
Currency
Notional
Amount
Maturity
Forward Price
Line Item in
Balance Sheet
Carrying Amount
Asset
Liability
Exchange rate swap
USD to RMB
USD75,000/
2022.1.14
RMB
498,529
Financial assets for
RMB
10,204
$
contracts
RMB488,325
hedging
Exchange rate swap
USD to RMB
USD70,000/
2022.1.14
RMB
465,153
Financial assets for
RMB
9,453
contracts
RMB455,700
hedging
Exchange rate swap
USD to RMB
USD20,000/
2022.6.08
RMB
129,728
Financial assets for
RMB
508
contracts
RMB129,220
hedging
Exchange rate swap
USD to RMB
USD15,000/
2022.6.08
RMB
97,308
Financial assets for
RMB
387
contracts
RMB96,921
hedging
Change in Value
Used for
Calculating Hedge
Ineffectiveness
$
-
-
-
-
-
-
-
-
b) Interest rate risk
The Group was exposed to interest rate risk because entities in the Group borrow
funds at both fixed and floating interest rates.
240
The carrying amounts of the Group’s financial assets and financial liabilities with
exposure to interest rates at the end of the year were as follows:
Fair value interest rate risk
Financial assets
Financial liabilities
Cash flow interest rate risk
Financial assets
Financial liabilities
Sensitivity analysis
December 31
2022
2021
$
189,242
7,742,955
$
-
7,500,000
2,202
66,022,290
-
42,613,799
The sensitivity analysis below was determined based on the Group’s exposure to
interest rates for financial instruments at the end of the year. For floating rate
liabilities, the analysis was prepared assuming the amount of each liability outstanding
at the end of the year was outstanding for the whole year.
If interest rates had been 1% basis points higher and all other variables were held
constant, the Group’s pre-tax profit for the years ended December 31, 2022 and 2021
would have decreased by NT$660,201 thousand and NT$426,138 thousand,
respectively.
Hedge accounting
For the year ended December 31, 2022
The Group entered into interest rate swap contracts to mitigate the risk of changes in
interest rates on cash flow exposure related to its outstanding variable rate debt.
Interest rate swaps are settled on a contract basis. The floating rate on interest rate
swaps is Euro Interbank Offered Rate (Euribor). The Group will settle the difference
between the fixed and floating interest rates on a net basis.
The following tables summarize the information relating to the hedges for interest rate
risk.
Hedging
Instrument
Currency
Contract
Amount
Range of Interest
Maturity
Rates Paid
Cash flow hedges
Range of
Interest
Rates
Received
Line Item in
Balance Sheet
Carrying Amount
Asset
Liability
Change in
Value Used for
Calculating
Hedge
Ineffectiveness
Interest rate swap
EUR
$
95,177
contracts
2023.05.31-
2030.12.18
-0.255%-3.120%
Note
Financial assets for
$
5,043
$
-
$
-
hedging
Note:
It is the three months interest rate of Euro Interbank Offered Rate (Euribor) on
the second business day before the issuance date.
2) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in a financial loss to the Group. At the end of the year, the Group’s maximum
exposure to credit risk, which would cause a financial loss to the Group due to the failure
of the counterparty to discharge its obligation and due to financial guarantees provided by
241
Financial Information
the Group, could be equal to the total of the following:
a) The carrying amount of the respective recognized financial assets as stated in the
balance sheets; and
b) The maximum amount the entity would have to pay if the financial guarantee is called
upon, irrespective of the likelihood of the guarantee being exercised.
The Group adopted a policy of only dealing with creditworthy counterparties and
obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of
financial loss from defaults. The Group’s exposure and the credit ratings of its
counterparties are continuously monitored, and the aggregate value of transactions
concluded is spread amongst the approved counterparties. Credit exposure is controlled by
setting credit limits that are reviewed and approved by the risk management committee
annually.
In order to minimize credit risk, the management of the Group has delegated a team
responsible for the determination of credit limits, credit approvals and other monitoring
procedures to ensure that follow-up action is taken to recover overdue receivables. In
addition, the Group reviews the recoverable amount of each individual trade receivables at
the end of the year to ensure that adequate impairment losses are made for irrecoverable
amounts. In this regard, the directors of the Group consider that the Group’s credit risk
was significantly reduced.
3) Liquidity risk
The Group manages liquidity risk by monitoring and maintaining a level of cash and cash
equivalents deemed adequate to finance the Group’s operations and mitigate the effects of
fluctuations in cash flows. In addition, management monitors the utilization of bank
borrowings and ensures compliance with loan covenants.
a) The following table details the Group’s expected maturities for its non-derivative
financial liabilities with agreed upon repayment periods.
December 31, 2022
Non-derivative
financial liabilities
Variable interest rate
liabilities
Lease liabilities
Fixed interest rate
liabilities
Non-interest bearing
liabilities
1 Year
1-2 Years
2-5 Years
5+ Years
Total
$ 23,605,356
254,655
$ 13,379,779
454,115
$ 28,258,134
617,027
$
680,861
1,939,529
$ 65,924,130
3,265,326
98,160
28,275,365
98,160
75,051
7,546,635
-
7,742,955
59,111
2,546,847
30,956,374
$ 52,233,536
$ 14,007,105
$ 36,480,907
$
5,167,237
$ 107,888,785
242
December 31, 2021
Non-derivative
financial liabilities
Variable interest rate
liabilities
Lease liabilities
Fixed interest rate
liabilities
Non-interest bearing
liabilities
1 Year
1-2 Years
2-5 Years
5+ Years
Total
$ 17,827,847
83,709
$ 16,648,182
68,394
$
7,000,000
100,609
$
1,137,770
141,279
$ 42,613,799
393,991
-
-
7,500,000
14,491,770
29,024
101,825
-
-
7,500,000
14,622,619
$ 32,403,326
$ 16,745,600
$ 14,702,434
$
1,279,049
$ 65,130,409
b) The Group’s expected maturities for its derivative financial instruments with agreed
upon settlement dates were as follows:
December 31, 2022
On Demand
or Less Than
1 Month
1-3 Months
3 Months to
1 Year
1-5 Years
Total
Net settled
Commodity futures
contracts
$ (44,810) $ 15,096 $
8,525 $
- $ (21,189)
Foreign exchange
forward contracts
(26,741)
6,844
(1,573)
-
(21,470)
Exchange rate swap
contracts
Interest rate swap
contracts
Gas swap contracts
Futures options
(22,113)
-
-
-
(22,113)
-
2
(74,893) (122,352)
7,629
-
20,615 144,404 165,021
- (222,272)
(25,027)
7,629
-
-
$ (168,557) $ (92,781) $
2,540 $ 144,404 $ (114,394)
December 31, 2021
On Demand
or Less Than
1 Month
1-3 Months
3 Months to
1 Year
1-5 Years
Total
Net settled
Commodity futures
contracts
$ 16,434
$ (19,571) $
5,077 $
- $
1,940
Foreign exchange
forward contracts
13,115
Exchange rate swap
contracts
47,904
146
-
946
-
14,207
3,889
-
51,793
$ 77,453
$ (19,425) $
9,912 $
- $ 67,940
243
Financial Information
e. Transfers of financial assets
1) Transfers of financial assets with recourse
From January 1 to December 31, 2022, the Group transferred part of banker’s acceptances
on notes receivable to a bank in mainland China. According to the contract, if the notes
receivable cannot be recovered when they are due, the bank has the right to require the
Group to pay outstanding balance. Therefore, the Group has not transferred the significant
risks and remuneration of the notes receivable. The Group continues to recognize all the
notes receivable and uses the transferred notes receivable as collateral for the loan. Refer
to Note 22 for the relevant loan information.
2) Transfers of financial assets without recourse
Factored trade receivables that are not overdue at the end of the year were as follows:
Receivables
Factoring
Proceeds
Amount
Reclassified
to Other
Receivables
Advances
Received -
Unused
Advances
Received -
Used
Counterparty
December 31, 2022
CTBC bank
$ 151,902 $ 18,449 US$ 2,700 $
-
December 31, 2021
CTBC bank
$ 150,495 $
5,786 US$ 2,700 $
-
Annual
Interest
Rates on
Advances
Received
(Used) (%)
-
-
36. TRANSACTIONS WITH RELATED PARTIES
Balances and transactions between the Company and its subsidiaries, which are related parties of
WLC, have been eliminated on consolidation and are not disclosed in this note. Details of
transactions between the Group and other related parties are disclosed as below:
a. Related party name and category
Related Party Name
Related Party Category
Winbond Electronics Corp.
Walsin Technology Corp.
Walton Advanced Engineering, Inc.
Chin-Xin Investment Co., Ltd.
Changzhou China Steel Precision Materials Co., Ltd.
Hangzhou Walsin Power Cable & Wire Co., Ltd.
Tsai Yi Corporation (formerly known as Walsin Color
Co., Ltd.)
Nuvoton Technology Corporation
Prosperity Dielectrics Co., Ltd.
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
(Continued)
244
Related Party Name
Related Party Category
PT. Westrong Metal Industry
HannStar Display Corp.
Kuong Tai Metal Industrial Co., Ltd.
HannStar Board Tech. (Jiangyin) Corp
HannStar Board Corp.
Global Brands Manufacture Ltd.
Info-Tek Corp.
Hwa Bao Botanic Conservation Corp.
b. Sales
Associates
Other related parties
c. Rental income
Associates
Other related parties
d. Purchases of goods
Associates
Other related parties
e. Administrative expenses
Associates
Other related parties
Associate
Substantive related party
Substantive related party
Substantive related party
Substantive related party
Substantive related party
Substantive related party
Substantive related party
(Concluded)
For the Year Ended December 31
2022
2021
$
22,653
1,452,637
$
6,458
1,751,701
$ 1,475,290
$ 1,758,159
For the Year Ended December 31
2022
2021
$
48,329
1,135
$
46,197
1,029
$
49,464
$
47,226
For the Year Ended December 31
2022
2021
$
58,289
4,308
$
33,027
4,961
$
62,597
$
37,988
For the Year Ended December 31
2022
2021
$
15,053
13,630
$
14,889
13,558
$
28,683
$
28,447
245
Financial Information
The stock registration matters of WLC and related parties were handled together. The related
fees allocated to the related parties were charged against general and administrative expenses.
f. Dividend income
HannStar Display Corp.
HannStar Board Corp.
Other related parties
g. Notes receivable
Associates
h. Trade receivables
Associates
Other related parties
i. Notes payable
Associates
j. Trade payables
Associates
Other related parties
246
For the Year Ended December 31
2022
2021
$
$
298,293
140,259
7,705
149,816
140,259
7,705
$
446,257
$
297,780
December 31
2022
2021
$
9,332
$
2,186
December 31
2022
2021
$
2,481
42,651
$
-
17,229
$
45,132
$
17,229
December 31
2022
2021
$
16,553
$
10,257
December 31
2022
2021
$
$
225
504
$
729
$
-
601
601
k. Other receivables (excluding financing provided)
Associates
Other related parties
l. Financing provided
December 31
2022
2021
$
13,056
3,062
$
19,279
2,648
$
16,118
$
21,927
Financing provided for the years ended December 31, 2022 and 2021 were as follows:
December 31, 2022
Highest
Balance for
the Period
Ending
Balance
Interest
Income
Interest Rate
$
360,721
$
352,747
$
15,563
4.35%
Related Parties
Hangzhou Walsin
Power Cable &
Wire Co., Ltd.
PT. Westrong Metal
Industry
$ 2,780,100
$ 1,228,400
$
463
6.79%
Related Parties
Hangzhou Walsin
Power Cable &
Wire Co., Ltd.
m. Guarantee deposits
Associates
Other related parties
December 31, 2021
Highest
Balance for
the Period
Ending
Balance
Interest
Income
Interest Rate
$
350,991
$
347,329
$
15,310
4.35%
December 31
2022
2021
$
$
7,362
282
7,453
282
$
7,644
$
7,735
247
Financial Information
n. Disposal of property, plant and equipment
For the Year Ended December 31
2022
2021
Price
Gain on
Disposals
Price
Gain on
Disposals
Hwa Bao Botanic
Conservation Corp.
$ 128,800
$ 78,443
$
-
$
-
The above transaction prices were determined with reference to the transaction prices of
similar real estate in the vicinity and professional valuation reports.
o. Remuneration of key management personnel
The remunerations of directors and key executives were as follows:
Short-term employee benefits
Post-employment benefits
December 31
2022
2021
$
265,970
1,299
$
217,518
1,392
$
267,269
$
218,910
The remuneration of directors and key executives, as determined by the remuneration
committee, is based on the performance of individuals and market trends.
37. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY
The following assets were provided as collaterals for bank borrowings, tariff guarantee for
imported raw material and the deposits for completing constructions and futures:
December 31
2022
2021
Refundable deposits (recorded under other financial assets
- current)
$
303,146
$
61,964
Restricted deposits (recorded under other financial assets -
current)
Pledged time deposits (recorded under other financial
assets - other)
Restricted deposits (recorded under other financial assets -
202,194
388,193
1,439
-
other)
Finance lease receivables
Long-term finance lease receivables
Refundable deposits
Discounted notes receivable
11,023
60,020
602,523
51,986
1,554,013
10,854
58,042
662,543
52,534
-
$ 2,786,344
$ 1,234,130
248
38. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS
In addition to those disclosed in other notes, significant contingencies and unrecognized
commitments of the Group at December 31, 2022 and 2021 were as follows:
a. Outstanding letters of credit not reflected in the accompanying consolidated financial
statements as of December 31, 2022 and 2021 were as follows (in thousands):
New Taiwan dollar
U.S. dollar
Renminbi
Japanese yen
Euro
December 31
2022
2021
NT$ 20,939
US$
3,186
RMB 2,189
JPY
54,144
EUR 34,490
NT$ 47,575
US$
9,572
RMB 13,134
JPY 160,710
EUR 26,852
b. Outstanding standby letters of credit and bid bonds of contingent liabilities not reflected in the
consolidated financial statements were as follows (in thousands):
New Taiwan dollar
U.S. dollar
Renminbi
December 31
2022
2021
NT$ 841,035
US$
30
RMB 16,884
NT$ 665,286
US$
30
RMB 111,504
c. Based on tariff and relevant regulations, the Group issue tariff letters of credit to import goods
and to meet the needs of post-release duty payment. The amount of tariff letters of credit were
as follows:
New Taiwan dollar
NT$ 496,000
NT$ 462,000
d. Non-cancelable raw material procurement contracts were as follows:
December 31
2022
2021
U.S. dollar
Renminbi
December 31
2022
2021
US$
43,926
RMB 85,530
US$
42,595
RMB 259,005
249
Financial Information
e. The Group entered into a contract for the construction of new plants on the Group’s own land.
The amount of the unrecognized commitments were as follow:
New Taiwan dollar
U.S. dollar
Renminbi
Euro
Japanese yen
Indonesian rupiah
December 31
2022
2021
NT$ 2,237,159
NT$ 2,702,350
US$
72,295
US$
4,362
RMB 780,815
RMB 395,368
-
EUR 70,927
EUR
-
JPY
11,680
JPY
-
IDR89,743,621 IDR
39. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN
CURRENCIES
The Group’s significant financial assets and liabilities dominated in foreign currencies aggregated
by the foreign currencies other than functional currencies of the entities in the Group and the
related exchange rates between the foreign currencies and the respective functional currencies
were as follows:
December 31, 2022
Financial assets
Monetary items
U.S. dollar
Japanese yen
Euro
Hong Kong dollar
Australian dollar
Singapore dollar
Indonesian rupiah
Renminbi
Korean won
Turkish lira
Financial liabilities
Monetary items
U.S. dollar
Euro
Renminbi
Swiss franc
Indonesian rupiah
Non-monetary items
U.S. dollar
Renminbi
250
Foreign
Currency
Exchange Rate
Carrying
Amount
$
575,500
236,526
37,125
2,505
1,298
5,432
2,267,040,632
21,137
394,230
6,605
$
645,822
121
406,181
17
300,118,783
1,677
233
$
$
30.7100
0.2324
32.7200
3.9380
20.8300
22.8800
0.00198
4.40934
0.02457
1.643167
30.7100
32.7200
4.40934
33.2050
0.00198
30.7100
4.40934
17,673,605
54,969
1,214,730
9,865
27,037
124,284
4,488,740
93,200
9,686
10,854
19,833,194
3,959
1,790,990
564
594,235
51,501
1,027
December 31, 2021
Financial assets
Monetary items
U.S. dollar
Japanese yen
Euro
Hong Kong dollar
Australian dollar
Singapore dollar
Indonesian rupiah
Non-monetary items
U.S. dollar
Financial liabilities
Monetary items
U.S. dollar
Euro
Renminbi
Swiss franc
Indonesian rupiah
Non-monetary items
U.S. dollar
Foreign
Currency
Exchange Rate
Carrying
Amount
$
811,837
511,128
30,442
4,481
1,579
3,291
1,650,074,291
$
27.6800
0.2405
31.3200
3.5490
20.0800
20.4600
0.00198
22,471,643
122,926
953,435
15,903
31,714
67,335
3,267,147
320
27.6800
8,864
230,939
27
171
17
52,340,604
27.68
31.3200
4.3416
31.1750
0.00198
6,392,384
830
743
513
103,634
1,353
27.68
37,439
For the years ended December 31, 2022 and 2021, realized and unrealized net foreign exchange
gain and loss were NT$1,748,708 thousand and NT$237,222 thousand, respectively. It is
impractical to disclose net foreign exchange gains (losses) by each significant foreign currency
due to the variety of the foreign currency transactions and functional currencies in the Group.
40. SEPARATELY DISCLOSED ITEMS
a. Information on significant transactions and information on investees:
1) Financing provided to others (Table 1)
2) Endorsements/guarantees provided (Table 2)
3) Marketable securities held (Table 3)
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million
or 20% of the paid-in capital (Table 4)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the
paid-in capital (Table 5)
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the
251
Financial Information
paid-in capital (None)
7) Total purchases from or sales to related parties amounting to at least NT$100 million or
20% of the paid-in capital (Table 6)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the
paid-in capital (Table 7)
9) Trading in derivative instrument (Notes 7 and 8)
10) Information on investees (Table 8)
11) Intercompany relationships and significant intercompany transactions (Table 10)
b. Information on investments in mainland China:
1) Information on any investee company in mainland China, showing the name, principal
business activities, paid-in capital, method of investment, inward and outward remittance
of funds, ownership percentage, net income of investees, investment income or loss,
carrying amount of the investment at the end of the year, repatriations of investment
income, and limit on the amount of investment in the mainland China area (Table 9)
2) Any of the following significant transactions with investee companies in mainland China,
either directly or indirectly through a third party, and their prices, payment terms, and
unrealized gains or losses (Table 10):
a) The amount and percentage of purchases and the balance and percentage of the related
payables at the end of the year;
b) The amount and percentage of sales and the balance and percentage of the related
receivables at the end of the year;
c) The amount of property transactions and the amount of the resultant gains or losses;
d) The balance of negotiable instrument endorsements or guarantees or pledges of
collateral at the end of the year and the purposes;
e) The highest balance, the ending period balance, the interest rate range, and total
current period interest with respect to the financing of funds; and
f) Other transactions that have a material effect on the profit or loss for the year or on the
financial position, such as the rendering or receipt of services.
c. Information of major shareholders: List all shareholders with ownership of 5% or greater
showing the name of the shareholder, the number of shares owned, and percentage of
ownership of each shareholder (Table 11)
41. SEGMENT INFORMATION
a. Basic information
1) Classification
252
Information reported to the chief operating decision maker for the purpose of resource
allocation and assessment of segment performance focuses on the types of goods or
services delivered or provided. Specifically, the Group’s reportable segments were as
follows:
a) Wires and cables
The segment’s main products include copper rods, wires, connector and components
which are sold to industries involving cables and wires, communications cable, heavy
electronics, home electrical appliances and construction.
b) Stainless steel
The segment’s main products include smelting, rolled stainless steel, carbon steel and
precision alloy wire which are sold to industries involving construction components,
crankshaft, machine tools, plumbing, heat exchanger, drainage, petrochemical and
construction.
c) Resource
The segment’s main business include nickel pig iron, sales of stainless steel products
as an agent in Taiwan and important metal procurement and hedging.
d) Real estate
Real estate is responsible for the development of commercial and real estate complex
and real estate management. Furthermore, the modes of operation are the construction
of residences, offices, markets and hotels, and the offering of rental space, operating
management and after-sales services.
e) Administration and investing
The segment of administration and investing refers to other investment in mainland
China.
2) Estimates of operating segment income and expenses, assets and liabilities
Accounting policies of operating segments are the same as those summarized in Note 4.
Sales and transfers between segments are treated as transactions with third parties and
evaluated at fair value.
The Group does not allocate income tax expense (benefit), investment income (loss)
recognized under equity method, foreign exchange gain (loss), net investment income
(loss), gain (loss) on disposal of investments, gain (loss) on valuation of financial assets
and liabilities and extraordinary items to reportable segments. The amounts reported are
consistent with the report used by chief operating decision makers.
3) Identification of operating segment
The reportable segments of the Group are strategic business units, providing different
products and services. They are managed separately because they use different
technologies and sales strategies.
253
Financial Information
b. Financial information
1) Segment revenues and results:
Wires and Cables
Stainless Steel
Resource
Real Estate
(NT$ in Thousand)
Administration
and Investing
Total
58,861,592
2,983,318
79,025,174
4,463,460
23,469,051
7,011,709
1,972,699
94,428
17,072,203
(5,054,201 )
$ 180,400,719
9,498,714
(586,922 )
3,607,040
766,857
68,051
7,210,043
1,748,708
265,134
(87 )
824,475
$ 23,402,013
62,302,436
2,267,026
67,417,565
5,876,831
8,571,368
4,009,584
1,882,235
214,240
16,491,162
977,871
$ 156,664,766
13,345,552
(325,999 )
4,808,211
561,499
20,468
679,207
(237,222 )
647,228
(693,892 )
317,446
$ 19,122,498
For the year ended December 31, 2022
Revenue from external customers
Segment profit (loss)
Net non-operating income (expenses)
Net interest income (expenses)
Share of profit of associates accounted
for using the equity method
Dividend income
Gain on disposal of property, plant and
equipment
Gain on disposal of investments
Foreign exchange gain
Gain on financial assets and liabilities
at fair value through profit or loss
Impairment loss
Net other income
Consolidated income before income tax
For the year ended December 31, 2021
Revenue from external customers
Segment profit (loss)
Net non-operating income (expenses)
Net interest income (expenses)
Share of profit of associates accounted
for using the equity method
Dividend income
Gain on disposal of property, plant and
equipment
Gain on disposal of investments
Foreign exchange gain
Gain on financial assets and liabilities
at fair value through profit or loss
Impairment loss
Net other income
Consolidated income before income tax
2) Segment assets and liabilities
Wires and Cables
Stainless Steel
Resource
Real Estate
Administration
and Investing
Total
Segment assets
December 31, 2022
December 31, 2021
$
9,871,071
12,961,862
$ 45,004,557
40,460,833
$ 43,443,642
17,042,352
$ 30,296,978
28,324,476
$ 124,049,301
84,245,375
$ 252,665,549
$ 183,034,898
Segment liabilities
December 31, 2022
December 31, 2021
5,690,853
8,815,068
26,924,149
18,842,990
27,486,296
7,578,444
15,638,505
12,893,795
47,963,838
26,958,333
$ 123,703,641
$ 75,088,630
Note: Due to the adjustment of departmental organization, segment assets and liabilities
were reclassified on 2021 for reference and comparison.
254
3) Geographical information
The Group’s non-current assets (exclude financial instruments, deferred tax assets and
post-employment benefit assets) and revenue from single geographical location are
detailed below.
Revenue from External
Customers (Note)
2022
2021
Non-current Assets
December 31
2022
2021
Asia
United States
$ 155,926,113
$ 134,031,146
$ 60,969,279
$ 54,005,146
of America
Europe
Others
18,346,783
4,040,919
2,086,904
17,315,503
3,662,416
1,655,701
245,719
5,891,034
-
225,071
-
-
$ 180,400,719
$ 156,664,766
$ 67,106,032
$ 54,230,217
Note: Revenue from external customers is classified by geographical location.
4) Information about major customers
No single customer contributed 10% or more to the Group’s revenue for both 2022 and
2021.
255
2
5
6
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In thousands of New Taiwan Dollars and U.S. Dollars)
TABLE 1
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest Balance
for the Period
Ending Balance
Actual Amount
Borrowed
Interest Rate
(%)
Nature of
Financing
Business
Transaction
Amount
Reasons for
Short-term
Financing
Allowance
for
Impairment
Loss
Collateral
Item
Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
0 Walsin Lihwa
Corporation
PT. Walsin Nickel
Other receivables
Yes
Industrial
Indonesia
$
(US$
2,255,050
70,000)
$
(US$
-
-)
$
(US$
-
-)
-
Operating
capital
$
- Operating capital $
PT. Sunny Metal
Other receivables
Yes
Industry
PT. Westrong Metal
Other receivables
Yes
Industry
7,745,668
250,750)
2,780,100
90,000)
(US
(US
7,700,533
250,750)
2,763,900
90,000)
(US
(US
5,397,283
175,750)
1,228,400
40,000)
5.80-6.90 Operating
capital
Operating
capital
6.79
(US
(US
- Equipment
purchase
- Equipment
purchase
-
-
-
-
-
-
$
- $
49,432,350
(US$ 1,609,650)
$
49,432,350
(US$ 1,609,650)
-
(US
-
(US
49,432,350
1,609,650)
49,432,350
1,609,650)
(US
(US
49,432,350
1,609,650)
49,432,350
1,609,650)
Notes:
1. According to the financing regulations provided by Walsin Lihwa Corporation, the limit on the amount of financing provided to a single enterprise that holds directly or indirectly 100% of the voting rights of a subsidiary cannot exceed 40% of the equity
presented in the consolidated financial statements of Walsin Lihwa Corporation.
a. The limit on the amount of financing provided to a single enterprise was as follows:
PT. Walsin Nickel Industrial Indonesia = $123,580,876 × 40% = $49,432,350 (US$1,609,650)
PT. Sunny Metal Industry = $123,580,876 × 40% = $49,432,350 (US$1,609,650)
PT. Westrong Metal Industry＝$123,580,876×40%＝$49,432,350 (US$1,609,650)
b. The limit on the amount of financing provided was as follows:
The limit on the amount of financing provided = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
2. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars.
3. The currency exchange rate as of December 31, 2022 was as follows: US$ to NT$= 1:30.71.
i
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WALSIN LIHWA HOLDINGS LIMITED AND SUBSIDIARIES
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, U.S. Dollars and Renminbi)
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest Balance
for the Period
Ending Balance
Actual Amount
Borrowed
Interest
Rate (%)
Nature of
Financing
Business
Transaction
Amount
Reasons for
Short-term
Financing
Allowance
for
Impairment
Loss
Collateral
Item Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
TABLE 1-1
1 Walsin (China)
Hangzhou Walsin
Other receivables
Yes
Investment Co.,
Ltd.
Power Cable & Wire
Co., Ltd.
Walsin (Nanjing)
Other receivables
Yes
Development Co.,
Ltd.
Yantai Walsin Stainless
Other receivables
Yes
Steel Co., Ltd.
Jiangyin Walsin
Other receivables
Yes
Specialty Alloy
Materials Co., Ltd.
Changshu Walsin
Other receivables
Yes
Specialty Steel Co.,
Ltd.
Dongguan Walsin Wire
& Cable Co., Ltd.
Jiangyin Walsin Steel
Cable Co., Ltd.
Shanghai Walsin Lihwa
Power Wire & Cable
Co., Ltd.
Other receivables
Yes
Other receivables
Yes
Other receivables
Yes
$
(RMB
360,721
80,000)
$
(RMB
352,747
80,000)
$
(RMB
352,747
80,000)
5,636,263
(RMB 1,250,000)
5,511,675
(RMB 1,250,000)
3,549,132
(RMB 804,912)
4.35
4.05
Operating
capital
$
Operating
capital
10,367,832
(US$
202,000)
(RMB 860,000)
1,988,336
(US$
45,000)
(RMB 120,000)
3,114,798
(RMB 170,000)
73,000)
(US$
2,577,200
80,000)
-)
2,117,686
(US$
10,000)
(RMB 400,000)
289,935
9,000)
(US$
(RMB
(US$
9,995,452
(US$
202,000)
(RMB 860,000)
1,822,884
(US$
45,000)
(RMB 100,000)
2,550,484
(RMB $ 70,000)
73,000)
(US$
2,149,700
70,000)
-)
1,409,435
(US$
10,000)
(RMB 250,000)
-
-)
(US$
(RMB
(US$
(RMB
(US$
(US$
(RMB
6,427,864
(US$
140,304)
(RMB 480,600)
1,369,530
44,596)
-)
1,387,772
-)
45,190)
742,540
24,179)
-)
714,418
(US$
8,059)
(RMB 105,896)
-
-)
(US$
(RMB
(US$
1.15-3.00 Operating
capital
1.15
1.15
1.15
Operating
capital
Operating
capital
Operating
capital
1.15-3.00 Operating
capital
-
Operating
capital
2 Dongguan Walsin
Walsin (China)
Other receivables
Yes
Wire & Cable Co.,
Ltd.
Investment Co., Ltd.
3,156,307
(RMB 700,000)
3,086,538
(RMB 700,000)
968,651
(RMB 219,682)
2.70
Operating
capital
19,619,260
400,000)
(US$
(RMB 1,500,000)
11,114,175
345,000)
8,053,750
350,000)
(US$
(US$
18,898,010
400,000)
(US$
(RMB 1,500,000)
7,677,500
250,000)
3,071,000
100,000)
(US$
(US$
12,769,666
254,000)
(US$
(RMB 1,127,000)
3,470,230
113,000)
3,071,000
100,000)
(US$
(US$
0.98-2.60 Operating
capital
4.3-4.4 Operating
capital
6.4-6.7 Operating
capital
3 Walsin International
Investments
Limited
Walsin (China)
Other receivables
Yes
Investment Co., Ltd.
Walsin Lihwa
Corporation
PT. Walsin Nickel
Industrial Indonesia
Other receivables
Yes
Other receivables
Yes
2
5
7
-
-
-
-
-
-
-
-
-
-
-
-
Operating
capital
$
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
Operating
capital
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
- $
(US$
1,720,129
56,013)
$
(US$
1,720,129
56,013)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
(US$
430,032
14,003)
(US$
1,720,129
56,013)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
-
49,432,350
(US$ 1,609,650)
7,833,998
255,102)
(US$
-
49,432,350
(US$ 1,609,650)
7,833,998
255,102)
(US$
(Continued)
2
5
8
Notes:
1. According to the financing regulations provided by Walsin (China) Investment Co., Ltd., Dongguan Walsin Wire & Cable Co., Ltd. and Walsin International Investments Ltd., the total limit on the amount of the financing provided to a single enterprise that holds
directly or indirectly 100% of the voting rights of a subsidiary whose equity is 100%-owned, directly or indirectly by the parent company cannot exceed 40% of the equity of the parent company as presented in the consolidated financial statements of Walsin
Lihwa Corporation. The limit on the amount of financing provided to a single enterprise that holds less than 100% of a subsidiary whose equity is less than 100%-owned, directly or indirectly by its parent company, cannot exceed 40% of the parent company’s
equity as presented in its the consolidated financial statements of a subsidiary. If the financing is a one-time funding, the amount for an individual loan shall not exceed 40 % of the financing company’s equity as stated in the financing company’s latest
consolidated financial statements. If it is a revolving funding, the amount for an individual loan shall not exceed 10 % of the financing company’s equity in the financing company’s latest consolidated financial statements.
a. The limit on the amount of financing provided to a single enterprise was as follows:
Jiangyin Walsin Steel Cable Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Shanghai Walsin Lihwa Power Wire & Cable Co., Ltd. = US$140,033×10%＝US$14,003 (430,032)
Walsin (China) Investment Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Walsin Lihwa Corporation = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Walsin (Nanjing) Development Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Yantai Walsin Stainless Steel Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Jiangyin Walsin Specialty Alloy Materials Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Changshu Walsin Specialty Steel Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Dongguan Walsin Wire & Cable Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Hangzhou Walsin Power Cable & Wire Co., Ltd. = US$140,033 × 40%＝US$56,013 (1,720,129)
PT. Walsin Nickel Industrial Indonesia= US$637,755 × 40%＝US$255,102 (7,833,998)
b. The limit on the amount of financing provided was as follows:
Walsin Lihwa Corporation = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
Walsin (China) Investment Co., Ltd. = US$140,033 × 40%＝US$56,013 ($1,720,129)
Walsin International Investments Limited = US$637,755 × 40% = US$255,102 ($7,833,998)
2. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars and Renminbi.
3. The currency exchange rates as of December 31, 2022 were as follows: US$to NT$= 1:30.71; RMB to NT$= 1:4.40934 US$to RMB = 1:6.9646.
(Concluded)
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TABLE 1-2
CONCORD INDUSTRIES LIMITED AND SUBSIDIARIES
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, U.S. Dollars and Renminbi)
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest Balance
for the Period
Ending Balance
Actual Amount
Borrowed
Interest
Rate (%)
Nature of
Financing
Business
Transaction
Amount
Reasons for
Short-term
Financing
Allowance for
Impairment
Loss
Collateral
Item
Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
Other receivables
Yes
$
(RMB
315,631
70,000)
$
(RMB
308,654
70,000)
$
(RMB
135,010
30,619)
2.70 Operating
capital
$
- Operating capital
$
Other receivables
Yes
901,802
(RMB 200,000)
881,868
(RMB 200,000)
(RMB
411,494
93,323)
2.70 Operating
capital
- Operating capital
-
-
-
$
-
$
49,432,350
(US$ 1,609,650)
$
49,432,350
(US$ 1,609,650)
-
-
$
49,432,350
(US$ 1,609,650)
$
49,432,350
(US$ 1,609,650)
4 Changshu Walsin
Specialty Steel
Co., Ltd.
Walsin (China)
Investment
Co., Ltd.
5 Jiangyin Walsin
Specialty Alloy
Materials Co.,
Ltd.
Walsin (China)
Investment
Co., Ltd.
Notes:
1. According to the financing regulations of Changshu Walsin Specialty Steel Co., Ltd. and Jiangyin Walsin Specialty Alloy Materials Co., Ltd., the limit on the amount of financing provided to a single enterprise that holds directly or indirectly 100% of the voting
rights of a subsidiary cannot exceed 40% of the parent company’s equity presented in the consolidated financial statements of Walsin Lihwa Corporation.
a. The limit on the amount of financing provided to a single enterprise was as follows:
Walsin (China) Investment Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
b. The limit on the amount of financing provided was as follows:
The limit on the amount of financing provided = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
2. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars.
3. The currency exchange rates as of December 31, 2022 were as follows: US$to NT$= 1:30.71; RMB to NT$= 1:4.40934; US$to RMB = 1:6.9646.
2
5
9
2
6
0
CHIN-CHERNG CONSTRUCTION CO. AND SUBSIDIARIES
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, U.S. Dollars and Renminbi)
TABLE 1-3
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest Balance
for the Period
Ending Balance
Actual Amount
Borrowed
Interest
Rate (%)
Nature of
Financing
Business
Transactio
n Amount
Reasons for
Short-term
Financing
Allowance
for
Impairmen
t Loss
Collateral
Item
Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
Walsin (Nanjing)
Other receivables
Yes
Development Co.,
Ltd.
$
(US$
853,053
26,480)
$
(US$
813,201
26,480)
$
(US$
813,201
26,480)
2.48 Operating capital
$
- Operating capital
$
-
-
$
- $
49,432,350
(US$ 1,609,650)
$
49,432,350
(US$ 1,609,650)
7 Joint Success
Enterprises
Limited
Notes:
1. According to the financing regulations provided by Joint Success Enterprises Limited, the total limit on the amount of the financing provided to a subsidiary whose equity is 100%-owned, directly or indirectly by the parent company, cannot exceed 40% of the
equity of the parent company as presented in the consolidated financial statements of Walsin Lihwa Corporation. The limit on the amount of financing provided to a subsidiary whose equity is less than 100%-owned, directly or indirectly by its parent company,
cannot exceed 40% of the parent company’s equity as presented in the parent company’s latest consolidated financial statements. If the financing is a one-time funding, the amount for an individual loan shall not exceed 40 % of the parent company’s equity in the
parent company’s latest consolidated financial statements. If it is a revolving fund, the amount for an individual loan shall not exceed 10 % of the parent company’s equity in the parent company’s latest consolidated financial statements.
a. The limit on the amount of financing provided to a single enterprise was as follows:
Walsin (Nanjing) Development Co., Ltd. = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
b. The limit on the amount of financing provided was as follows:
The limit on the amount of financing provided = $123,580,876 × 40% ＝ $49,432,350 (US$1,609,650)
2. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars.
3. The currency exchange rates as of December 31, 2022 were as follows: US$to NT$= 1:30.71; RMB to NT$= 1:4.40934; US$to RMB = 1:6.9646.
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TABLE 1-4
WALSIN INFO-ELECTRIC CORP. AND SUBSIDIARIES
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest
Balance for
the Period
Ending
Balance
Actual
Amount
Borrowed
Interest Rate
(%)
Nature of
Financing
Business
Transaction
Amount
Reasons for
Short-term
Financing
Allowance
for
Impairment
Loss
Collateral
Item
Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
9 Walsin Info-Electric
Corporation
Notes:
Walsin Lihwa
Other receivables
Yes
$ 130,000 $ 130,000 $
-
-
Operating capital
$
- Operating capital
$
-
-
$
- $
126,222
$
126,222
Corporation
1. According to the financing regulations provided by Walsin Info-Electric Corporation, the total limit on the amount of the financing provided to a subsidiary whose equity is 100% owned, directly or indirectly by the parent company, cannot exceed 40% of the
equity of the parent company as presented in the consolidated financial statements of Walsin Lihwa Corporation. The limit on the amount of financing provided to a subsidiary whose equity is less than 100% owned, directly or indirectly by its parent company,
cannot exceed 40% of the parent company’s equity as presented in the parent company’s latest consolidated financial statements. If the financing is a one-time funding, the amount for an individual loan shall not exceed 40% of the parent company’s equity in the
parent company’s latest consolidated financial statements. If it is a revolving fund, the amount for an individual loan shall not exceed 10% of the parent company’s equity in the parent company’s latest consolidated financial statements.
a. The limit on the amount of financing provided to a single enterprise was as follows:
Walsin Lihwa Corporation = $315,554 × 40% ＝ $126,222
b. The limit on the amount of financing provided was as follows:
The limit on the amount of financing provided = $315,554 × 40% ＝ $126,222
2. The board of directors of the Group will soon propose an improvement plan for the excess amount of funds lent to individual targets.
2
6
1
2
6
2
WALSIN LIHWA HOLDINGS LIMITED AND SUBSIDIARIES
TABLE 2
ENDORSEMENTS/GUARANTEES PROVIDED
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars and U.S. Dollars)
Endorsee/Guarantee
No.
(Note 1)
Endorser/
Guarantor
Name
Relationship
(Note 2)
Limit on
Endorsement/
Guarantee Given
on Behalf of Each
Party (Note 3)
Maximum Amount
Endorsed/
Guaranteed During
the Period
Outstanding
Endorsement/
Guarantee at the
End of the Period
(Note 4)
Actual Amount
Borrowed
Amount of
Endorsement/
Guarantee by
Collateral
Ratio of
Accumulated
Endorsement/
Guarantee to Net
Equity in Latest
Financial
Statements (%)
Aggregate
Endorsement/
Guarantee Limit
Endorsement/
Guarantee
Given by Parent
on Behalf of
Subsidiaries
Endorsement/
Guarantee
Given by
Subsidiaries
on Behalf of
Parent
Endorsement/
Guarantee Given
on Behalf of
Companies in
Mainland China
0 Walsin Lihwa
Corporation
PT. Walsin Nickel
Industrial Indonesia
Borrego Energy, LLC
b
b
$
(US$
(US$
27,912,319
908,900)
357,710
11,648)
$
(US$
(US$
2,899,350
90,000)
368,520
12,000)
$
(US$
(US$
-
-)
368,520
12,000)
$
(US$
(US$
$
-
-)
-
-)
-
-
-
0.30
$ 123,580,876
123,580,876
Yes
Yes
No
No
No
No
Notes:
1. The information on Walsin Lihwa Corporation and its subsidiaries is listed and labeled on the entitled “No.” column.
“0” represents Walsin Lihwa Corporation.
a.
b. Subsidiaries are numbered consecutively starting from 1.
2. The relationship between Walsin Lihwa Corporation and the endorsed/guaranteed entities can be classified into the following categories
a. A company with which Walsin Lihwa Corporation does business.
b. A company in which Walsin Lihwa Corporation directly and indirectly holds more than 50% of the voting shares.
c. A company that directly and indirectly holds more than 50% of the voting shares in Walsin Lihwa Corporation.
d. A company in which Walsin Lihwa Corporation directly or indirectly holds 90% or more of the voting shares.
e. A company that fulfills Walsin Lihwa Corporation’s contractual obligations by providing mutual endorsements/guarantees for another company in the same industry or for joint builders for purposes of undertaking a construction project.
f. A company in which all capital contributing shareholders make endorsements/guarantees for it and Walsin Lihwa Corporation’s joint-investment company in proportion to their shareholding percentages.
g. A company in the same industry as Walsin Lihwa Corporation whereby either provides among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each
other.
