ZIPPY Technology Corp. - Interim / Quarterly Report 2023

Stock Code:2420

ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

With Independent Auditors’ Review Report For the Nine Months Ended September 30, 2023 and 2022

Address: 10F., No. 50, Minquan Rd., Xindian Dist., New Taipei City , Taiwan, R.O.C. Telephone: 886-2-2918-8512

The independent auditors’ review report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ review report and consolidated financial statements, the Chinese version shall prevail.

～1～

Table of contents
Contents 1.Cover Page 2.Table of Contents 3.Independent Auditors’ Report 4.Consolidated Balance Sheets 5.Consolidated Statements of Comprehensive Income 6.Consolidated Statements of Changes in Equity 7.Consolidated Statements of Cash Flows 8.Notes to the Consolidated Financial Statements (1)Company history (2)Financial Statements Authorization Date and Authorization Process (3)New Standards, Amendments and Interpretations not yet Adopted (4)Summary of Material Accounting Policies (5)Significant Accounting Judgments, Estimation, Assumptions, and Sources of Estimation Uncertainty (6)Explanation to Significant Accounts (7)Related Party Transactions (8)Pledged Assets (9)Significant Commitments and Contingencies (10)Losses Due to Major Disasters (11)Subsequent Events (12)Other (13)Other disclosures (a) Information on significant transactions (b) Information on investment (c) Information on investment in Mainland China (d) Information on major shareholder (14)Segment Information	Page
	1 2 3 4 5 6 7 8 8 8～9 9～10 11 11～32 32 32 33 33 33 33 34～37 37 38 39 39～40

Table of contents

Contents
1.Cover Page
2.Table of Contents
3.Independent Auditors’ Report
4.Consolidated Balance Sheets
5.Consolidated Statements of Comprehensive Income
6.Consolidated Statements of Changes in Equity
7.Consolidated Statements of Cash Flows
8.Notes to the Consolidated Financial Statements
(1)Company history
(2)Financial Statements Authorization Date and Authorization Process
(3)New Standards, Amendments and Interpretations not yet Adopted
(4)Summary of Material Accounting Policies
(5)Significant Accounting Judgments, Estimation, Assumptions, and Sources
of Estimation Uncertainty
(6)Explanation to Significant Accounts
(7)Related Party Transactions
(8)Pledged Assets
(9)Significant Commitments and Contingencies
(10)Losses Due to Major Disasters
(11)Subsequent Events
(12)Other
(13)Other disclosures
(a) Information on significant transactions
(b) Information on investment