3. According to the endorsements/guarantees provided and financing regulations provided by Walsin Lihwa Corporation, the total limit on the amount of endorsements/guarantees cannot exceed 100% of the equity of Walsin Lihwa Corporation’s current financial
statements (including the consolidated financial statements). The limit on the amount of endorsements/guarantees provided and financing provided to a single enterprise cannot exceed the equity of the guaranteed company. The limit on the amount of guarantees
provided to an investee in which over 66.67% of the common shares are held cannot exceed the amount which is 250% of the net value multiplied by the equity percentage of the guarantee provider; however, the limits mentioned above are not applicable to
Walsin Lihwa Corporation’s wholly-owned holding companies incorporated in duty-free areas overseas.
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a. The limit on the amount of endorsements/guarantees provided was as follows:
NT$123,580,876 × 100% ＝ $123,580,876
b. The limit on the amount of endorsements/guarantees provided to a single entity was as follows:
PT. Walsin Nickel Industrial Indonesia.: US$395,174 × 250% × 92% ＝ US$908,900
Borrego Energy, LLC: US$6,422 × 250% × 72.55% ＝ US$11,648
4. The currency exchange rates as of December 31, 2022 were as follows: US$ to NT$= 1:30.71.
5. The Group's plan to improve the excess amount of single corporate endorsement guarantees will be proposed by the audit committee soon.
TABLE 3
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Holding Company
Name
Type and Name of Issuer of
Marketable Securities
Relationship with the Holding
Company
Financial Statement Account
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
December 31, 2022
Walsin Lihwa
Corporation
Share
HannStar Display Corp.
The holding company is a director of the
issuer company
HannStar Board Corp.
The chairman of the holding company
and the chairman of the company are
second-class relatives
TECO Electric & Machinery Co.,
-
Ltd.
Kuong Tai Metal Industrial Co.,
The holding company is a director of the
Ltd.
issuer company
Global Investment Holdings
The holding company is a director of the
Universal Venture Capital
Investment
issuer company
-
Hwa Bao Botanic Conservation
The holding company is a supervisor of
Corp.
the issuer company
Tung Mung Development Co.,
-
Ltd.
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
299,632,180
$ 3,340,899
9.90
$ 3,340,899
63,753,952
2,017,812
12.06
2,017,812
230,438,730
6,348,587
10.77
6,348,587
9,631,802
201,788
9.39
201,788
5,221,228
55,794
2.97
55,794
1,400,000
12,904
1.16
12,904
12,000,000
132,152
15.00
132,152
14,285,000
96,264
4.01
96,264
2
6
3
2
6
4
CONCORD INDUSTRIES CONSTRUCTION CO. AND SUBSIDIARIES
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of Renminbi)
TABLE 3-1
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Holding Company Name
Type and Name of Issuer of
Marketable Securities
Relationship of Issuer
to the Holding
Company
Financial Statement Account
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
December 31, 2022
XiAn Walsin Metal Product Certification of capital verification
Co., Ltd.
Shaanxi Tianhong Silicon Industrial
Corporation
Jiangyin Walsin Specialty
Alloy Materials Co., Ltd.
Certification of capital verification
Shaanxi Electronic Group
Optoelectronics Technology Co., Ltd.
-
-
Financial assets at fair value through
other comprehensive income -
non-current
Financial assets at fair value through
other comprehensive income -
non-current
N/A
$
-
19.00
$
-
N/A
12,828
6.02
12,828
CHIN-CHERNG CONSTRUCTION CO. AND SUBSIDIARIES
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Holding Company Name
Type and Name of Issuer of
Marketable Securities
Relationship of Issuer to
the Holding Company
Financial Statement Account
December 31, 2022
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
Chin-Cherng Construction Co. Share
Gsharp Corporation
-
Financial assets at fair value through other
comprehensive income - non-current
270,000
$
-
2.73
$
-
TABLE 3-2
2
6
5
2
6
6
WALSIN INFO-ELECTRIC CORP.
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
TABLE 3-3
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a
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n
Holding Company Name
Type and Name of Issuer of
Marketable Securities
Relationship of Issuer to
the Holding Company
Financial Statement Account
December 31, 2022
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
Walsin Info-Electric Corp.
Share
K. S. Terminals Inc.
W T International Inc.
Ufi Space Co., Ltd.
InSynerger Technology Co., Ltd.
Landing AI
-
-
-
-
-
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
145,000
$ 10,179
228,000
2,278
297,069
42,569
750,000
20,397
265,583
4,044
0.09
5.43
0.95
6.60
0.54
$ 10,179
2,278
42,569
20,397
4,044
PT. WALSIN LIPPO INDUSTRIES
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of U.S. Dollars)
Holding Company
Name
Type and Name of Issuer of
Marketable Securities
Relationship of Issuer to the
Holding Company
Financial Statement Account
December 31, 2022
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
Pt. Walsin Lippo
Industries
Government bonds
Indonesia Government Bonds
-
Financial assets at amortized cost -
-
$ 6,162
N/A
$ 6,162
non-current
TABLE 3-4
2
6
7
2
6
8
COGNE ACCIAI SPECIALI S.P.A.
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of Euro)
TABLE 3-5
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Holding Company Name
Type and Name of Issuer
of Marketable Securities
Relationship of Issuer to
the Holding Company
Financial Statement Account
December 31, 2022
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
Cogne Acciai Speciali S.p.A. Share
Geo Storage
Metal Interconnector
-
-
Financial assets at fair value through profit
N/A
$
2
or loss - non-current
Financial assets at fair value through profit
2,114,787
2,197
or loss - non-current
-
1.64
$
2
2,197
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Company
Name
Type and Name of
Marketable Securities
Financial Statement
Account
Purpose of
Transaction/Count
erparty
Beginning Balance
Acquisition
Disposal
Ending Balance
Relationship
Number of
Shares
Amount
Number of
Shares
Amount
Number of
Shares
Amount
Carrying
Amount
Gain (Loss)
on Disposal
Number of
Shares
Amount
TABLE 4
Walsin Lihwa
Corporation
Share
Walsin Lihwa
Holdings Limited
Walsin Lihwa Europe
S.a r.l.
Walsin Singapore Pte.
Ltd. (formerly
known as New Hono
Investment Pte. Ltd)
PT. Sunny Metal
Industry
Investments accounted
for using the equity
method
Investments accounted
for using the equity
method
Investments accounted
for using the equity
method
Capital reduction
Subsidiaries
473,730,393 $ 26,803,960
-
$
Capital investment Subsidiaries
-
-
12,000
Capital investment Subsidiaries
42,000,000
5,828,396
380,000,000
8,448,083
(Note 1)
4,146,986
(Note 2)
13,774,869
(Note 2)
365,000,000 $ 11,178,225
$
-
$
-
108,730,393
$ 24,073,818
-
-
-
-
-
-
-
-
-
-
12,000
4,146,986
-
422,000,000
19,603,265
-
-
-
-
-
50,100
6,010,659
(Note 3)
-
-
50,100
6,251,000
6,010,659 240,341
(Note 4 )
Investments accounted
for using the equity
method
Ever Rising Limited
and Berg Holding
Limited
-
PT. Sunny Metal
Industry
Investments accounted
for using the equity
method
Walsin Singapore
Subsidiaries
Pte. Ltd. (formerly
known as New
Hono Investment
Pte. Ltd)
PT. Westrong Metal
Industry
Investments accounted
for using the equity
method
Capital investment Associated
-
Companies
-
-
-
-
-
590,000
4,590,864
-
-
-
-
590,000
4,590,864
Note 1: The amount included investment income or loss and changes in other equity.
Note 2: The amount included a capital increase in cash, recognition of investment gains and losses, and changes in other equity.
Note 3: The amount included the purchase amount, investment income or loss and changes in other equity.
Note 4: The difference between the price of equity under capital surplus- acquiring or disposing of subsidiaries and the carrying value.
2
6
9
2
7
0
WALSIN LIHWA HOLDINGS LIMITED AND SUBSIDIARIES
MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of Renminbi)
Company Name
Type and Name of
Marketable
Securities
Financial Statement
Account
Purpose of
Transaction/
Counterparty
Beginning Balance
Acquisition
Disposal
Ending Balance
Relationship
Number of
Shares
Amount
Number of
Shares
Amount
Number of
Shares
Amount
Carrying
Amount
Gain (Loss) on
Disposal
Number of
Shares
Amount
TABLE 4-1
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Walsin Lihwa
Holdings Limited
Share
Borrego Solar
Systems, Inc.
Investments accounted
for using the equity
method
New Leaf Energy,
Inc. and Borrego
Energy, LLC
Subsidiary
1,460,458
$
787,885
-
$
-
1,460,458
$
-
$
787,885
(Notes 1 and 2)
$
Share
New Leaf Energy,
Inc. (formerly
named 2022 Solar
Development, Inc.)
Share
New Leaf Energy,
Inc. (formerly
named 2022 Solar
Development, Inc.)
Share
New Leaf Energy,
Inc. (formerly
named 2022 Solar
Development, Inc.)
Share
Walsin America,
LLC
Investments accounted
for using the equity
method
Borrego Solar
Subsidiary
Systems, Inc.
Investments accounted
for using the equity
method
ECP
-
Investments accounted
for using the equity
method
Walsin America,
Subsidiary
LLC
Investments accounted
for using the equity
method
New Leaf Energy,
Inc. and Borrego
Energy, LLC
Subsidiary
Walsin America,
LLC
Share
Borrego Energy
Holdings, LLC
Borrego Energy
Holdings, LLC
Share
Borrego Energy
Holdings, LLC
Investments accounted
for using the equity
method
Investments accounted
for using the equity
method
Capital investment Subsidiary
Capital investment Subsidiary
-
-
-
-
-
-
-
1,460,458
675,004
(Note 2)
-
-
-
- 1,371,729
2,772,189
980,903
(Note 3)
1,791,286
-
-
-
-
-
-
-
-
88,729
N/A
32,450
(Notes 4 and 5)
N/A
N/A
32,450
(Note 5)
44,727
(Note 5)
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
104,703
(Note 4)
-
-
-
-
-
N/A
32,450
-
-
N/A
44,727
Notes:
1. The amount included the loss of investments and cumulative translation adjustment for the period.
2. The subsidiary Borrego Solar Systems, Inc. has been dissolved after the merger with its subsidiary New Leaf Energy, Inc.
3. The amount included the disposal of related direct costs and related costs of employees’ compensation.
4. The amount included Walsin Lihwa Holdings’ contribution of New Leaf Energy, Inc.’s shares to establish its subsidiary Walsin America, LLC and also the cash capital increase.
5. The amount included cash capital increase, recognized investment gain or loss, and cumulative translation adjustment.
6. The adjustments between the price of equity under capital surplus- acquiring or disposing of subsidiaries and its carrying value.
7. Due to the investment structure adjustments of the Group, it was transferred from WLHL to WLC in December, 2022.
WALSIN SINGAPORE PTE. LTD.
MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of U.S. Dollars)
Company Name
Type and Name of
Marketable
Securities
Financial
Statement Account
Counterparty Relationship
Beginning Balance
Acquisition
Disposal
Ending Balance
Number of
Shares
Amount
Number of
Shares
Amount
Number of
Shares
Amount
Carrying
Amount
Gain (Loss) on
Disposal
Number of
Shares
Amount
Share
PT. Sunny Metal
Industry
Walsin Singapore
Pte. Ltd.
(Formerly known
as New Hono
Investment Pte.
Ltd.)
Investments
accounted for
using the equity
method
Walsin Lihwa
Corporation
Parent
company
-
$
-
50,100
$
189,531
(Note)
-
$
-
$
-
$
-
50,100
$
189,531
Note: The amount included the purchase amount, recognized investment income or loss and changes in other equity.
TABLE 4-2
2
7
1
2
7
2
WALSIN LIHWA EUROPE S.A R.L.
MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of Euro)
Company Name
Type and Name
of Marketable
Securities
Financial
Statement Account
Counterparty Relationship
Beginning Balance
Acquisition
Disposal
Ending Balance
Number of
Shares
Amount
Number of
Shares
Amount
Number of
Shares
Amount
Carrying
Amount
Gain (Loss) on
Disposal
Number of
Shares
Amount
Walsin Lihwa
Europe S.a r.l.
Share
MEG S.A
Investments
Eugenoi
-
-
$
-
5,102
$
accounted for
using the equity
method
Marzorati
and three
others
177,148
(Note)
-
$
-
$
-
$
-
50,102
$
177,148
Note: The amount included the purchase amount, recognized investment income or loss and changes in other equity.
TABLE 4-3
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
ACQUISITION OF INDIVIDUAL REAL ESTATE AT COSTS OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, Renminbi and U.S. Dollars)
Company Name
Property Transaction Date
Transaction
Amount (Foreign
Currencies in
Thousands)
Payment Term
Counterparty
Relationships
Information on Previous Title Transfer If Counterparty Is A
Related Party
Property Owner Relationships Transaction Date Amount
Price Reference
Purpose of
Acquisition
Other
Terms
Walsin Lihwa Corporation Plant
Yantai Walsin Stainless
Plant
Steel Co., Ltd.
PT. Sunny Metal Industry Plant
2022/03/02-
2022/12/26
2022/01/14-
2022/12/31
2022/10/14-
2022/10/21
$
1,293,729 Based on the terms
Chung-Lu
in the contract
Construction Co.,
Ltd.
RMB 154,868 Based on the terms
China Construction
in the contract
US$
52,296 Based on the terms
in the contract
Eighth Engineering
Division. Co., Ltd.
PT. Perintis Makmur
Indonesia etc.
-
-
-
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Based on the
Manufacturing and
marketability
operating
purpose
N/A
Based on the
Manufacturing and
marketability
operating
purpose
N/A
Based on the
Manufacturing and
marketability
operating
purpose
-
-
-
TABLE 5
2
7
3
2
7
4
WALSIN LIHWA CORPORATION
TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
TABLE 6
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Relationship
Transaction Details
Abnormal
Transaction
Notes/Accounts Payable
or Receivable
Purchase/
Sale
Amount
% of
Total
Payment Terms
Unit Price
Payment
Terms
Ending
Balance
% of
Total
Note
Walsin Lihwa
Corporation
Dongguan Walsin Wire & Cable
100% indirectly
Sales
$
(326,711)
-
The payment terms are set by
Normal
Normal
$
-
-
Co., Ltd.
owned subsidiary
Koung Tai Metal Industrial Co.,
Director of the related
Sales
(1,447,563)
Ltd.
party
Jiangyin Walsin Specialty Alloy
100% indirectly
Sales
(255,763)
Materials Co., Ltd.
owned subsidiary
Changshu Walsin Specialty Steel
100% indirectly
Sales
(242,061)
Co., Ltd.
owned subsidiary
quotations on the local market, and
the transaction terms are similar to
those of general customers.
(1) The payment terms are set by
-
-
quotations on the local market, and
the transaction terms are similar to
those of general customers.
The payment terms are set by
quotations on the local market, and
the transaction terms are similar to
those of general customers.
The payment terms are set by
quotations on the local market, and
the transaction terms are similar to
those of general customers.
Normal
Normal
42,651
1
Normal
Normal
150,819
4
Similar
Similar
102,984
3
TABLE 6-1
WALSIN LIHWA HOLDINGS LIMITED AND SUBSIDIARIES
TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars and Renminbi)
Company Name
Related Party
Relationship
Transaction Details
Abnormal Transaction
Notes/Accounts
Payable or
Receivable
Purchase/
Sale
Amount
% of
Total
Payment Terms
Unit Price Payment Terms Ending Balance
Note
% of
Total
Dongguan Walsin
Walsin Lihwa Corporation Parent company
Purchases
$
326,711
2
The payment terms are set by quotations
Normal
Normal
$
-
-
Wire & Cable Co.,
Ltd.
Shanghai Walsin Lihwa
Power Wire & Cable
Co., Ltd.
Both subsidiaries of
Walsin Lihwa
Corporation
Shanghai Walsin
Dongguan Walsin Wire &
Lihwa Power Wire
& Cable Co., Ltd.
Cable Co., Ltd.
Yantai Walsin Stainless
Steel Co., Ltd.
Both subsidiaries of
Walsin Lihwa
Corporation
Both subsidiaries of
Walsin Lihwa
Corporation
Sales
RMB
(79,290)
(2)
The payment terms are set by quotations
Normal
Normal
RMB
2,513
3
on the local market, and the
transaction terms are similar to those
of general customers.
on the local market, and the
transaction terms are similar to those
of general customers.
Purchases
RMB
79,290
12
The payment terms are set by quotations
Normal
Normal
RMB
(2,513)
(38)
Sales
RMB (32,480)
(4)
The payment terms are set by quotations
Normal
Normal
RMB
4,145
4
on the local market, and the
transaction terms are similar to those
of general customers.
on the local market, and the
transaction terms are similar to those
of general customers.
2
7
5
2
7
6
CONCORD INDUSTRIES LIMITED AND SUBSIDIARIES
TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars and Renminbi)
TABLE 6-2
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Relationship
Transaction Details
Abnormal Transaction
Notes/Accounts Payable
or Receivable
Purchase/
Sale
Amount
% of
Total
Payment Terms
Unit Price
Payment
Terms
Ending Balance
% of
Total
Note
Yantai Walsin Stainless
Changshu Walsin Specialty
Both subsidiaries of Concord
Sales
RMB(198,7637)
(6) The payment terms are set by quotations
Normal
Normal
RMB
25,973
2
Steel Co., Ltd.
Steel Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
Jiangyin Walsin Specialty
Both subsidiaries of Concord
Sales
RMB (278,697)
(8) The payment terms are set by quotations
Normal
Normal
RMB
19,682
2
Alloy Materials Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
Changshu Walsin Specialty
Both subsidiaries of Concord
Purchases
RMB
50,664
1
The payment terms are set by quotations
Normal
Normal
RMB
(8,381)
(2)
Steel Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
Jiangyin Walsin Specialty
Both subsidiaries of Concord
Purchases
RMB
28,542
1
The payment terms are set by quotations
Normal
Normal
RMB
(2,695)
(1)
Alloy Materials Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
Shanghai Walsin Lihwa
Both subsidiaries of Walsin
Purchases
RMB
32,480
1
The payment terms are set by quotations
Normal
Normal
RMB
(4,145)
-
Power Wire & Cable Co.,
Ltd.
Lihwa Corporation
on the local market, and the transaction
terms are similar to those of general
customers.
Jiangyin Walsin
Walsin Lihwa Corporation Parent company
Purchases
255,763
16
The payment terms are set by quotations
Normal
Normal
(150,819)
(54)
Specialty Alloy
Materials Co., Ltd.
on the local market, and the transaction
terms are similar to those of general
customers.
Yantai Walsin Stainless
Both subsidiaries of Concord
Purchases
RMB 278,697
79
The payment terms are set by quotations
Normal
Normal
RMB
19,682
(31)
Steel Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
Yantai Walsin Stainless
Both subsidiaries of Concord
Sales
RMB
(28,542)
(7) The payment terms are set by quotations
Normal
Normal
RMB
2,695
2
Steel Co., Ltd.
Industries Limited
on the local market, and the transaction
terms are similar to those of general
customers.
(Continued)
Company Name
Related Party
Relationship
Transaction Details
Abnormal Transaction
Notes/Accounts Payable
or Receivable
Purchase/
Sale
Amount
% of
Total
Payment Terms
Unit Price Payment Terms Ending Balance
% of
Total
Note
Changshu Walsin
Yantai Walsin Stainless
Both subsidiaries of Concord
Purchases
RMB 198,637
32
The payment terms are set by quotations
Normal
Normal
RMB
(25,973)
(11)
Specialty Steel Co.,
Ltd.
Steel Co., Ltd.
Industries Limited
Yantai Walsin Stainless
Both subsidiaries of Concord
Sales
RMB
(50,664)
Steel Co., Ltd.
Industries Limited
on the local market, and the
transaction terms are similar to those
of general customers.
(6) The payment terms are set by quotations
on the local market, and the
transaction terms are similar to those
of general customers.
Normal
Normal
RMB
8,381
3
Walsin Lihwa
Corporation
Parent company
Purchases
242,061
9
The payment terms are set by quotations
Normal
Normal
(102,984)
(10)
on the local market, and the
transaction terms are similar to those
of general customers.
(Concluded)
2
7
7
2
7
8
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
TABLE 7
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Relationship
Financial Statement Account and
Ending Balance
Turnover
Rate
Amount
Overdue
Action
Taken
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
Walsin Lihwa
Corporation
Jiangyin Walsin Specialty Alloy Materials
100% indirectly owned subsidiary Trade receivables
$ 150,819
1.29
$
Co., Ltd.
Changshu Walsin Specialty Steel Co., Ltd.
PT. Sunny Metal Industry
PT. Westrong Metal Industry
100% indirectly owned subsidiary Trade receivables
50.1% indirectly owned subsidiary Other receivables
29.5% indirectly owned associate Other receivables
102,984
5,481,736
1,228,863
1.26
-
-
$
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
WALSIN LIHWA HOLDINGS LIMITED AND SUBSIDIARIES
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of Renminbi and U.S. Dollars)
Company Name
Related Party
Relationship
Financial Statement Account and
Ending Balance
Turnover
Rate
Overdue
Amount
Action
Taken
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
TABLE 7-1
Walsin Lihwa Holdings Limited Walsin (China) Investment Co., Ltd.
Walsin Lihwa Corporation
100% owned subsidiary
Parent company
Other receivables RMB 264,805
53,230
Trade receivables RMB
Walsin (China) Investment Co.,
Walsin Lihwa Holdings Limited
Parent company
Other receivables US$
4,900
Ltd.
Yantai Walsin Stainless Steel Co., Ltd.
Both subsidiaries of Walsin
Lihwa Corporation
Changshu Walsin Specialty Steel Co., Ltd. Both subsidiaries of Walsin
Lihwa Corporation
Other receivables US$
Other receivables US$
140,443
RMB 481,667
45,237
Jiangyin Walsin Specialty Alloy Materials
Both subsidiaries of Walsin
Other receivables US$
44,640
Co., Ltd.
Jiangyin Walsin Steel Cable Co., Ltd.
Lihwa Corporation
100% owned subsidiary
Hangzhou Walsin Power Cable & Wire Co.,
Associate
Ltd.
Other receivables US$
Other receivables RMB
8,067
RMB 106,151
81,237
XiAn Walsin Metal Product Co., Ltd.
Both subsidiaries of Walsin
Other receivables RMB 179,818
Nanjing Taiwan Trade Mart Management
Both subsidiaries of Walsin
Other receivables RMB
96,282
Co., Ltd.
Lihwa Corporation
Dongguan Walsin Wire & Cable Co., Ltd. 100% owned subsidiary
Walsin (Nanjing) Development Co., Ltd.
Both subsidiaries of Walsin
Other receivables US$
24,210
Other receivables RMB 807,674
Lihwa Corporation
Lihwa Corporation
Walsin International Investments
Walsin Lihwa Corporation
Parent company
Other receivables RMB 788,305
Limited
PT. Walsin Nickel Industrial Indonesia
Both subsidiaries of Walsin
Other receivables RMB 701,665
Lihwa Corporation
Walsin (China) Investment Co., Ltd.
Both subsidiaries of Walsin
Other receivables RMB 2,915,745
Lihwa Corporation
Dongguan Walsin Wire & Cable
Walsin (China) Investment Co., Ltd.
Both subsidiaries of Walsin
Other receivables RMB 220,228
Co., Ltd.
Shanghai Walsin Lihwa Power
Wire & Cable Co., Ltd.
Walsin (China) Investment Co., Ltd.
Both subsidiaries of Walsin
Other receivables RMB 128,409
Lihwa Corporation
Lihwa Corporation
Note: Amounts are stated in thousands of Renminbi, except those stated in thousands of U.S. dollars.
2
7
9
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2
8
0
CONCORD INDUSTRIES LIMITED AND SUBSIDIARIES
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of Renminbi)
TABLE 7-2
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Relationship
Financial Statement Account and
Ending Balance
Turnover
Rate
Amount
Action Taken
Overdue
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
Yantai Walsin Stainless Steel
Changshu Walsin
Both are subsidiaries of Concord
Trade receivables
$
25,973
7.45
$
Co., Ltd.
Specialty Steel Co.,
Ltd.
Industries Limited
Changshu Walsin Specialty
Walsin (China)
Both are subsidiaries of Walsin
Other receivables
30,702
Steel Co., Ltd.
Investment Co., Ltd.
Lihwa Corporation
Jiangyin Walsin Specialty
Walsin (China)
Both are subsidiaries of Walsin
Other receivables
93,552
Alloy Materials Co., Ltd.
Investment Co., Ltd.
Lihwa Corporation
-
-
-
-
-
-
-
-
$
5,250
$
-
-
-
-
-
CHIN-CHERNG CONSTRUCTION CO. AND SUBSIDIARIES
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of Renminbi)
Company Name
Related Party
Relationship
Financial Statement Account
and Ending Balance
Turnover
Rate
Amount
Action Taken
Overdue
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
Joint Success Enterprises
Walsin (Nanjing) Development Co., Ltd. Subsidiary
Other receivables
$ 198,436
-
$
-
-
$
-
$
-
Limited
TABLE 7-3
2
8
1
2
8
2
WALSIN SINGAPORE PTE. LTD. AND SUBSIDIARIES
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of U.S. Dollars)
TABLE 7-4
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Relationship
Financial Statement Account
and Ending Balance
Turnover
Rate
Amount
Action Taken
Overdue
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
Walsin Singapore Pte. Ltd. Walsin Lihwa Corporation
Parent company
Other receivables
$ 179,800
-
$
-
-
$
-
$
-
WALSIN LIHWA CORPORATION
NAMES, LOCATIONS, AND RELATED INFORMATION OF INVESTEES OVER WHICH THE GROUP EXERCISES SIGNIFICANT INFLUENCE
FOR THE YEAR ENDED DECEMBER 31, 2022
Information of investees that Walsin Lihwa Corporation has controlling power or significant influence over was as follows (in thousands of New Taiwan dollars U.S. dollars and Hong Kong dollars):
Investor
Company
Investee Company
Location
Main Businesses and Products
Original Investment Amount
December 31,
2022
December 31,
2021
Number of Shares
Carrying Amount
Balance as of December 31, 2022
Percentage
of
Ownership
(%)
TABLE 8
Net Income
(Loss) of the
Investee
Investment
Gain (Loss)
Note
Walsin Lihwa
Corporation
Walsin Lihwa Holdings Limited
Concord Industries Limited
Ace Result Global Limited
Min Maw Precision Industry Corp.
British Virgin Islands Investments holding
British Virgin Islands Investments holding
British Virgin Islands Investments holding
Taiwan
Solar power systems management,
$
3,317,552
$
13,611,135
1,587,416
180,368
14,495,777
13,611,135
1,587,416
180,368
108,730,393
308,498,375
44,739,988
32,791,149
100.00
100.00
100.00
100.00
$
24,073,818
5,210,454
354,722
388,436
$ 7,661,077 $ 7,661,054
(210,389)
(34,906)
22,733
(210,389 )
(34,906 )
22,733
Waltuo Green Resources Corporation
Taiwan
Waste disposal, resource recovery and
10,000
10,000
1,828,287
100.00
17,660
(1,543)
(1,543 )
design, and installation
Walsin Precision Technology Corp.
Malaysia
Production and sale of stainless steel
434,994
434,994
32,178,385
100.00
563,204
88,275
88,275
cement products
Chin-Cherng Construction Co.
Taiwan
Walsin Info-Electric Corp.
Taiwan
PT. Walsin Lippo Industries
PT. Walsin Lippo Kabel
Indonesia
Indonesia
plates
Investment in the construction of
residential, sale of commercial
buildings, rental design and interior
decoration business
Mechanical and electrical,
communications, and power
systems
Steel wires
Production and sale of cables and
wires
PT. Walsin Nickel Industrial Indonesia
Joint Success Enterprises Limited
Chin-Xin Investment Co., Ltd.
Tsai Yi Corporation (Formerly known as
Walsin Color Co., Ltd.)
Production and sale of nickel pig iron
Indonesia
British Virgin Islands Investments holding
Taiwan
Taiwan
Investments
Management and investments holding
Concord II Venture Capital Co., Ltd.
Winbond Electronics Corp.
Taiwan
Taiwan
Venture capital and consulting affairs
Research, development, production
and sale of semiconductors and
related components
611,688
611,688
577,583,403
99.22
6,182,490
(239,992)
(238,136 )
270,034
270,034
29,854,246
99.51
314,008
2,025
2,015
481,663
11,656
481,663
11,656
10,500
1,050,000
1,509,171
1,164,273
2,237,969
457,610
1,509,171
1,164,273
2,237,969
457,610
500,000
36,058,184
179,468,270
49,831,505
257,860
7,429,920
257,860
7,429,920
26,670,699
883,848,423
70.00
70.00
50.00
49.05
37.00
33.97
26.67
22.21
953,239
12,000
26,703
(1,001)
18,692
(701 )
5,832,774
5,084,267
7,744,232
799,618
6,067,971 3,069,275
(508,445)
1,026,112
4,840
(172,225 )
369,503
1,644
174,997
20,953,105
(15,248)
(4,067 )
12,927,165 2,863,601
Walton Advanced Engineering, Inc.
Taiwan
Production, sale, and testing of
1,185,854
1,185,854
109,628,376
21.01
2,109,400
258,067
54,220
Walsin Technology Corp.
Taiwan
Production and sale of ceramic
1,649,039
1,649,039
88,902,325
18.30
8,147,080
1,640,227
300,162
semiconductors
capacitors
Powertec Electrochemical Corp.’s
Taiwan
Basic industrial chemical
2,945,925
2,945,925
318,522,792
22.46
-
-
-
Walsin Singapore Pte. Ltd.(formerly known
Singapore
Investments holding
16,790,710
5,003,810
422,000,000
100.00
19,603,265
2,465,074 2,022,543
as New Hono Investment Pte. Ltd)
manufacturing and energy technical
services
PT. Sunny Metal Industry
Walsin Lihwa Europe S.a r.l.
PT. Walsin Research Innovation Indonesia Indonesia
Walsin America, LLC
PT. CNGR Walsin New Energy and
USA
Indonesia
Indonesia
Luxembourg
Manufacture and sale of nickel matte
Investments holding
Consulting and management
Investments
Investments holding
-
6,692,862
22,223
185,752
300,000
Technology Indonesia
PT. Westrong Metal Industry
Indonesia
Manufacture and sale of nickel matte
4,680,030
2
8
3
-
-
-
-
-
-
-
12,000
6,930
N/A
140,651
-
100.00
99.00
100.00
29.17
(25,416)
-
148,026
4,146,986
21,342
25
(17,487) (1,001,746)
(869)
278,241
(6,141 ) (Note 4)
148,026
25
-
(313 )
(Note 5)
590,000
29.50
4,590,864
(3,352)
-
(Continued)
2
8
4
Investor Company
Investee Company
Location
Main Businesses and Products
Original Investment Amount
December 31,
2022
December 31,
2021
Number of Shares
Carrying Amount
Balance as of December 31, 2022
Percentage
of
Ownership
(%)
Net Income (Loss)
of the Investee
Investment
Gain (Loss)
Note
Walsin Lihwa Holding
Walsin International Investments
Hong Kong
Investments
HK$ 4,653,372 HK$ 4,653,372 $ 4,653,371,702
100.00
$
19,584,996
$
993,233
$
993,233
Limited
Limited
Walcom Chemicals Industrial
Hong Kong
Commerce
US$
0.030 US$
0.030
325,000
65.00
0.842
-
-
Limited
Walsin America, LLC
Borrego Solar Systems, Inc.
USA
USA
Investments
Grid-connected solar electric systems US$
-
- US$
-
15,000
N/A
-
-
-
-
-
(1,001,746)
(1,013,915)
(1,001,746) (Note 5)
(744,463) (Note 1)
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Walsin America, LLC
Borrego Energy Holdings, LLC USA
Investments
US$
38,147
US$
Borrego Energy
Holdings, LLC
Borrego Energy, LLC
USA
Grid-connected solar electric systems US$
US$
-
-
N/A
72.55
143,078
(1,380,776)
(1,001,746)
N/A
100.00
197,220
(1,380,776)
(1,380,776)
Concord Industries
Walsin Specialty Steel Corp.
British Virgin
Islands
Commerce and investments
US$
US$
101,400
(Note 3)
92,393,195
100.00
1,383,391
351,416
351,416
52,576
(Note 2)
92,393
(Note 3)
Joint Success Enterprises Limited British Virgin
Investments
1,202,993
1,202,993
37,461,816
50.95
5,097,232
(508,445)
(259,053)
Dinghsin Development Co., Ltd. Taiwan
Investment of real estate and related
business
Concord II Venture Capital Co.,
Taiwan
Venture capital and consulting affairs
8,540
1,603
8,540
1,603
Islands
Ltd.
Chin-Xin Investment Co., Ltd.
Taiwan
Investments
54,154
54,154
3,264,092
2,119,200
35.32
172,342
0.17
0.67
38,212
1,131
2,559
(15,248)
904
4
142,143
1,026,112
6,882
Limited
Chin-Cherng
Construction Co.
Walsin Singapore Pte.
PT. Walsin Nickel Industrial
Indonesia
Production and sale of nickel pig iron US$
42,000
US$
42,000
42,000
42.00
5,097,031
6,067,971
2,548,548
Ltd. (Formerly known
as New Hono
Investment Pte. Ltd)
Indonesia
PT. Sunny Metal Industry
Indonesia
Manufacture and sale of nickel matte
US$
200,000
Walsin Lihwa Europe
MEG S.A.
Luxembourg
Investments
EUR 207,216
S.a r.l.
-
-
50,100
50.10
5,820,497
(25,416)
(82,853) (Note 4)
5,102
85.03
5,796,269
(225,154)
148,084
Note 1: On May 24, 2022, WLC’s board of directors resolved that its subsidiary Borrego Solar Systems, Inc. would split its business into its 100% subsidiaries New Leaf Energy, Inc. (original name of the announcement: 2022 Solar Development, Inc.) and Borrego
Energy, LLC, and sold its subsidiary New Leaf Energy, Inc.; the transaction was completed on July 28, 2022 (United States local time July 27, 2022).
Note 2: The amount of the payment of US$10,372 thousand was deducted for Borrego Energy, LLC employees’ compensation, which was paid by Walsin Lihwa Corporation.
Note 3: The amount included capitalization of retained earnings of US$4,500 thousand.
Note 4: Due to adjustments in the investment structure of the Group, it was transferred from Walsin Lihwa Corporation to Walsin Singapore Pte. Ltd.
Note 5: Due to adjustments in the investment structure of the Group, it was transferred from Walsin Lihwa Holding Limited to Walsin Lihwa Corporation.
Note 6: Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars and Hong Kong dollars.
(Concluded)
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
INFORMATION ON INVESTMENTS IN MAINLAND CHINA
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, U.S. Dollars and Renminbi)
A. Walsin Lihwa Corporation
TABLE 9
The names of investee companies in mainland China, their main businesses and products, total amount of paid-in capital, investment type, investment flows, percentage of ownership in investment, investment gain or loss, carrying amount, accumulated
1.
inward remittance of earnings and upper limit on investment in mainland China were as follows:
Investee Company
Main Businesses and
Products
Paid-in Capital
Method of
Investment
(Note 1)
Jiangyin Walsin Steel
Cable Co., Ltd.
Manufacture and sale of steel
cables and wires
$
(US$
614,200
20,000)
Shanghai Walsin Lihwa
Power Wire & Cable
Co., Ltd.
Manufacture and sale of
cables and wires
(US$
479,905
15,627)
Hangzhou Walsin Power
Cable & Wire Co., Ltd.
Manufacture and sale of
cables and wires
(US$
5,468,837
178,080)
Walsin (China) Investment
Investments
Co., Ltd.
(US$
2,413,806
78,600)
Changshu Walsin Specialty
Steel Co., Ltd.
Manufacture and sale of
specialized steel tubes
(US$
2,978,870
97,000)
Shanghai Baihe Walsin
Lihwa Specialty Steel
Co., Ltd.
Manufacture and sale of
stainless steel
-
-
Dongguan Walsin Wire &
Cable Co., Ltd.
Manufacture and sale of bare
copper cables and wires
(US$
798,460
26,000)
Jiangyin Walsin Specialty
Manufacture and sale of
Alloy Materials Co., Ltd.
cold-rolled stainless steel
and flat rolled products
(US$
1,504,790
49,000)
XiAn Walsin Metal
Product Co., Ltd. (Note
13)
Manufacture and sale of
specialized stainless steel
plates
(US$
1,699,799
55,350)
Yantai Walsin Stainless
Production and sale of
Steel Co., Ltd.
electronic components and
new alloy materials
(US$
10,289,846
335,065)
(Note 11)
b
b
b
b
b
b
b
b
b
b
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
January 1, 2022
$
(US$
(US$
(US$
(US$
(US$
(US$
(US$
(US$
799,719
26,041)
(Note 2)
459,299
14,956)
(Note 3)
2,591,310
84,380)
(Note 4)
2,413,806
78,600)
(Note 5)
2,978,870
97,000)
(Note 6)
1,197,690
39,000)
(Note 7)
798,460
26,000)
(Note 9)
1,504,790
49,000)
(Note 10)
(US$
925,907
30,150)
(US$
6,538,988
212,927)
Remittance of Funds
Outward
Inward
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
December 31, 2022
Net Income
(Loss) of the
Investee
Ownership
of Direct or
Indirect
Investment
(%)
Investment
Gain (Loss)
(Note 16)
Carrying
Amount
as of
December 31,
2022
Accumulated
Repatriation of
Investment Income
as of
December 31, 2022
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
$
(US$
-
-
-
-
-
-
-
-
(US$
(US$
(US$
(US$
(US$
1,197,690
39,000)
799,719
26,041)
(Note 2)
459,299
14,956)
(Note 3)
2,591,310
84,380)
(Note 4)
2,413,806
78,600)
(Note 5)
2,978,870
97,000)
(Note 6)
-
-
-
-
-
-
-
-
-
-
(US$
(US$
798,460
26,000)
(Note 9)
1,504,790
49,000)
(Note 10)
(US$
925,907
30,150)
(US$
6,538,988
212,927)
$
(43,738)
100.00
$
(43,738 ) $
841,752
$
90,369
95.71
86,492
1,207,083
(142,964)
40.00
(57,187 )
681,239
(217,027)
100.00
(217,027 )
4,300,323
337,522
100.00
337,522
1,048,836
(1,028)
-
(1,028 )
-
(Note 8)
(191,422)
100.00
(191,422 )
1,485,939
(230,096)
100.00
(230,096 )
1,763,939
(14,022)
100.00
(14,022 )
(792,817)
(678,277)
100.00
(678,277 )
4,100,422
-
-
-
-
-
-
-
-
-
-
(Continued)
2
8
5
2
8
6
Investee Company
Main Businesses and
Products
Paid-in Capital
Changzhou China Steel
Melting and forging of
Precision Materials Co.,
Ltd.
nonferrous metallic materials
and composites as well as
new types of alloys
$
(US$
1,338,956
43,600)
Nanjing Taiwan Trade Mart
Management Co., Ltd.
Business and asset
management, consulting and
advertising services
(US$
30,710
1,000)
Dong Guan Cogne Steel
Products Co., Ltd.
Stainless Steel Products
Shaanxi Tianhong Silicon
Industrial Corporation
Polysilicon production
(US$
835,312
27,200)
5,291,208
(RMB 1,200,000)
Jiangsu Taiwan Trade Mart
Development Co., Ltd.
Development and management
of Nanjing Taiwan Trade
Mart Management Co., Ltd.
(RMB
44,093
10,000)
Shaanxi Electronic Group
Optoelectronics
Technology Co., Ltd.
(Note 14)
Communications equipment
and electronic components
686,080
(RMB 155,597)
Walsin (Nanjing)
Construction, rental and sale of
Development Co., Ltd.
buildings and industrial
factories
(US$
1,535,500
50,000)
Nanjing Walsin Property
Management Co., Ltd.
Property management, business
management and housing
leasing
(RMB
4,409
1,000)
2. The upper limit on investment of WLC in mainland China was as follows:
Method of
Investment
(Note 1)
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
January 1, 2022
Remittance of Funds
Outward
Inward
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
December 31, 2022
Net Income
(Loss) of the
Investee
Ownership
of Direct or
Indirect
Investment
(%)
Investment Gain
(Loss)
(Note 16)
Carrying Amount
as of
December 31, 2022
b
b
b
b
b
b
b
b
$
(US$
401,687
13,080)
$
(US$
30,710
1,000)
-
-
-
-)
9,336
304)
-
-
(US$
(US$
RMB
(US$
1,529,358
49,800)
(Note 15)
RMB
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
$
(US$
401,687
13,080)
$
238,066
30.00
$
71,420
$
519,403
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(US$
30,710
1,000)
(97,643 )
100.00
(97,643)
(518,896)
-
-
-
-)
9,336
304)
-
-
(US$
(US$
RMB
(US$
1,529,358
49,800)
(Note 15)
RMB
-
-
32,389
100.00
32,389
163,535
-
19.00
-
-
(Note 12)
1,332
20.00
265
9,736
31,798
6.02
-
56,563
(526,029 )
99.60
(523,937)
9,233,321
(12,868 )
99.60
(12,818)
(18,100)
Accumulated Outward Remittance for
Investment in Mainland China as of
December 31, 2022
(NT$ and US$ in Thousands)
Investment Amounts Authorized by the
Investment Commission, MOEA
(NT$ and US$ in Thousands)
Upper Limit on the Amount of Investments Stipulated by
the Investment Commission, MOEA
(NT$ in Thousands)
$
(US$
19,767,658
643,688)
$
(US$
19,706,392
641,693)
N/A (Note 19)
Accumulated
Repatriation of
Investment Income
as of
December 31, 2022
$
(US$
937,269
30,520)
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-
-
-
-
-
-
(Continued)
Notes:
1. Investments can be classified into three categories as follows:
a. Direct investment in mainland China.
b. Reinvestment in mainland China through companies in a third country companies.
c. Others.
2. Including US$15,000 thousand investment through Walsin (China) Investment Co., Ltd.
3. Including US$14,950 thousand investment through Walsin (China) Investment Co., Ltd.
4. Including US$13,300 thousand investment through Walsin (China) Investment Co., Ltd., US$53,000 thousand investment through Ace Result Global Ltd. and US$22,730 thousand dividends appropriated from Dongguan Walsin Wire & Cable Co., Ltd.,
Jiangying Walsin Steel Cable Co., Ltd., Shanghai Walsin Lihwa Power Wire & Cable Co., Ltd. and Hangzhou Walsin Power Cable & Wire Co., Ltd.
5. Capital investment of US$28,600 thousand was contributed from the accounts payable of Walsin (China) Investment Co., Ltd. to Walsin Lihwa Holdings Limited.
6. Including US$20,000 thousand investment through Walsin Specialty Steel Corp. and US$42,000 thousand dividends appropriated from Changshu Walsin Specialty Steel Co., Ltd. and Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd.
7. Including US$4,800 thousand investment through Walsin (China) Investment.
8. The liquidation and deregistration of Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd were completed on July 13, 2022.
9. Investment through Walsin (China) Investment Co., Ltd.
10. Including investments through Walsin (China) Investment Co., Ltd. of US$4,500 thousand and US$4,500 thousand of the own capital of Walsin (China) Investment Co., Ltd.
11. Including investments of its own capital of RMB578,796 thousand from Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd., Changzhou Wujin NSL Co., Ltd. and Changshu Walsin Specialty Steel Co., Ltd. and RMB3,750 thousand investments through
Changzhou Wujin NSL Co., Ltd. Including US$32,927 thousand investment through Yantai Huanghai Iron and Steel Co., Ltd. and Yantai Dazhong Recycling Resource Co., Ltd. which were merged.
12. The amount was adjusted by the capital of XiAn Lv Jing Technology Co., Ltd. of RMB228,000 thousand and the fair value.
13. XiAn Walsin Metal Product Co., Ltd. merged XiAn Lv Jing Technology Co., Ltd. and XiAn Walsin Opto-electronic Limited.
14. Shaanxi Electronic Group Optoelectronics Technology Co., Ltd. was formerly known as Shaanxi Optoelectronics Technology Co., Ltd.
15. The amount included investment through Joint Success Enterprise Limited approved in the previous years.
16. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars and Renminbi.
17. The currency exchange rates as of December 31, 2022 were as follows: US$to NT$= 1:30.71, RMB to NT$= 1:4.40934. The average exchange rates of December 31, 2022 were as follows: US$to NT$= 1:29.805, RMB to NT$= 1:4.41084.
18. The basis for recognizing investment gains and losses in the current period is the financial report audited by an international accounting firm that has a cooperative relationship with the accounting firm of the Republic of China.
19. Upper limit on investment:
WLC was approved as the operation headquarter by the Industrial Development Bureau, Ministry of Economic Affairs and is thus exempted from the related regulations of “Regulations Governing the Approval of Investment or Technical Cooperation in
Mainland China”.
(Continued)
2
8
7
2
8
8
B. Chin-Cherng Construction Co.
TABLE 9-1
1. The names of investee companies in mainland China, their main businesses and products, total amount of paid-in capital, investment type, investment flows, percentage of ownership in investment, investment gain or loss, carrying amount, accumulated
inward remittance of earnings and upper limit on investment in mainland China were as follows:
(In Thousands of U.S. and Renminbi)
Investee Company
Main Businesses and
Products
Paid-in Capital
Method of
Investment
(Note 1)
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
January 1, 2022
Remittance of Funds
Outward
Inward
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
December 31, 2022
Net Income (Loss)
of the Investee
Ownership
of Direct or
Indirect
Investment
(%)
Investment Gain
(Loss)
(Note 16)
Carrying Amount
as of
December 31, 2022
Accumulated
Repatriation of
Investment Income
as of
December 31, 2022
Walsin (Nanjing)
Development Co.,
Ltd.
Construction, rental and
sale of buildings and
industrial factories
Nanjing Walsin
Property
Management Co.,
Ltd.
Property management,
business management
and housing leasing
US$ 50,000
Note 1
US$ 25,475
$
-
$
-
US$ 25,475
$
(119,258)
50.95
$
(60,762)
$ 1,071,169
$
1,000
Note 1
-
-
-
-
(2,917)
50.95
(1,486)
(2,100)
2. The upper limit on investment in mainland China
Accumulated Investment in
Mainland China as of December 31, 2022
(US$ in Thousands)
Investment Amounts Authorized by the
Investment Commission, MOEA
(US$ in Thousands)
Upper Limit on the Amount of Investments Stipulated by the
Investment Commission, MOEA
(NT$ in Thousands)
US$25,475
US$25,475
NT$3,738,655 (Note 3)
Note 1:
Investing in companies in mainland China through the companies already established and existing in the areas other than Taiwan and mainland China.
Note 2: The basis for recognizing investment gains and losses in the current period is the financial statements audited by an international accounting firm that has a cooperative relationship with the accounting firm of the Republic of China.
Note 3: The upper limit on investment in mainland China was as follows:
NT$6,231,092 × 60% = NT$3,738,655 thousand.
Note 4: Amounts are stated in thousands of Renminbi, except those stated in thousands of U.S. dollars.
-
-
(Concluded)
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TABLE 10
WALSIN LIHWA CORPORATION AND INVESTEES
INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars, US Dollars and Renminbi)
No.
Company
Counterparty
Relationship
Financial
Statement
Accounts
Transaction Details
Amount
Payment Terms
% of Total
Sales or
Assets
2022
0 Walsin Lihwa Corporation Changshu Walsin Specialty Steel
Co., Ltd.
Jianyin Walsin Specialty Alloy
Materials Co., Ltd.
Dongguan Walsin Wire & Cable Co.,
Ltd.
Changshu Walsin Specialty Steel
Co., Ltd.
Jianyin Walsin Specialty Alloy
Materials Co., Ltd.
PT. Sunny Metal Industry
Dongguan Walsin Wire & Cable Co.,
Ltd.
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Trade receivables
$
$102,984 The terms are set by quotations on the local market
and are similar to those of general customers
Trade receivables
150,819 The terms are set by quotations on the local market
Sales
Sales
Sales
and are similar to those of general customers
326,711 The terms are set by quotations on the local market
and are similar to those of general customers
242,061 The terms are set by quotations on the local market
and are similar to those of general customers
255,763 The terms are set by quotations on the local market
and are similar to those of general customers
Other receivables
5,481,736 Based on capital demand
Other receivables
36,445 Based on capital demand
1 Walsin Lihwa Holdings
Limited
Walsin (China) Investment Co., Ltd. Transactions between parent
company and subsidiaries
Other receivables
RMB 264,805 Based on capital demand
Walsin Lihwa Corporation
Transactions between
Trade receivables
RMB
53,230 The terms are set by quotations on the local market
subsidiaries and parent
company
and are similar to those of general customers
2
Joint Success Enterprises
Walsin (Nanjing) Development Co.,
Limited
Ltd.
Transactions between parent
company and subsidiaries
Other receivables
RMB 198,436 Based on capital demand
-
-
-
-
-
2
-
-
-
-
(Continued)
2
8
9
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2
9
0
No.
Company
Counterparty
Relationship
Financial
Statement
Accounts
Transaction Details
Amount
Payment Terms
% of Total
Sales or
Assets
3 Walsin (China)
Walsin Lihwa Holdings Limited
Transactions between subsidiaries
Other receivables
US$
4,900 Based on capital demand
Investment Co., Ltd.
and parent company
Yantai Walsin Specialty Steel Co., Ltd.
Transactions between subsidiaries Other receivables
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Other receivables
Co., Ltd.
Jiangyin Walsin Steel Cable Co., Ltd.
Transactions between parent
company and subsidiaries
Other receivables
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Other receivables
Walsin (Nanjing) Development Co., Ltd. Transactions between subsidiaries Other receivables
Transactions between subsidiaries Other receivables
XiAn Walsin Metal Product Co., Ltd.
Transactions between subsidiaries Other receivables
Nanjing Taiwan Trade Mart Management
US$
140,443
RMB 481,667
US$
Based on capital demand
44,640 The terms are set by quotations on the local market
and are similar to those of general customers
Based on capital demand
US$
8,067
RMB 106,151
45,237 Based on capital demand
US$
RMB 807,674 Based on capital demand
RMB 179,818 Based on capital demand
96,282 Based on capital demand
RMB
Co., Ltd.
Dongguan Walsin Wire & Cable Co., Ltd. Transactions between parent
company and subsidiaries
Other receivables
US$
24,210 Based on capital demand
4 Walsin International
Walsin Lihwa Corporation
Transactions between subsidiaries
Other receivables
RMB 788,305 Based on capital demand
Investments Limited
and parent company
PT. Walsin Nickel Industrial Indonesia
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
Transactions between subsidiaries Other receivables
RMB 701,665 Based on capital demand
RMB 2,915,745 Based on capital demand
5 Yantai Walsin Stainless
Steel Co., Ltd.
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Trade receivables
RMB
25,973 The terms are set by quotations on the local market
and are similar to those of general customers
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Trade receivables
RMB
19,682 The terms are set by quotations on the local market
Co., Ltd.
and are similar to those of general customers
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Sales
RMB 198,637 The terms are set by quotations on the local market
and are similar to those of general customers
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Sales
RMB 278,697 The terms are set by quotations on the local market
Co., Ltd.
and are similar to those of general customers
6
Jiangyin Walsin
Yantai Walsin Specialty Steel Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
3,105 Based on capital demand
Specialty Alloy
Materials Co., Ltd. Yantai Walsin Specialty Steel Co., Ltd.
Transactions between subsidiaries Trade receivables
RMB
2,695 The terms are set by quotations on the local market
Yantai Walsin Specialty Steel Co., Ltd.
Transactions between subsidiaries Sales
RMB
28,542 The terms are set by quotations on the local market
and are similar to those of general customers
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
93,552 Based on capital demand
and are similar to those of general customers
7 Walsin Specialty Steel
Corp.
Changshu Walsin Specialty Steel Co., Ltd. Transactions between parent
company and subsidiaries
Other receivables
RMB
8,453 Based on capital demand
-
3
1
-
1
1
-
-
-
1
1
5
-
-
-
1
-
-
-
-
-
(Continued)
No.
Company
Counterparty
Relationship
Financial
Statement
Accounts
Transaction Details
Amount
Payment Terms
% of Total
Sales or
Assets
8 Changshu Walsin Specialty
Yantai Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Trade receivables
RMB
8,381 The terms are set by quotations on the local market
Steel Co., Ltd.
Yantai Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Sales
RMB
50,664 The terms are set by quotations on the local market
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
and are similar to those of general customers
30,702 Based on capital demand
and are similar to those of general customers
9 Shanghai Walsin Lihwa Power
Wire & Cable Co., Ltd.
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB 128,409 Based on capital demand
Yantai Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Trade receivables
RMB
4,145 The terms are set by quotations on the local market
Yantai Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Sales
RMB
32,480 The terms are set by quotations on the local market
and are similar to those of general customers
and are similar to those of general customers
10 Dongguan Walsin Wire &
Cable Co., Ltd.
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries
Other receivables
RMB 220,228 Based on capital demand
Shanghai Walsin Lihwa Power Wire &
Cable Co., Ltd.
Shanghai Walsin Lihwa Power Wire &
Cable Co., Ltd.
and parent company
Transactions between subsidiaries Sales
RMB
79,290 The terms are set by quotations on the local market
Transactions between subsidiaries Trade receivables
RMB
2,513 The terms are set by quotations on the local market
and are similar to those of general customers
and are similar to those of general customers
11 Walsin Singapore Pte. Ltd.
Walsin Lihwa Corporation
Transactions between subsidiaries
Other receivables
US$
179,800 Based on capital demand
and parent company
Ltd.
Ltd.
Ltd.
Cable Co., Ltd.
Materials Co., Ltd.
Jiangyin Walsin Specialty Alloy
Dongguan Walsin Wire & Cable Co.,
Dongguan Walsin Wire & Cable Co.,
Changshu Walsin Specialty Steel Co.,
Changshu Walsin Specialty Steel Co.,
Shanghai Walsin Lihwa Power Wire &
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Yantai Walsin Stainless Steel Co., Ltd. Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Shanghai Walsin Lihwa Power Wire &
Dongguan Walsin Wire & Cable Co.,
Jiangyin Walsin Specialty Alloy
Jianyin Walsin Specialty Alloy
Materials Co., Ltd.
Materials Co., Ltd.
Cable Co., Ltd.
Ltd.
Ltd.
Trade receivables
81,510 The terms are set by quotations on the local market
Trade receivables
and are similar to those of general customers
281,518 The terms are set by quotations on the local market
and are similar to those of general customers
Trade receivables
245,996 The terms are set by quotations on the local market
Trade receivables
Sales
Sales
Sales
Sales
Sales
Other receivables
and are similar to those of general customers
4,515 The terms are set by quotations on the local market
and are similar to those of general customers
2,773,189 The terms are set by quotations on the local market
and are similar to those of general customers
595,996 The terms are set by quotations on the local market
and are similar to those of general customers
668,583 The terms are set by quotations on the local market
and are similar to those of general customers
18,689 The terms are set by quotations on the local market
and are similar to those of general customers
7,723 The terms are set by quotations on the local market
and are similar to those of general customers
32,849 The terms are set by quotations on the local market
and are similar to those of general customers
Other receivables
37,008 The terms are set by quotations on the local market
and are similar to those of general customers
2021
0 Walsin Lihwa Corporation
2
9
1
-
-
-
-
-
-
-
-
-
2
-
-
-
-
1
-
-
-
-
-
-
(Continued)
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
2
9
2
No.
Investee Company
Counterparty
Relationship
Financial
Statement
Accounts
Transaction Details
Amount
Payment Terms
% of Total
Sales or
Assets
1 Walsin Lihwa Holdings
Walsin (China) Investment Co., Ltd.
Limited
Transactions between parent
company and subsidiaries
Other receivables
RMB 261,794 Based on capital demand
Walsin Lihwa Corporation
Transactions between subsidiaries
Trade receivables
RMB
10,259 The terms are set by quotations on the local market
and parent company
and are similar to those of general customers
2 Joint Success Enterprise
Limited
Walsin (Nanjing) Development Co., Ltd. Transactions between parent
company and subsidiaries
Other receivables
RMB 177,412 Based on capital demand
3 Walsin (China)
Walsin Lihwa Holdings Limited
Transactions between subsidiaries
Other receivables
US$
4,900 Based on capital demand
Investment Co., Ltd.
and parent company
Yantai Walsin Specialty Steel Co., Ltd.
Transactions between subsidiaries Other receivables
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Other receivables
Co., Ltd.
Jiangyin Walsin Steel Cable Co., Ltd.
Shanghai Walsin Lihwa Power Wire &
Cable Co., Ltd.
Transactions between parent
company and subsidiaries
Transactions between parent
company and subsidiaries
Other receivables
Other receivables
Based on capital demand
US$
60,175
RMB 363,643
US$
US$
8,717
RMB 214,155
US$
44,636 Based on capital demand
Based on capital demand
8,955 Based on capital demand
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Other receivables
Walsin (Nanjing) Development Co., Ltd. Transactions between subsidiaries Other receivables
Transactions between subsidiaries Other receivables
XiAn Walsin Metal Product Co., Ltd.
Transactions between subsidiaries Other receivables
Nanjing Taiwan Trade Mart Management
55,825 Based on capital demand
US$
RMB 698,586 Based on capital demand
RMB 176,213 Based on capital demand
37,250 Based on capital demand
RMB
Co., Ltd.
Dongguan Walsin Wire & Cable Co., Ltd Transactions between parent
company and subsidiaries
Other receivables
US$
68,544 Based on capital demand
4 Walsin International
PT. Walsin Nickel Industrial Indonesia
Transactions between subsidiaries Other receivables
RMB 1,596,871 Based on capital demand
Investments Limited
5 Yantai Walsin Stainless
Steel Co., Ltd.
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB 2,558,656 Based on capital demand
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Trade receivables
RMB
27,311 The terms are set by quotations on the local market
and are similar to those of general customers
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Trade receivables
RMB
6,386 The terms are set by quotations on the local market
Co., Ltd.
and are similar to those of general customers
Changshu Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Sales
RMB 242,772 The terms are set by quotations on the local market
and are similar to those of general customers
Jiangyin Walsin Specialty Alloy Materials
Transactions between subsidiaries Sales
RMB 233,251 The terms are set by quotations on the local market
Co., Ltd.
and are similar to those of general customers
6 Jiangyin Walsin
Yantai Walsin Stainless Steel Co., Ltd.
Transaction between subsidiaries Other receivables
RMB
10,581 Based on capital demand
Specialty Alloy
Materials Co., Ltd. Yantai Walsin Stainless Steel Co., Ltd.
Transaction between subsidiaries Trade receivables
RMB
1,213 The terms are set by quotations on the local market
Yantai Walsin Stainless Steel Co., Ltd.
Transaction between subsidiaries Sales
RMB
40,500 The terms are set by quotations on the local market
and are similar to those of general customers
Walsin (China) Investment Co., Ltd.
Transaction between subsidiaries Other receivables
RMB
99,473 Based on capital demand
and are similar to those of general customers
1
-
-
-
2
1
1
-
1
2
-
-
1
4
6
-
-
1
1
-
-
-
-
(Continued)
No.
Investee Company
Counterparty
Relationship
Financial
Statement
Accounts
Transaction Details
Amount
Payment Terms
% of Total
Sales or
Assets
7 Walsin Specialty Steel
Changshu Walsin Specialty Steel Co.,
Corp.
Ltd.
Transactions between parent
company and subsidiaries
Other receivables
RMB
8,453 Based on capital demand
8 Changshu Walsin
Jiangyin Walsin Specialty Alloy
Transaction between subsidiaries Trade receivables
RMB
1,130 The terms are set by quotations on the local market
Specialty Steel Co.,
Ltd.
Materials Co., Ltd.
and are similar to those of general customers
Yantai Walsin Stainless Steel Co., Ltd. Transaction between subsidiaries Trade receivables
RMB
5,739 The terms are set by quotations on the local market
Jiangyin Walsin Specialty Alloy
Transaction between subsidiaries Sales
RMB
817 The terms are set by quotations on the local market
Materials Co., Ltd.
and are similar to those of general customers
Yantai Walsin Stainless Steel Co., Ltd. Transaction between subsidiaries Sales
RMB
32,926 The terms are set by quotations on the local market
and are similar to those of general customers
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
37,911 Based on capital demand
and are similar to those of general customers
9 Shanghai Walsin Lihwa
Power Wire & Cable
Co., Ltd.
Jiangyin Walsin Specialty Alloy
Transactions between subsidiaries Sales
RMB
6 The terms are set by quotations on the local market
Materials Co., Ltd.
and are similar to those of general customers
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
83,540 Based on capital demand
10 Dongguan Walsin Wire
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries
Other receivables
RMB 553,394 Based on capital demand
& Cable Co., Ltd.
and parent company
Shanghai Walsin Lihwa Power Wire &
Transactions between subsidiaries Sales
RMB
49,712 The terms are set by quotations on the local market
Cable Co., Ltd.
and are similar to those of general customers
Shanghai Walsin Lihwa Power Wire &
Transactions between subsidiaries Trade receivables
RMB
14,014 The terms are set by quotations on the local market
Cable Co., Ltd.
and are similar to those of general customers
12 Jiangyin Walsin Steel
Yantai Walsin Specialty Steel Co., Ltd. Transactions between subsidiaries Sales
RMB
581 The terms are set by quotations on the local market
Cable Co., Ltd.
13 Nanjing Walsin Property
Management Co., Ltd.
Walsin (China) Investment Co., Ltd.
Transactions between subsidiaries Other receivables
RMB
5,420 Based on capital demand
and are similar to those of general customers
-
-
-
-
-
-
-
-
1
-
-
-
-
(Concluded)
2
9
3
Financial Information
TABLE 11
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
INFORMATION OF MAJOR SHAREHOLDERS
DECEMBER 31, 2022
Name of Major Shareholder
Shares
Number of
Shares
Percentage of
Ownership
(%)
Winbond Electronics Corp.
Chin-Xin Investment Co., Ltd.
LGT Bank (Singapore) Investment Fund under the custody of
Standard Chartered
TECO Electric & Machinery Co., Ltd.
247,527,493
247,399,375
262,598,000
210,332,390
6.63
6.63
7.03
5.63
Note 1: The information of major shareholders presented in this table is provided by the Taiwan
Depository & Clearing Corporation based on the number of ordinary shares and preferred
shares held by shareholders with ownership of 5% or greater, that have been issued without
physical registration (included treasury shares) by the Company as of the last business day
for the current quarter. The share capital in the consolidated financial statements may differ
from the actual number of shares that have been issued without physical registration because
of different preparation basis.
Note 2: If a shareholder delivers their shareholdings to the trust, the above information will be
disclosed by the individual trustee who opened the trust account. For shareholders who
declare insider shareholdings with ownership greater than 10% in accordance with Security
and Exchange Act, the shareholdings include shares held by shareholders and those delivered
to the trust over which shareholders have rights to determine the use of trust property. For
information relating to insider shareholding declaration, please refer to Market Observation
Post System.
294
5. Financial report of the parent company of the most recent year audited and certified
by Supervisors
INDEPENDENT AUDITORS’ REPORT
The Board of Directors and Shareholders
Walsin Lihwa Corporation
Opinion
We have audited the accompanying financial statements of Walsin Lihwa Corporation (the
“Company”), which comprise the balance sheets as of December 31, 2022 and 2021, and the
statements of comprehensive income, changes in equity and cash flows for the years then ended, and
the notes to the financial statements, including a summary of significant accounting policies.
In our opinion, based on our audits and the reports of other auditors (as set out in the Other Matter
section of our report), the accompanying financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2022 and 2021, and its financial performance
and its cash flows for the years then ended in accordance with the Regulations Governing the
Preparation of Financial Reports by Securities Issuers.
Basis for Opinion
We conducted our audit in accordance with the Regulations Governing Auditing and Attestation of
Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic
of China. Our responsibilities under those standards are further described in the Auditors’
Responsibilities for the Audit of the Financial Statements section of our report. We are independent of
the Company in accordance with The Norm of Professional Ethics for Certified Public Accountant of
the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. Based on our audits and the reports of other auditors, we believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements as of and for the year ended December 31, 2022. These matters
were addressed in the context of our audit of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
The following are key audit matters of the Company’s financial statements as of and for the year
ended December 31, 2022:
295
Financial Information
Sales Revenue Recognition
In 2022, the main products of the Company’s wires and cables business unit include bare copper wires,
wires and cables. The fluctuation in prices of bare copper wires is often subject to the movement in
prices of raw materials, and thus some of the sales prices are set according to the market prices agreed
under the contracts at the time of shipments. The Company prepares reports on point of sale
transactions by referring to the actual shipments and market price adjustments as the basis for revenue
recognition. Due to the large number of transactions and different market prices that have been agreed
upon by customers, the processing, recording and maintenance of such reports are performed manually
in which their amounts are significant to the financial statements. Therefore, the accuracy of revenue
recognized from sales of bare copper wires was considered as a key audit matter. Refer to Notes 4 and
21 to the financial statements for related accounting policies and disclosure of information relating to
revenue recognition.
Our audit procedures performed in respect of the above key audit matter were as follows:
1. We obtained an understanding and tested the reasonableness of revenue recognition policy and
internal control procedures over the sales of bare copper wires, and evaluated the effectiveness of
relevant internal controls.
2. We performed sampling and reconciliation of sales prices and quantities with their respective
amounts in the contracts and verified the accuracy of market price adjustments.
3. We verified the accuracy of monthly reports by recalculating the sales revenue and confirmed that
the recognized amounts were consistent with those recorded in the general ledger.
Other Matter
The financial statements of certain equity-method investees included in the financial statements as of
and for the years ended December 31, 2022 and 2021 were audited by other auditors. Our opinion,
insofar as it relates to such investments, is based solely on the reports of other auditors. The
investments in such investees amounted to NT$14,685,608 thousand and NT$5,587,877 thousand,
which constituted 7.30% and 3.39% of the total assets as of December 31, 2022 and 2021, respectively;
and the investment (loss) gains amounted to NT$(118,414) thousand and NT$743,761 thousand for the
years ended December 31, 2022 and 2021, respectively.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers,
and for such internal control as management determines is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless management either intends to liquidate the Company or
to cease operations, or has no realistic alternative but to do so.
Those charged with governance (including audit committee) are responsible for overseeing the
Company’s financial reporting process.
296
Auditors’ Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Standards on Auditing of the Republic of China will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
1.
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
4. Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditors’ report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditors’ report. However, future events or conditions may cause the Company to
cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of entities or
business activities within the Company to express an opinion on the financial statements. We are
responsible for the direction, supervision, and performance of the audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
297
Financial Information
From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the financial statements for the year ended December 31,
2022 and are therefore the key audit matters. We describe these matters in our auditors’ report unless
law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
The engagement partners on the audit resulting in this independent auditors’ report are Wen-Yea Shyu
and Ker-Chang Wu.
Deloitte & Touche
Taipei, Taiwan
Republic of China
February 24, 2023
Notice to Readers
The accompanying financial statements are intended only to present the financial position, financial
performance and cash flows in accordance with accounting principles and practices generally
accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures
and practices to audit such financial statements are those generally applied in the Republic of China.
For the convenience of readers, the independent auditors’ report and the accompanying financial
statements have been translated into English from the original Chinese version prepared and used in
the Republic of China. If there is any conflict between the English version and the original Chinese
version or any difference in the interpretation of the two versions, the Chinese-language independent
auditors’ report and financial statements shall prevail.
298
WALSIN LIHWA CORPORATION
BALANCE SHEETS
DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
ASSETS
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)
Financial assets at fair value through profit or loss - current (Notes 4 and 7)
Contract assets - current (Notes 4 and 8)
Notes receivable (Notes 4, 9 and 31)
Trade receivables (Notes 4 and 9)
Trade receivables from related parties (Notes 4, 9 and 31)
Other receivables (Note 31)
Inventories (Notes 4 and 10)
Other current assets (Notes 6 and 16)
Total current assets
NON-CURRENT ASSETS
2022
2021
Amount
%
Amount
%
$ 10,956,239
-
267,147
25,058
3,652,066
296,053
8,272,172
11,819,088
2,060,227
$
6
-
-
-
2
-
4
6
1
5,023,659
8,864
151,065
36,993
4,488,125
630,518
985,084
15,567,272
2,051,688
3
-
-
-
3
-
1
10
1
37,348,050
19
28,943,268
18
Financial assets at fair value through profit or loss - non-current (Notes 4 and 7)
Financial assets at fair value through other comprehensive income - non-current (Notes 4 and 11)
Investments accounted for using equity method (Notes 4 and 12)
Property, plant and equipment (Notes 4 and 13)
Right-of-use assets (Notes 4 and 14)
Investment properties (Notes 4 and 15)
Deferred tax assets - non-current (Notes 4 and 23)
Refundable deposits
Other non-current assets (Note 16)
2,567,786
12,206,200
117,556,202
18,760,190
1,459,994
8,170,554
700,710
31,197
2,281,237
1
6
59
9
1
4
-
-
1
-
16,139,524
92,360,069
17,411,273
81,050
8,243,668
1,291,573
27,548
182,006
-
10
56
10
-
5
1
-
-
Total non-current assets
TOTAL
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 17)
Financial liabilities at fair value through profit or loss - current (Notes 4 and 7)
Trade payables (Note 31)
Other payables
Other payables to related parties (Note 31)
Current tax liabilities (Notes 4 and 23)
Lease liabilities - current (Notes 4 and 14)
Current portion of long-term borrowings (Note 17)
Other current liabilities
Total current liabilities
NON-CURRENT LIABILITIES
Bonds Payable (Note 18)
Long-term borrowings (Note 17)
Long-term notes and bills payable (Note 17)
Deferred tax liabilities (Notes 4 and 23)
Lease liabilities - non-current (Notes 4 and 14)
Net defined benefit liabilities - non-current (Notes 4 and 19)
Other non-current liabilities (Note 28)
Total non-current liabilities
Total liabilities
EQUITY (Note 20)
Share capital
Capital surplus
Retained earnings
Legal reserve
Special reserve
Unappropriated earnings
Total retained earnings
Other equity
Exchange differences on translation of the financial statements of foreign operations
Unrealized gain on financial assets at fair value through other comprehensive income
Loss on hedging instruments
Other equity - other
Total other equity
Total equity
TOTAL
The accompanying notes are an integral part of the financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
163,734,070
81
135,736,711
82
$ 201,082,120
100
$ 164,679,979
100
$
6,600,565
51,505
3,226,544
2,884,659
9,273,554
1,420,015
38,519
-
227,916
$
3
-
2
1
5
1
-
-
-
5,074,632
37,439
3,040,224
2,498,452
178,362
2,040,190
20,564
10,500,000
372,874
3
-
2
2
-
1
-
7
-
23,723,277
12
23,762,737
15
7,500,000
37,445,270
1,497,914
5,495,675
1,498,347
147,420
193,341
4
18
1
3
1
-
-
7,500,000
24,640,014
-
2,151,564
64,580
451,697
225,863
5
15
-
1
-
-
-
53,777,967
27
35,033,718
21
77,501,244
39
58,796,455
36
37,313,329
24,672,454
18
12
34,313,329
18,440,875
21
11
7,564,090
2,712,250
51,762,058
62,038,398
4
1
26
31
6,109,568
2,712,250
38,965,389
47,787,207
4
1
24
29
(4,256,774)
6,693,877
(105,801)
(2,774,607)
(443,305)
(2)
3
-
(1)
-
(6,100,687)
11,534,267
-
(91,467)
5,342,113
(4)
7
-
-
3
123,580,876
61
105,883,524
64
$ 201,082,120
100
$ 164,679,979
100
299
Financial Information
WALSIN LIHWA CORPORATION
STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)
2022
2021
Amount
%
Amount
%
OPERATING REVENUE (Notes 4 and 21)
$ 98,420,045
100
$ 97,789,648
100
OPERATING COSTS (Note 10)
(87,224,447) (89)
(84,881,753) (87)
REALIZED (UNREALIZED) GAIN
11,802
-
(13,335)
-
GROSS PROFIT
11,207,400
11
12,894,560
13
OPERATING EXPENSES
Selling and marketing expenses
General and administrative expenses
Research and development expenses
Total operating expenses
PROFIT FROM OPERATIONS
NON-OPERATING INCOME AND EXPENSES
Interest income
Dividend income
Other income - other
Gain on disposal of property, plant and
equipment
Foreign exchange gain (loss), net
(Loss) gain on valuation of financial assets and
liabilities at fair value through profit or loss
Other expenses
(Loss) gain on disposal of investments (Note
22)
Recognition of impairment loss (Note 22)
Interest expense
Share of profit of subsidiaries and associates
accounted for using the equity method
1,431,892
1,833,812
200,649
3,466,353
7,741,047
119,155
764,885
405,699
78,846
1,732,956
(165,235)
(124,715)
1
2
-
3
8
-
1
-
-
2
-
-
1,258,609
1,257,078
180,944
2,696,631
1
1
-
2
10,197,929
11
225,171
560,552
447,284
683
(311,352)
654,576
(78,196)
-
1
-
-
-
1
-
(597,501)
-
(727,747)
(1)
-
(1)
461,026
(557,721)
(425,367)
-
(1)
-
15,429,151
16
7,218,874
7
8
Total non-operating income and expenses
16,915,494
17
8,195,530
PROFIT BEFORE INCOME TAX FROM
CONTINUING OPERATIONS
24,656,541
25
18,393,459
19
INCOME TAX EXPENSE (Notes 4 and 23)
(5,304,444)
(5)
(3,750,830)
(4)
NET PROFIT FOR THE YEAR
19,352,097
20
14,642,629
15
(Continued)
300
WALSIN LIHWA CORPORATION
STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)
OTHER COMPREHENSIVE INCOME (LOSS)
Items that will not be reclassified subsequently
to profit or loss:
Remeasurement of defined benefit plans
(Notes 4 and 19)
Unrealized (loss) gain on investments in
equity instruments at fair value through
other comprehensive income
Share of the other comprehensive (loss)
income of associates accounted for using
the equity method
Items that may be reclassified subsequently to
profit or loss:
Exchange differences on translating the
financial statements of foreign operations
Share of other comprehensive income (loss)
of associates accounted for using the
equity method
2022
2021
Amount
%
Amount
%
260,538
-
(160,650)
-
(4,022,988)
(4)
2,611,742
(688,713)
(4,451,163)
(1)
(5)
2,892,990
5,344,082
2
3
5
1,663,884
74,228
1,738,112
2
-
2
(67,717)
-
(127,834)
(195,551)
-
-
5
Other comprehensive (loss) income for the
year, net of income tax
(2,713,051)
(3)
5,148,531
TOTAL COMPREHENSIVE INCOME FOR THE
YEAR
$ 16,639,046
17
$ 19,791,160
20
EARNINGS PER SHARE (Note 24)
Basic
Diluted
$
$
5.45
5.44
$
$
4.27
4.26
The accompanying notes are an integral part of the financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
(Concluded)
301
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
3
0
2
WALSIN LIHWA CORPORATION
STATEMENTS OF CHANGES IN EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
Share Capital
Capital
Surplus
Legal Reserve
Special Reserve
Unappropriated
Earnings
Retained Earnings
Exchange Differences
on Translating the
Financial Statements
of Foreign Operations
Other Equity
Unrealized Valuation
Gain (Loss) on
Financial Assets at
Fair Value through
Other Comprehensive
Income
Loss on Hedging
Instrument
Others
Total Equity
BALANCE AT JANUARY 1, 2021
$ 32,260,002 $ 15,690,406
$
5,428,200 $ 3,110,410
$ 27,791,577
$
(5,905,135 )
$
6,092,775
$
Appropriation of 2020 earnings (Note 20)
Legal reserve
Special reserve
Cash dividends distributed by WLC
-
-
-
-
-
-
681,368
-
-
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Changes in capital surplus from investments in associates accounted for
using the equity method
-
3,124
-
(26,782 )
Issuance of new shares in exchange for the shares of another company
2,053,327
2,771,798
Net profit for the year ended December 31, 2021
Other comprehensive (loss) income for the year ended December 31, 2021,
net of income tax
Total comprehensive income (loss) for the year ended December 31, 2021
Others
-
-
-
-
-
-
-
2,329
-
-
-
-
-
-
-
-
(398,160 )
-
-
-
-
-
-
-
-
(681,368 )
398,160
(3,088,200 )
-
77,160
-
14,642,629
-
-
-
-
-
-
-
(174,569 )
(195,552 )
14,468,060
(195,552 )
-
-
-
-
-
-
(77,160 )
-
-
5,518,652
5,518,652
-
BALANCE AT DECEMBER 31, 2021
34,313,329
18,440,875
6,109,568
2,712,250
38,965,389
(6,100,687 )
11,534,267
Appropriation of 2021 earnings (Note 20)
Legal reserve
Cash dividends distributed by WLC
Change in ownership interests in subsidiaries
Excess of the carrying amount over the consideration received of the
subsidiaries' net assets during disposal
Disposal of equity instrument measured at fair value through other
comprehensive income
Changes in capital surplus from investments in associates accounted for
using the equity method
Issuance of ordinary shares for cash
Net profit for the year ended December 31, 2022
Other comprehensive income (loss) for the year ended December 31, 2022,
net of income tax
Total comprehensive income (loss) for the year ended December 31, 2022
Share-based payment transaction (Note 25)
Others
-
-
-
-
-
-
-
(994 )
-
-
-
887
3,000,000
6,000,000
-
-
-
-
-
-
-
225,000
-
6,686
1,454,522
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,454,522 )
(5,490,133 )
-
-
(3,589 )
79,546
-
19,352,097
313,270
19,665,367
-
-
-
-
-
-
-
-
-
-
1,843,913
1,843,913
-
-
-
-
-
-
3,589
(79,546 )
-
-
(4,764,433 )
(4,764,433 )
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(105,801 )
(105,801 )
-
-
$
-
-
-
-
-
$ 84,468,235
-
-
(3,088,200 )
3,124
(91,467 )
(118,249 )
-
-
-
-
-
4,825,125
14,642,629
5,148,531
19,791,160
2,329
(91,467 )
105,883,524
-
-
-
(5,490,133 )
(2,683,140 )
(2,683,140 )
-
-
-
-
-
-
-
-
-
(994 )
-
887
9,000,000
19,352,097
(2,713,051 )
16,639,046
225,000
6,686
BALANCE AT DECEMBER 31, 2022
$ 37,313,329 $ 24,672,454
$
7,564,090 $ 2,712,250
$ 51,762,058
$
(4,256,774 )
$
6,693,877
$
(105,801 )
$
(2,774,607 )
$ 123,580,876
The accompanying notes are an integral part of the financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
WALSIN LIHWA CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax
Adjustments for:
Depreciation expenses
Amortization expenses
Net loss (gain) on fair value changes of financial assets and
liabilities at fair value through profit or loss
Interest expenses
Interest income
Dividend income
Compensation costs of employee share options
Share of profit of subsidiaries and associates accounted for using
the equity method
Gain on disposal of property, plant and equipment
Loss (gain) on disposal of investments
Impairment loss recognized on non-financial assets
(Realized) unrealized gain on the transaction with associates
Unrealized loss on foreign currency exchange
Loss on lease modification
Changes in operating assets and liabilities
(Increase) decrease in financial assets mandatorily classified as
at fair value through profit or loss
Increase in contract assets
Decrease (increase) in notes receivable
Decrease (increase) in trade receivables
Increase in other receivables
Decrease (increase)in inventories
Decrease in other current assets
Increase in other financial assets
Decrease (increase) in other operating assets
Increase in trade payables
Increase in other payables
(Decrease) increase in net defined benefit liabilities
Decrease in other current liabilities
(Decrease) increase in other operating liabilities
Cash generated from operations
Interest received
Dividends received
Interest paid
Income tax paid
2022
2021
$ 24,656,541
$ 18,393,459
1,422,173
11,750
165,235
727,747
(119,155)
(764,885)
225,000
(15,429,151)
(78,846)
597,501
-
(11,802)
7,352
6
(555,033)
(116,082)
11,935
1,170,524
(625,476)
3,748,184
232,752
(241,290)
93,091
186,320
146,827
(43,738)
(133,155)
(50,009)
15,234,316
118,408
2,161,080
(649,093)
(1,989,646)
1,343,326
445
(654,576)
425,367
(225,171)
(560,552)
-
(7,218,874)
(683)
(461,026)
557,721
13,335
1,784
-
297,214
(138,128)
(9,716)
(2,532,916)
(640,575)
(7,064,475)
406,860
(14,820)
(64,888)
517,896
525,554
810
(399,500)
38,202
2,536,073
235,112
1,358,109
(498,619)
(138,061)
Net cash generated from operating activities
14,875,065
3,492,614
(Continued)
303
Financial Information
WALSIN LIHWA CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets at fair value through other
comprehensive income
Disposal of financial assets at fair value through other
comprehensive income
Capital reduction and refund from financial assets at fair value
through other comprehensive income
Purchase of financial assets at fair value through profit or loss
Disposal of financial assets at fair value through profit or loss
Acquisition of investments accounted for using the equity method
Repatriation through capital reduction of investee companies
accounted for using the equity method
Purchase of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Increase in refundable deposits
(Increase) decrease in other receivables
Purchase of investment properties
Increase in prepaid long-term investments
Other investing activities
2022
2021
(90,000)
(1,944,281)
335
-
(2,686,100)
-
(17,718,066)
11,178,225
(2,467,304)
129,210
(3,650)
(6,710,599)
(183)
(2,204,073)
(524,195)
-
3,615
-
4,948,895
(6,760,343)
699,515
(1,729,419)
2,204
(635)
7,016,224
(2,362)
-
(404,184)
Net cash (used in) generated from investing activities
(21,096,400)
1,829,229
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings
Proceeds from bonds payable
Proceeds from long-term borrowings
Repayment of long-term borrowings
Increase in long-term notes and bills payable
Increase (decrease) in other payables to related parties
Repayment of the principal portion of lease liabilities
Cash dividends paid
Proceeds from issuance of ordinary shares
Other financing activities
1,518,581
-
21,755,400
(19,450,144)
1,497,914
3,345,925
(30,665)
(5,489,781)
9,000,000
6,685
(1,559,788)
7,500,000
4,000,000
(6,000,000)
-
(5,640,652)
(23,133)
(3,088,030)
-
2,329
Net cash generated from (used in) financing activities
12,153,915
(4,809,274)
NET INCREASE IN CASH AND CASH EQUIVALENTS
5,932,580
512,569
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF
THE YEAR
5,023,659
4,511,090
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
$ 10,956,239
$
5,023,659
The accompanying notes are an integral part of the financial statements.
(With Deloitte & Touche auditors’ report dated February 24, 2023)
(Concluded)
304
WALSIN LIHWA CORPORATION
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
(In Thousands of New Taiwan Dollars)
1. GENERAL INFORMATION
Walsin Lihwa Corporation (“the Company”) was incorporated in December 1966 and commenced
operations in December 1966. To diversify its operations, the Company made various investments
in construction, electronics, material science, real estate, etc. The Company’s main products are
wires, cables, stainless steel, resource business and real estate.
The Company’s shares have been listed on the Taiwan Stock Exchange (TWSE) since November
1972. In October 1995 and November 2010, the Company increased its share capital and issued
Global Depositary Receipts (GDRs), which were listed on the Luxembourg Stock Exchange under
stock number 168527.
The financial statements are presented in the Company’s functional currency, the New Taiwan
dollar.
2. APPROVAL OF FINANCIAL STATEMENTS
The financial statements were approved by the board of directors on February 24, 2023.
3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS, AMENDED AND
INTERPRETATIONS
a. Initial application of the amendments to the International Financial Reporting Standards
(IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC
Interpretations (SIC) (collectively, the “IFRSs”) endorsed and issued into effect by the
Financial Supervisory Commission (FSC)
The initial application of the IFRSs endorsed and issued into effect by the FSC did not have a
material impact on the Company’s accounting policies.
b. The IFRSs endorsed by the FSC for application starting from 2023
New, Amended and Revised Standards and
Interpretations
Effective Date
Announced by IASB
Amendments to IAS 1 “Disclosure of Accounting Policies”
January 1, 2023 (Note 1)
Amendments to IAS 8 “Definition of Accounting Estimates” January 1, 2023 (Note 2)
January 1, 2023 (Note 3)
Amendments to IAS 12 “Deferred Tax related to Assets and
Liabilities arising from a Single Transaction”
Note 1: The amendments will be applied prospectively for annual reporting periods
beginning on or after January 1, 2023.
305
Financial Information
Note 2: The amendments will be applicable to changes in accounting estimates and changes
in accounting policies that occur on or after the beginning of the annual reporting
period beginning on or after January 1, 2023.
Note 3: Except for deferred taxes that were recognized on January 1, 2022 for temporary
differences associated with
the
amendments will be applied prospectively to transactions that occur on or after
January 1, 2022.
leases and decommissioning obligations,
1) Amendments to IAS 1 “Disclosure of Accounting Policies”
The amendments specify that the Company should refer to the definition of material to
determine its material accounting policy information to be disclosed. Accounting policy
information is material if it can reasonably be expected to influence decisions that the
primary users of general purpose financial statements make on the basis of those financial
statements. The amendments also clarify that:
Accounting policy information that relates to immaterial transactions, other events or
conditions is immaterial and need not be disclosed;
The Company may consider the accounting policy information as material because of
the nature of the related transactions, other events or conditions, even if the amounts
are immaterial; and
Not all accounting policy information relating to material transactions, other events or
conditions is itself material.
The amendments also illustrate that accounting policy information is likely to be
considered as material to the financial statements if that information relates to material
transactions, other events or conditions and:
a) The Company changed its accounting policy during the reporting period and this
change resulted in a material change to the information in the financial statements;
b) The Company chose the accounting policy from options permitted by the standards;
c) The accounting policy was developed in accordance with IAS 8 “Accounting Policies,
Changes in Accounting Estimates and Errors” in the absence of an IFRS that
specifically applies;
d) The accounting policy relates to an area for which the Company is required to make
significant judgements or assumptions in applying an accounting policy, and the
Company discloses those judgements or assumptions; or
e) The accounting is complex and users of the financial statements would otherwise not
understand those material transactions, other events or conditions.
2) Amendments to IAS 8 “Definition of Accounting Estimates”
The amendments define that accounting estimates are monetary amounts in financial
statements that are subject to measurement uncertainty. In applying accounting policies,
the Company may be required to measure items at monetary amounts that cannot be
observed directly and must instead be estimated. In such a case, the Company uses
306
measurement techniques and inputs to develop accounting estimates to achieve the
objective. The effects on an accounting estimate of a change in a measurement technique
or a change in an input are changes in accounting estimates unless they result from the
correction of prior period errors.
3) Amendments to IAS 12 “Deferred Tax related to Assets and Liabilities arising from a
Single Transaction”
The amendments clarify that the initial recognition exemption under IAS 12 does not
apply to transactions in which equal taxable and deductible temporary differences arise on
initial recognition. The Company shall recognize a deferred tax asset (to the extent that it
is probable that taxable profit will be available against which the deductible temporary
difference can be utilized) and a deferred tax liability for all deductible and taxable
temporary differences associated with leases and decommissioning obligations on January
1, 2022, and the Company shall recognize the cumulative effect of initial application in
retained earnings at that date. The Company shall apply the amendments prospectively to
transactions other than leases and decommissioning obligations that occur on or after
January 1, 2022.
Except for the above impact, as of the date the financial statements were authorized for issue,
the Company has assessed that the application of other standards and interpretations will not
have a material impact on the Company’s financial position and financial performance.
c. The IFRSs in issue but not yet endorsed and issued into effect by the FSC
New, Amended and Revised Standards and
Interpretations
Effective Date
Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution
of Assets between an Investor and its Associate or Joint
Venture”
To be determined by IASB
Amendments to IFRS 16 “Leases Liability in a Sale and
January 1, 2024 (Note 2)
Leaseback”
IFRS 17 “Insurance Contracts”
Amendments to IFRS 17
Amendments to IFRS 17 “Initial Application of IFRS 9 and
January 1, 2023
January 1, 2023
January 1, 2023
IFRS 17- Comparative Information”
Amendments to IAS 1 “Classification of Liabilities as
January 1, 2024
Current or
Non-current”
Amendments to IAS 1 “Non-current Liabilities with
January 1, 2024
Covenants”
Note 1: Unless stated otherwise, the above IFRSs are effective for annual reporting periods
beginning on or after their respective effective dates.
Note 2: A seller-lessee shall apply the Amendments to IFRS 16 retrospectively to sale and
leaseback transactions entered into after the date of initial application of IFRS 16.
1) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor
and Its Associate or Joint Venture”
307
Financial Information
The amendments stipulate that, when the Company sells or contributes assets that
constitute a business (as defined in IFRS 3) to an associate or joint venture, the gain or
loss resulting from the transaction is recognized in full. Also, when the Company loses
control of a subsidiary that contains a business but retains significant influence or joint
venture, the gain or loss resulting from the transaction is recognized in full.
Conversely, when the Company sells or contributes assets that do not constitute a business
to an associate or joint venture, the gain or loss resulting from the transaction is
recognized only to the extent of the Company’s interest as an unrelated investor in the
associate or joint venture, i.e., the Company’s share of the gain or loss is eliminated. Also,
when the Company loses control of a subsidiary that does not contain a business but
retains significant influence or joint control over an associate or a joint venture, the gain or
loss resulting from the transaction is recognized only to the extent of the Company’s
interest as an unrelated investor in the associate or joint venture, i.e., the Company’s share
of the gain or loss is eliminated.
2) Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” (referred
to as the “2020 amendments”) and “Non-current Liabilities with Covenants” (referred to
as the “2022 amendments”)
The 2020 amendments clarify that for a liability to be classified as non-current, the
Company shall assess whether it has the right at the end of the reporting period to defer
settlement of the liability for at least twelve months after the reporting period. If such
rights are in existence at the end of the reporting period, the liability is classified as
non-current regardless of whether the Company will exercise that right.
The 2020 amendments also stipulate that, if the right to defer settlement is subject to
compliance with specified conditions, the Company must comply with those conditions at
the end of the reporting period even if the lender does not test compliance until a later date.
The 2022 amendments further clarify that only covenants with which an entity is required
to comply on or before the reporting date should affect the classification of a liability as
current or non-current. Although the covenants to be complied with within twelve months
after the reporting period do not affect the classification of a liability, the Company shall
disclose information that enables users of financial statements to understand the risk of the
Company that may have difficulty complying with the covenants and repay its liabilities
within twelve months after the reporting period.
The 2020 amendments stipulate that, for the purpose of liability classification, the
aforementioned settlement refers to a transfer of cash, other economic resources or the
Company’s own equity instruments to the counterparty that results in the extinguishment
of the liability. However, if the terms of a liability that could, at the option of the
counterparty, result in its settlement by a transfer of the Company’s own equity
instruments, and if such option is recognized separately as equity in accordance with IAS
32: Financial Instruments: Presentation, the aforementioned terms would not affect the
classification of the liability.
3) Amendments to IFRS 16 “Leases Liability in a Sale and leaseback”
The amendments clarify that the liability that arises from a sale and leaseback transaction -
that satisfies the requirements in IFRS 15 to be accounted for as a sale - is a lease liability
to which IFRS 16 applies. However, if the lease in a leaseback that includes variable lease
payments that do not depend on an index or rate, the seller-lessee shall measure lease
liabilities arising from a leaseback in a way that it does not recognize any amount of the
gain or loss that relates to the right of use it retains. Seller-lessee subsequently recognizes
308
in profit or loss the difference between the payments made for the lease and the lease
payments that reduce the carrying amount of the lease liability.
Except for the above impact, as of the date the financial statements were authorized for issue,
the Company is continuously assessing the possible impact of the application of other
standards and interpretations on the Company’s financial position and financial performance
and will disclose the relevant impact when the assessment is completed.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Statement of compliance
The financial statements have been prepared in accordance with the Regulations Governing
the Preparation of Financial Reports by Securities Issuers.
b. Basic of preparation
The financial statements have been prepared on the historical cost basis except for financial
instruments which are measured at fair value and net defined benefit liabilities which are
measured at the present value of the defined benefit obligation less the fair value of plan
assets.
The fair value measurements are grouped into Levels 1 to 3 based on the degree to which the
fair value measurement inputs are observable and based on the significance of the inputs to
the fair value measurement in its entirety, which are described as follows:
1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are
observable for an asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived
from prices); and
3) Level 3 inputs are unobservable inputs for an asset or liability.
When preparing these parent company only financial statements, the Company used the equity
method to account for its investments in subsidiaries and associates. In order for the amounts
of the net profit for the year, other comprehensive income for the year and total equity in the
parent company only financial statements to be the same with the amounts attributable to the
owners of the Company in its consolidated financial statements, adjustments arising from the
differences in accounting treatments between the parent company only basis and the
consolidated basis were made to investments accounted for using the equity method, the share
of profit or loss of subsidiaries and associates, the share of other comprehensive income of
subsidiaries and associates and the related equity items, as appropriate, in these parent
company only financial statements.
c. Classification of current and non-current assets and liabilities
Current assets include:
Assets held primarily for the purpose of trading;
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Financial Information
Assets expected to be realized within 12 months after the reporting period; and
Cash and cash equivalents unless the asset is restricted from being exchanged or used to
settle a liability for at least 12 months after the reporting period.
Current liabilities include:
Liabilities held primarily for the purpose of trading;
Liabilities due to be settled within 12 months after the reporting period; and
Liabilities for which the Company does not have an unconditional right to defer settlement
for at least 12 months after the reporting period. Terms of a liability that could, at the
option of the counterparty, result in its settlement by the issue of equity instruments do not
affect its classification.
Assets and liabilities that are not classified as current are classified as non-current.
d. Foreign currencies
In preparing the Company’s financial statements, transactions in currencies other than the
Company’s functional currency (foreign currencies) are recognized at the rates of exchange
prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are
retranslated at the rates prevailing at that date. Exchange differences on monetary items
arising from settlement or translation are recognized in profit or loss in the period in which
they arise except for exchange differences on transactions entered into in order to hedge
certain foreign currency risks.
Non-monetary items denominated in foreign currencies that are measured at fair value are
retranslated at the rates prevailing at the date when fair value was determined. Exchange
differences arising from the retranslation of non-monetary items are included in profit or loss
for the period except for exchange differences arising from the retranslation of non-monetary
items in respect of which gains and losses are recognized directly in other comprehensive
income; in which cases, the exchange differences are also recognized directly in other
comprehensive income.
Non-monetary item denominated in a foreign currency and measured at historical cost is
stated at the reporting currency as originally translated from the foreign currency.
e. Inventories
Inventories consist of raw materials, supplies, finished goods and work-in-process and are
stated at the lower of cost or net realizable value. Inventory write-downs are made by item,
except where it may be appropriate to group similar or related items. The net realizable value
is the estimated selling price of inventories less all estimated costs of completion and costs
necessary to make the sale. Inventories are recorded at the weighted-average cost on the
balance sheet date.
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f.
Investments accounted for using the equity method
The Company uses the equity method to account for its investments in subsidiaries and
associates.
1) Investment in subsidiaries
A subsidiary is an entity that is controlled by the Company.
Under the equity method, an investment in a subsidiary is initially recognized at cost and
adjusted thereafter to recognize the Company’s share of the profit or loss and other
comprehensive income of the subsidiary. The Company also recognizes the changes in the
Company’s share of equity of subsidiaries.
Changes in the Company’s ownership interest in a subsidiary that do not result in the
Company losing control of the subsidiary are accounted for as equity transactions. The
Company recognizes directly in equity any difference between the carrying amount of the
investment and the fair value of the consideration paid or received.
When the Company’s share of loss of a subsidiary exceeds its interest in that subsidiary
(which includes any carrying amount of the investment accounted for using the equity
method and long-term interests that, in substance, form part of the Company’s net
investment in the subsidiary), the Company continues recognizing its share of further loss,
if any.
Any excess of the cost of acquisition over the Company’s share of the net fair value of the
identifiable assets and liabilities of a subsidiary at the date of acquisition is recognized as
goodwill, which is included within the carrying amount of the investment and is not
amortized. Any excess of the Company’s share of the net fair value of the identifiable
assets and liabilities over the cost of acquisition is recognized immediately in profit or
loss.
The Company assesses its investment for any impairment by comparing the carrying
amount with the estimated recoverable amount as assessed based on the investee’s
financial statements as a whole. Impairment loss is recognized when the carrying amount
exceeds the recoverable amount. If the recoverable amount of the investment subsequently
increases, the Company recognizes a reversal of the impairment loss; the adjusted
post-reversal carrying amount should not exceed the carrying amount that would have
been recognized (net of amortization or depreciation) had no impairment loss been
recognized in prior years. An impairment loss recognized on goodwill cannot be reversed
in a subsequent period.
When the Company loses control of a subsidiary, it recognizes the investment retained in
the former subsidiary at its fair value at the date when control is lost. The difference
between the fair value of the retained investment plus any consideration received and the
carrying amount of the previous investment at the date when control is lost is recognized
as a gain or loss in profit or loss. Besides this, the Company accounts for all amounts
previously recognized in other comprehensive income in relation to that subsidiary on the
same basis as would be required had the Company directly disposed of the related assets
or liabilities.
Profit or loss resulting from downstream transactions is eliminated in full only in the
financial statements. Profit and loss resulting from upstream transactions and transactions
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Financial Information
between subsidiaries is recognized only in the parent company only financial statements
and only to the extent of interests in the subsidiaries that are not related to the Company.
2) Investment in associates
An associate is an entity over which the Company has significant influence and which is
neither a subsidiary nor an interest in a joint venture. The Company uses the equity
method to account for its investments in associates.
Under the equity method, an investment in an associate is initially recognized at cost and
adjusted thereafter to recognize the Company’s share of the profit or loss and other
comprehensive income of the associate. The Company also recognizes the changes in the
Company’s share of equity of associates.
Any excess of the cost of acquisition over the Company’s share of the net fair value of the
identifiable assets and liabilities of an associate at the date of acquisition is recognized as
goodwill, which is included within the carrying amount of the investment and is not
amortized. Any excess of the Company’s share of the net fair value of the identifiable
assets and liabilities over the cost of acquisition, after reassessment, is recognized
immediately in profit or loss.
When the Company subscribes for additional new shares of an associate at a percentage
different from its existing ownership percentage, the resulting carrying amount of the
investment differs from the amount of the Company’s proportionate interest in the
associate. The Company records such a difference as an adjustment to investments with
the corresponding amount charged or credited to capital surplus - changes in capital
surplus from investments in associates accounted for using the equity method. If the
Company’s ownership interest is reduced due to its additional subscription of the new
shares of the associate, the proportionate amount of the gains or losses previously
recognized in other comprehensive income in relation to that associate is reclassified to
profit or loss on the same basis as would be required had the investee directly disposed of
the related assets or liabilities. When the adjustment should be debited to capital surplus,
but the capital surplus recognized from investments accounted for using the equity method
is insufficient, the shortage is debited to retained earnings.
When the Company’s share of losses of an associate equals or exceeds its interest in that
associate, the Company discontinues recognizing its share of further losses. Additional
losses and liabilities are recognized only to the extent that the Company has incurred legal
obligations, or constructive obligations, or made payments on behalf of that associate.
The entire carrying amount of the investment (including goodwill) is tested for
impairment as a single asset by comparing its recoverable amount with its carrying
amount. Any impairment loss recognized is deducted from investments and the carrying
amount of investment is net of impairment loss. Any reversal of that impairment loss is
recognized to the extent that the recoverable amount of the investment subsequently
increases.
The Company discontinues the use of the equity method from the date on which it ceases
to have significant influence over the associate. Any retained investment is measured at
fair value on that date and the fair value is regarded as its fair value on initial recognition
as a financial asset. The difference between the previous carrying amount of the associate
attributable to the retained interest and its fair value is included in the determination of the
gain or loss on disposal of the associate. The Company accounts for all amounts
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previously recognized in other comprehensive income in relation to that associate on the
same basis as would be required if that associate had directly disposed of the related assets
or liabilities.
When the Company transacts with its associate, profits and losses resulting from the
transactions with the associate are recognized in the Company’s financial statements only
to the extent of interests in the associate that are not related to the Company.
g. Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at
cost less accumulated depreciation and accumulated impairment loss.
Property, plant and equipment in the course of construction are measured at cost less any
recognized impairment loss. Cost includes professional fees and borrowing costs eligible for
capitalization. Such assets are depreciated and classified to the appropriate categories of
property, plant and equipment when completed and ready for their intended use.
The depreciation of property, plant and equipment is recognized using the straight-line
method. Each significant part is depreciated separately. The estimated useful lives, residual
values and depreciation methods are reviewed at the end of each reporting period, with the
effects of any changes in the estimates accounted for on a prospective basis.
On derecognition of an item of property, plant and equipment, the difference between the
sales proceeds and the carrying amount of the asset is recognized in profit or loss.
h. Investment properties
Investment properties are properties held to earn rentals and/or for capital appreciation.
Investment properties also include land held for a currently undetermined future use.
Investment properties are measured initially at cost. Subsequent to initial recognition,
investment properties are measured at cost less accumulated depreciation and accumulated
impairment loss. Depreciation is recognized using the straight-line method.
On derecognition of an investment property, the difference between the net disposal proceeds
and the carrying amount of the asset and is included in profit or loss.
i.
Intangible assets
Intangible assets with finite useful lives that are acquired separately are initially measured at
cost and subsequently measured at cost less accumulated amortization and accumulated
impairment loss. Amortization is recognized on a straight-line basis within useful lives. The
estimated useful lives, residual values, and amortization methods are reviewed at the end of
each reporting period, with the effect of any changes in estimate accounted for on a
prospective basis. Intangible assets with indefinite useful lives are reported at cost less
accumulated impairment loss.
Intangible assets are derecognized when they are disposed or are not expected to generate
future economic benefits through usage or through disposal.
On derecognition of an intangible asset, the differences between the net disposal proceeds and
the carrying amount of the asset is recognized in profit or loss.
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Financial Information
j.
Impairment of property, plant and equipment, right-of-use asset, investment properties,
intangible assets other than goodwill and assets related to contract costs
At the end of each reporting period, the Company reviews the carrying amounts of its property,
plant and equipment, right-of-use asset and intangible assets, excluding goodwill, to determine
whether there is any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order to determine the
extent of the impairment loss. When it is not possible to estimate the recoverable amount of an
individual asset, the Company estimates the recoverable amount of the cash-generating unit to
which the asset belongs. Corporate assets are allocated to the individual cash-generating units
on a reasonable and consistent basis of allocation.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are
tested for impairment at least annually and whenever there is an indication that the assets may
be impaired.
The recoverable amount is the higher of fair value less costs to sell and value in use. If the
recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying
amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable
amount, with the resulting impairment loss recognized in profit or loss.
Before the Company recognizes an impairment loss from assets related to contract costs, any
impairment loss on inventories, property, plant and equipment and intangible assets related to
the contract applicable under IFRS 15 shall be recognized in accordance with applicable
standards. Then, impairment loss from the assets related to the contract costs is recognized to
the extent that the carrying amount of the assets exceeds the remaining amount of
consideration that the Company expects to receive in exchange for related goods or services
less the costs which relate directly to providing those goods or services and which have not
been recognized as expenses. The assets related to the contract costs are then included in the
carrying amount of the cash-generating unit to which they belong for the purpose of
evaluating impairment of that cash-generating unit.
When an impairment loss is subsequently reversed, the carrying amount of the corresponding
asset, cash-generating unit or assets related to contract costs is increased to the revised
estimate of its recoverable amount, but only to the extent of the carrying amount that would
have been determined had no impairment loss been recognized on the asset, cash-generating
unit or assets related to contract costs in prior years. A reversal of an impairment loss is
recognized in profit or loss.
k. Financial instruments
Financial assets and financial liabilities are recognized when the Company becomes a party to
the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs
that are directly attributable to the acquisition or issuance of financial assets and financial
liabilities (other than financial assets and financial liabilities at FVTPL) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on
initial recognition. Transaction costs directly attributable to the acquisition of financial assets
or financial liabilities at FVTPL are recognized immediately in profit or loss.
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1) Financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on
a trade date basis.
a) Measurement categories
Financial assets are classified into the following categories: Financial assets at FVTPL,
financial assets at amortized cost and investments in equity instruments at FVTOCI.
i. Financial assets at FVTPL
Financial assets are classified as at FVTPL when such financial asset are
mandatorily classified or designated as at FVTPL. Financial assets mandatorily
classified as at FVTPL include investments in equity instruments which are not
designated as at FVTOCI and debt instruments that do not meet the amortized cost
criteria or the FVTOCI criteria.
Financial assets at FVTPL are subsequently measured at fair value, and any
remeasurement gains or losses are recognized in profit or losses. Fair value is
determined in the manner described in Note 30.
ii. Financial assets at amortized cost
Financial assets that meet the following conditions are subsequently measured at
amortized cost:
i) The financial assets are held within a business model whose objective is to
hold financial assets in order to collect contractual cash flows; and
ii) The contractual terms of the financial asset give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal
amount outstanding.
Subsequent to initial recognition, financial assets at amortized cost, including
cash and cash equivalents and trade receivables at amortized cost are measured
at amortized cost, which equals the gross carrying amount determined using
the effective interest method less any impairment loss. Exchange differences
are recognized in profit or loss.
Interest income is calculated by applying the effective interest rate to the gross
carrying amount of such a financial asset, except for:
i) Purchased or originated credit-impaired financial assets, for which interest
income is calculated by applying the credit-adjusted effective interest rate to
the amortized cost of such financial assets; and
ii) Financial assets that are not credit-impaired on purchase or origination but
have subsequently become credit-impaired, for which interest income is
calculated by applying the effective interest rate to the amortized cost of such
financial assets in subsequent reporting periods.
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Financial Information
Cash equivalents include time deposits with original maturities within 3 months
from the date of acquisition or time deposits with original maturities within 3-12
months from the date of acquisition and the interest paid to deposits which is
terminated before maturity is higher than demand deposits, which are highly liquid,
readily convertible to a known amount of cash and are subject to an insignificant
risk of changes in value. These cash equivalents are held for the purpose of
meeting short-term cash commitments.
iii. Investments in equity instruments at FVTOCI
On initial recognition, the Company may make an irrevocable election to
designate investments in equity instruments as at FVTOCI. Designation as at
FVTOCI is not permitted if the equity investment is held for trading or if it is
contingent consideration recognized by an acquirer in a business combination.
Investments in equity instruments at FVTOCI are subsequently measured at fair
value with gains and losses arising from changes in fair value recognized in other
comprehensive income and accumulated in other equity. The cumulative gain or
loss will not be reclassified to profit or loss on disposal of the equity investments;
instead, it will be transferred to retained earnings.
Dividends on these investments in equity instruments are recognized in profit or
loss when the Company’s right to receive the dividends is established, unless the
dividends clearly represent a recovery of part of the cost of the investment.
b) Impairment of financial assets
The Company recognizes a loss allowance for expected credit losses on financial
assets at amortized cost (including trade receivables), investments in debt instruments
that are measured at FVTOCI, operating lease receivables, as well as contract assets.
The Company always recognizes lifetime expected credit losses (ECLs) for trade
receivables, operating lease receivables and contract assets. For all other financial
instruments, the Company recognizes lifetime ECLs when there has been a significant
increase in credit risk since initial recognition. If, on the other hand, the credit risk on
a financial instrument has not increased significantly since initial recognition, the
Company measures the loss allowance for that financial instrument at an amount equal
to 12-month ECLs.
Expected credit losses reflect the weighted average of credit losses with the respective
risks of default occurring as the weights. Lifetime ECLs represent the expected credit
losses that will result from all possible default events over the expected life of a
financial instrument. In contrast, 12-month ECLs represents the portion of lifetime
ECLs that is expected to result from default events on a financial instrument that are
possible within 12 months after the reporting date.
For internal credit risk management purposes, the Company considers that the
following situations indicate that a financial asset is in default (without taking into
account any collateral held by the Company):
i.
Internal or external information shows that the debtor is unlikely to pay its
creditors.
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ii. Financial asset is more than 90 days past due unless the Company has reasonable
and corroborative information to support a more lagged default criterion.
The impairment loss of all financial assets is recognized in profit or loss by a
reduction in their carrying amounts through a loss allowance account, except for
investments in debt instruments that are measured at FVTOCI, for which the loss
allowance is recognized in other comprehensive income and the carrying amounts of
such financial assets are not reduced.
c) Derecognition of financial assets
The Company derecognizes a financial asset only when the contractual rights to the
cash flows from the asset expire, or when it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset to another party.
On derecognition of a financial asset at amortized cost in its entirety, the difference
between the asset’s carrying amount and the sum of the consideration received and
receivable is recognized in profit or loss. On derecognition of an investment in a debt
instrument at FVTOCI, the difference between the asset’s carrying amount and the
sum of the consideration received and receivable and the cumulative gain or loss
which had been recognized in other comprehensive income is recognized in profit or
loss. However, on derecognition of an investment in an equity instrument at FVTOCI,
the difference between the asset’s carrying amount and the sum of the consideration
received and receivable is recognized in profit or loss, and the cumulative gain or loss
which had been recognized in other comprehensive income is transferred directly to
retained earnings, without recycling through profit or loss.
2) Equity instruments
Equity instruments issued by the Company are recognized at the proceeds received, net of
direct issue costs.
The repurchase of the Company’s own equity instruments is recognized in and deducted
directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale,
issuance or cancellation of the Company’s own equity instruments.
3) Financial liabilities
a) Subsequent measurement
Except the following situation, all the financial liabilities are measured at amortized
cost using the effective interest method:
i. Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL when the financial liabilities are
held for trading or are designated as at FVTPL. Financial liabilities held for
trading are stated at fair value, and any remeasurement gains or losses are
recognized in other gains or losses. Fair value is determined in the manner
described in Note 30.
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Financial Information
ii. Financial guarantee contracts
Financial guarantee contracts issued by the Company, if not designated as at
FVTPL, are subsequently measured at the higher of:
i) The amount of the loss allowance reflecting expected credit losses; and
ii) The amount initially recognized less, where appropriate, the cumulative
amount of income recognized in accordance with the revenue recognition
policies.
b) Derecognition of financial liabilities
The difference between the carrying amount of the financial liability derecognized and
the consideration paid, including any non-cash assets transferred or liabilities assumed,
is recognized in profit or loss.
4) Derivative financial instruments
The Company enters into a variety of derivative financial instruments to manage its
exposure to interest rate and foreign exchange rate risks, including foreign exchange
forward contracts and interest rate swaps.
Derivatives are initially recognized at fair value at the date on which the derivative
contracts are entered into and are subsequently remeasured to their fair value at the end of
each reporting period. The resulting gain or loss is recognized in profit or loss
immediately unless the derivative is designated and effective as a hedging instrument; in
which event, the timing of the recognition in profit or loss depends on the nature of the
hedging relationship. When the fair value of a derivative financial instrument is positive,
the derivative is recognized as a financial asset; when the fair value of a derivative
financial instrument is negative, the derivative is recognized as a financial liability.
Derivatives embedded in hybrid contracts that contain financial asset hosts that is within
the scope of IFRS 9 are not separated; instead, the classification is determined in
accordance with the entire hybrid contract. Derivatives embedded in non-derivative host
contracts that are not financial assets within the scope of IFRS 9 (e.g., financial liabilities)
are treated as separate derivatives when they meet the definition of a derivative; their risks
and characteristics are not closely related to those of the host contracts; and the host
contracts are not measured at FVTPL.
l. Hedge accounting
The Company designates certain hedging instruments, which include derivatives, embedded
derivatives and non-derivatives in respect of foreign currency risk, as either fair value hedges
or cash flow hedges. Hedges of foreign exchange risk on firm commitments are accounted for
as cash flow hedges.
1) Fair value hedges
Gain or losses on derivatives that are designated and qualify as fair value hedges are
recognized in profit or loss immediately, together with any changes in the fair value of the
hedged asset or liability that are attributable to the hedged risk. The change in the fair
value of the hedging instrument and the change in the hedged item attributable to the
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hedged risk are recognized in profit or loss in the line item relating to the hedged item.
The Company discontinues hedge accounting only when the hedging relationship ceases
to meet the qualifying criteria; for instance, when the hedging instrument expires or is sold,
terminated or exercised.
2) Cash flow hedges
The effective portion of gains or losses on derivatives that are designated and qualify as
cash flow hedges is recognized in other comprehensive income. The gains or losses
relating to the ineffective portion are recognized immediately in profit or loss.
The associated gains or losses that were recognized in other comprehensive income are
reclassified from equity to profit or loss as reclassification adjustments in the line items
relating to the hedged item in the same period in which the hedged item affects profit or
loss. If a hedge of a forecasted transaction subsequently results in the recognition of a
non-financial asset or a non-financial liability, the associated gains and losses that were
recognized in other comprehensive income are removed from equity and included in the
initial cost of the non-financial asset or non-financial liability.
The Company discontinues hedge accounting only when the hedging relationship ceases
to meet the qualifying criteria; for instance, when the hedging instrument expires or is sold,
terminated or exercised. The cumulative gain or loss on the hedging instrument that was
previously recognized in other comprehensive income (from the period in which the hedge
was effective) remains separately in equity until the forecasted transaction occurs. When a
forecasted transaction is no longer expected to occur, the gains or losses accumulated in
equity are recognized immediately in profit or loss.
m. Levies
Levies imposed by a government are accrued as other liabilities when the transactions or
activities that trigger the payment of such levies occur. If the obligating event occurs over a
period of time, the liability is recognized progressively. If an obligation to pay a levy is
triggered upon reaching a minimum threshold, the liability is recognized when that minimum
threshold is reached.
n. Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive)
as a result of a past event, it is probable that the Company will be required to settle the
obligation, and the amount of the obligation can be measured reliably.
o. Revenue recognition
The Company identifies contracts with the customers, allocates the transaction price to the
performance obligations and recognizes revenue when performance obligations are satisfied.
1) Revenue from the sale of goods
Revenue from the sale of goods comes from sales of wires, cables and stainless steel.
Sales of wires, cables and stainless steel are recognized as revenue when the customer has
full discretion over the manner of distribution and the price to sell the goods, has the
primary responsibility for sales to future customers and bears the risks of obsolescence.
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Financial Information
Trade receivables are recognized concurrently.
The Company does not recognize revenue on materials delivered to subcontractors
because this delivery does not involve a transfer of control.
2) Revenue from the others
a) Revenue from the reading of services
Service income is recognized when services are rendered. Revenue should be
recognized over time by measuring the progress toward complete satisfaction of the
performance obligation.
b) Construction contract revenue
A contract asset is recognized during construction and is reclassified to trade
receivables at the point at which the customer is invoiced. If the milestone payment
exceeds the revenue recognized to date, then the Company recognizes a contract
liability for the difference. Certain payments retained by the customer as specified in
the contract are intended to ensure that the Company adequately completes all of its
contractual obligations. Such retention receivables are recognized as contract assets
until the Company satisfies its performance obligation.
When the outcome of a performance obligation cannot be reasonably measured,
contract revenue is recognized only to the extent of contract costs incurred in
satisfying the performance obligation for which recovery is expected.
p. Leases
At the inception of a contract, the Company assesses whether the contract is, or contains, a
lease.
1) The Company as lessor
Leases are classified as finance leases whenever the terms of the lease transfer
substantially all the risks and rewards of ownership to the lessee. All other leases are
classified as operating leases.
Under finance leases, the lease payments comprise fixed payments and variable lease
payments which depend on an index or a rate. The net investment in a lease is measured at
(a) the present value of the sum of the lease payments receivable by a lessor and any
unguaranteed residual value accrued to the lessor plus (b) initial direct costs and is
presented as a finance lease receivable. Finance lease income is allocated to the relevant
accounting periods so as to reflect a constant, periodic rate of return on the Company’s net
investment outstanding in respect of leases.
Lease payments less any lease incentives payable from operating leases are recognized as
income on a straight-line basis over the terms of the relevant leases. Initial direct costs
incurred in obtaining operating leases are added to the carrying amounts of the underlying
assets and recognized as expenses on a straight-line basis over the lease terms.
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2) The Company as lessee
The Company recognizes right-of-use assets and lease liabilities for all leases at the
commencement date of a lease, except for short-term leases and low-value asset leases
accounted for applying a recognition exemption where lease payments are recognized as
expenses on a straight-line basis over the lease terms.
Right-of-use assets are initially measured at cost, which comprises the initial measurement
of lease liabilities adjusted for lease payments made at or before the commencement date,
plus any initial direct costs incurred and an estimate of costs needed to restore the
underlying assets, and less any lease incentives received. Right-of-use assets are
subsequently measured at cost less accumulated depreciation and impairment losses and
adjusted for any remeasurement of the lease liabilities.
the
Right-of-use assets are depreciated using
commencement dates to the earlier of the end of the useful lives of the right-of-use assets
or the end of the lease terms.
the straight-line method
from
Lease liabilities are initially measured at the present value of the lease payments, which
comprise fixed payments, in-substance fixed payments, variable lease payments which
depend on an index or a rate, residual value guarantees, the exercise price of a purchase
option if the Company is reasonably certain to exercise that option, and payments of
penalties for terminating a lease if the lease term reflects such termination, less any lease
incentives receivable. The lease payments are discounted using the interest rate implicit in
a lease, if that rate can be readily determined. If that rate cannot be readily determined, the
lessee’s incremental borrowing rate will be used.
Subsequently, lease liabilities are measured at amortized cost using the effective interest
method, with interest expense recognized over the lease terms. When there is a change in
a lease term, a change in the amounts expected to be payable under a residual value
guarantee, a change in the assessment of an option to purchase an underlying asset, or a
change in future lease payments resulting from a change in an index or a rate used to
determine those payments, the Company remeasures the lease liabilities with a
corresponding adjustment to the right-of-use-assets. However, if the carrying amount of
the right-of-use assets is reduced to zero, any remaining amount of the remeasurement is
recognized in profit or loss. Lease liabilities are presented on a separate line in the balance
sheets.
The Company negotiates with the lessor for rent concessions as a direct consequence of
the Covid-19 to change the lease payments originally due by June 30, 2022, that results in
the revised consideration for the lease less than, the consideration for the lease
immediately preceding the change. There is no substantive change to other terms and
conditions. The Company elects to apply the practical expedient to all of these rent
concessions and, therefore, does not assess whether the rent concessions are lease
modifications. Instead, the Company recognizes the reduction in lease payment in profit or
loss as, in the period in which the events or conditions that trigger the concession occur,
and makes a corresponding adjustment to the lease liability.
Variable lease payments that do not depend on an index or a rate are recognized as
expenses in the periods in which they are incurred.
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Financial Information
q. Government grants
Government grants are not recognized until there is reasonable assurance that the Company
will comply with the conditions attached to them and that the grants will be received.
Government grants are recognized profit and loss on a systematic basis over the periods in
which the Company recognizes as expenses the related costs that the grants intend to
compensate.
Government grants that are receivable as compensation for expenses or losses already
incurred or for the purpose of giving immediate financial support to the Company with no
future related costs are recognized in profit or loss in the period in which they are received.
The benefit of a government loan received at a below-market rate of interest is treated as a
government grant measured as the difference between the proceeds received and the fair value
of the loan based on prevailing market interest rates.
r. Employee benefits
1) Short-term employee benefits
Liabilities recognized in respect of short-term employee benefits are measured at the
undiscounted amount of the benefits expected to be paid in exchange for the related
service.
2) Retirement benefits
Payments to defined contribution retirement benefit plans are recognized as an expense
when employees have rendered service entitling them to the contributions.
Defined benefit costs (including service cost, net interest and remeasurement) under the
defined benefit retirement benefit plans are determined using the projected unit credit
method. Service cost (including current service cost) and net interest on the net defined
benefit liability (asset) are recognized as employee benefits expense in the period they
occur. Remeasurement, comprising actuarial gains and losses and return on plan assets
(excluding interest), are recognized in other comprehensive income in the period in which
they occur. Remeasurement recognized in other comprehensive income is reflected
immediately in retained earnings and will not be reclassified to profit or loss.
Net defined benefit liability (asset) represents the actual deficit (surplus) in the Company’s
defined benefit plan. Any surplus resulting from this calculation is limited to the present
value of any refunds from the plans or reductions in future contributions to the plans.
s. Share-based payment transaction agreements
Employee share options granted to employees and others providing similar services.
The fair value at the grant date of the employee share options is expensed on a straight-line
basis over the vesting period, based on the Company’s best estimates of the number of shares
or options that are expected to ultimately vest, with a corresponding increase in capital surplus
- employee share options. The expense is recognized in full at the grant date if the grants are
vested immediately. The grant date of issued ordinary shares for cash which are reserved for
employees is the date on which the number of shares that the employees purchase is
322
confirmed.
t. Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
1) Current tax
According to the Income Tax Act in ROC, an additional tax on unappropriated earnings is
provided for in the year the shareholders approve to retain earnings.
Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s
tax provision.
2) Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of
assets and liabilities and the corresponding tax bases used in the computation of taxable
profit.
Deferred tax liabilities are generally recognized for all taxable temporary differences.
Deferred tax assets are generally recognized for all deductible temporary differences and
unused loss carryforward to the extent that it is probable that taxable profits will be
available against which those deductible temporary differences can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries and associates, except where the Company is able to control
the reversal of the temporary difference and it is probable that the temporary difference
will not reverse in the foreseeable future. Deferred tax assets arising from deductible
temporary differences associated with such investments and interests are recognized only
to the extent that it is probable that there will be sufficient taxable profits against which to
utilize the benefits of the temporary differences and they are expected to reverse in the
foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period
and reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered. A previously unrecognized
deferred tax asset is also reviewed at the end of each reporting period and recognized to
the extent that it has become probable that future taxable profit will allow the deferred tax
asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply
in the period in which the liability is settled or the asset realized, based on tax rates (and
tax laws) that have been enacted or substantively enacted by the end of the reporting
period. The measurement of deferred tax liabilities and assets reflects the tax
consequences that would follow from the manner in which the Company expects, at the
end of the reporting period, to recover or settle the carrying amount of its assets and
liabilities.
3) Current and deferred taxes for the year
Current and deferred taxes are recognized in profit or loss, except the current and deferred
taxes that are recognized in other comprehensive income or directly in equity; in which
323
Financial Information
case, the current and deferred taxes will recognized in other comprehensive income or
directly in equity, respectively.
5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION
UNCERTAINTY
In the application of the Company’s accounting policies, management is required to make
judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are
not readily apparent from other sources. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be relevant. Actual results may differ
from these estimates.
The Company considers the possible impact when making its critical accounting estimates. The
estimates and underlying assumptions are audited on an ongoing basis. Revisions to accounting
estimates are recognized in the period in which the estimate is revised if the revision affects only
that period or in the period of the revision and future periods if the revision affects both current
and future periods.
6. CASH AND CASH EQUIVALENTS
Cash on hand
Checking accounts and cash in banks
Cash equivalents
Time deposits
December 31
2022
2021
$
1,050
7,423,539
$
1,050
5,022,609
3,531,650
-
$ 10,956,239
$ 5,023,659
The market rate intervals of cash in the bank at the end of the year were as follows (except for
checking accounts’ interest rate of 0.00%):
Bank balance
Time deposits
December 31
2022
2021
0.001%-3.80%
1.035%
0.001%-0.11%
-
Other bank deposits have been reclassified to other accounts for the following purposes:
Purpose
December 31
2022
2021
Other current assets - current
Restricted deposits
Repatriation of offshore fund
$ 40,786
$ 80,493
Refundable deposits
Futures deposits
and projects grants
280,997
321,783
-
80,493
(Continued)
324
Purpose
December 31
2022
2021
Non-current assets-other
Pledged time deposits
To meet required security
600
600
deposits
$ 322,383
$ 81,093
(Concluded)
7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
December 31
2022
2021
Financial assets mandatorily classified as at FVTPL
Derivative financial assets (not under hedge accounting)
Commodity futures contracts
Foreign exchange forward contracts
Non-derivative financial assets
Contingent consideration
$
$
-
-
873
7,991
2,567,786
-
Financial assets at FVTPL
$ 2,567,786
$
8,864
Current
Non-current
Financial liabilities held for trading
Derivative financial liabilities (not under hedge
accounting)
Commodity futures contracts
Foreign exchange forward contracts
Exchange rate swap contracts
$
-
2,567,786
$
8,864
-
$ 2,567,786
$
8,864
$
$
21,017
30,488
-
-
-
37,439
Financial liabilities at FVTPL
$
51,505
$
37,439
Current
Non-current
$
51,505
-
$
37,439
-
$
51,505
$
37,439
325
Financial Information
a. As of December 31, 2022 and 2021, outstanding commodity futures not under hedge
accounting were as follows:
Type of
Transaction
Quantity
(Tons)
Trade Date
Maturity
Date
Exercise Price
(In Thousands)
Market Price
(In Thousands)
Valuation
(Loss) Gain
(In Thousands)
December 31, 2022
Commodity futures
Copper
Copper
Nickel
December 31, 2021
Commodity futures
Copper
Copper
Nickel
Buy
Sell
Sell
Buy
Sell
Sell
5,900
2022.08.15-
2023.01.18-
US$ 48,178 US$ 49,332 US$
1,154
2022.12.30
2023.06.21
25
4,188
2022.12.02
2022.11.15-
2023.03.02
2023.01.18-
US$
209 US$
US$ 122,940 US$ 124,780 US$
210 US$
1
(1,840 )
2022.12.30
2023.03.20
9,925
2021.09.01-
2022.01.19-
US$ 94,424
US$ 96,834
US$
2,410
2021.12.31
2022.04.20
3,050
2021.12.10-
2022.01.19-
US$ 29,229
US$ 29,846
US$
(617 )
2021.12.31
2022.03.31
2,238
2021.11.04-
2022.02.04-
US$ 44,698
US$ 46,459
US$
(1,761 )
2021.12.31
2022.03.31
b. As of December 31, 2022 and 2021, outstanding foreign exchange forward contracts not
under hedge accounting were as follows:
Currency
Maturity Date
Notional Amount
(In Thousands)
December 31, 2022
Buy
USD to IDR
USD to JPY
2023.01.31
2023.01.05
USD91,000/IDR1,429,633,100
USD3,000/JPY412,605
December 31, 2021
Sell
Buy
EUR to USD
USD to NTD
EUR to USD
USD to NTD
USD to JPY
2022.01.18-2022.02.17 EUR18,000/USD20,326
2022.01.07-2022.02.10 USD100,000/NTD2,776,800
2022.01.10
EUR25,405/USD28,694
2022.01.06-2022.02.21 USD129,363/NTD3,579,887
2022.01.12-2022.01.18 USD4,784/JPY547,970
c. As of the December 31, 2021, outstanding exchange rate swap contracts not under hedge
accounting were as follows:
Currency
Maturity Date
Notional Amount
(In Thousands)
December 31, 2021 USD to NTD
USD to NTD
USD to NTD
2022.01.12
2022.01.12
2022.01.14
USD75,000/NTD2,097,188
USD70,000/NTD1,957,375
USD40,000/NTD1,109,600
d. For the years ended December 31, 2022 and 2021, the Company’s strategies for commodity
futures contracts and forward exchange contracts were to hedge exposures to fluctuations in
the prices of raw material and foreign exchange rates. However, those derivative financial
instruments did not meet the criteria of hedge effectiveness; therefore, they were not
accounted for by hedge accounting.
326
e. Contingent consideration is the amount of consideration to be received by the Company from
the acquirer in the disposal of the subsidiary on July 27, 2022. In accordance with the
agreement of contingent consideration, the acquirer shall respectively pay additional payments
when the gross profit of the target company during the period starting from the settlement date
to December 31, 2023 and the gross profit in the year of 2024 meet the amount agreed upon
by Target Company.
8. CONTRACT ASSETS
At the end of the year, contract balances were as follows:
Contract assets
Cable installation
Less: Allowance for impairment loss
December 31
2022
2021
$ 267,147
-
$ 151,065
-
Contract assets - current
$ 267,147
$ 151,065
The changes in the balance of contract assets primarily resulted from the timing differences
between the Company’s satisfaction of performance obligations and the respective customer’s
payment.
9. NOTES RECEIVABLE AND TRADE RECEIVABLES
Notes receivable
Notes receivable
Notes receivable - non-operating
December 31
2022
2021
$
24,016
$
36,024
Notes receivable from related parties
1,042
969
Trade receivables
Trade receivables
Less: Allowance for impairment loss
Trade receivables from related parties
$
25,058
$
36,993
$ 3,652,066
-
3,652,066
296,053
$ 4,488,125
-
4,488,125
630,518
$ 3,948,119
$ 5,118,643
327
Financial Information
The average credit period on the sales of goods was 60 days. In determining the collectability of a
trade receivable, the Company considered any change in the credit quality of the trade receivable
since the date credit was initially granted to the end of the reporting period. When the Company
dealt with new entities, the Company reviewed the credit ratings of the entities and obtained
sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from
defaults. The Company uses other publicly available financial information or its own trading
records to rate its major customers. The Company’s exposure and the credit ratings of its
counterparties are continuously monitored, and the aggregate value of transactions concluded is
spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that
are reviewed and approved by the risk management committee annually. In this regard, the
management believes the Company’s credit risk is significantly reduced.
The Company permits the use of a lifetime expected credit loss allowance for all trade receivables.
The expected credit losses on trade receivables are estimated using a provision matrix by
reference to past default experience with the respective debtors and an analysis of the debtors’
current financial positions. As the Company’s historical credit loss experience does not show
significantly different loss patterns for different customer segments, the loss allowance based on
the past due status of receivables is not further distinguished according to different segments of
the Company’s customer base.
The Company writes off a trade receivable when there is information indicating that the debtor is
experiencing severe financial difficulty and there is no realistic prospect of recovery of the
receivable. For trade receivables that have been written off, the Company continues to engage in
enforcement activity to attempt to recover the receivables which are due. Where recoveries are
made, they are recognized in profit or loss.
The following table details the loss allowance of trade receivables based on the Company’s
provision matrix.
December 31, 2022
Not Past Due Up to 90 Days
91 to 180
Days
181 to 365
Days
Over 365
Days
Total
0%
0%-2%
0%-50%
0%-100%
50%-100%
$ 3,763,039 $
24,816 $
126,508
$
33,756
$
-
$ 3,948,119
-
-
-
-
-
-
Expected credit loss
rate
Gross carrying
amount
Loss allowance
(lifetime ECLs)
Amortized cost
$ 3,763,039
$
24,816
$
126,508
$
33,756
$
-
$ 3,948,119
December 31, 2021
Not Past Due Up to 90 Days
91 to 180
Days
181 to 365
Days
Over 365
Days
Total
Expected credit loss
rate
0%
0%-2%
0%-50%
0%-100%
50%-100%
Gross carrying amount $ 4,940,106
Loss allowance
$
178,537
$
-
$
-
$
-
$ 5,118,643
(lifetime ECLs)
-
-
-
-
-
-
Amortized cost
$ 4,940,106
$
178,537
$
-
$
-
$
-
$ 5,118,643
328
10. INVENTORIES
Raw materials
Raw materials in transit
Supplies
Work-in-process
Finished goods and merchandise
Construction in progress
December 31
2022
2021
$ 1,905,546
1,488,842
1,208,541
1,746,284
5,251,659
218,216
$ 2,852,040
2,446,150
1,161,688
1,732,064
7,145,905
229,425
$ 11,819,088
$ 15,567,272
a. The cost of goods sold related to inventories for the years ended December 31, 2022 and 2021
were NT$86,967,000 thousand and NT$84,624,278 thousand, respectively.
b. The cost of goods sold for the years ended December 31, 2022 and 2021 included inventory
write-downs of NT$74,230 thousand and reversals of inventory write-downs of NT$15,985
thousand, respectively. The reversals of previous write-downs for the year ended December
31, 2021 resulted from the inventory closeout.
11. FINANCIAL ASSETS MEASURED AT FAIR VALUE THROUGH OTHER
COMPREHENSIVE INCOME
Domestic listed ordinary shares
HannStar Display Corp.
HannStar Board Corp.
Teco Electric & Machinery Co., Ltd.
Domestic unlisted ordinary shares
Current
Non-current
December 31
2022
2021
$ 3,340,899 $ 5,423,342
2,894,429
7,293,386
528,367
2,017,812
6,348,587
498,902
$ 12,206,200
$ 16,139,524
-
$
12,206,200
-
$
16,139,524
$ 12,206,200
$ 16,139,524
These investments in equity instruments are held for medium- to long-term strategic purposes.
Accordingly, the management selected to designate these investments in equity instruments as at
FVTOCI as they believe that recognizing short-term fluctuations in these investments’ fair value
in profit or loss would not be consistent with the Company’s strategy of holding these investments
for long-term purposes.
On December 31, 2022 and 2021, the unrealized valuation (losses) gains resulting from these
investments in equity instruments were NT$(4,022,988) thousand and NT$2,611,742 thousand,
respectively, recognized in other comprehensive income (loss).
329
Financial Information
On January 6, 2021, the Company issued 205,333 thousand shares in exchange for 171,104
thousand shares of TECO Electric & Machinery Co., Ltd. WLC and TECO agreed to build a
strategic alliance to enhance competitiveness and cooperation in next generation smart grid, smart
manufacturing, and green energy industry.
In addition, the Company also acquired the shares of TECO Electric & Machinery Co., Ltd. from
the open market. As of December 31, 2022 and 2021, the Company held a total of 230,439
thousand shares of TECO Electric & Machinery Co., Ltd.
12. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Investments in subsidiaries
Investments in associates
a. Investments in subsidiaries
December 31
2022
2021
$ 72,758,665
44,797,537
$ 54,273,810
38,086,259
$ 117,556,202
$ 92,360,069
Name of Subsidiary
Carrying Value
Ownership
Percentage Carrying Value
Ownership
Percentage
December 31
2022
2021
Unlisted companies:
Walsin Lihwa Holdings Ltd. $ 24,073,818 100.00
100.00
Concord Industries Ltd.
100.00
Walsin Precision
5,210,454
563,204
$ 26,803,960
5,353,142
447,963
100.00
100.00
100.00
Technology Sdn. Bhd.
Min Maw Precision Industry
Corp.
Ace Result Limited
Walsin Info-Electric Inc.
Chin-Cherng Construction
Co., Ltd.
388,436
100.00
365,703
100.00
354,722
314,008
6,182,490
100.00
99.51
99.22
383,632
335,371
6,348,728
100.00
99.51
99.22
P.T. Walsin Lippo Industries
Joint Success Enterprises
953,239
5,084,267
70.00
49.05
818,205
5,175,692
70.00
49.05
Ltd.
PT. Walsin Nickel Industrial
5,832,774
Indonesia
Walsin Singapore Pte. Ltd.
(formerly known as New
Hono Investment Pte.
Ltd.)
19,603,265
Walsin Lihwa Europe S.a r.l.
4,146,986
50.00
(Note 1)
100.00
(Note 1)
100.00
(Note 4)
2,381,125
5,828,396
50.00
(Note 1)
100.00
(Note 1)
-
-
(Continued)
330
Name of Subsidiary
Carrying Value
Ownership
Percentage Carrying Value
Ownership
Percentage
December 31
2022
2021
Walsin America, LLC
PT. Sunny Metal Industry
-
-
100.00
(Note 2)
-
(Note 3)
-
-
-
(Note 1)
-
(Note 1)
Others
51,002
31,893
$ 72,758,665
$ 54,273,810
(Concluded)
Note 1: In January 2020, the Company invested capital to establish PT. Walsin Nickel
Industrial Indonesia (“WNII”). Walsin Singapore Pte. Ltd. (“WLS”) formerly known
as New Hono Investment Pte. Ltd. held 42% equity of WNII. According to the joint
venture agreement signed by the Company and WLS in January 2020, the Company
had the right to purchase 100% of WLS’s shares on the terms agreed by all parties to
acquire 42% equity of WNII indirectly. On June 25, 2021, the board of directors of
the Company resolved to acquire 100% of WLS’s shares and the Company acquired
100% of WLS’s shares at a price US$178,500 thousand on July 30, 2021. After the
transaction, the Company directly and indirectly acquired 92% of WNII’s shares.
The Investment Commission of the Ministry of Economic Affairs has approved the
investment to pay by the Company’s own foreign exchange. Therefore, the
Company communicated with Golden Harbour International Pte. Ltd. to exercise the
early redemption and to pay back the US-currency bonds. The Company will pay the
purchase of WLS’s shares by the redemption of the bonds. As of December 31, 2021,
US$178,500 thousand has been paid.
Note 2: Due to the adjustment of the investment structure of the Group, it was transferred
from WLHL to Walsin Lihwa Corporation on December 2022.
Note 3: On September 23, 2022, the Company acquired 50.10% shares of PT. Sunny Metal
Industry from Ever Rising Limited and Berg Holding Limited at the price of
US$200,000 thousand. On November 4, 2022, the board of directors of the
Company resolved to transfer PT. Sunny Metal Industry to Walsin Singapore Pte.
Ltd.
Note 4: On May 31, 2022, the Company’s board of directors resolved to establish Walsin
Lihwa Europe S.a r.l. and Walsin Lihwa Europe S.a r.l. acquired 85.032% shares of
Luxembourg MEG S.A.
As of December 31, 2022, the carrying amount of Company’s long-term investment to Walsin
America, LLC was negative, so the difference of $17,487 thousand was reclassified to other
non-current liabilities.
331
Financial Information
b. Investments in associates
Name of Associate
Carrying Value
Ownership
Percentage Carrying Value
Ownership
Percentage
December 31
2022
2021
Material associates
Winbond Electronics Corp. $ 20,953,105
Walton Advanced
22.21
$ 18,357,864
22.21
Engineering, Inc.
Walsin Technology Corp.
2,109,400
8,147,080
21.01
18.30
2,322,664
8,166,415
21.01
18.30
Associates that are not
individually
material
Others
13,587,952
9,239,316
$ 44,797,537
$ 38,086,259
Refer to Table 8 “Information on Investees” and Table 9 “Information on Investments in
Mainland China” for the nature of activities, principal places of business and countries of
incorporation of the associates.
The Company is the single largest shareholder of the abovementioned material associates in
which the Company has an ownership percentage of less than 50%. Considering the relative
size and wide dispersion of the voting rights owned by other shareholders, the Company has
no ability to direct the relevant activities of the associates and therefore has no control over
these associates.
Fair values (Level 1) of investments in associates with available published price quotations
are summarized as follows:
Name of Associate
Winbond Electronics Corp.
Walton Advanced Engineering, Inc.
Walsin Technology Corp.
December 31
2022
2021
$ 17,323,429
$ 1,244,282
$ 7,023,284
$ 30,050,846
$ 2,066,495
$ 14,846,688
All the associates were accounted for using the equity method.
The summarized financial information below represents amounts shown in the associates’
financial statements prepared in accordance with IFRSs adjusted by the Company for equity
accounting purposes.
332
1) Material associates
December 31, 2022
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Non-controlling interests
$ 68,537,523 $
115,627,470
(27,776,754)
(53,654,523)
102,733,716
(8,570,720)
8,080,399 $ 42,078,074
49,653,421
11,240,954
(19,230,081)
(5,110,938)
(18,917,380)
(3,970,323)
53,584,034
10,240,092
(9,303,110)
(200,109)
$ 94,162,996 $ 10,039,983 $ 44,280,924
Proportion of the Company’s
ownership
Equity attributable to the
Company
Other adjustments
22.21%
21.01%
18.30%
$ 20,913,601
$
2,109,400
$
39,504
-
8,103,409
43,671
Carrying amount
$ 20,953,105 $
2,109,400 $
8,147,080
Operating revenue
$ 94,529,790 $
9,506,348 $ 35,297,163
Net profit for the year
Other comprehensive income
(loss)
Total comprehensive income for
$ 14,986,552 $
156,098 $
2,295,275
2,717,903
(1,186,315)
218,387
the year
$ 17,704,455
$
(1,030,217)
$
2,513,662
December 31, 2021
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
Non-controlling interests
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
$ 72,506,733
$ 8,361,878 $ 41,187,886
80,233,551 13,155,507 52,910,618
(5,019,961) (21,557,433)
(28,644,931)
(34,061,841)
(5,259,172) (19,062,857)
90,033,512 11,238,252 53,478,214
(9,089,372)
(7,589,399)
(297,416)
$ 82,444,113 $ 10,940,836 $ 44,388,842
(Continued)
333
Financial Information
Proportion of the Company’s
ownership
Equity attributable to the
Company
Other adjustments
Winbond
Electronics
Corp.
Walton
Advanced
Engineering,
Inc.
Walsin
Technology
Corp.
22.21%
21.01%
18.30%
$ 18,310,837
$ 2,298,670
47,027
23,994
$ 8,123,158
43,257
Carrying amount
$ 18,357,864 $ 2,322,664
$ 8,166,415
Operating revenue
$ 99,569,924 $ 8,118,256 $ 42,108,708
Net profit for the year
Other comprehensive income
(loss)
$ 15,000,122 $
118,732 $ 8,961,076
4,186,931
(892,554)
1,157,156
Total comprehensive income for
the year
$ 19,187,053
$
(773,822)
$ 10,118,232
(Concluded)
2) Associates that are not individually material
For the Year Ended December 31
2022
2021
The Company’s share of:
Net profit from continuing operations
Other comprehensive (loss) income
$
366,767
(901,548)
$
185,157
1,794,745
Total comprehensive income for the year
$
(534,781)
$ 1,979,902
The Company’s share of profit and other comprehensive income of associates for the
years ended December 31, 2022 and 2021 was based on the associates’ financial
statements audited by independent auditors for the same period. The financial statements
of certain equity-method investees included in the financial statements were not audited
by the auditors of the Company, but were audited by other independent auditors. The
investment in such investee amounted to NT$14,685,608 thousand and NT$5,587,877
thousand as of December 31, 2022 and 2021, respectively; investment (loss) gain
amounted to NT$(118,414) thousand and NT$743,761 thousand for the years ended
December 31, 2022 and 2021, respectively.
334
13. PROPERTY, PLANT AND EQUIPMENT
Land
Buildings and
Improvements
Machinery and
Equipment
Other
Equipment
Construction
in Progress
Total
Cost
Balance at January 1, 2022
Additions
Disposals
Reclassified
$ 3,611,025 $ 7,219,012 $ 20,438,380
258,714
(78,137 )
546,277
29,938
(4,979 )
104,430
80,867
(50,356 )
107,209
$ 4,282,943
126,330
(30,930 )
97,151
$ 1,779,489 $ 37,330,849
2,676,627
2,180,778
(164,405 )
(3 )
-
(855,067 )
Balance at December 31, 2022
$ 3,748,745 $ 7,348,401 $ 21,165,234
$ 4,475,494
$ 3,105,197 $ 39,843,071
Accumulated depreciation
and impairment
Balance at January 1, 2022
Disposals
Depreciation expenses
$
8,067 $ 4,365,668 $ 12,751,878
$ 2,793,963 $
-
-
(4,980 )
184,735
(78,137 )
796,861
(30,924 )
295,750
- $ 19,919,576
(114,041 )
-
1,277,346
-
Balance at December 31, 2022
$
8,067 $ 4,545,423 $ 13,470,602
$ 3,058,789 $
- $ 21,082,881
Carrying amount at
December 31, 2022
$ 3,740,678 $ 2,802,978 $ 7,694,632 $ 1,416,705 $ 3,105,197 $ 18,760,190
Cost
Balance at January 1, 2021
Additions
Disposals
Reclassified
$ 3,483,995 $ 6,898,636
54,540
(25,232 )
291,068
78,421
(1,164 )
49,773
$ 20,102,064
163,434
(90,497 )
263,379
$ 4,018,641
290,573
(62,645 )
36,374
$ 1,283,927 $ 35,787,263
1,723,184
1,136,216
(179,598 )
(60 )
-
(640,594 )
Balance at December 31, 2021
$ 3,611,025 $ 7,219,012
$ 20,438,380
$ 4,282,943
$ 1,779,489 $ 37,330,849
Accumulated depreciation
and impairment
Balance at January 1, 2021
Disposals
Impairment losses recognized
(reversed)
Depreciation expenses
Reclassified
$
8,067 $ 4,146,696
$ 11,464,404
$ 2,674,800
$
-
(25,232 )
(90,296 )
(62,549 )
- $ 18,293,967
(178,077 )
-
-
-
-
24,962
164,134
55,108
553,609
815,930
8,231
(20,850 )
265,901
(63,339 )
-
-
-
557,721
1,245,965
-
Balance at December 31, 2021
$
8,067 $ 4,365,668
$ 12,751,878
$ 2,793,963
$
- $ 19,919,576
Carrying amount at
December 31, 2021
$ 3,602,958 $ 2,853,344
$ 7,686,502
$ 1,488,980
$ 1,779,489 $ 17,411,273
a. Apart from stated above, the above items of property, plant and equipment are depreciated on
a straight-line basis over their estimated useful lives as follows:
Buildings and improvements
Machinery and equipment
Other equipment
3-50 years
3-20 years
3-15 years
The Company’s main buildings, office buildings and electrical and mechanical power
equipment are depreciated over their estimated useful lives of 50 years and 20 years,
respectively.
b. The Company owns parcels of land which were registered in the name of certain individuals
because of certain regulatory restrictions. To secure its ownership of such parcels of land, the
Company keeps in its possession the land titles with the annotation of the land being pledged
335
Financial Information
to the Company. As of December 31, 2022 and 2021, the recorded total carrying amount of
such parcels of land amounted to NT$491,917 thousand and NT$542,274 thousand,
respectively.
c. After appropriate evaluation, the Company recognized an impairment loss on property, plant
and equipment of NT$557,721 thousand for the year ended December 31, 2021.
14. LEASE ARRANGEMENTS
a. Right-of-use assets
Carrying amounts
Land
Buildings
Transportation equipment
December 31
2022
2021
$ 1,423,924
2,666
33,404
$
49,464
472
31,114
$ 1,459,994
$
81,050
For the Year Ended December 31
2022
2021
Additions to right-of-use assets
$ 1,450,985
$
24,290
Disposal
$
(511)
$
-
Depreciation charge for right-of-use assets
Land
Buildings
Transportation equipment
b. Lease liabilities
Carrying amounts
Current
Non-current
$
$
56,047
1,714
13,769
6,644
5,238
11,987
$
71,530
$
23,869
December 31
2022
2021
$
38,519
$ 1,498,347
$
$
20,564
64,580
336
Range of discount rate for lease liabilities was as follows:
Land
Buildings
Transportation equipment
c. Other lease information
December 31
2022
2021
2.000%-3.759% 1.75%-3.759%
1.409%-1.9%
3.038%
1.198%
1.964%-3.038%
For the Year Ended December 31
2022
2021
Expenses relating to short-term leases
Expenses relating to low-value asset leases
Total cash outflow for leases
$ 19,512
$
108
$ (50,285)
$ 16,203
$
201
$ (39,537)
15. INVESTMENT PROPERTIES
Completed investment properties
$ 8,170,554
$ 8,243,668
December 31
2022
2021
Cost
Balance at January 1, 2022
Additions
Balance at December 31, 2022
Balance at January 1, 2021
Additions
Balance at December 31, 2021
Accumulated depreciation and impairment
Balance at January 1, 2022
Depreciation expenses
Balance at December 31, 2022
Balance at January 1, 2021
Depreciation expenses
Balance at December 31, 2021
Completed
Investment
Properties
$ 9,977,502
183
$ 9,977,685
$ 9,975,140
2,362
$ 9,977,502
$ 1,733,834
73,297
$ 1,807,131
$ 1,660,342
73,492
$ 1,733,834
337
Financial Information
a. The completed investment properties are depreciated on a straight-line method over their
estimated useful lives of 20 to 50 years.
b. The investment property of the Company are the Walsin Xin Yi Building and other completed
investment properties. The building valuation was commissioned by independent appraisal
agencies (third parties). As of December 31, 2022 and 2021, the fair values of the investment
properties were NT$30,844,090 thousand and NT$29,482,520 thousand, respectively.
16. OTHER ASSETS
Prepayment for purchases
Prepaid expense
Overpaid sales taxes
Refundable deposits
Prepayment for investments
Others
Current
Non-current
17. BORROWINGS
Short-term borrowings
Current portion of long-term borrowings
Long-term borrowings
Long-term notes and bills payable
December 31
2022
2021
$ 1,390,831
348,419
-
280,997
2,204,073
117,144
$ 1,318,635
403,139
250,658
-
-
261,262
$ 4,341,464
$ 2,233,694
$ 2,060,227
2,281,237
$ 2,051,688
182,006
$ 4,341,464
$ 2,233,694
December 31
2022
2021
$ 6,600,565 $ 5,074,632
$ 10,500,000
$
-
$ 24,640,014
$ 37,445,270
-
$
$ 1,497,914
a. Short-term borrowings as of December 31, 2022 and 2021 were as follows:
December 31
2022
2021
Interest Rate
%
Amount
Interest Rate
%
Amount
Procurement loans
Bank lines of credit
-
0.95-1.62%
$
-
6,600,565
0.64-0.70
0.69-0.91
$ 2,111,447
2,963,185
$ 6,600,565
$ 5,074,632
338
b. Long-term borrowings as of December 31, 2022 and 2021 were as follows:
December 31
2022
Significant Covenant
Amount
2021
Amount
Long-term credit loan
Bank of Taiwan
Principal repayments at maturity, from March 4, 2019
$
-
$ 3,000,000
Taipei Fubon Commercial Bank
Principal repayments at maturity, from June 3, 2019 to
to March 4, 2022
June 3, 2022
Chinatrust Commercial Bank
Principal repayments at maturity, from September 3,
2019 to September 3, 2022
Taiwan Cooperative Bank
Principal repayments at maturity, from March 4, 2019
Cathay United Bank
Principal repayments at maturity, from March 4, 2019
to March 4, 2022
to March 4, 2022
KGI Bank
Principal repayments at maturity, from June 3, 2019 to
June 3, 2022
Standard Chartered Bank
Principal repayments at maturity, from September 27,
Standard Chartered Bank
Principal repayments at maturity, from September 27,
2021 to December 31, 2023
2021 to December 31, 2023
Chang Hwa Commercial Bank
Principal repayments at maturity, from June 3, 2019 to
June 3, 2022
-
-
-
-
-
-
-
-
1,000,000
1,500,000
1,000,000
1,500,000
1,500,000
5,352,144
2,093,000
1,000,000
The Export-Import Bank of the
Long-term credit loan from December 04, 2020 to
1,137,770
1,137,770
Republic of China
Bank of Taiwan
Taiwan Cooperative Bank
DBS Bank
Hua Nan Commercial Bank
December 04, 2027; principal to be repaid evenly in
seven phases; 1st repayment due 48 months after the
drawdown date, after which repayments are due once
every six months
Principal repayments at maturity, from September 22,
2020 to October 4, 2027; principal to be repaid in
two phases: From the 5th year, repayments are due
once every six months; at rates of 20% and 80%,
respectively
Principal repayment at maturity, from June 28, 2021
to June 28, 2026; principal to be repaid in two
phases: 1st repayment due 48 months after the
drawdown date, 2nd repayment due maturity date.
Principal repayments at maturity, from March 30,
2020 to April 15, 2025
Principal repayment at maturity, from March 29, 2021
to March 29, 2026; principal to be repaid in two
phases: From the 5th year, repayments are due once
every six months
9,000,000
3,000,000
2,000,000
2,000,000
7,552,100
9,057,100
2,000,000
2,000,000
Chinatrust Commercial Bank
Principal repayments at maturity, from October 4, 2022
1,500,000
Taiwan Cooperative Bank
to October 3, 2025
Principal repayments at maturity, from October 4, 2022
to October 4, 2027; principal to be repaid in two
phases: From the 4th year, repayments are due once
every six months; at rates of 20% and 80%,
respectively
3,000,000
KGI Bank
Principal repayments at maturity, from October 24,
1,500,000
2022 to April 24, 2027
Standard Chartered Bank
Principal repayments at maturity, from November 16,
1,555,400
Hua Nan Commercial Bank
Principal repayments at maturity, from March 8, 2022
2,500,000
2022 to December 31, 2024
to March 8, 2027
Agricultural Bank of Taiwan
Principal repayments at maturity, from October 31,
1,000,000
Chang Hwa Commercial Bank
Principal repayments at maturity, from March 8, 2022
3,000,000
2022 to October 31, 2025
Others bank long-term credit
Principal repayments at maturity, from September 22,
1,700,000
loan
2022 to September 22, 2029
to October 4, 2027
-
-
-
-
-
-
-
-
Less current portion of long-term
borrowings
37,445,270
-
35,140,014
(10,500,000 )
$ 37,445,270
$ 24,640,014
339
Financial Information
1) As mentioned above, long-term borrowings are assigned to credit loans.
2) Under the loan agreements with DBS Bank, the Company should maintain certain
financial ratios during the loan term, which are based on the annual and semi-annual
financial statements audited by the independent auditors. The financial ratios are as
follows:
a) Ratio of current assets to current liabilities not less than 100%;
b) Ratio of total liabilities less cash and cash equivalents to tangible net worth not more
than 120%;
c) Ratio of Interest Coverage Ratio which included net income before interest expenses,
taxation, depreciation and amortization to interest expenses not less than 150%; and
d) Tangible net worth (net worth less intangible assets) not less than NT$55,000,000
thousand.
3) As of December 31, 2022 and 2021, the Company’s current portion of long-term
borrowings was NT$0 thousand and NT$10,500,000 thousand, respectively, under the
loan agreement. The Company’s consolidated financial statements for the years ended
December 31, 2022 and 2021 showed that the Company was in compliance with the
aforementioned financial ratio requirements.
c. Long-term notes and bills payables
December 31, 2022
Acceptance Agency
Character
Interest rate (%)
Amount
China Bills and International Bills
Less: Discount on short-term bills
payable
Unsecured
1.395-1.50
$ 1,500,000
(2,086)
$ 1,497,914
18. BONDS PAYABLE
December 31
2022
2021
The 1st unsecured bonds in 2021
$ 7,500,000
$ 7,500,000
On October 8, 2021, the Company issued the first unsecured bonds for $7.5 billion, each with a
face value of $10 million. The issuance period is 5 years, and the maturity date is on October 8,
2026. The annual percentage rate is 0.7%. Since the issuance date, the interest will be paid once a
year, and the principal will be repaid once due.
340
19. RETIREMENT BENEFIT PLANS
a. Defined contribution plan
The Company adopted a pension plan under the Labor Pension Act (LPA), which is a
state-managed defined contribution plan. Under the LPA, the Company makes monthly
contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.
The total expenses recognized in profit or loss for the years ended December 31, 2022 and
2021 were NT$109,019 thousand and NT$95,977 thousand, respectively, which is based on
the specified ratio in defined contributions plan.
b. Defined benefit plans
The defined benefit plans adopted by the Company in accordance with the Labor Standards
Act are operated by the government of the ROC. Pension benefits are calculated on the basis
of the length of service and average monthly salaries of the 6 months before retirement. The
Company contributes amounts equal to 2% of total monthly salaries and wages to a pension
fund administered by the pension fund monitoring committee. Pension contributions are
deposited in the Bank of Taiwan in the committee’s name. Before the end of each year, the
Company assesses the balance in the pension fund. If the amount of the balance in the pension
fund is inadequate to pay retirement benefits for employees who conform to retirement
requirements in the next year, the Company is required to fund the difference in one
appropriation that should be made before the end of March of the next year. The pension fund
is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the Company
has no right to influence the investment policy and strategy.
The amounts included in the balance sheets in respect of the Company’s defined benefit plans
are as follows:
December 31
2022
2021
Present value of defined benefit obligation
Fair value of plan assets
$ 1,209,509
(1,060,075)
$ 1,482,158
(1,028,335)
Net defined benefit liabilities
$
149,434
$
453,823
As of December 31, 2022 and 2021, net defined benefit liabilities of NT$2,014 thousand and
NT$2,126 thousand, respectively, were recorded under “other payables - accrued expense.”
Balance at January 1, 2021
Service cost
Current service cost
Net interest expense (income)
Recognized in profit or loss
Present Value of
Defined Benefit
Obligation
Fair Value of
Plan Assets
Net Defined
Benefit
Liabilities
(Assets)
$ 1,366,378
$ (1,074,219)
$
292,159
10,917
6,801
17,718
-
(5,366)
(5,366)
10,917
1,435
12,352
(Continued)
341
Financial Information
Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial (gain) loss
Changes in demographic
assumptions
Changes in financial
assumptions
Experience adjustments
Recognized in other comprehensive
income
Contributions from the employer
Benefits paid
Balance at December 31, 2021
Service cost
Current service cost
Net interest expense (income)
Recognized in profit or loss
Remeasurement
Return on plan assets (excluding
amounts included in net
interest)
Actuarial (gain) loss
Changes in financial
assumptions
Experience adjustments
Recognized in other comprehensive
income
Contributions from the employer
Benefits paid
Present Value of
Defined Benefit
Obligation
Fair Value of
Plan Assets
Net Defined
Benefit
Liabilities
(Assets)
-
(13,584)
(13,584)
38,641
(15,729)
151,322
-
-
-
174,234
-
(76,172)
1,482,158
(13,584)
(11,138)
76,172
(1,028,335)
10,007
9,244
19,251
-
(6,442)
(6,442)
38,641
(15,729)
151,322
160,650
(11,138)
-
453,823
10,007
2,802
12,809
-
(82,973)
(82,973)
(63,850)
(113,715)
(177,565)
-
(114,335)
-
-
(82,973)
(56,660)
114,335
(63,850)
(113,715)
(260,538)
(56,660)
-
149,434
(Concluded)
Balance at December 31, 2022
$ 1,209,509
$ (1,060,075)
$
An analysis by function of the amounts recognized in profit or loss in respect of the defined
benefit plans are as follows:
Operating costs
Selling and marketing expenses
General and administrative expenses
Research and development expenses
For the Year Ended December 31
2022
2021
$ 6,638
894
5,077
200
$ 6,240
945
4,918
249
$ 12,809
$ 12,352
342
Through the defined benefit plans under the Labor Standards Act, the Company is exposed to
the following risks:
1) Investment risk: The plan assets are invested in domestic and foreign equity and debt
securities, bank deposits, etc. The investment is conducted at the discretion of the Bureau
or under the mandated management. However, in accordance with relevant regulations,
the return generated by plan assets shall not be below the interest rate for a 2-year time
deposit with local banks.
2) Interest risk: A decrease in the government bond interest rate will increase the present
value of the defined benefit obligation; however, this will be partially offset by an increase
in the return on the plan’s debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated using the
future salaries of plan participants. As such, an increase in the salaries of the plan
participants will increase the present value of the defined benefit obligation.
The actuarial valuations of the present value of the defined benefit obligation were carried out
by qualified actuaries. The significant assumptions used for the purposes of the actuarial
valuations are as follows:
Discount rate(s)
Expected rate(s) of salary increase
December 31
2022
1.25%
2.25%
2021
0.625%
2.25%
If possible reasonable change in each of the significant actuarial assumptions occur and all
other assumptions remain constant, the present value of the defined benefit obligation will
increase (decrease) as follows:
Discount rate(s)
0.5% increase
0.5% decrease
Expected rate(s) of salary increase
0.5% increase
0.5% decrease
December 31
2022
2021
$ (47,681)
$ 50,683
$ 49,149
$ (46,718)
$ (61,945)
$ 66,092
$ 63,726
$ (60,375)
The above sensitivity analysis may not be representative of the actual changes in the present
value of the defined benefit obligation as it is unlikely that the changes in assumptions will
occur in isolation of one another as some of the assumptions may be correlated.
343
Financial Information
20. EQUITY
Share capital
Ordinary shares
Capital surplus
Retained earnings
Others
a. Share capital
Ordinary shares
Number of authorized shares (in thousands)
Amount of authorized shares
Number of issued and fully paid shares (in thousands)
Amount of issued shares
December 31
2022
2021
$ 37,313,329
24,672,454
62,038,398
$ 34,313,329
18,440,875
47,787,207
5,342,113
(443,305)
$ 123,580,876
$ 105,883,524
December 31
2022
2021
6,500,000
6,500,000
$ 65,000,000 $ 65,000,000
3,431,333
$ 37,313,329 $ 34,313,329
3,731,333
As of January 1, 2021, the balances of the Company’s capital account were all
NT$32,260,002 thousand, which consisted of 3,226,000 thousand shares at par value of
NT$10.
The Company issued 205,333 thousand shares in exchange for shares of TECO Electric &
Machinery Co., Ltd. in January 2021. On June 6, 2022, the Company’s board of directors
resolved to issue 300,000 thousand ordinary shares at a price of NT$33 per share with August
10, 2022 as the base date for the capital increase. On July 21, 2022, the Company’s chairman
of the board adjusted the new share issuing price from NT$33 to NT$30, which was
authorized by the board. As of December 31, 2022, the paid-in capital was NT$37,313,329
thousand, divided into 3,731,333 thousand ordinary shares at a par value of NT$10.
As of December 31, 2022, 2 thousand GDRs of the Company were traded on the Luxembourg
Stock Exchange. The number of ordinary shares represented by the GDRs was 22 thousand
shares (one GDR
represents 10 ordinary shares).
344
b. Capital surplus
May be used to offset a deficit, distributed as cash
dividend or transferred to share capital (Note)
Issuance of ordinary shares
The difference between the consideration received or
paid and the carrying amount of the subsidiaries’ net
assets during actual disposal or acquisition
Share of changes in capital surplus of associates
Treasury share transactions
Gain on disposal of property, plant and equipment
Others
December 31
2022
2021
$ 18,864,452
$ 12,639,452
2,130
441,175
2,254,074
2,074,231
1,036,392
3,124
440,288
2,254,074
2,074,231
1,029,706
$ 24,672,454
$ 18,440,875
Note: The premium from shares issued in excess of par (share premium from issuance of
ordinary shares, conversion of bonds and treasury share transactions) and donations
may be used to offset a deficit; in addition, when the Company has no deficit, such
capital surplus may be distributed as cash dividends or transferred to share capital
(limited to a certain percentage of the Company’s capital surplus and to once a year).
c. Retained earnings and dividend policy
The shareholders of the Company have held their regular meeting on May 13, 2022, and in
that meeting, have resolved the amendments to the Company’s Articles of Incorporation (the
“Articles”). Under the dividends policy as set forth in the amended Articles, where the
Company made a profit in a fiscal year, the profit shall be first utilized for paying taxes,
offsetting losses of previous years, setting aside as legal reserve 10% of the remaining profit
this requirement is not applicable when the legal reserve has reached the total capital, and then
any remaining profit together with prior unappropriated earnings shall be appropriated for
special reserve or appropriate reversal of special reserve in accordance with the laws and
regulations, and then the balance shall be used by the Company’s board of directors as the
basis for proposing a distribution plan, which should be resolved in the shareholders’ meeting
for the distribution of dividends to shareholders. If appropriated earnings are distributed in
cash, the cash distribution shall be resolved by the Company’s board of directors and reported
in the shareholders’ meeting. Other than the aforementioned regulations, the distribution shall
be after deducting the share of profit of associates accounted for using the equity method and
adding cash dividends of associates accounted for using the equity method. The Company
shall reserve no lesser than 40% of the balance amount as shareholders’ profit after offsetting
its loss and tax payments in the previous year, capital reserve, and special reserve adjusted by
the accumulated net deduction of other equity. The profits shall be distributed in cash or in
form of shares; cash dividends shall not be lesser than 70% of the total dividends.
Before the amendments, where the Company made a profit in a fiscal year, the profit shall be
first utilized for paying taxes, offsetting losses of previous years, setting aside as legal reserve
10% of the remaining profit (this requirement is not applicable when the legal reserve has
reached the total capital), and then any remaining profit together with prior unappropriated
earnings shall be appropriated for setting aside or reversing a special reserve in accordance
with the laws and regulations, and then shall be used by the Company’s board of directors as
the basis for proposing a distribution plan, which should be resolved in the shareholders’
meeting for the distribution of dividends to shareholders. Other than the aforementioned
345
Financial Information
regulations, the Company shall reserve no lesser than 40% of the balance amount as
shareholders’ profit after offsetting its loss and tax payments in the previous year, capital
reserve and special reserve. The profits shall be distributed in cash or in form of shares; cash
dividends shall not be lesser than 70% of the total dividends.
Appropriation of earnings to the legal reserve shall be made until the legal reserve equals the
Company’s paid-in capital. The legal reserve may be used to offset any deficits. If the
Company has no deficit and the legal reserve has exceeded 25% of the Company’s paid-in
capital, the excess may be transferred to capital or distributed in cash.
Items referred to under Rule No. 1010012865, Rule No. 1010047490 and Rule No.
1030006415 issued by the FSC and in the directive titled “Questions and Answers for Special
Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed
from a special reserve by the Company.
Refer to Note 22 for the policies on the distribution of employees’ compensation and
remuneration of directors and supervisors.
The appropriation of earnings for 2021 and 2020 which were approved in the shareholders’
meeting on May 13, 2022 and July 15, 2021, respectively, were as follows:
Appropriation of Earnings
Dividends Per Share (NT$)
2021
2020
Legal reserve
Special reserve
Cash dividends
$ 1,454,522
-
5,490,133
$
681,368
(398,160)
3,088,200
$ 6,944,655
$ 3,371,408
2021
$
-
-
1.6
2020
$
-
-
0.9
The appropriations of earnings for 2022, which were resolved by the Company’s board of
directors on February 24, 2023 were as follows:
Legal reserve
Cash dividends
d. Special reserve
Appropriation
of Earnings
Dividends Per
Share (NT$)
$ 1,974,132
6,716,399
$
-
1.8
$ 8,690,531
December 31
2022
2021
Special reserve
$ 2,712,250
$ 2,712,250
346
Information regarding above special reserve changes as follows:
Balance at January 1
Reversals
For the Year Ended December 31
2022
2021
$ 2,712,250
-
$ 3,110,410
(398,160)
Balance at December 31
$ 2,712,250
$ 2,712,250
e. Other equity items
1) Exchange differences on the translation of the financial statements of foreign operations
Balance at January 1
Share from subsidiaries and associates accounted
For the Year Ended December 31
2022
2021
$ (6,100,687)
$ (5,905,135)
for using the equity method
1,843,913
(195,552)
Balance at December 31
$ (4,256,774)
$ (6,100,687)
Exchange differences relating to the translation of the results and net assets of the
Company’s foreign operations from their functional currencies to the Company’s
presentation currency (the New Taiwan dollar) were recognized directly in other
comprehensive income and accumulated in the exchange differences on the translation of
the financial statements of foreign operations. Exchange differences previously
accumulated in the exchange differences on the translation of the financial statements of
foreign operations were reclassified to profit or loss when disposing foreign operation.
2) Unrealized valuation gain (loss) on financial assets at FVTOCI
For the Year Ended December 31
2022
2021
Balance at January 1
Unrealized (loss) gain - equity instruments
Share from associates accounted for using the
equity method
Cumulative unrealized loss of equity instruments
transferred to retained earnings due to disposal
$ 11,534,267
(4,022,988)
$ 6,092,775
2,611,742
(741,445)
2,906,910
(75,957)
(77,160)
Balance at December 31
$ 6,693,877
$ 11,534,267
347
Financial Information
3) (Loss) gain on the hedging instruments
For the Year Ended December 31
2022
2021
Cash flow hedges
Balance at January 1
Share from associates accounted for using the
equity method
$
-
$
(105,801)
Balance at December 31
$ (105,801)
$
-
-
-
4) Other equity - others
Balance at January 1
Originally recognized equity items arising from the
acquisition of subsidiary equity instrument’s put
and call options
Other comprehensive loss from associates
accounted for using the equity method
For the Year Ended December 31
2022
2021
$
(91,467)
$
(2,683,140)
-
-
-
(91,467)
Balance at December 31
$ (2,774,607)
$
(91,467)
21. OPERATING REVENUE
Sales revenue
Other revenue
For the Year Ended December 31
2022
2021
$ 95,624,880
2,795,165
$ 94,405,651
3,383,997
$ 98,420,045
$ 97,789,648
22. NET PROFIT FROM CONTINUING OPERATIONS
Non-operating Income and Expenses - Gain (Loss) on Disposal of Investments
For the Year Ended December 31
2022
2021
(Loss) gain on disposal of investments - commodity futures
Gain on disposal of investments - forward exchange
$ (640,987)
$ 431,529
contracts
(Loss) gain on disposal of investments - exchange rate swap
contracts
Loss on disposal of investments - options
259,332
(215,846)
-
16,695
14,301
(1,499)
$ (597,501)
$ 461,026
348
Non-operating Income and Expenses - Impairment Losses (Recognized) Reversed
For the Year Ended December 31
2022
2021
Impairment loss recognized on property, plant and
equipments
$
-
$ (557,721)
Employee Benefits Expense, Depreciation and Amortization
Short-term employment
benefits
Post-employment
benefits
Other employee benefits
Depreciation
Property, plant and
equipments
Right-of-use assets
Investment properties
For the Year Ended December 31, 2022
Operating
Costs
Operating
Expenses
Non-operating
Expenses and
Losses
Total
$ 1,960,313
$ 1,745,879
$
-
$ 3,706,192
$
$
70,683
169,398
$
$
51,145
100,287
$
$
-
-
$
$
121,828
269,685
$ 1,103,944
5,508
71,118
$
173,402
66,022
2,179
$
-
-
-
$ 1,277,346
71,530
73,297
$ 1,180,570
$
241,603
$
-
$ 1,422,173
Amortization
$
-
$
11,750
$
-
$
11,750
Short-term employment
benefits
Post-employment
benefits
Other employee benefits
Depreciation
Property, plant and
equipments
Right-of-use assets
Investment properties
For the Year Ended December 31, 2021
Operating
Costs
Operating
Expenses
Non-operating
Expenses and
Losses
Total
$ 1,684,098
$ 1,214,050
$
-
$ 2,898,148
$
$
63,272
150,075
$
$
45,057
79,641
$
$
-
-
$
$
108,329
229,716
$ 1,105,101
4,124
71,966
$
140,864
19,745
1,526
$
-
-
-
$ 1,245,965
23,869
73,492
$ 1,181,191
$
162,135
$
-
$ 1,343,326
Amortization
$
-
$
445
$
-
$
445
349
Financial Information
According to the Company’s Articles, the Company accrued employees’ compensation and
remuneration of directors and supervisors at rates of no less than 1% and no higher than 1%,
respectively, of net profit before income tax, employees’ compensation, and remuneration of
directors and supervisors. For the years ended December 31, 2022 and 2021, the compensation of
employees’ amounted to NT$252,000 thousand and NT$187,000 thousand, respectively, and the
remuneration of directors amounted to NT$100,050 thousand and NT$75,000 thousand,
respectively. The compensation of employees and the remuneration of directors and supervisors
for the years ended December 31, 2022 and 2021 were approved by the Company’s board of
directors on February 24, 2023 and February 22, 2022, respectively.
If there is a change in the amounts before the annual financial statements are authorized for issue,
the differences are recorded in the expenses as an adjustment.
The employees’s compensation and the remuneration of directors and supervisors for the years
ended December 31, 2021 and 2020 resolved by the Company’s board of directors on February 22,
2022 and February 26, 2021, respectively, are the same as the amounts recognized in the 2021 and
2020 financial statements.
Information on the employees’ compensation and remuneration of directors and supervisors
resolved by the Company’s board of directors in 2023 and 2022 is available at the Market
Observation Post System website of the Taiwan Stock Exchange.
23. INCOME TAXES RELATING TO CONTINUING OPERATIONS
a. Income tax recognized in profit or loss
Major components of income tax expense are as follows:
Current tax
In respect of the current year
Income tax on unappropriated earnings
Adjustments for prior year
Land value-added tax
Deferred tax
In respect of the current year
Adjustments for prior year
For the Year Ended December 31
2022
2021
$ 1,059,128
321,642
(11,548)
248
1,369,470
$ 1,958,584
83,446
(1,632)
-
2,040,398
3,898,110
36,864
3,934,974
1,715,707
(5,275)
1,710,432
Income tax expense recognized in profit or loss
$ 5,304,444
$ 3,750,830
A reconciliation of accounting profit and income tax expense is as follows:
For the Year Ended December 31
2022
2021
Profit before tax from continuing operations
$ 24,656,541 $ 18,393,459
(Continued)
350
Income tax expense calculated at the statutory rate
Investment income accounted for using the equity
method
Tax-exempt dividend income
Loss on investments
Others
Land value-added tax
Income tax on unappropriated earnings
Adjustments for prior years’ tax
For the Year Ended December 31
2022
2021
$ 4,931,308 $ 3,678,692
153,441
(152,977)
(2,630)
28,096
248
321,642
25,316
495,820
(112,110)
(384,000)
(4,111)
-
83,446
(6,907)
Income tax expense recognized in profit or loss
$ 5,304,444 $ 3,750,830
(Concluded)
b. Current tax assets and liabilities
Current tax assets
Tax refund receivable (recorded under other
non-current assets-others)
$
32,006
$
32,006
December 31
2022
2021
Current tax liabilities
Income tax payable
c. Deferred tax assets and liabilities
Deferred tax assets
$ 1,420,015
$ 2,040,190
December 31
2022
2021
Pension expense overlimit
Unrealized impairment loss on long-term investments
Unrealized loss on inventories write-down
Impairment loss on idle assets
Loss on liquidation of investments
Others
$
23,000
7,000
39,000
15,000
591,000
25,710
$
32,000
547,000
25,000
10,000
384,000
293,573
$
700,710
$ 1,291,573
Deferred tax liabilities
Provision for land value-added tax
Unrealized gain of investments
$
(131,132)
(5,364,543)
$
(131,132)
(2,020,432)
$ (5,495,675)
$ (2,151,564)
351
Financial Information
d. The Company’s income tax returns through 2020, except 2019, have been assessed by the tax
authorities.
24. EARNINGS PER SHARE
For the Year Ended December 31
2022
2021
Amounts
(Numerator)
After Income
Tax
(Attributable
to Owners of
the Company)
Shares
(Denominator)
(In Thousands)
Earnings Per
Share (In
Dollars)
After Income
Tax
(Attributable
to Owners of
the Company)
Amounts
(Numerator)
After Income
Tax
(Attributable
to Owners of
the Company)
Earnings Per
Share (In
Dollars)
After Income
Tax
(Attributable
to Owners of
the Company)
Shares
(Denominator)
(In Thousands)
Basic earnings per share
Net income
$ 19,352,097
3,549,689
$ 5.45
$ 14,642,629
3,428,520
$ 4.27
Effect of potentially
dilutive ordinary
shares
Employee bonus
-
5,690
-
7,632
$ 19,352,097
3,555,379
$ 5.44
$ 14,642,629
3,436,152
$ 4.26
25. SHARE-BASED PAYMENT AGREEMENTS
Employee Share Option Plan for Cash Capital Increase
The Company was approved by the Securities and Futures Bureau (FSC) on March 11, 2022 to
issue 300,000 thousand shares for cash capital increase. The board of directors resolved to retain
10% of the issued shares for employees’ subscription. The number of shares retained for
employees’ subscription and the subscription price were confirmed on June 27, 2022. The
Company recognized the capital surplus of NT$157,800 thousand on the grant date at the fair
value computed based on the Black-Scholes option evaluation model.
a. The share-based payment arrangement of the Company as of December 31, 2022 is as
follows:
Type of Agreement
Grant Date
Quantity
Granted
Vesting
Conditions
Shares retained for employees to
2022.6.27
30,000 thousand
Vesting
subscribe
shares
immediately
b. The Company used the Black-Scholes option evaluation model to calculate the fair value of
employee subscriptions for cash capital increase on June 27, 2022. Relevant information is as
follows:
Share Price
on the Grant
Date (In
Dollars)
Exercise
Price (In
Dollars)
Expected
Ratio of
Stock Price
Fluctuation
Expected
Duration
Expected
Dividend
Rate
Risk-Free
Interest
Rate
Fair Value
Per Share
(In Dollars)
$37.45
$33
52.95%
38 days
0.00%
0.52%
$5.26
352
c. Because of the dramatic changes in the capital market environment, to maintain the
shareholders' rights and ensure the completion of fundraising, the chairman of the Company,
authorized by the board of directors, adjusted the new share issuing price from NT$33 to
NT$30 on July 21, 2022. In addition, due to the price adjustment, the remuneration cost of the
relevant share-based payment agreement increased by NT$67,200 thousand.
The Company used the Black-Scholes option evaluation model to calculate the fair value of
employee subscriptions for cash capital increase as remeasurement on July 21, 2022. Relevant
information is as follows:
Share Price
on the Grant
Date (In
Dollars)
Exercise
Price (In
Dollars)
Expected
Ratio of
Stock Price
Fluctuation
Expected
Duration
Expected
Dividend
Rate
Risk-Free
Interest
Rate
Fair Value
Per Share
(In Dollars)
$34.05
$30
54.13%
14 days
0.00%
0.72%
$2.24
26. ACQUISITION OF A SUBSIDIARY THAT DOES NOT CONSTITUTE A BUSINESS
To develop a new energy industry and increase investment in Matte and Nickel pig iron
production capacity, the Company acquired 50.10% shares of PT. Sunny Metal Industry for
$6,016,800 thousand on September 23, 2022.
In addition, to combine the acquired company's products, technologies and market advantages to
expand the stainless steel business, the Company acquired 85.032% of the shares of MEG S.A. for
$6,692,862 thousand on November 30, 2022.
In accordance with IFRS 3 “Business Combinations”, the aforementioned acquisition of equity
does not constitute a business; therefore, the share purchase transaction is accounted for as the
acquisition of a group of assets. For the description of the acquisition of the investment in
subsidiaries, refer to Note 31 to the Company’s consolidated financial statements for the year
ended December 31, 2022.
27. DISPOSAL OF SUBSIDIARIES - WITH LOSS OF CONTROL
The Company entered into an agreement with ECP (third party) to dispose of its subsidiary New
Leaf Energy, Inc. (original name of the announcement: 2022 Solar Development, Inc.) and
completed the transaction on July 28, 2022 (United States local time July 27, 2022). For the
description of the disposal of the investment, refer to Note 32 to the Company’s consolidated
financial statements for the year ended December 31, 2022.
28. OPERATING LEASE ARRANGEMENTS
Operating leases relating to the investment properties owned by the Company with lease terms
between 5 and 10 years, with an option to extend for another 10 years. All operating lease
contracts contain market review clauses in the event that the lessees exercise its option to renew.
The lessees do not have a bargain purchase options to acquire the properties at the expiry of the
lease periods.
353
Financial Information
As of December 31, 2022 and 2021, deposits received under operating leases amounted to
NT$159,118 thousand and NT$167,217 thousand, respectively (recorded under other non-current
liabilities).
As of December 31, 2022, the Company’s future minimum lease receivables on non-cancelable
operating lease commitments are as follows:
2023
2024-2027
After 2028
29. CAPITAL MANAGEMENT
$
685,004
1,010,847
16,584
$ 1,712,435
The Company’s capital management objective is to ensure that it has the necessary financial
resources and operational plan so that it can cope with the next 12 months working capital
requirements, capital expenditures, debt repayments and dividends spending.
The capital structure of the Company consists of net debt (borrowings offset by cash and cash
equivalents) and equity attributable to owners of the Company (comprising issued capital,
reserves, retained earnings and other equity).
Key management personnel of the Company review the capital structure on a quarterly basis. As
part of this review, the key management personnel consider the cost of capital and the risks
associated with each class of capital. Based on recommendations of the key management
personnel, in order to balance the overall capital structure, the Company may adjust the amount of
dividends paid to shareholders, the number of new shares issued or repurchased, and/or the
amount of new debt issued or existing debt redeemed.
30. FINANCIAL INSTRUMENTS
a. Fair value of financial instruments that are not measured at fair value
Except the following assets and liabilities, the management considers the carrying amounts of
financial assets and financial liabilities not recognized at fair value approximate to their fair
values.
December 31, 2022
Financial liabilities
Financial liabilities at amortized cost
Carrying
Amount
Level 1
Level 2
Level 3
Total
Fair Value
Bonds payable
$ 7,500,000
$
-
$ 7,143,278
$
-
$ 7,143,278
354
December 31, 2021
Financial liabilities
Financial liabilities at amortized cost
Carrying
Amount
Level 1
Level 2
Level 3
Total
Fair Value
Bonds payable
$ 7,500,000
$
-
$ 7,500,000
$
-
$ 7,500,000
The fair values of the financial assets and financial liabilities included in the Level 2
categories above have been determined in accordance with the income approach based on a
discounted cash flow analysis. The observable inputs included bond duration, bond interest
rates and credit rating.
b. Fair value of financial instruments that are measured at fair value on a recurring basis
1) Fair value hierarchy
December 31, 2022
Financial assets at FVTPL
Level 1
Level 2
Level 3
Total
Contingent consideration
$
- $
- $ 2,567,786 $ 2,567,786
Financial assets at FVTOCI
Investments in equity
instruments
Listed securities in ROC
Unlisted securities
Financial liabilities at FVTPL
Derivatives not designated as
$ 11,707,298 $
-
- $
-
- $ 11,707,298
498,902
498,902
$ 11,707,298 $
- $
498,902 $ 12,206,200
hedging instruments
$
21,017 $
30,488 $
- $
51,505
December 31, 2021
Financial assets at FVTPL
Derivatives not designated as
Level 1
Level 2
Level 3
Total
hedging instruments
$
873 $
7,991 $
- $
8,864
(Continued)
355
Financial Information
Financial assets at FVTOCI
Investments in equity
instruments
Listed securities in ROC
Unlisted securities
Financial liabilities at FVTPL
Derivatives not designated as
Level 1
Level 2
Level 3
Total
$ 15,611,157 $
-
- $
-
- $ 15,611,157
528,367
528,367
$ 15,611,157 $
- $
528,367 $ 16,139,524
hedging instruments
$
- $
37,439 $
- $
37,439
(Concluded)
2) There were no transfers between Levels 1, 2 and 3 in 2022 and 2021.
3) Reconciliation of Level 3 fair value measurements of financial instruments
For the year ended December 31, 2022
Financial Assets
Balance at January 1, 2022
Additions
Disposals
Recognized in other comprehensive loss
Recognized in profit or loss
Financial Assets
at FVTPL
Financial
Instruments
Financial Assets
at FVTOCI
Equity
Instruments
$
$
-
2,686,100
-
-
(118,314)
528,367
90,000
(335)
(119,130)
-
Balance at September 30, 2022
$ 2,567,786
$
498,902
For the year ended December 31, 2021
Financial Assets
Balance at January 1, 2021
Additions
Capital reduction and refund
Recognized in other comprehensive income
Balance at December 31, 2021
Financial Assets
at FVTOCI
Equity
Instruments
$ 307,641
149,993
(3,615)
74,348
$ 528,367
356
4) Valuation technique and inputs applied for Level 2 fair value measurement
Financial Instruments
Valuation Technique and Inputs
Derivatives - foreign exchange
Discounted cash flow. Future cash flows are
forward contracts
estimated based on observable forward exchange
rates at the end of the reporting period and
contract forward rates, discounted at a rate that
reflects the credit risk of various counterparties.
Derivatives - exchange rate swap
Discounted cash flow. Future cash flows are
contracts
estimated based on observable forward exchange
rates at the end of the reporting period and
contract forward rates, discounted at a rate that
reflects the credit risk of various counterparties.
5) Valuation technique and inputs applied for Level 3 fair value measurement
Financial Instruments
Valuation Technique and Inputs
Unlisted equity securities
Derivatives - options
Market approach. Fair values are determined based
on observable and comparable companies’ fair
values at the end of the reporting period, adjusted
by price earnings ratio and price-to-book ratio of
the investees.
Net asset method. Fair values are determined based
on the book value of companies.
Discounted cash flow. Present values are determined
based on future cash flows discounted at market
yield.
Black-Scholes Model. The significant unobservable
input value is the market price volatility of the
shares.
Hybrid instruments - bonds
Discounted cash flow. Future cash flows are
Contingent consideration
estimated based on contract rates discounted at a
rate that reflects the credit risk of various
counterparties.
The estimated fair value is discounted according to
the probability of reaching the agreed conditions
and based on credit risk discount rate and other
information.
357
Financial Information
c. Categories of financial instruments
Financial assets
Financial assets at amortized cost
Cash and cash equivalents
Contract assets - current
Notes receivable and trade receivables (including
related parties)
Other receivables
Refundable deposits
Financial assets at FVTPL (current and non-current)
Financial assets at FVTOCI (current and non-current)
Financial liabilities
December 31
2022
2021
$ 10,956,239
267,147
$ 5,023,659
151,065
3,973,177
8,272,172
31,197
2,567,786
12,206,200
5,155,636
985,084
27,548
8,864
16,139,524
Financial liabilities at FVTPL (current and non-current)
Financial liabilities at amortized cost
51,505
37,439
Short-term borrowings
Notes payables and trade payables
Other payables
Bonds Payable
Long-term borrowings (including current portion of
6,600,565
3,226,544
12,158,213
7,500,000
5,074,632
3,040,224
2,676,814
7,500,000
notes payable)
38,943,184
35,140,014
Deposits received (recorded under other non-current
liabilities)
175,854
225,863
d. Financial risk management objectives and policies
The Company’s major financial instruments included equity and investments, borrowings,
trade receivables, trade payables and lease liabilities. The Company’s corporate treasury
function provides services to the business, coordinates access to domestic and international
financial markets, and monitors and manages the financial risks relating to the operations of
the Company through internal risk reports that analyze exposures by degree and magnitude of
risks. These risks include market risk, credit risk and liquidity risk.
The Company seeks to minimize the effects of these risks by using derivative financial
instruments to hedge risk exposures. The use of financial derivatives is governed by the
Company’s policies approved by the board of directors, which provides written principles on
foreign exchange risk, interest rate risk and credit risk, the use of financial derivatives and
non-derivative financial instruments, and the investment of excess liquidity. Compliance with
policies and exposure limits is reviewed by the internal auditors on a continuous basis. The
Company did not enter into or trade financial instruments for speculative purposes.
1) Market risk
The Company’s activities exposed it primarily to the financial risks of changes in foreign
currency exchange rates and interest rates. The Company entered into foreign exchange
forward contracts and interest rate swaps contracts to hedge foreign currency risk and
interest rate risk.
358
There had been no change to the Company’s exposure to market risks or the manner in
which these risks were managed and measured.
a) Foreign currency risk
The Company had foreign currency sales and purchases, which exposed the Group to
foreign currency risk. Exchange rate exposures were managed within approved policy
parameters utilizing foreign exchange forward contracts.
It is the Company’s policy to negotiate the terms of the derivatives to match the terms
of the hedged item to maximize hedge effectiveness.
The carrying amounts of the Company’s foreign currency denominated monetary
assets and monetary liabilities (including those eliminated on consolidation) at the end
of the period are set out in Note 34.
The carrying amounts of the Company’s derivatives exposed to foreign currency risk
at the end of the reporting period were as follows:
Assets
U.S. dollar
Euro
Liabilities
U.S. dollar
Euro
December 31
2022
2021
$ 2,886,740
-
$ 3,713,197
795,675
-
-
7,888,800
563,760
Sensitivity analysis
The Company is mainly exposed to the U.S. dollars.
The following table details the Company’s sensitivity to a 1% increase and decrease in
the New Taiwan dollar (i.e. functional currency) against the relevant foreign
currencies. The sensitivity analysis includes only outstanding foreign currency
denominated monetary items and adjusts their translation at the end of the year for a
1% change in foreign currency rates.
U.S. Dollar Impact
For the Year Ended December 31
2022
2021
$ 50,651
$ (7,048)
Profit or loss
b) Interest rate risk
The Company was exposed to interest rate risk because entities in the Company
359
Financial Information
borrow funds at both fixed and floating interest rates.
The carrying amounts of the Company’s financial assets and financial liabilities with
exposure to interest rates at the end of the year were as follows:
Fair value interest rate risk
Financial liabilities
Cash flow interest rate risk
Financial liabilities
Sensitivity analysis
December 31
2022
2021
$ 7,500,000
$ 7,500,000
$ 45,543,749
$ 40,214,646
The sensitivity analysis below was determined based on the Company’s exposure to
interest rates for financial instruments at the end of the year. For floating rate
liabilities, the analysis was prepared assuming the amount of each liability outstanding
at the end of the year was outstanding for the whole year.
If interest rates had been 1% basis points higher and all other variables were held
constant, the Company’s pre-tax net profit for the years ended December 31, 2022 and
2021 would decrease by NT$455,437
thousand,
respectively.
thousand and NT$402,146
2) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in a financial loss to the Company. As at the end of the year, the Company’s
maximum exposure to credit risk, which would cause a financial loss to the Company due
to the failure of the counterparty to discharge its obligation and due to financial guarantees
provided by the Company, could be equal to the total of the following:
a) The carrying amount of the respective recognized financial assets as stated in the
balance sheets; and
b) The maximum amount the entity would have to pay if the financial guarantee is called
upon, irrespective of the likelihood of the guarantee being exercised.
The Company adopted a policy of only dealing with creditworthy counterparties and
obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of
financial loss from defaults. The Company’s exposure and the credit ratings of its
counterparties are continuously monitored and the aggregate value of transactions
concluded is spread amongst the approved counterparties. Credit exposure is controlled by
setting credit limits that are reviewed and approved by the risk management committee
annually.
In order to minimize credit risk, the management of the Company has delegated a team
responsible for the determination of credit limits, credit approvals and other monitoring
procedures to ensure that follow-up action is taken to recover overdue receivables. In
addition, the Company reviews the recoverable amount of each individual trade
receivables at the end of the year to ensure that adequate impairment losses are made for
360
irrecoverable amounts. In this regard, the directors of the Company consider that the
Company’s credit risk was significantly reduced.
3) Liquidity risk
The Company manages liquidity risk by monitoring and maintaining a level of cash and
cash equivalents deemed adequate to finance the Company’s operations and mitigate the
effects of fluctuations in cash flows. In addition, management monitors the utilization of
bank borrowings and ensures compliance with loan covenants.
a) The following table details the Company’s expected maturities for its non-derivative
financial liabilities with agreed upon repayment periods.
December 31, 2022
Non-derivative
financial liabilities
Variable interest rate
liabilities
Lease liabilities
Non-interest bearing
liabilities
Fixed interest rate liabilities
December 31, 2021
Non-derivative
financial liabilities
Variable interest rate
liabilities
Lease liabilities
Non-interest bearing
liabilities
Fixed interest rate liabilities
1 Year
1-2 Years
2-5 Years
5+ Years
Total
$ 6,600,565
33,771
$ 12,307,500
31,007
$ 26,135,684
234,683
$
500,000
1,752,617
$ 45,543,749
2,052,078
15,421,946
-
75,051
-
59,111
7,500,000
4,503
-
15,560,611
7,500,000
$ 22,056,282
$ 12,413,558
$ 33,929,478
$ 2,257,120
$ 70,656,438
1 Year
1-2 Years
2-5 Years
5+ Years
Total
$ 15,574,632
18,501
$ 16,502,244
15,124
$ 7,000,000
29,550
$ 1,137,770
20,125
$ 40,214,646
83,300
5,812,052
-
29,024
-
101,825
7,500,000
-
-
5,942,901
7,500,000
$ 24,405,185
$ 16,546,392
$ 14,631,375
$ 1,157,895
$ 53,740,847
361
Financial Information
b) The Group’s expected maturities for its derivative financial instruments with agreed
upon settlement date were as follows:
December 31, 2022
Net settled
Commodity futures
contracts
Foreign exchange forward
contracts
December 31, 2021
Net settled
Commodity futures
contracts
Foreign exchange forward
contracts
Exchange rate swap
contracts
On Demand
or Less Than
1 Month
1-3 Months
3 Months to
1 Year
1-5 Years
Total
$ (44,748)
$ 15,206
$
8,525
$
(30,488)
-
-
$ (75,236)
$ 15,206
$
8,525
$
-
-
-
$ (21,017)
(30,488)
$ (51,505)
On Demand
or Less Than
1 Month
1-3 Months
3 Months to
1 Year
1-5 Years
Total
$ 14,706
$ (25,016)
$ 11,183
$
7,814
(37,439)
177
-
-
-
$ (14,919)
$ (24,839)
$ 11,183
$
-
-
-
-
$
873
7,991
(37,439)
$ (28,575)
e. Transfers of financial assets
Factored trade receivables that are not overdue at the end of the year were as follows:
Proceeds
from
Receivables
Factoring
Amount
Reclassified
to Other
Receivables
Advances
Received -
Unused
Advances
Received -
Used
Annual
Interest
Rates on
Advances
Received
(Used) (%)
Counterparty
2022
CTBC bank
$ 151,902
$ 18,449
US$ 2,700
$
2021
CTBC bank
$ 150,495
$
5,786
US$ 2,700
$
-
-
-
-
362
31. TRANSACTIONS WITH RELATED PARTIES
Details of transactions between the Company and other related parties are disclosed as follows:
a. Related party name and category
Related Party Name
Related Party Category
Walsin Lihwa Holdings Ltd.
Walsin Info-Electric Corp.
Chin-Cherng Construction Co.
Min Maw Precision Industry Corp.
Dongguan Walsin Wire & Cable Co., Ltd.
Jiangyin Walsin Specialty Alloy Materials Co., Ltd.
Changshu Walsin Specialty Steel Co., Ltd.
Shanghai Walsin Lihwa Power Wire & Cable Co.,
Ltd.
Yantai Walsin Stainless Steel Co., Ltd.
PT. Walsin Nickel Industrial Indonesia
Walsin Internation Investments Limited
Borrego Energy, LLC
Waltuo Green Resources Corporation
PT. Sunny Metal Industry
Walsin Singapore Pte. Ltd. (Formerly known as New
Hono Investment Pte. Ltd.)
Walsin Technology Corp.
Walton Advanced Engineering, Inc.
Chin-Xin Investment Co., Ltd.
Tsai Yi Corporation (formerly known as Walsin Color
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Associate
Associate
Associate
Co., Ltd.)
Winbond Electronics Corp.
Prosperity Dielectrics Co., Ltd.
Nuvton Technology Corporation
PT. Westrong Metal Industry
HannStar Display Corp.
Kuong Tai Metal Industrial Co., Ltd.
HannStar Board Corp.
Global Brands Manufacture Ltd.
Info-Tek Corp.
Hwa Bao Botanic Conservation Corp.
b. Sales
Subsidiaries
Other related parties
Associate
Associate
Associate
Associate
Associate
Substantive related party
Substantive related party
Substantive related party
Substantive related party
Substantive related party
Substantive related party
For the Year Ended December 31
2022
2021
$
835,245
1,447,563
$ 3,564,180
1,743,620
$ 2,282,808
$ 5,307,800
363
Financial Information
c. Rental income
Subsidiaries
Associates
Other related parties
d. Purchases of goods
Subsidiaries
Other related parties
e. Administrative expenses
Subsidiaries
Associates
Other related parties
For the Year Ended December 31
2022
2021
$
$
6,480
36,930
1,135
2,840
34,798
1,029
$
44,545
$
38,667
For the Year Ended December 31
2022
2021
$
$
5,898
4,308
5,478
4,961
$
10,206
$
10,439
For the Year Ended December 31
2022
2021
$
$
391
15,053
13,630
390
14,889
13,558
$
29,074
$
28,837
The stock registration matters of the Company and related parties were handled together. The
related fees allocated to the related parties were charged against general and administrative
expenses.
f. Dividend income
HannStar Display Corp.
HannStar Board Corp.
Other related parties
For the Year Ended December 31
2022
2021
$
$
298,293
140,259
7,705
149,816
140,259
7,705
$
446,257
$
297,780
364
g. Notes receivable
Not arising from operating activities
Associates
h. Trade receivables
Subsidiaries
Other related parties
i. Trade payables
Subsidiaries
Other related parties
j. Other receivables (excluding financing provided)
Subsidiaries
Associates
Other related parties
k. Other payables (excluding loans from related parties)
Related Party
Walsin Singapore Pte. Ltd.
Other related parties
December 31
2022
2021
$
1,042
$
970
December 31
2022
2021
$
253,402
42,651
$
613,289
17,229
$
296,053
$
630,518
December 31
2022
2021
$
11,605
504
$
5,153
601
$
12,109
$
5,754
December 31
2022
2021
$
$
36,471
13,056
3,062
70,541
19,279
2,648
$
52,589
$
92,468
December 31
2022
2021
$ 5,521,658
275,909
$
-
48,300
$ 5,797,567
$
48,300
365
Financial Information
l. Disposals of property, plant and equipment
Proceeds
For the Year Ended
December 31
Gain on Disposals
For the Year Ended
December 31
Related Party
2022
2021
2022
2021
Hwa Bao Botanic
Conservation
Corp.
$ 128,800
$
-
$ 78,443
$
-
The above transaction prices were determined with reference to the transaction prices of
similar real estate in the vicinity and professional valuation reports.
m. Lease arrangements - Company is lessee
Line Item
Related Party Category
2022
2021
December 31
Lease liabilities
Subsidiaries
$
-
$
416
Line Item
Related Party Category
2022
2021
For the Year Ended December 31
Interest expense
Lease liabilities
Subsidiaries
Subsidiaries
$
$
1
4,169
$
$
59
450
n. Guarantee deposits
Associates
Other related parties
o. Loan to related parties (including interest receivable)
Related Party Category/Name
Subsidiaries
PT. Sunny Metal Industry
Associates
PT. Westrong Metal Industry
December 31
2022
2021
$
$
7,362
282
7,453
282
$
7,644
$
7,735
December 31
2022
2021
$ 5,481,736
$
$ 1,228,863
$
-
-
366
Interest revenue
Related Party Category/Name
Subsidiaries
PT. Sunny Metal Industry
Associates
PT. Westrong Metal Industry
For the Year Ended December 31
2022
2021
$
84,453
$
222,172
$
463
$
-
The interest rate of the Company’s loan to the above-mentioned related parties is equivalent to
the market interest rate.
p. Loan from related parties (including interest payable)
Related Party
December 31
2022
2021
Walsin Internation Investments Limited
$ 3,475,987
$
130,062
Interest expenses
Subsidiaries
q. Endorsements and guarantees
Subsidiaries
Amount endorsed
Amount utilized
r. Remuneration of key management personnel
For the Year Ended December 31
2022
2021
$
6,535
$
11,901
December 31
2022
2021
$
$
369
-
$
$
-
-
The remunerations of directors and key executives in 2022 and 2021 were as follows:
Short-term employee benefits
Post-employment benefits
For the Year Ended December 31
2022
2021
$
265,922
1,299
$
217,470
1,392
$
267,221
$
218,862
The remuneration of directors and key executives, as determined by the remuneration
committee, was based on the performance of individuals and market trends.
367
Financial Information
32. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY
The following assets were provided as collaterals for future deposits:
Refundable deposits (recorded under other financial assets -
current)
Pledged time deposits (recorded under other non-current
financial assets - other)
December 31
2022
2021
$ 280,997
$
-
600
600
$ 281,597
$
600
33. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS
In addition to those disclosed in other notes, significant contingencies and unrecognized
commitments of the Company at December 31, 2022 and 2021 were as follows:
a. Outstanding letters of credit not reflected in the financial statements as of December 31, 2022
and 2021 were as follows (in thousands):
New Taiwan dollar
U.S. dollar
Renminbi
Japanese yen
Euro
December 31
2022
2021
NT$ 20,939
US$
3,186
RMB 2,189
54,144
JPY
EUR 34,490
NT$ 47,575
US$
9,572
RMB 13,134
JPY 160,710
EUR 13,946
b. Outstanding standby letters of credit and bid bonds of contingent liabilities not reflected in the
accompanying financial statements were as follows (in thousands):
New Taiwan dollar
U.S. dollar
December 31
2022
2021
NT$ 841,035
30
US$
NT$ 665,286
30
US$
c. Based on the tariff and relevant regulations, the Company issue tariff letters of credit to import
goods and to meet the needs of post-release duty payment. The amount of tariff letters of
credit were as follows:
New Taiwan dollar
NT$ 496,000
NT$ 462,000
December 31
2022
2021
368
d. Non-cancelable raw material procurement contracts were as follows:
December 31
2022
2021
U.S. dollar
US$ 43,926
US$ 42,595
e. The Company entered into a contract for the construction of new plants on the Company’s
own land. The amount of the unrecognized commitments were as follow:
U.S. dollar
Japanese yen
Euro
New Taiwan dollar
December 31
2022
2021
US$
18
11,680
JPY
EUR 39,064
NT$ 2,237,157
-
US$
-
JPY
EUR
-
NT$ 2,702,350
34. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN
CURRENCIES
The Company’s significant financial assets and liabilities dominated in foreign currencies
aggregated by the foreign currencies other than functional currencies of the entities in the
Company and the related exchange rates between the foreign currencies and the respective
functional currencies were as follows:
December 31, 2022
Unit: Foreign Currency/In Thousands of Taiwan Dollars
Foreign
Currency
Exchange Rate
Carrying
Amount
Financial assets
Monetary items
U.S. dollar
Japanese yen
Euro
Hong Kong dollar
Australian dollar
Investments accounted for using the
equity method
U.S. dollar
Renminbi
Indonesia rupiah
Euro
$
382,488
236,526
35,095
1,027
1,298
30.7100
0.2324
32.7200
3.9380
20.8300
$ 11,746,208
54,969
1,148,296
4,043
27,031
884,702
7,874,934
2,475,983,068
131,042
30.7100
4.40934
0.0020
32.7200
27,169,195
34,723,262
4,902,446
4,287,682
(Continued)
369
Financial Information
Financial liabilities
Monetary items
U.S. dollar
Euro
Swiss franc
December 31, 2021
Foreign
Currency
Exchange Rate
Carrying
Amount
311,554
121
17
30.7100
32.7200
33.2050
9,567,835
3,973
564
(Concluded)
Unit: Foreign Currency/In Thousands of Taiwan Dollars
Foreign
Currency
Exchange Rate
Carrying
Amount
Financial assets
Monetary items
U.S. dollar
Japanese yen
Euro
Singapore dollars
Hong Kong dollar
Australian dollar
Investments accounted for using the
equity method
U.S. dollar
Renminbi
Indonesia rupiah
Malaysian ringgit
Financial liabilities
Monetary items
U.S. dollar
Euro
Swiss franc
$
218,163
511,128
29,590
76
3,245
1,579
27.6800
0.2405
31.3200
20.4600
3.5490
20.0800
$ 6,038,747
122,926
926,756
1,559
11,515
31,714
326,162
8,674,482
6,409,142
70,490
27.6800
4.3416
0.00198
6.3550
9,028,163
37,661,217
12,690
447,963
92,774
26
17
27.6800
31.3200
30.1750
2,567,987
830
513
For the years ended December 31, 2022 and 2021, realized and unrealized net foreign exchange
were gain NT$1,732,956 thousand and loss NT$311,352 thousand, respectively. It is impractical
to disclose net foreign exchange gains (losses) by each significant foreign currency due to the
variety of the foreign currency transactions and functional currencies of the entities in the Group.
35. SEPARATELY DISCLOSED ITEMS
a. Information about significant transactions and b. information on investees:
1) Financing provided to others (Table 1)
370
2) Endorsements/guarantees provided (Table 2)
3) Marketable securities held (Table 3)
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million
or 20% of the paid-in capital (Table 4)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the
paid-in capital (Table 5)
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the
paid-in capital (None)
7) Total purchases from or sales to related parties amounting to at least NT$100 million or
20% of the paid-in capital (Table 6)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the
paid-in capital (Table 7)
9) Trading in derivative instruments (Note 7)
10) Information on investees (Table 8)
c. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal
business activities, paid-in capital, method of investment, inward and outward remittance
of funds, ownership percentage, net income of investees, investment income or loss,
carrying amount of the investment at the end of the period, repatriations of investment
income, and limit on the amount of investment in the mainland China area (Table 9)
2) Any of the following significant transactions with investee companies in mainland China,
either directly or indirectly through a third party, and their prices, payment terms, and
unrealized gains or losses (Table 9):
a) The amount and percentage of purchases and the balance and percentage of the related
payables at the end of the year
b) The amount and percentage of sales and the balance and percentage of the related
receivables at the end of the year
c) The amount of property transactions and the amount of the resultant gains or losses
d) The balance of negotiable instrument endorsements or guarantees or pledges of
collateral at the end of the year and the purposes
e) The highest balance, the ending balance, the interest rate range, and total current
period interest with respect to the financing of funds; and
f) Other transactions that have a material effect on the profit or loss for the year or on the
financial position, such as the rendering or receipt of services
371
Financial Information
d. Information of major shareholders: List all shareholders with ownership of 5% or greater
showing the name of the shareholder, the number of shares owned, and percentage of
ownership of each shareholder (Table 10).
36. SEGMENT INFORMATION
The Company has provided the financial information of the operating segments in the
consolidated financial statements. These parent company only financial statements do not provide
such information.
372
WALSIN LIHWA CORPORATION
FINANCING PROVIDED TO OTHERS
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars and U.S. Dollars)
No.
Lender
Borrower
Financial
Statement
Account
Related
Party
Highest Balance
for the Period
Ending Balance
Actual Amount
Borrowed
Interest
Rate (%)
Nature of
Financing
Business
Transaction
Amount
Reasons for
Short-term
Financing
Allowance for
Impairment
Loss
Collateral
Item
Value
Financing Limit
for Each
Borrower
(Note 1)
Aggregate
Financing Limit
(Note 1)
TABLE 1
PT. Walsin Nickel
Other receivables
Yes
$
(US$
2,255,050
70,000)
$
(US$
-
-)
$
(US$
-
-)
-
Operating
capital
$
- Operating capital $
Other receivables
Yes
Other receivables
Yes
7,745,668
250,750)
2,780,100
90,000)
(US$
(US$
7,700,533
250,750)
2,763,900
90,000)
(US$
(US$
5,397,283
175,750)
1,228,400
40,000)
5.80-6.90 Operating
capital
Operating
capital
6.79
(US$
(US$
- Equipment
purchase
- Equipment
purchase
0 Walsin Lihwa
Corporation
Notes:
Industrial
Indonesia
PT. Sunny Metal
Industry
PT. Westrong
Metal Industry
-
-
-
-
-
-
$
- $
49,432,350
(US$ 1,609,650)
$
49,432,350
(US$ 1,609,650)
-
-
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
49,432,350
(US$ 1,609,650)
1. According to the financing regulations provided by Walsin Lihwa Corporation, the limit on the amount of financing provided to a single enterprise that holds directly or indirectly 100% of the voting rights of a subsidiary cannot exceed 40% of the equity
presented in the consolidated financial statements of Walsin Lihwa Corporation.
a. The limit on the amount of financing provided to a single enterprise was as follows:
PT. Walsin Nickel Industrial Indonesia = $123,580,876 × 40% = $49,432,350 (US$1,609,650)
PT. Sunny Metal Industry = $123,580,876 × 40% = $49,432,350 (US$1,609,650)
PT. Westrong Metal Industry = $123,580,876×40%=$49,432,350 (US$1,609,650)
b. The limit on the amount of financing provided was as follows:
The limit on the amount of financing provided = $123,580,876 × 40% = $49,432,350 (US$1,609,650)
2. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars.
3.
The currency exchange rate as of December 31, 2022 was as follows: US$ to NT$= 1:30.71.
3
7
3
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
3
7
4
WALSIN LIHWA CORPORATION
ENDORSEMENTS/GUARANTEES PROVIDED
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars and U.S. Dollars)
TABLE 2
Endorsee/Guarantee
No.
(Note 1)
Endorsement/
Guarantor
Name
Relationship
(Note 2)
Limits on
Endorsement/
Guarantee Given
on Behalf of Each
Party
(Note 3)
Maximum Amount
Endorsed/
Guarantee During
the Period
Outstanding
Endorsement/
Guarantee at the
End of the Period
(Note 4)
Actual Amount
Borrowed
Amount of
Endorsement/
Guarantee by
Collateral
Ratio of
Accumulated
Endorsement/
Guarantee to Net
Equity in Latest
Financial
Statements (%)
Aggregate
Endorsement/
Guarantee Limit
(Note 3)
Guaranteed
Provided by
Parent
Company
Guarantee
Provided by A
Subsidiary
Provided to
Subsidiaries
Mainland
China
0 Walsin Lihwa
Corporation
PT. Walsin Nickel
Industrial Indonesia
Borrego Energy, LLC
b
b
$
(US$
(US$
27,912,319
908,900)
357,710
11,648)
$
(US$
(US$
2,899,350
90,000)
368,520
12,000)
$
(US$
(US$
-
-)
368,520
12,000)
$
(US$
(US$
-
- )
-
- )
$
-
-
-
0.30
$ 123,580,876
123,580,876
Yes
Yes
No
No
No
No
Notes:
1. The information on Walsin Lihwa Corporation and its subsidiaries is listed and labeled on the entitled “No.” column.
“0” represents Walsin Lihwa Corporation.
a.
b. Subsidiaries are numbered consecutively starting from 1.
2. The relationship between Walsin Lihwa Corporation and the endorsed/guaranteed entities can be classified into the following categories
a. A company with which Walsin Lihwa Corporation does business.
b. A company in which Walsin Lihwa Corporation directly and indirectly holds more than 50% of the voting shares.
c. A company that directly and indirectly holds more than 50% of the voting shares in Walsin Lihwa Corporation.
d. A company in which Walsin Lihwa Corporation directly or indirectly holds 90% or more of the voting shares.
e. A company that fulfills Walsin Lihwa Corporation’s contractual obligations by providing mutual endorsements/guarantees for another company in the same industry or for joint builders for purposes of undertaking a construction project.
f. A company in which all capital contributing shareholders make endorsements/guarantees for it and Walsin Lihwa Corporation’s joint-investment company in proportion to their shareholding percentages.
g. A company in the same industry as Walsin Lihwa Corporation whereby either provides among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each
other.
3. According to the endorsements/guarantees provided and financing provided by Walsin Lihwa Corporation, the total limit on the amount of endorsements/guarantees cannot exceed 100% of the equity of Walsin Lihwa Corporation’s current parent-company-only
financial statements (including the consolidated financial statements). The limit on the amount of endorsements/guarantees provided and financing provided to a single enterprise cannot exceed the equity of the guaranteed company. The limit on the amount of
guarantees provided to an investee in which over 66.67% of the common shares are held cannot exceed the amount which is 250% of the equity multiplied by the equity percentage of the guarantee provider; however, the limits mentioned above are not applicable
to Walsin Lihwa Corporation’s wholly-owned holding companies incorporated in duty-free areas overseas.
a. The limit on the amount of endorsements/guarantees provided was as follows:
NT$123,580,876 × 100% = $123,580,876
b. The limit on the amount of endorsements/guarantees provided to a single entity was as follows:
PT. Walsin Nickel Industrial Indonesia: US$395,174 × 250% × 92% = US$908,900
Borrego Energy, LLC: US$6,422 × 250% × 72.55% = US$11,648
4. The currency exchange rates as of December 31, 2022 were as follows: US$ to NT$= 1:30.71.
5. The Company's plan to improve the excess amount of single corporate endorsement guarantees will be proposed by the audit committee soon.
TABLE 3
WALSIN LIHWA CORPORATION
MARKETABLE SECURITIES HELD
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Holding
Company Name
Type and Name of Issuer of
Marketable Securities
Relationship with the Holding
Company
Financial Statement Account
Number of
Shares/Units
Carrying
Amount
Percentage of
Ownership (%)
Fair Value
Note
December 31, 2022
Walsin Lihwa
Corporation
Share
HannStar Display Corp.
The holding company is a director of the
HannStar Board Corp.
The chairman of the holding company
issuer company
and the chairman of the company are
second-class relatives
TECO Electric & Machinery
-
Co., Ltd.
Kuong Tai Metal Industrial
The holding company is a director of the
Co., Ltd.
issuer company
Global Investment Holdings The holding company is a director of the
Universal Venture Capital
Investment
Hwa Bao Botanic
issuer company
-
The holding company is a supervisor of
Conservation Corp.
Tung Mung Development
the issuer company
-
Co., Ltd.
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
Financial assets at fair value through other
comprehensive income - non-current
299,632,180
$ 3,340,899
9.90
$ 3,340,899
63,753,952
2,017,812
12.06
2,017,812
230,438,730
6,348,587
10.77
6,348,587
9,631,802
201,788
5,221,228
1,400,000
55,794
12,904
9.39
2.97
1.16
12,000,000
132,152
15.00
14,285,000
96,264
4.01
201,788
55,794
12,904
132,152
96,264
3
7
5
3
7
6
WALSIN LIHWA CORPORATION
MARKETABLE SECURITIES ACQUIRED OR DISPOSED OF AT COSTS OR PRICES OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Company
Name
Type and Name of
Marketable
Securities
Financial Statement
Account
Purpose of
Transaction
Counterparty
Beginning Balance
Acquisition
Disposal
Ending Balance
Relationship
Number of
Shares
Amount
Number of
Shares
Amount
Number of
Shares
Amount
Carrying
Amount
Gain (Loss) on
Disposal
Number of
Shares
Amount
TABLE 4
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Walsin Lihwa
Corporation
Share
Walsin Lihwa
Holdings Limited
Investments
Capital reduction
Subsidiaries
473,730,393 $ 26,803,960
accounted for using
the equity method
$ 8,448,083
(Note 1)
365,000,000 $ 11,178,225 $
- $
Walsin Lihwa Europe
Investments
Capital investment
Subsidiaries
-
-
12,000
4,146,986
(Note 2)
-
-
-
-
-
-
5,828,396 380,000,000 13,774,869
(Note 2)
-
-
-
-
108,730,393 $ 24,073,818
12,000
4,146,986
422,000,000 19,603,265
-
-
-
-
50,100
6,010,659
(Note 3)
-
-
-
-
-
50,100
6,251,000
6,010,659
240,341
(Note 4)
-
-
590,000
4,590,864
-
-
-
-
590,000
4,590,864
S.a r.l.
accounted for using
the equity method
Walsin Singapore Pte.
Investments
Capital investment
Subsidiaries
42,000,000
Ltd. (formerly
known as New
Hono Investment
Pte. Ltd)
accounted for using
the equity method
PT. Sunny Metal
Investments
Industry
accounted for using
the equity method
Ever Rising Limited
and Berg Holding
Limited
-
PT. Sunny Metal
Investments
Walsin Singapore
Subsidiaries
-
-
-
-
Industry
accounted for using
the equity method
Pte. Ltd. (formerly
known as New
Hono Investment
Pte. Ltd)
PT. Westrong Metal
Investments
Capital investment
Industry
accounted for using
the equity method
Associated
Companies
Note 1: The amount included investment income or loss and changes in other equity.
Note 2: The amount included a capital increase in cash, recognition of investment gains and losses, and changes in other equity.
Note 3: The amount included the purchase amount, investment income or loss and changes in other equity.
Note 4: The difference between the price of equity under capital surplus - acquiring or disposing of subsidiaries and its carrying value.
WALSIN LIHWA CORPORATION
ACQUISITION OF INDIVIDUAL REAL ESTATE AT COSTS OF AT LEAST NT$300 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Company Name
Property Transaction Date
Transaction
Amount (Foreign
Currencies in
Thousands)
Payment Term
Counterparty Relationships
Information on Previous Title Transfer If Counterparty Is A Related
Party
Property Owner
Relationships
Transaction Date Amount
Price Reference
Purpose of
Acquisition
Other
Terms
Walsin Lihwa Corporation Plant
2022/03/02-
2022/12/26
$
1,293,729 Based on the terms
Chung-Lu
-
N/A
N/A
N/A
N/A
Based on the
Manufacturing and
-
in the contract
Construction Co.,
Ltd.
marketability
operating purpose
TABLE 5
3
7
7
3
7
8
WALSIN LIHWA CORPORATION
TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
TABLE 6
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Company Name
Related Party
Nature of
Relationship
Transaction Details
Abnormal Transaction
Notes/Accounts Payable
or Receivable
Purchase/
Sale
Amount
% of
Total
Payment Terms
Unit Price
Payment
Terms
Ending
Balance
% of
Total
Note
Walsin Lihwa
Corporation
Dongguan Walsin Wire
& Cable Co., Ltd.
subsidiary
100% indirectly owned
Sales
$
(326,711)
-
The payment terms are set by
Similar
Similar
$
-
-
Koung Tai Metal
Director of the related
Sales
(1,447,563)
Industrial Co., Ltd.
party
Jiangyin Walsin
100% indirectly owned
Sales
(255,763)
Specialty Alloy
Materials Co., Ltd.
subsidiary
Changshu Walsin
100% indirectly owned
Sales
(242,061)
Specialty Steel Co.,
Ltd.
subsidiary
quotations on the local market, and
the transaction terms are similar to
those of general customers.
(1) The payment terms are set by
-
-
quotations on the local market, and
the transaction terms are similar to
those of general customers.
The payment terms are set by
quotations on the local market, and
the transaction terms are similar to
those of general customers.
The payment terms are set by
quotations on the local market, and
the transaction terms are similar to
those of general customers.
Similar
Similar
42,651
1
Similar
Similar
150,819
4
Similar
Similar
102,984
3
WALSIN LIHWA CORPORATION
RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars)
Company Name
Related Party
Relationship
Financial Statement Account and
Ending Balance
Turnover
Rate
Amount
Action Taken
Overdue
Walsin Lihwa
Corporation
Jiangyin Walsin Specialty Alloy
100% indirectly owned subsidiary Trade receivables
$ 150,819
1.29
$
Materials Co., Ltd.
Changshu Walsin Specialty Steel
100% indirectly owned subsidiary Trade receivables
102,984
Co., Ltd.
PT. Sunny Metal Industry
PT. Westrong Metal Industry
50.1% indirectly owned subsidiary Other receivables
29.5% indirectly owned associate Other receivables
5,481,736
1,228,863
1.26
-
-
-
-
-
-
-
-
-
-
TABLE 7
Amounts
Received in
Subsequent
Period
Allowance for
Bad Debts
$
-
$
-
-
-
-
-
-
-
3
7
9
3
8
0
WALSIN LIHWA CORPORATION
NAMES, LOCATIONS, AND RELATED INFORMATION OF INVESTEES OVER WHICH THE GROUP EXERCISES SIGNIFICANT INFLUENCE
FOR THE YEAR ENDED DECEMBER 31, 2022
Information of investees that Walsin Lihwa Corporation has controlling power or significant influence over was as follows (in thousands of New Taiwan dollars):
Investor
Company
Investee Company
Location
Main Businesses and Products
Original Investment Amount
December 31,
2022
December 31,
2021
TABLE 8
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
Net Income
(Loss) of the
Investee
Investment
Gain (Loss)
Note
Balance as of December 31, 2022
Percentage of
Ownership
(%)
Number of
Shares
Carrying
Amount
Walsin Lihwa Walsin Lihwa Holdings Limited
Corporation Concord Industries Limited
Ace Result Global Limited
British Virgin Islands Investments holding
British Virgin Islands Investments holding
Investments holding
British Virgin Islands
$ 3,317,552
13,611,135
1,587,416
$ 14,495,777
13,611,135
1,587,416
108,730,393
308,498,375
44,739,988
100.00
100.00
100.00
$ 24,073,818
5,210,454
354,722
$ 7,661,077
(210,389)
(34,906)
$ 7,661,054
(210,389)
(34,906)
Min Maw Precision Industry Corp.
Taiwan
Solar power systems management, design, and
180,368
180,368
32,791,149
100.00
388,436
22,733
22,733
Waltuo Green Resources Corporation
Taiwan
Waste disposal, resource recovery and cement
10,000
10,000
1,828,287
100.00
17,660
(1,543)
(1,543)
installation
Walsin Precision Technology Corp.
Chin-Cherng Construction Co.
Malaysia
Taiwan
Walsin Info-Electric Corp.
Taiwan
products
Production and sale of stainless steel plates
Investment in the construction of residential,
sale of commercial buildings, rental design
and interior decoration business
Mechanical and electrical, communications,
and power systems
PT. Walsin Lippo Industries
PT. Walsin Lippo Kabel
PT. Walsin Nickel Industrial Indonesia
Joint Success Enterprises Limited
Chin-Xin Investment Co., Ltd.
Tsai Yi Corporation (formerly known as
Walsin Color Co., Ltd.)
Concord II Venture Capital Co., Ltd.
Winbond Electronics Corp.
Walton Advanced Engineering, Inc.
Walsin Technology Corp.
Powertec Electrochemical Corp.
Steel wires
Production and sale of cables and wires
Production and sale of nickel pig iron
Indonesia
Indonesia
Indonesia
British Virgin Islands Investments holding
Taiwan
Taiwan
Investments
Management and investments holding
Taiwan
Taiwan
Taiwan
Taiwan
Taiwan
Venture capital and consulting affairs
Research, development, production and sale of
semiconductors and related components
Production, sale, and testing of semiconductors
Production and sale of ceramic capacitors
Basic industrial chemical manufacturing and
energy technical services
434,994
611,688
434,994
611,688
32,178,385
577,583,403
100.00
99.22
563,204
6,182,490
88,275
(239,992)
88,275
(238,136)
270,034
270,034
29,854,246
99.51
314,008
2,025
2,015
481,663
11,656
1,509,171
1,164,273
2,237,969
457,610
257,860
7,429,920
1,185,854
1,649,039
2,945,925
481,663
11,656
1,509,171
1,164,273
2,237,969
457,610
10,500
1,050,000
500,000
36,058,184
179,468,270
49,831,505
257,860
7,429,920
26,670,699
883,848,423
1,185,854
1,649,039
2,945,925
109,628,376
88,902,325
318,522,792
70.00
70.00
50.00
49.05
37.00
33.97
26.67
22.21
21.01
18.30
22.46
953,239
12,000
5,832,774
5,084,267
7,744,232
799,618
26,703
(1,001)
6,067,971
(508,445)
1,026,112
4,840
18,692
(701)
3,069,275
(172,225)
369,503
1,644
174,997
20,953,105
(15,248)
12,927,165
(4,067)
2,863,601
2,109,400
8,147,080
-
258,067
1,640,227
-
54,220
300,162
-
Walsin Singapore Pte. Ltd. (Formerly
Singapore
Investments holding
16,790,710
5,003,810
422,000,000
100.00
19,603,265
2,465,074
2,022,543
known as New Hono Investment Pte.
Ltd)
PT. Sunny Metal Industry
Walsin Lihwa Europe S.a r.l.
PT. Walsin Research Innovation Indonesia
Walsin America, LLC
PT. CNGR Walsin New Energy and
Indonesia
Luxembourg
Indonesia
USA
Indonesia
Manufacture and sale of nickel matte
Investments holding
Consulting and management
Investments
Investments holding
Technology Indonesia
PT. Westrong Metal Industry
Indonesia
Manufacture and sale of nickel matte
-
6,692,862
22,223
185,752
300,000
4,680,030
-
-
-
-
-
-
-
12,000
6,930
N/A
140,651
-
100.00
99.00
100.00
29.17
-
4,146,986
21,342
(17,487)
278,241
(25,416)
148,026
25
-
(869)
590,000
29.50
4,590,864
(3,352)
(6,141) (Note 1)
148,026
25
- (Note 2)
(313)
-
Note 1: Due to adjustments in the investment structure of the Group, it was transferred from Walsin Lihwa Corporation to Walsin Singapore Pte. Ltd.
Note 2: Due to adjustments in the investment structure of the Group, it was transferred from Walsin Lihwa Holdings Limited to Walsin Lihwa Corporation.
WALSIN LIHWA CORPORATION
INFORMATION ON INVESTMENTS IN MAINLAND CHINA
FOR THE YEAR ENDED DECEMBER 31, 2022
(In Thousands of New Taiwan Dollars, U.S. Dollars and Renminbi)
Walsin Lihwa Corporation
A. The names of investee companies in mainland China, their main businesses and products, total amount of paid-in capital, investment type, investment flows, percentage of ownership in investment, investment gain or loss, carrying amount, accumulated inward
remittance of earnings and upper limit on investment in mainland China were as follows:
TABLE 9
Investee Company
Main Businesses and
Products
Paid-in Capital
Method of
Investment
(Note 1)
Jiangyin Walsin Steel Cable
Manufacture and sale of steel
Co., Ltd.
cables and wires
$
(US$
614,200
20,000)
Shanghai Walsin Lihwa
Manufacture and sale of
Power Wire & Cable Co.,
Ltd.
cables and wires
(US$
479,905
15,627)
Hangzhou Walsin Power
Cable & Wire Co., Ltd.
Manufacture and sale of
cables and wires
(US$
5,468,837
178,080)
Walsin (China) Investment
Investments
Co., Ltd.
(US$
2,413,806
78,600)
Changshu Walsin Specialty
Steel Co., Ltd.
Manufacture and sale of
specialized steel tubes
(US$
2,978,870
97,000)
Shanghai Baihe Walsin
Lihwa Specialty Steel
Co., Ltd.
Manufacture and sale of
stainless steel
(US$
-
-)
Dongguan Walsin Wire &
Cable Co., Ltd.
Manufacture and sale of bare
copper cables and wires
(US$
798,460
26,000)
Jiangyin Walsin Specialty
Manufacture and sale of
Alloy Materials Co., Ltd.
cold-rolled stainless steel
and flat rolled products
(US$
1,504,790
49,000)
XiAn Walsin Metal Product
Manufacture and sale of
Co., Ltd. (Note 13)
specialized stainless steel
plates
(US$
1,699,799
55,350)
Yantai Walsin Stainless
Production and sale of
Steel Co., Ltd.
electronic components and
new alloy materials
(US$
10,289,846
335,065)
(Note 11)
b
b
b
b
b
b
b
b
b
b
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
January 1, 2022
$
(US$
(US$
(US$
(US$
(US$
(US$
(US$
(US$
799,719
26,041)
(Note 2)
459,299
14,956)
(Note 3)
2,591,310
84,380)
(Note 4)
2,413,806
78,600)
(Note 5)
2,978,870
97,000)
(Note 6)
1,197,690
39,000)
(Note 7)
798,460
26,000)
(Note 9)
1,504,790
49,000)
(Note 10)
(US$
925,907
30,150)
(US$
6,538,988
212,927)
3
8
1
Remittance of Funds
Outward
Inward
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
December 31, 2022
Net Income
(Loss) of the
Investee
Ownership
of Direct or
Indirect
Investment
(%)
Investment
Gain (Loss)
(Note 16)
Carrying
Amount
as of
December 31,
2022
Accumulated
Repatriation of
Investment Income
as of
December 31, 2022
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
$
(US$
-
-
-
-
-
-
-
-
(US$
(US$
(US$
(US$
(US$
1,197,690
39,000)
(US$
799,719
26,041)
(Note 2)
459,299
14,956)
(Note 3)
2,591,310
84,380)
(Note 4)
2,413,806
78,600)
(Note 5)
2,978,870
97,000)
(Note 6)
-
-)
(Note 7)
798,460
26,000)
(Note 9)
-
-
-
-
-
-
-
-
(US$
(US$
1,504,790
49,000)
(Note 10)
(US$
925,907
30,150)
(US$
6,538,988
212,927)
$
(43,738 )
100.00
$
(43,738 ) $ 841,752
$
90,369
95.71
86,492
1,207,083
(142,964 )
40.00
(57,187 )
681,239
(217,027 )
100.00
(217,027 ) 4,300,323
337,522
100.00
337,522
1,048,836
(1,028 )
-
(1,028 )
-
(Note 8)
(191,422 )
100.00
(191,422 ) 1,485,939
(230,096 )
100.00
(230,096 ) 1,763,939
(14,022 )
100.00
(14,022 )
(792,817 )
(678,277 )
100.00
(678,277 ) 4,100,422
-
-
-
-
-
-
-
-
-
-
(Continued)
3
8
2
Investee Company
Main Businesses and
Products
Paid-in Capital
Changzhou China Steel
Melting and forging of
Precision Materials Co.,
Ltd.
nonferrous metallic materials
and composites as well as
new types of alloys
$
(US$
1,338,956
43,600)
Nanjing Taiwan Trade Mart
Management Co., Ltd.
Business and asset
management, consulting and
advertising services
(US$
30,710
1,000)
DongGuan Cogne Steel
Products Co., Ltd.
Stainless Steel Products
Shaanxi Tianhong Silicon
Industrial Corporation
Polysilicon production
(US$
835,312
27,200)
5,291,208
(RMB 1,200,000)
Jiangsu Taiwan Trade Mart
Development Co., Ltd.
Development and management
of Nanjing Taiwan Trade
Mart Management Co., Ltd.
(RMB
44,093
10,000)
Shaanxi Electronic Group
Optoelectronics
Technology Co., Ltd.
(Note 14)
Communications equipment
and electronic components
686,080
(RMB 155,597)
Walsin (Nanjing)
Construction, rental and sale of
Development Co., Ltd.
buildings and industrial
factories
(US$
1,535,500
50,000)
Nanjing Walsin Property
Management Co., Ltd.
Property management,
business management and
housing leasing
(RMB
4,409
1,000)
B. The upper limit on investment of WLC in mainland China was as follows:
Method of
Investment
(Note 1)
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
January 1, 2022
Remittance of Funds
Outward
Inward
Accumulated
Outward
Remittance for
Investment from
Taiwan as of
December 31, 2022
Net Income
(Loss) of the
Investee
Ownership
of Direct or
Indirect
Investment
(%)
Investment
Gain (Loss)
(Note 16)
Carrying Amount
as of
December 31,
2022
Accumulated
Repatriation of
Investment Income
as of
December 31, 2022
$
-
-
$
(US$
401,687
13,080)
$ 238,066
30.00
$
71,420
$
519,403
$
(US$
937,269
30,520)
b
b
b
b
b
b
b
b
$
(US$
401,687
13,080)
$
(US$
30,710
1,000)
(US$
(US$
(US$
(RMB
-
-)
-
-)
9,336
304)
-
-)
(US$
1,529,358
49,800)
(Note 15)
(RMB
-
-)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(US$
30,710
1,000)
(US$
(US$
(US$
(RMB
-
-)
-
-)
9,336
304)
-
-)
(US$
1,529,358
49,800)
(Note 15)
(RMB
-
-)
(97,643 )
100.00
(97,643 )
(518,896 )
32,389
100.00
32,389
163,535
-
19.00
-
-
(Note 12)
1,332
20.00
265
9,736
31,798
6.02
-
56,563
(526,029 )
99.60
(523,937 ) 9,233,321
(12,868 )
99.60
(12,818 )
(18,100 )
Accumulated Outward Remittance for Investment in
Mainland China as of December 31, 2022
(NT$ and US$ in Thousands)
Investment Amounts Authorized by the
Investment Commission, MOEA
(NT$ and US$ in Thousands)
Upper Limit on the Amount of Investments Stipulated by
the Investment Commission, MOEA
(NT$ in Thousands)
$
(US$
19,767,658
643,688)
$
(US$
19,706,392
641,693)
N/A (Note 19)
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
-
-
-
-
-
-
-
(Continued)
Notes:
1. Investments can be classified into three categories as follows:
a. Direct investment in mainland China.
b. Reinvestment in mainland China through companies in a third country companies.
c. Others.
2. Including US$15,000 thousand investment through Walsin (China) Investment Co., Ltd.
3. Including US$14,950 thousand investment through Walsin (China) Investment Co., Ltd.
4. Including US$13,300 thousand investment through Walsin (China) Investment Co., Ltd., US$53,000 thousand investment through Ace Result Global Ltd. and US$22,730 thousand dividends appropriated from Dongguan Walsin Wire & Cable Co., Ltd.,
Jiangying Walsin Steel Cable Co., Ltd., Shanghai Walsin Lihwa Power Wire & Cable Co., Ltd. and Hangzhou Walsin Power Cable & Wire Co., Ltd.
5. Capital investment of US$28,600 thousand was contributed from the accounts payable of Walsin (China) Investment Co., Ltd. to Walsin Lihwa Holdings Limited.
6. Including US$20,000 thousand investment through Walsin Specialty Steel Corp. and US$42,000 thousand dividends appropriated from Changshu Walsin Specialty Steel Co., Ltd. and Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd.
7. Including US$4,800 thousand investment through Walsin (China) Investment.
8. The liquidation and deregistration of Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd were completed on July 13, 2022.
9. Investment through Walsin (China) Investment Co., Ltd.
10. Including investments through Walsin (China) Investment Co., Ltd. of US$4,500 thousand and US$4,500 thousand of the own capital of Walsin (China) Investment Co., Ltd.
11. Including investments of its own capital of RMB578,796 thousand from Shanghai Baihe Walsin Lihwa Specialty Steel Co., Ltd., Changzhou Wujin NSL Co., Ltd. and Changshu Walsin Specialty Steel Co., Ltd. and RMB3,750 thousand made through
Changzhou Wujin NSL Co., Ltd. Including US$32,927 thousand investment through Yantai Huanghai Iron and Steel Co., Ltd. and Yantai Dazhong Recycling Resource Co., Ltd. which were merged.
12. The amount was adjusted by the capital of XiAn Lv Jing Technology Co., Ltd. of RMB228,000 thousand and by the fair value.
13. XiAn Walsin Metal Product Co., Ltd. merged XiAn Lv Jing Technology Co., Ltd. and XiAn Walsin Opto-electronic Limited.
14. Shaanxi Electronic Group Optoelectronics Technology Co., Ltd. was formerly known as Shaanxi Optoelectronics Technology Co., Ltd.
15. The amount included investment through Joint Success Enterprise Limited approved in the previous years.
16. Amounts are stated in thousands of New Taiwan dollars, except those stated in thousands of U.S. dollars and Renminbi.
17. The currency exchange rates as of December 31, 2022 were as follows: US$ to NT$= 1:30.71, RMB to NT$= 1:4.40934. The average exchange rates of December 31, 2022 were as follows: US$ to NT$= 1:29.805, RMB to NT$= 1:4.41084.
18. The basis for recognizing investment gains and losses in the current period is the financial report audited by an international accounting firm that has a cooperative relationship with the accounting firm of the Republic of China.
19. Upper limit on investment:
The Company was approved as the operation headquarters by the Industrial Development Bureau, Ministry of Economic Affairs and is thus exempted from the related regulations of “Regulations Governing the Approval of Investment or Technical
Cooperation in Mainland China”.
(Continued)
3
8
3
3
8
4
C. Significant direct or indirect transactions between the Company and investees in mainland China
Related Party
Relationship
Transaction
Type
Amount
% of Total
Unit Price
Payment Terms
Compare to
General
Transactions
Ending Balance
% of Total
Unrealized Loss
Transaction terms
Notes/Accounts Payable or Receivable
(In Thousands of New Taiwan Dollars)
Dongguan Walsin Wire &
100% indirectly owned
Sales
$
(326,711)
Cable Co., Ltd.
subsidiary
Jiangyin Walsin Specialty
100% indirectly owned
Sales
(255,763)
Alloy Materials Co., Ltd.
subsidiary
Changshu Walsin Specialty
100% indirectly owned
Sales
(242,061)
Steel Co., Ltd.
subsidiary
- The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
- The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
- The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
The price and payment terms are
set by quotations on the local
market, and the transaction
terms are similar to those of
general customers.
Similar
$
-
Similar
150,819
Similar
102,984
-
4
3
$
-
(100)
(4,564)
(Concluded)
i
F
n
a
n
c
i
a
l
I
n
f
o
r
m
a
t
i
o
n
TABLE 10
WALSIN LIHWA CORPORATION AND SUBSIDIARIES
INFORMATION OF MAJOR SHAREHOLDERS
DECEMBER 31, 2022
Name of Major Shareholder
Shares
Number of
Shares
Percentage of
Ownership
(%)
Winbond Electronics Corp.
Chin-Xin Investment Co., Ltd.
LGT Bank (Singapore) Investment Fund under the custody of
Standard Chartered
TECO Electric & Machinery Co., Ltd.
247,527,493
247,399,375
262,598,000
210,332,390
6.63
6.63
7.03
5.63
Note 1: The information of major shareholders presented in this table is provided by the Taiwan
Depository & Clearing Corporation based on the number of ordinary shares and preferred
shares held by shareholders with ownership of 5% or greater, that have been issued without
physical registration (included treasury shares) by the Company as of the last business day
for the current quarter. The share capital in the financial statements may differ from the
actual number of shares that have been issued without physical registration because of
different preparation basis.
Note 2: If a shareholder delivers their shareholdings to the trust, the above information will be
disclosed by the individual trustee who opened the trust account. For shareholders who
declare insider shareholdings with ownership greater than 10% in accordance with Security
and Exchange Act, the shareholdings include shares held by shareholders and those delivered
to the trust over which shareholders have rights to determine the use of trust property. For
information relating to insider shareholding declaration, please refer to Market Observation
Post System.
6. Any financial crunch confronted by the Company or its subsidiaries and related
impacts in the most recent year and up to the date of annual report publication: None.
385
Review of Financial Conditions, Financial Performance, and Risk Management
VII .... Review of Financial Conditions, Financial Performance,
and Risk Management
1.
Financial Status - Consolidated (Based on IFRSs)
Year
2021
2022
Unit: NT$ Thousands
Difference
Amount
％
69,320,640
92,707,385
23,386,745
41,474,488
65,656,466
24,181,978
33.74
58.31
173,430
4,966,534
4,793,104
2763.71
72,066,340
89,194,468
17,128,128
183,034,898
252,524,853
69,489,955
38,852,513
36,236,117
60,869,368
61,834,273
22,016,855
25,598,156
75,088,630
122,703,641
47,615,011
34,313,329
18,440,875
47,787,207
37,313,329
24,672,454
62,038,398
3,000,000
6,231,579
14,251,191
23.77
37.97
56.67
70.64
63.41
8.74
33.79
29.82
Items
Current Assets
Property, Plant and
Equipment
Intangible Assets
Other Assets
Total Assets
Current Liabilities
Non-current Liabilities
Total Liabilities
Capital Stock
Capital Surplus
Retained Earnings
Note: The reasons, effects and future plans about that changes in assets, liabilities and equity which over 20% or
NT$10 million in last two years:
1. Reasons:
A. Compared to 2021, current assets show an increase in 2022 due to the acquisition of MEG S.A. in 2022.
B. Compared to 2021, property, plant ,and equipment show an increase in 2022 because WLC built new
factories and purchased machine equipment in 2022.
C. Compared to 2021, other assets show an increase in 2022 due to (1)The investment properties of the
Group increased because the Group changed the purpose of use of the completed commercial building of
Walsin (Nanjing) Development Co., Ltd. (2)The increase of the recognition amounts of investments
accounted for using the equity method in 2022 due to the goodwill recognized on acquisitions.
D. Compared to 2021, current liabilities show an increase in 2022 due to the increase of the short-term
borrowings in 2022.
E. Compared to 2021, non-current liabilities show an increase in 2022 due to the increase of the long-term
borrowings in 2022.
F. Compared to 2021, retained earnings show an increase in 2022 due to the increase of the net profit for the
year ended December 31, 2022.
2. Effects: None.
3. Future plans: Keep working on managing working capital and asset and liability structure
386
2.
Financial Performance - Consolidated (Based on IFRSs)
Year
2021
2022
Unit: NT$ Thousands
Difference
Amount
％
156,664,766
136,855,301
19,809,465
6,463,913
13,345,552
5,776,946
19,122,498
3,865,184
15,257,314
180,400,719
23,735,953
163,054,414
26,199,113
17,346,305
-2,462,160
7,847,591
9,498,714
1,383,678
-3,846,838
13,903,299
8,126,353
23,402,013
4,279,515
4,261,937
19,140,076
396,753
3,882,762
15.15
19.14
(12.43)
21.41
(28.82)
140.67
22.38
10.26
25.45
Items
Operating Revenue
Operating Costs
Gross Profit
Operating Expense
Profit from Operations
Non-operating Revenue
and Expense
Profit before Taxes
Tax Expense
Net Income
I.
The variance analysis in last two years:(Variable proportion over 20%)
1. In 2022, operating expenses increased. Due to the increase in the company's profits and the distribution of
employees’ compensation.
2. In 2022, the increase in non-operating income and expense was mainly due to the increase in disposal of
subsidiaries and foreign exchange gains.
The reason for the changes in business content changes: None.
The expected sales volume in the next year and its main reason:
II.
III.
1. Expected sales volume in the next year:
2023(Unit：ton)
Bare copper wire
Power line
Strand
Stainless steel
Hot rods
Seamless steel pipe
Nickel Pig Iron
135,442
56,281
70,500
772,194
300,000
15,600
87,960
2. The basis of the expected sales volume and Possible future impact on the Company's financial operations
and response plans: see the contents (5)-Business Overview
387 387
Review of Financial Conditions, Financial Performance, and Risk Management
3. Cash Flow - Consolidated (Based on IFRSs)
(1) Cash flow analysis for the current year:
Cash and Cash
Equivalents at
the beginning
of the year
Net Cash flow
from Operating
Activities
Net Cash flow from
Net Cash flow from
Investing Activities
Financing Activities
Unit: NT$ Thousands
Effects of
Exchange Rate
Changes
Cash and Cash
Equivalents at
the ending of
the year
Note
10,387,581
13,904,807
(26,346,546)
20,318,482
1,133,649
19,397,973
Analysis of change in cash flow in the current year:
1.The inflows of net cash generated by operating activities were due to the profit of the year.
2.The outflows of net cash used in investing activities were due to the purchase of property, plant, and
equipment.
3.The outflows of net cash generated by financing activities were due to the acquisition of equity in subsidiaries.
4.The outflows of net cash in the year was NT$ 9,010,392 thousand and the ending balance of cash was NT$
19,397,973 thousand.
(2) Remedy for cash Deficit and Liquidity Analysis: Not applicable.
(3) Cash flow Analysis for the coming year:
Cash and Cash
Equivalents at
the beginning of
the year
Net Cash flow
from Operating
Activities
Net Cash flow from
Net Cash flow from
Investing Activities
Financing Activities
Unit: NT$ Thousands
Effects of
Exchange Rate
Changes
Cash and Cash
Equivalents at
the ending of
the year
Note
18,255,452
8,849,113
(15,935,705)
3,830,707
0
14,999,567
Analysis of change in cash flow for the coming year:
1.The inflows of net cash generated by operating activities due to the increase of profit before taxes.
2.The outflows of net cash used in investing activities due to the strategic project investment, the increase of
capital expenditures, renewal of equipment.
3.The outflows of net cash used in financing activities due to repayment of borrowings and payment of
dividends.
388
4.
Effect of Major Capital Expenditure on Financial Business Operations:
(1) Utilization of Major Capital Expenditures and Sources of Funds:
Project
Source of
Funds
Actual or
Estimated
Completion
Date
Investment
Actual or Expected Status of Spending
Unit: NT$ Million
2019
2020
2021
2022
2023
2024
1. HR Coil Project of
Yantai Plant
Working
Capital
October 2023
8,346
53
594
1,525
3,848
2,326
2. Cold Finished Bar
Project of Yantai
Plant
3. The establishment
of nickel pig iron
plant
4. The establishment
of high-efficiency
factories
Working
December
Capital
2023
Working
December
Capital
2021
Working
September
Capital
2024
(2) Estimated Benefits:
3,238
0
0
83
690
2,465
9,667
0
6,851
2,576
240
0
0
0
0
5,407
0
27
484
2,638
2,258
455
1. The establishment of steel rolling and cold finished factories of Yantai Plant will help expand
economies of scale and improve product quality to meet the needs of the customers.
2. Invest in the construction of a nickel pig iron plant and supporting power plants in Indonesia, with a
planned monthly output of 3,000 tons of nickel metal, which will enable the company to securely
control the supply of upstream raw materials and make profits for the company.
3. Build high-efficiency factories, deepen the integration of manufacturing service value and integrate
manufacturing systems through smart manufacturing, advanced warehousing and logistics, and
create competitiveness that is difficult to imitate.
5.
Investment Policy of the Past Year, Profit/Loss Analysis, Improvement Plan and
Investment Plan for the Coming Year:
(1) Investment Policy and Profit/Loss in the Past Year:
1. On a consolidated basis, the Company’s current key reinvestment areas are DRAM, TFT LCD and
passive components.
2. On a consolidated basis, in 2022, the gains for affiliated enterprises recognized by equity method
was NT$3.607 billion, as a result of the weakened downstream demand in the semiconductor
industry, indicating a lower profitability of affiliated enterprises recognized under the equity
method compared to 2021.
(2) Main Reasons for Profit:
Recognition of the gains from Winbond Electronics Corporation and Walsin Technology Corporation.
(3) Investment Plan for the Coming Year:
To continue to focus on upstream and downstream consolidation of core businesses and carefully
assess investment plans.
389 389
Review of Financial Conditions, Financial Performance, and Risk Management
6. Risk Management and Assessment of the Following Items for the Past Year and the
Year to Date:
(1)
Impact of Interest Rate and Exchange Rate Changes and Inflation on the Company’s Profit and
Countermeasures.
Affected
item
Interest Rate
Change
Exchange
Rate Change
Inflation
Impact
Response measures:
Net interest expense (interest expense less
interest income) in 2022 was approximately
NT$587 million, accounting for merely 0.33%
of the Company's net operating revenues;
therefore, the change in interest rates does
not yet have a significant impact on the
profit or loss of the Company and its
subsidiaries.
Foreign exchange gains for 2022 were
approximately NT$1.7 billion (including
profit/loss from trading foreign exchange
derivative products).
The Company's products are not for general
public consumption therefore inflation has
no direct impact on the Company. However,
it might raise the Company's demand for
working capital.
The Company will plan and execute plans for
funding sources and costs based on business
development and needs.
Based on foreign currency positions, the Company
will utilize market instruments (e.g. forward foreign
exchange contracts) for hedging purposes.
The Company will strictly control the operating
cycle and keep track of the source and use of funds.
(2) Policies of Engaging
in High-risk, High-leverage Investments, Lending to Others, Providing
Endorsements and Guarantees and Derivatives Transactions, Profit/loss Analysis and Future
Countermeasures.
Major causes of profit
or loss
None
Future response
measures
None
None
None
None
None
None
None
Item
Policy
High-risk, High-
Leverage Investments
Lending to Others
Endorsements/
Guarantees
Derivative Instrument
Transactions
The Company does not engage in any high-
risk, high-leverage investment activities.
Conducted in accordance with the provisions
of the Company's "Management Guidelines
on Lending Company Funds to Others"
Conducted in accordance with the provisions
of the Company's "Management Guidelines
on Endorsement/Guarantee"
With respect to derivative instruments, the
Company has mainly engaged in hedging
transactions related to business operations
and investment activities (foreign exchange
and non-ferrous metals). For non-ferrous
metals, the Company may carry out non-
hedging transactions based on authorized
positions and under risk management
control for the purpose of curbing price
volatilities in raw materials. The
authorization is conducted in accordance
with the Company's "Procedure for
Derivatives Products Trades."
(3) Future R&D Plans and Projected R&D Investments: The research and development plans of each
business group have been included in the business activities section of the Business Overview, and
390
these plans have relatively low risks. Please refer to “V. Business Overview—A. Business Activities—
(3) Overview of Technology and R&D”.
(4) Major Changes in Domestic and Foreign Government Policies and Laws and Impact on the
Company’s Finances and Business: None
(5)
Impact of Recent Technological and Market Changes on the Company's Finances and Business, and
Countermeasures:
To achieve the goal of Smart Manufacturing, Walsin has started to promote the new MES
(Manufacturing Execution System) and ERP (Enterprise Resource Planning) and move towards CPS
(Cyber-Physical System). Through cloud-based, component-based, and parametric design to retain
the flexibility and speed, we will ensure the ability to integrate with the supply chains in the future.
Global pandemic prevention has made remote work the "new normal", thus providing a new channel
for hacker attacks. In order to prevent theft and destruction of sensitive data of the Company, which
may affect its industrial productivity and damage corporate image, Walsin has strengthened its
identity authentication mechanism for remote work and enhanced the protection of external
services in response to this new type of risk.
We will establish the defensive capability of the defender by using the protection measures
corresponding to the "Cyber Kill Chain" model against the attacking mobile phones and steps of
hackers, and set up information security technology products for purposes of inventory, prevention,
detection, response and recovery, in order to respond to various information security risks.
(6)
Impact of Change in Corporate Image on Risk Management and Countermeasures: None
(7) Expected Benefits and Potential Risks of Merger and Acquisition:
At the 19th meeting of the Board of Directors of the 19th term held on May 31, 2022, the Company
resolved to acquire, through its wholly-owned subsidiary, Walsin Lihwa Europe S.A R.L., 85.032% of
the shares of MEG S.A. (based in Luxembourg), which held 82.32% of the shares of Cogne Acciai
Speciali S.p.A. (based in Italy). Thus, the Company's ultimately acquired 70% of the shares of Cogne
Acciai Speciali S.p.A., and the transaction was completed on November 30 of the same year. The
expected benefits of the merger are to expand the stainless steel business by combining the
strengths of both companies in products, technologies and markets.
(8) Expected Benefits and Potential Risks of Capacity Expansion: All capacity expansion for plants under
Walsin and its group members has to undergo careful assessments. All major capital expenditure has
to be submitted to the Board of Directors for review. Hence, investment benefits and potential risks
will have been taken into account.
(9) Risks Associated with Over-concentration in Purchases or Sales and Countermeasures: None
(10) Impact of Mass Transfer(s) of Equity by or Change of Directors or Shareholders Holding 10% or more
Interest on the Company, the Associated Risks and Countermeasures: None.
(11) Impact of Change of Control on the Company, Associated risks and Countermeasures: None.
(12) Final and Non-appealable and Pending Material Litigious, Non-litigious or Administrative Legal
Proceedings involving the Company, the Directors and the President during the Most Recent Year
and up to the Annual Report Publication Date: None.
391 391
Review of Financial Conditions, Financial Performance, and Risk Management
(13) Other significant risks and response measures:
1. The Company's KPIs:
(1) Financial indicators: Optimizing financial structure and control of bank financing agreements
Ratio
Formula
Target KPI
2022
2021
Current ratio Current assets / Current liabilities
>=100%
152.30%
178.41%
Debt ratio
Net liabilities (Total liabilities - Cash
and cash equivalents) / Tangible assets
<=120%
82.74%
60.03%
Interest
coverage ratio
Tangible net
value
(Net income before income tax,
depreciation, amortization and interest
>=150%
3,465.09%
5,352.60%
expense / Current interest expense
Shareholders' equity - Intangible assets >=NT$55 billion
NT$124.9
NT$107.8
billion
billion
(2) Performance indicators: Return on shareholder's equity and income before accrued interest, tax,
depreciation and amortization
Ratio
Formula
Return on Shareholder's
Equity
Earnings Before Interest,
Taxes, Depreciation and
Amortization (EBITDA)
Net Income after tax /
Average of total
shareholders' equity
Income before interest &
taxes＋depreciation &
amortization + interest
expenses
2022
16.09%
2021
15.63%
NT$28,681
million
NT$22,371
million
7. Other Major Issues: None
392
VIII . Special Disclosures
1. Summary of Affiliates Companies
(1) Affiliates
1. Affiliated Organization Chart of Walsin Lihwa Corporation (as of 2022/12/31)
Walsin Lihwa Corporation
WALSIN LIHWA HOLDINGS LIMITED
(Please refer to the page below for its investee companies)
CONCORD INDUSTRIES LIMITED
(Please refer to the page below for its investee companies)
ACE RESULT GLOBAL LIMITED
Chin-Cherng Construction Co.
WALSIN INFO-ELECTRIC INC..
MIN MAW PRECISION INDUSTRY CORP.
Waltuo Green Resources Corporation
WALSIN PRECISION TECHNOLOGY SDN. BHD.
P.T. WALSIN LIPPO INDUSTRIES
P.T. Walsin Lippo Kabel
Walsin Singapore Pte. Ltd.
50.95%
49.05%
99%
1%
50%
42%
50.1%
Joint Success Enterprises Limited
100%
Walsin (Nanjing)
Construction Limited
100%
Nanjing Walsin Property
Management Co., Ltd.
PT Walsin Research Innovation Indonesia
PT Walsin Nickel Industrial Indonesia
PT Sunny Metal Industry
Walsin Lihwa Europe S.a r.l.
Please see 3. Affiliated Organization Chart for the information on its affiliates
Walsin America, LLC
72.55%
Borrego Energy Holdings, LLC
100%
Borrego Energy, LLC
100%
100%
100%
99.22%
99.51%
100%
100%
100%
70%
70%
100%
100%
100%
393 393
Special Disclosures
2. Affiliated Organization Chart of Walsin Lihwa Holdings Limited and Concord Industries Limited (as of
2022/12/31)
Walsin Lihwa Corporation
華新麗華股份有限公司
100%
Walsin Lihwa Europe S.a r.l.
85.03%
MEG S.A.
82.32%
Cogne Acciai Speciali S.p.A.
100%
100%
100%
100%
100%
100%
99%
100%
100%
100%
Cogne France Société par Actions
Simplifiée
Cogne Edelstahl Gmbh
COGNE SG PTE. LTD.
100%
EMB GmbH Edelstahl &
Metallhandel - Beratung &
Service
Cogne Hong Kong Limited
100%
Dong Guan Cogne Steel
東莞珂霓鋼製品有限公司
Products Co,. Ltd
Cogne U.K. LIMITED
Cogne Stainless Bars SA
100%
Aosta Servizi Generali S.r.l.
1%
Cogne Mexico Sociedad Anonima
de Capital Variable
Metalinox Cogne Acos Inoxidaveis
Especiais Ltda
Cogne Speciality Steel USA, INC.
Cogne Celik Sanayi ve Ticaret
Limited Şirketi
3. Affiliated Organization Chart of Walsin Lihwa Corporation (as of 2022/12/31)
華新麗華股份有限公司
Walsin Lihwa Corporation
100%
Walsin Lihwa Europe S.a r.l.
85.03%
MEG S.A.
82.32%
Cogne Acciai Speciali S.p.A.
100%
100%
100%
100%
100%
100%
99%
100%
100%
100%
Cogne France Société par Actions
Simplifiée
Cogne Edelstahl Gmbh
COGNE SG PTE. LTD.
100%
EMB GmbH Edelstahl &
Metallhandel - Beratung &
Service
Cogne Hong Kong Limited
100%
Dong Guan Cogne Steel
東莞珂霓鋼製品有限公司
Products Co,. Ltd
Cogne U.K. LIMITED
Cogne Stainless Bars SA
100%
Aosta Servizi Generali S.r.l.
1%
Cogne Mexico Sociedad Anonima
de Capital Variable
Metalinox Cogne Acos Inoxidaveis
Especiais Ltda
Cogne Speciality Steel USA, INC.
Cogne Celik Sanayi ve Ticaret
Limited Şirketi
394
(2) Background Information of the Affiliated Companies
Entity
Walsin Lihwa Holdings
Limited
Date of
Incorporation
1992/07/15
Walsin (China) Investment
Co., Ltd.
1995/11/02
Address
Capital
Main Operation or Business Items
Unit: 1,000 NTD/USD/Other foreign currencies
Services
Corporate
Vistra
Centre
Wickhams Cay II, Road Town, Tortola,
VG1110 British Virgin Islands
Rm. 2804, 28th Floor, Shanghai Mart
Tower, No. 2299, Yanan Road (West),
Shanghai, China
USD
108,730 Investment holding.
USD
78,600 Investment holding.
1995/03/21
No. 1128 Liuxiang Road, Nanxiang Town,
Jiading, Shanghai
USD
15,627 Cables and wires.
Shanghai Walsin Lihwa
Power Wire & Cable Co.,
Ltd.
Dongguan Walsin Wire &
Cable Co., Ltd.
2000/01/26
Jiangyin Walsin Steel Cable
Co., Ltd.
1992/12/16
Walsin International
Investments Limited
1993/12/02
Walcom Chemicals
Industrial Limited
1988/12/29
No. 680, Meijing West Road, Dalang Town,
Dongguan, Guangdong
No. 679 Binjiang Road (West), Binjiang
Economic & Technology Development
Zone, Jiangyin, Jiangsu
Room 1102, Level 11, Lee Garden One, 33
Hysan Avenue, Causeway Bay, Hong Kong
Unit 714, 7/F, Miramar Tower, 1-23
Kimberley Road, Tsimshatsui, Kowloon,
Hong Kong
USD
26,000 Bare copper cables and wires.
USD
20,000
Steel stranded wire, steel wire, and
galvanized steel wire.
HKD
4,653,372 Investments.
HKD
500 Commerce.
Nanjing Taiwan Trade Mart
Management Co., Ltd.
2010/04/14 No. 230 Hexi street, Nanjing
USD
1,000
Enterprise management, property
management, marketing planning,
consultation on various types of
advertising information; leasing of
market facilities and management
of market operations; import and
export of electronics, machinery,
agricultural and by-products, textiles
and handicrafts; commission agency
(except auction).
Concord Industries Limited 1992/08/25
Walsin Specialty Steel
Corp.
1997/08/07
Changshu Walsin Specialty
Steel Co., Ltd.
1997/12/24
Vistra Corporate Services Centre
Wickhams Cay II, Road Town, Tortola,
VG1110 British Virgin Islands
Vistra Corporate Services Centre
Wickhams Cay II, Road Town, Tortola,
VG1110 British Virgin Islands
Haiyu Town, Changshu City, Jiangsu
Province
(Mailing address：No. 2,Hai Yang
Road ,Haiyu Town, Changshu City, Jiangsu
Province)
USD
308,498 Investment holding.
USD
92,393 Investment holding.
USD
97,000
Manufacture and sale of special
steel pipes, rods, wires, stainless
steel pipes, building and household
hardware and heating equipment.
Yantai Huanghai Iron and
Steel Co., Ltd.
2007/03/19
No. 2 Wuzhishan Road. ETDZ Yantai City,
Shantung Province,
USD
Jiangyin Walsin Specialty
Alloy Materials Co., Ltd.
2005/03/10
XiAn Walsin Metal Product
Co., Ltd.
2008/06/20
No. 677, Binjiang West Road, Jiangyin City,
Jiangsu
Room 105, 1 floor, block A, long Qi science
and Technology Park, No. 29 Jinye Road,
Xi'an new and high tech Zone, Shaanxi
USD
USD
It develops and produces new alloy
materials, carbon steels, alloy
steels, stainless steels, steel billets,
various types of steel and iron and
steel products and sells its own
products; engages in the wholesale
business of new alloy materials,
carbon steels, alloy steels, stainless
steels, steel billets, various types of
steel and iron and steel products;
engages in the import and export of
steel and iron products and related
technologies. It also engages in
recycling and wholesale of used and
waste materials.
Cold-rolled stainless steel and flat-
rolled products.
335,065
49,000
55,350
Production and sale of medium and
heavy specialized stainless steel
plates; sale of its own products.
395 395
Special Disclosures
Entity
Date of
Incorporation
Ace Result Global Limited 2014/10/08
Chin-Cherng Construction
Co.
1973/06/28
Joint Success Enterprises
Limited
2004/01/08
Walsin (Nanjing)
Construction Limited
2005/08/09
Nanjing Walsin Property
Management Co., Ltd.
2013/01/30
Vistra Corporate Services Centre
Wickhams Cay II, Road Town, Tortola,
VG1110 British Virgin Islands
5th Floor, 192 Jingye 1st Road, Jhongshan
District, Taipei 104, Taiwan, R.O.C.
Vistra Corporate Services Centre
Wickhams Cay II, Road Town, Tortola,
VG1110 British Virgin Islands
No. 236 Jiangdong Road,Jianye District,
Nanjing, Jiangsu Province
No. 230, Hexi Avenue,
Nanjing, Jiangsu
Jianye Zone,
Address
Capital
Main Operation or Business Items
USD
44,740 Investment holding.
NTD 5, 820,994
Investment in and construction of
national housing, sale of commercial
buildings, rental design and interior
renovation.
USD
73,520 Investment holding.
USD
RMB
50,000
1,000
Real estate development, sales,
leasing, after-sales service, and
property management; hotel and
serviced apartments management
and consulting, and retail sales and
food service management
consulting.
Property management, car park
management services, corporate
marketing planning, management
consulting, self-owned house rental,
building installation, decoration
projects, landscaping design,
construction, etc
Solar engineering, mechanical and
electrical engineering, and power
engineering.
Assembly of solar panel power
systems.
USD
700 Other consulting and management.
Walsin Info-Electric Corp.
1995/6/21
25F., No. 1, Songzhi Rd., Xinyi Dist., Taipei
City, Taiwan
NTD
96,000
Min Maw Precision
Industry Corp.
1980/10/17
PT Walsin Research
Innovation Indonesia
2022/8/23
25F., No. 1, Songzhi Rd., Xinyi Dist., Taipei
City, Taiwan
Gold Coast Office Eiffel Tower Lt. 23 Unit
Indah Kapuk,
OTA23WF,
Desa/Kelurahan
Kec.
Penjaringan, Kota Adm. Jakarta Utara,
Provinsi DKI Jakarta
Kamal Muara,
Jl. Pantai
NTD
327,911
Waltuo Green Resources
Corporation
2018/06/06
No. 47, Bade Rd., Yenshui Dist., Tainan City
737, Taiwan
NTD
Walsin Precision
Technology Sdn. Bhd.
2000/03/15
P.T Walsin Lippo Industries 1991/04/29
P.T. Walsin Lippo Kabel
1997/12/29
Walsin Singapore Pte. Ltd. 2019/12/3
PT Walsin Nickel Industrial
Indonesia
2019/12/19
PT Sunny Metal Industry
2021/8/13
Walsin Lihwa Europe S.a r.l. 2022/10/24
MEG S.A.
1995/1/27
2115-1,Kawasan Perindustrian air Keroh,
Fasa IV, Air Keroh, 75450 Melaka, Malaysia
JI. MH. Thamrin Blok A1-1, Delta Silicon
Industrial Park, Lippo Cikarang, Bekasi
17550, Indonesia
Jl. Jati 3 Blok J7/5, Newton Techno Park,
Serang, Cikarang Selatan, Bekasi, Jawa
Barat 17550
727 Clementi West Street 2 #01-280
Singapore (120727)
Gedung IMIP, Jalan Batu Mulia 8, RT. 007
RW. 007, Meruya Utara Kembangan, Kota
Adm. Jakarta Barat DKI Jakarta 11620,
Indonesia
Sopo Del Office Tower A Lantai 21 Jalan
Mega Kuningan Barat III Lot 10 1-6 , Kel.
Kuningan Timur, Kec. Setiabudi, Kota Adm.
Jakarta Selatan,Provinsi DKI Jakarta,
Indonesia
16, rue Eugène Ruppert, L- 2453,
Luxembourg
16, rue Eugène Ruppert, L- 2453,
Luxembourg
USD
USD
USD
USD
USD
USD
EUR
EUR
18,283
Waste removal, resource recycling
and cement, soil blending and
related businesses.
8,470 Stainless steel calendered sheets.
15,000 Steel wires.
1,500 Power cables.
422,000 Investment holding.
100,000
Non-ferrous base metal (nickel pig
iron) manufacturing and power
plant.
100,000
Manufacturing and trading of nickel
matte.
12 Investment holding.
60 Investment holding.
Cogne Acciai Speciali S.p.A. 1991/10/24 VIA PARAVERA 16 AOSTA9AO) CAP 11100 EUR
250,000
Cogne France Société par
Actions Simplifiée
1997/5/26
16 Rue de la Patelle 95613 Cergy Pontoise
Cedex BP 80119 - France
EUR
6,068
396
Production, sales and distribution of
stainless steel products.
Sales and distribution of stainless
steel products.
Entity
Date of
Incorporation
Address
Capital
Main Operation or Business Items
Cogne Edelstahl Gmbh
1997/10/16 Carl-Schurz-Str. 2 41460 Neuss - Germany EUR
3,328
Sales and distribution of stainless
steel products.
EMB GmbH Edelstahl &
Metallhandel - Beratung &
Service
1998/5/4 Marie-Curie-Str. 9 28816 Stuhr - Germany EUR
60
Sales and distribution of stainless
steel products.
Cogne Stainless Bars SA
2015/12/21 Via Laveggio 6a 6855 Stabio - Svizzera
CHF
1,000
COGNE SG PTE. LTD.
2022/7/13
Cogne Hong Kong Limited 2003/12/12
DongGuan Cogne Steel
Products Co.,Ltd
2005/1/21
Cogne U.K. LIMITED
1996/12/31
160 Robinson Road, #14-04, SBF Center
Singapore - 068914
5/F, Manulife Place, 348 Kwun Tong Road,
Hong Kong
Building 1, No. 27, WeiJian Road,industrial
park of ChaShan,ChaShan town,DongGuan
city,GuangDong province,China
Uniformity Steel WorksDon Road Newhall
Sheffield S92UD
Aosta Servizi Generali S.r.l. 2007/4/26
Cogne Mexico Sociedad
Anonima de Capital
Variable
2014/10/10
Metalinox Cogne Acos
Inoxidaveis Especiais Ltda
1977/7/5
Cogne Specialty Steel USA,
INC.
Cogne Çelik Sanayi ve
Ticaret Limited Şirketi
1995/8/16
2010/5/20
Walsin America, LLC
2022/7/1
Borrego Energy Holdings,
LLC
2022/4/8
Borrego Energy, LLC
2022/4/8
Via Nazionale per Carema 40 - 11026
Pont-Saint-Martin (AO) - Italy
Av. Otomies no sin numero int. 1 - CD
industrial Xicohtencatl II Huamantla -
90500 Tlaxcala - Mexico
Avenida Presidente Wilsom. 4382
Upiranga - Sao Paulo/SP CEP 04220-001
Brazil
277 Fairfield Road _STE 315. Fairfiled, NJ
07004
Sultan Orhan Mah Keresteciler San. Sit.
2003ada 1Parsel Gebze Kocaeli Türkiye
1209 Orange Street, Wilmington, New
Castle Country, DE 19801,USA
1814 Franklin St, Ste 700, Oakland, CA
94612
1814 Franklin St, Ste 700, Oakland, CA
94612
EUR
MXN
RS
USD
TL
SGD
140
Sales and distribution of stainless
steel products.
USD
28,580 Investment holding.
USD
27,200
Production, sales and distribution of
stainless steel products.
GBP
3,000
Sales and distribution of stainless
steel products.
Production, sales and distribution of
stainless steel products.
Electrical and mechanical repair
services and general services
200
55,025
Production, sales and distribution of
stainless steel products.
76,502
Sales and distribution of stainless
steel products.
6,850
Sales and distribution of stainless
steel products.
23,952
Sales and distribution of stainless
steel products.
USD
81,302 Investment holding.
USD
63,209 Solar EPC and O&M Services
USD
63,209 Solar EPC and O&M Services
(3) Presumed to have control and affiliation Common Shareholders Information: Not applicable
397 397
Special Disclosures
(4) The main Industries of affiliated companies:
1. Wire and cable industry
2. Stainless steel industry
3. Business real estate
4. Construction and development of solar power systems
5. Production and sales of non-ferrous metals
6. General investment industry
Above table include the main operation or business items of each affiliated company.
The division of work of affiliated companies:
Each line of business affiliates operate independently, partially some affiliates have the purchases, sales,
engineering contracting trading and marketing agency services and other projects with each other.
(5) Directors, Supervisors, and Presidents of the Affiliated Companies (as of 2022.12.31)
Entity
Title
Name of the Representation
Shares (Contribution) Sharelold
No. of Share: Share; 1000 RMB/USD/EUR
Shareholding (Contribution)
Walsin Lihwa Holdings
Limited
Director
Representative of Walsin Lihwa Corporation: Yu-Lon Chiao,
Patricia Chiao, Sophi Pan
Walsin (China)
Chairman
Jian-Hua Cao
Investment Co., Ltd.
General manager Fred Pan
Director
Supervisor
Chairman
Representative of Walsin Lihwa Holdings Limited: Jian-Hua
Cao, C.C. Chen, Fred Pan
Representative of Walsin Lihwa Holdings Limited: Richard Wu
Witty Liao
Shanghai Walsin Lihwa
Power Wire & Cable
Vice Chairman
Chien-Ming Chang
Co., Ltd.
General manager Jen-Chan Huang
Director
Director
Supervisor
Representative of Shanghai Nanxiang Development Zone
Industrial Co. Ltd. : Chien-Ming Chang, Chi-Ming Chou
Representative of Walsin (China) Investment Co., Ltd.: Witty
Liao, Jin-Renn Leu, Wei-Chih Hu, Allen Yang, Jen-Chan Huang
Representative of Walsin (China) Investment Co., Ltd.: Richard
Wu
Dongguan Walsin Wire
Chairman
Witty Liao
& Cable Co., Ltd.
General manager Chang-Ming Wu
Director
Supervisor
Representative of Walsin (China) Investment Co., Ltd.: Witty
Liao, Chang-Ming Wu, Kiwi Lan
Representative of Walsin (China) Investment Co., Ltd.: Richard
Wu
Jiangyin Walsin Steel
Chairman
Witty Liao
Cable Co., Limited
Vice Chairman
Lu Lu
(JHS)
Walsin International
Investments Limited
Director
Supervisor
Director
President
Representative of Walsin (China) Investment Co., Ltd.: Witty
Liao, Chao-Yang Cheng , Sherry Ho
Representative of Walsin (China) Investment Co., Ltd.: Richard
Wu
Representative of Walsin Lihwa Holdings Limited: C.C. Chen,
Fred Pan
Tzu-Yi Chiao
ing
108,730,393
100.00%
USD
USD
USD
USD
USD
USD
USD
USD
0
0
0.00%
0.00%
78,600 100.00%
78,600 100.00%
0
0
0
0.00%
0.00%
0.00%
671
4.29%
USD
14,956
95.71%
USD
USD
USD
USD
USD
USD
USD
USD
14,956
95.71%
0
0
0.00%
0.00%
26,000 100.00%
26,000 100.00%
0
0
0.00%
0.00%
20,000 100.00%
USD
20,000 100.00%
4,653,371,702
100.00%
0
0.00%
398
Entity
Title
Name of the Representation
Shares (Contribution) Sharelold
Shareholding (Contribution)
Representative of Walsin Lihwa Holdings Limited: Yu-Lon
1,460,458
73.49%
Chiao, Justin Wong, Sophi Pan
ing
Borrego Solar Systems,
Inc.
Walcom Chemicals
Industrial Limited
Nanjing Taiwan Trade
Director
Director
Director
CEO
Director
Director
Director
Chairman
Aaron Stephen Hall
Michael Adam Hall
Michael Adam Hall
Hao Chi
Qi-Ying Liang
Yong-Taig Chen
Tzu-Yi Chiao
Mart Management
General manager Min Zhou
Co., Ltd.
Director
Supervisor
Industries
Concord
Limited
Walsin Specialty Steel
Corp.
Director
Director
Representative of Walsin Lihwa Holdings Limited: Tzu-Yi Chiao,
Xue-Wu Wu, Min Zhou
Representative of Walsin Lihwa Holdings Limited: Richard Wu
Representative of Walsin Lihwa Corporation: Yu-Lon Chiao,
Patricia Chiao, Sophie Pan
Representative of Walsin Lihwa Corporation: Yu-Lon Chiao,
Patricia Chiao, David Wen
Changshu Walsin
Specialty Steel Co.,
Chairman
General manager Pei-Yuan Sun
Witty Liao
Ltd.
Director
Representative of Walsin Specialty Steel Corp: Witty Liao, Pei-
Yuan Sun, Sherry Ho
Representative of Walsin Specialty Steel Corp: Richard Wu
Supervisor
Yantai Walsin
Stainless Steel
Co., Ltd.
General manager Nora Lin
Witty Liao
Yantai Walsin Stainless
Steel Co., Ltd.
Jiangyin Walsin
Specialty Alloy
Materials Co., Ltd.
Director
Director
Supervisor
Chairman
Representative of Jiangyin Walsin Specialty Alloy Materials
Co., Ltd.: Witty Liao, Nora Lin
USD
116,312.7
Representative of Concord Industries Limited: Allen Yang
USD
218,752.6
Representative of Jiangyin Walsin Specialty Alloy Materials
Co., Ltd.: Richard Wu
Chao-Yang Cheng
General manager Lu Lu
Director
Supervisor
Representatives of Concord Industries Limited/ Walsin (China)
Investment Co., Ltd.: Chao-Yang Cheng, Witty Liao, Sherry Ho
Representative of Concord Industries Limited/ Walsin (China)
Investment Co., Ltd.: Richard Wu
154,774
92,587
92,587
7.79%
4.66%
4.66%
174,999
35.00%
1
0
0
0
0.00%
0.00%
0.00%
0.00%
1,000
100.00%
1,000
100.00%
308,498,375
100.00%
92,393,195
100.00%
0
0
0.00%
0.00%
USD
USD
USD
USD
USD
USD
USD
97,000 100.00%
USD
97,000 100.00%
USD
USD
0
0.00%
0
0.00%
34.71%
65.29%
34.71%
USD
116,313
USD
USD
0
0
0.00%
0.00%
USD
49,000 100.00%
USD
USD
USD
USD
49,000 100.00%
0
0
0.00%
0.00%
55,350
100.00%
XiAn Walsin Metal
Product Co., Ltd.
Chairman
Nora Lin
General manager Nora Lin
Ace Result Global
Limited
Chin-Cherng
Construction Co.
Chin-Cherng
Construction Co.
General manager Fred Pan
Wu-Shung Hong
Director
Supervisor
Director
Representative of Concord Industries Limited: Nora Lin, Lei
Chen, Allen Yang
Representative of Walsin Lihwa Corporation: David Wen,
Sophi Pan
Representative of Concord Industries Limited: Sophi Pan
USD
55,350
100.00%
Director
Supervisor
Director
Representative of Walsin Lihwa Corporation: Yu-Cheng Chiao,
Yu-Lon Chiao, Fred Pan, David Wen
Richard Wu
Representative of Chin-Cherng Construction Co.: Fred Pan,
Sophi Pan, Patricia Chiao
Joint Success
Enterprises Limited
44,739,988 100.00%
439,894
0.08%
0
0.00%
577,583,403
99.22%
0
0.00%
37,461,816
50.95%
399 399
Special Disclosures
Entity
Title
Name of the Representation
Shares (Contribution) Sharelold
Shareholding (Contribution)
Walsin (Nanjing)
Construction Limited
Chairman
Jian-Hua Cao
Vice Chairman
Fred Pan
President
Wei-Hsiung Wang
Director
Supervisor
Representative of Joint Success Enterprises Limited: Jian-Hua
Cao , Yu-Lon Chiao, Fred Pan
Representative of Joint Success Enterprises Limited: Richard
Wu
Nanjing Walsin
Property Management
Co., Ltd.
Nanjing Walsin
Property
Management Co.,
Ltd.
General manager Lin Chen
Tzu-Yi Chiao
Director
Supervisor
Representative of Walsin (Nanjing) Construction Limited: Tzu-
Yi Chiao, Fred Pan, Kiwi Lan
Representative of Walsin (Nanjing) Construction Limited:
Richard Wu
Walsin Info-Electric
Corp.
Chairman
David Wen
General manager David Wen
Director
Supervisor
Chairman
Representative of Walsin Lihwa Corporation: David Wen, C.C.
Chen, Sherry Ho
Richard Wu
David Wen
General manager David Wen
Director
Supervisor
Director
Representative of Walsin Lihwa Corporation: David Wen,
Sophi Pan, Allen Yang
Representative of Walsin Lihwa Corporation: Richard Wu
Representative of Walsin Lihwa Corporation: Hueiping Lo
Min Maw Precision
Industry Corp.
PT Walsin Research
Innovation
Indonesia
Waltuo Green
USD
USD
USD
ing
0.00%
0.00%
0.00%
0
0
0
USD
50,000
100.00%
USD
50,000
100.00%
RMB
RMB
RMB
0
0
0.00%
0.00%
1,000
100.00%
RMB
1,000
100.00%
0
0
0.00%
0.00%
9,491,461
98.87%
0
0
0
0.00%
0.00%
0.00%
32,791,149
100.00%
32,791,149 100.00%
6,930
99.00%
Supervisor
Representative of Walsin Lihwa Corporation: Richard Wu
6,930
99.00%
Chairman
David Wen
Resources Corporation
General manager Kuo-Hui Chen
Director
Supervisor
Representative of Walsin Lihwa Corporation: David Wen, Kuo-
Hui Chen, Allen Yang
Representative of Walsin Lihwa Corporation: Richard Wu
Walsin Precision
Technology Sdn. Bhd
Chairman
General manager Pang Boon Wah
Juei-Lung Chen
0
0
0.00%
0.00%
1,828,287
100.00%
1,828,287 100.00%
0
0
0.00%
0.00%
Director
Representatives of Walsin Lihwa Corporation: Juei-Lung Chen,
Pang Boon Wah, Josh Chia, Goh Lay Hong
32,178,385
100.00%
P.T. Walsin Lippo
President
Representative of P.T. Multi Prima Sejahtera, Tbk,: Rudy
Industries
Commissioner
Nanggulangi
4,500
30.00%
Vice President
Commissioner
Representative of Walsin Lihwa Corporation: Yu-Lon Chiao
10,500
70.00%
President Director Representative of Walsin Lihwa Corporation: Kai-Dai Ou Yang
10,500
70.00%
Vice President
Director
Director
Representative of P.T. Multi Prima Sejahtera, Tbk,: Hery
Soegiarto
Representative of Walsin Lihwa Corporation: Sophi Pan, David
Karman, Ardinand Roynald P, Andre Kelsen, Foe
P.T. Walsin Lippo Kabel President
Representative of P.T. Multi Prima Sejahtera, Tbk,: Rudy
Commissioner
Nanggulangi
4,500
30.00%
10,500
70.00%
450,000
30.00%
Vice President
Commissioner
Representative of Walsin Lihwa Corporation: Yu-Lon Chiao
1,050,000
70.00%
President Director Representative of Walsin Lihwa Corporation: Kai-Dai Ou Yang
Vice President
Representative of P.T. Multi Prima Sejahtera, Tbk,: Hery
1,050,000
450,000
70.00%
30.00%
400
Entity
Title
Name of the Representation
Shares (Contribution) Sharelold
Shareholding (Contribution)
ing
Director
Soegiarto
Director
Representative of Walsin Lihwa Corporation: Sophi Pan, David
Karman, Ardinand Roynald P, Andre Kelsen, Foe
1,050,000
70.00%
Walsin Singapore Pte.
Director
Representatives of Walsin Lihwa Corporation: C.C. Chen, Wei-
422,000,000
100.00%
Ltd.
Hsiung Wang, Josh Chia, Richard Wu, Loh Kwai Weng
President
Commissioner
Representative of Walsin Lihwa Corporation: Sherry Ho
500,000
50.00%
PT Walsin Nickel
Industrial Indonesia
Commissioner
Representative of Perlux Investment Pte. Ltd.: Hsiung-Feng
Mei
President Director Representative of Walsin Lihwa Corporation: Josh Chia
Director
Director
Director
Representative of Perlux Investment Pte. Ltd.: Chi-Chun Lin
Representative of Walsin Singapore Pte. Ltd.: Hueiping Lo
Representative of Walsin Lihwa Corporation: C.C. Chen,
Ardinand Roynald P.
80,000
8.00%
500,000
50.00%
80,000
8.00%
420,000
42.00%
500,000
50.00%
PT Sunny Metal
Chairman
Walsin Singapore Pte. Ltd. Representative: Josh Chia
50,100
50.10%
Industry
Director
Walsin Singapore Pte. Ltd. Representative: C.C. Chen, Sherry
Ho
Director
Berg Holding Limited Representative: Lin Jiqun
Supervising Officer Berg Holding Limited Representative: Xiang Binghe, Ye
Changqing
50,100
50.10%
49,900
49.90%
49,900
49.90%
Supervisor
Walsin Singapore Pte. Ltd. Representative: Richard Wu
50,100
50.10%
Walsin Lihwa Europe
Director
Walsin Lihwa Corporation Representative: C.C. Chen, Sherry
S.a r.l.
MEG S.A.
Ho, Hueiping Lo
Director
Walsin Lihwa Europe S.a r.l. Representative: Sherry Ho, Wei-
Hsiung Wang
Director
Eugenio Marzorati
12,000 100.00%
5,102
85.03%
470
7.83%
Cogne Acciai Speciali
Director
MEG S.A. Representative: Yu-Lon Chiao, Kevin Niu, Sherry Ho,
S.p.A.
Wei-Hsiung Wang, Ono Motoo, Massimiliano Burelli
205,811,717
Director
REM HOLDING S.A. Representative: Eugenio Marzorati,
Roberto Marzorati, Monica Pirovano
44,188,283
Cogne France Société
President
HESPEL Davi
par Actions Simplifiée
Supervisor
Monica Pirovano
Cogne Edelstahl Gmbh CEO
Bernd Grotenburg
Director
Bernd Grotenburg , Ralf Schmitz , Roberto Marzorati
Supervisor
Eugenio Marzorati, Monica Pirovano, Emilio Giacomazzi
EMB GmbH Edelstahl &
CEO
Reinhard Frankowski
Metallhandel -
Beratung & Service
Director
Reinhard Frankowski
Supervisor
Bernd Grotenburg, Ralf Schmitz
COGNE SG PTE. LTD.
Director
Sidhu Kamaljit Singh, Monica Pirovano; Giacomazzi Emilio
Cogne Hong Kong
Director
Monica Pirovano
Limited
DongGuan Cogne Steel
Chairman
Monica Pirovano
Products Co.,Ltd
President
Monica Pirovano
Vice President
Roberto Marzorati
Director
Emillio Giacomzzi
Supervisor
Eugenio Marzorati
Cogne U.K. LIMITED
Director
Eugenio Marzorati, Monica Pirovano, Jonathan Smit
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
82.32%
17.68%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
401 401
Special Disclosures
Entity
Title
Name of the Representation
Shares (Contribution) Sharelold
Shareholding (Contribution)
Cogne Stainless Bars SA Director
Franco Lorenzo Alberto SPINELLI ,Costa Roberto
Aosta Servizi Generali
President
Francesco Turcato
S.r.l.
Cogne Mexico
Sociedad Anonima de
Capital Variable
Director
Director
Francesco Turcato,Alessandra Perlo
Eugenio Marzorati
Metalinox Cogne Acos
Director
Gilberto Sanches Gonzales
Inoxidaveis Especiais
Ltda
Cogne Specialty Steel
CEO
Jean Paul Betemps
USA, INC.
President
Giulio Girivetto
Director
Monica Pirovano
Cogne Çelik Sanayi ve
Ticaret Limited Şirketi
Director
Monica Pirovano
Walsin America, LLC
Director
Walsin Lihwa CorporationRepresentative: Hueiping Lo, Tzu-
Wei Chiao, Sophie Pan
Borrego Energy
Director
Walsin America, LLCRepresentative: Yu-Lon Chiao, Wei-Hsiung
Holdings, LLC
Director
Director
Wang, Sophie Pan
Michael Adam Hall
Aaron Stephen Hall
Borrego Energy, LLC
NA
BE, LLC is member-managed (it does not have directors)
(6) Operating Condition of the Affiliated Companies
ing
0.00%
0.00%
0.00%
0
0
0
500 100.00%
0
0.00%
0
0
0
0
0.00%
0.00%
0.00%
0.00%
USD81,302 100.00%
USD 1,460
72.55%
USD 123
6.09%
USD 154
7.66%
NA
NA
Entity
Capital
Stock
Total
Assets
Total
Liabilities
Net Worth
Sales
Operating
Income
(loss)
Unit: NT$ thousands
Earnings
(Loss)
Per
Share
(NT$)
Net
Income
(loss)
Walsin Lihwa Corporation
Walsin Lihwa Holdings Limited (Note 1)
Subsidiaries of
Walsin Lihwa
Holdings
Limited
Walsin (China) Investment Co.,
Ltd.
Shanghai Walsin Lihwa Power
Wire & Cable Co., Ltd.
Dongguan Walsin Wire & Cable
Co., Ltd.
Jiangyin Walsin Steel Cable Co.,
Limited
Walsin International Investments
Limited
Nanjing Taiwan Trade Mart
Management Co., Ltd.
Walcom Chemicals Industrial
Limited
37,313,329 201,222,816 77,501,243 123,721,573 98,420,045
24,127,441 36,949,655
3,187,715
27,315,156
3,339,098
7,741,047 19,352,097
7,661,078
(2,690,436)
2,413,806
20,446,445 16,146,121
4,300,324
31,388
(62,660)
(217,027)
5.46
N/A
N/A
479,905
1,619,692
358,506
1,261,186
3,296,979
94,815
90,369
N/A
798,460
2,542,681
1,056,742
1,485,939 15,928,853
(67,653)
(191,422)
N/A
614,200
2,689,671
1,847,919
841,752
2,015,472
(26,915)
(43,738)
N/A
18,324,979
19,633,623
48,631
19,584,992
0
(22,526)
993,233
N/A
30,710
37,153
556,049
(518,896)
116,843
(2,527)
(97,643)
N/A
1,925
1
68,701
(68,700)
0
(24)
(24)
Nanjing Taiwan Trade Mart Management Co., Ltd.
9,473,974
25,851,467 20,317,066
5,534,401 19,195,707
(371,388)
(252,979)
1,504,790
3,666,476
1,903,027
1,763,449
1,848,208
39,173
(230,096)
2,837,389
1,384,043
653
1,383,390
0
(53)
351,416
2,978,870
4,084,134
3,035,297
1,048,837
3,645,824
297,313
337,522
0
0
0
0
0
(860)
(1,028)
N/A
N/A
N/A
N/A
N/A
N/A
Subsidiaries of
Concord
Industries
Limited
Jiangyin Walsin Specialty Alloy
Materials Co., Ltd.
Walsin Specialty Steel Corp
Changshu Walsin Specialty Steel
Co., Ltd.
Shanghai Baihe Walsin Lihwa
Specialty Steel Co., Ltd.
402
Entity
Capital
Stock
Total
Assets
Total
Liabilities
Net Worth
Sales
Operating
Income
(loss)
Net
Income
(loss)
Earnings
(Loss)
Per
Share
(NT$)
Yantai Walsin Stainless Steel Co.,
Ltd.
XiAn Walsin Metal Product Co.,
Ltd.
Borrego Energy Holdings, LLC
Walsin America, LLC (Note 3)
Subsidiary of
Walsin
America, LLC.
Ace Result Limited
P.T Walsin
Lippo Kabel
Walsin Singapore Pte. Ltd.(Note 4)
Subsidiary of
Walsin
Singapore Pte.
Ltd.
Walsin Info-Electric Corp.
P.T. Walsin Lippo Industries
Chin-Cherng Construction Co. (Note 5)
'PT Sunny Metal Industry
Subsidiaries of
Chin-Cherng
Construction
Co.
Joint Success Enterprises Limited
Walsin (Nanjing) Development
Limited
Nanjing Walsin Property
Management Co., Ltd.
1,319,486
18,965,533 14,865,111
4,100,422 15,862,228
(736,015)
(678,277)
N/A
217,968
794
793,611
(792,817)
0
(3,030)
(14,022)
150,223
6,926,333
6,950,441
(24,107) 15,836,827
(4,072,972)
(4,411,080)
N/A
N/A
207,044
6,926,333
6,950,441
(24,107) 15,836,827
(4,072,972)
(4,411,080)
N/A
176,186
354,723
5,907
17,198
0
55
354,723
17,143
952,996
32,180,518 13,986,716
18,193,802
393,800
16,900,634 13,856,229
3,044,405
0
0
0
0
(57)
(34,907)
N/A
(2,446)
(1,001)
(0.67)
(5,603)
2,465,082
N/A
(5,007)
(13,412)
N/A
300,000
59,070
5,820,994
289,522
315,754
1,496,775
21,070,320
10,187,485
200
135,001
9,932,079
183,107
315,554
1,361,774
11,138,241
10,004,378
0
839,458
1,108,531
0
(2,454)
73,797
(443,055)
(1,570)
2,025
26,705
(489,384)
(508,446)
0.07
1,780.33
(0.84)
N/A
196,900
20,021,402 10,751,241
9,270,161
978,730
(419,255)
(526,028)
N/A
4,409
33,277
51,448
(18,171)
114,558
(20,166)
(12,866)
N/A
MEG S.A.
Cogne Acciai Speciali S.p.A.
772,536
23,442
17,229,016
617,333
21,688
327,911
18,283
393,800
33,355
2,757
6,809,425
1,963
384,100
5,782
5,093,223
54,128
122
25,120,649 17,824,056
2,094
Min Maw Precision Industry Corp.
Waltuo Green Resources Corp.
PT Walsin Nickel Industrial Indonesia
Walsin Precision Technology Sdn. Bhd.
PT Walsin Research Innovation Indonesia
Walsin Lihwa Europe S.a r.l. (Note 6)
Subsidiaries of
Walsin Lihwa
Europe S.a r.l.
Note 1: The assets, liabilities and net income/loss of Walsin Lihwa Holdings Limited include its subsidiaries’.
Note 2: The assets, liabilities and net income/loss of Concord Industries Limited include its subsidiaries’.
Note 3: The assets, liabilities and net income/loss of Walsin America, LLC include its subsidiaries’.
Note 4: The assets, liabilities and net income/loss of Walsin Singapore Pte. Ltd. include its subsidiaries’.
Note 5: The assets, liabilities and net income/loss of Chin-Cherng Construction Co. include its subsidiaries’.
Note 6: The assets, liabilities and net income/loss of Walsin Lihwa Europe S.A.R.L. include its subsidiaries’.
Note 7: The assets, liabilities and net income/loss of Cogne Acciai Speciali S.p.A. include its subsidiaries’.
Note 8: The currency exchange rate was as follows:
2022/12/31 US$/NT$=1: 30.71 (exchange rate for profit/loss entries: US$/NT$ =1:29.806)
2022/12/31 RMB/NT$=1: 4.34161 (exchange rate for profit/loss entries: RMB/NT$=1:4.41084)
2022/12/31 EUR/NT$=1: 32.72 (exchange rate for profit/loss entries: RMB/NT$=1:31.35843)
563,205
21,566
7,296,593
8,301,260
24,999,127 14,916,426
10,082,701
8,303,354
8,180,000
388,436
17,660
58,102
22,436
12,135,794 22,281,175
944,240
0
1,626,185
0
33,960
(2,135)
6,443,215
95,340
(58)
(451,624)
(94)
22,733
(1,543)
6,067,970
88,276
25
148,012
(225,154)
0.69
(0.84)
6,067.97
2.74
3.61
0.35
N/A
1,626,185
(451,530)
(273,414)
N/A
2.
3.
Progress of private placement of securities during the latest year and up to the date of annual report
publication: None
The subsidiaries’ shareholding or disposal of the company’s shares during the latest year and up to the
date of annual report publication: None
4. Other supplemental information: None
5.
Corporate events with material impact on shareholders' equity or stock prices set forth in Subparagraph
2, Paragraph 2, Article 36 of the Securities and Exchange Act during the most recent year and up to the
annual report publication date: : None.
403 403
Walsin Lihwa Corporation
Yu-Lon Chiao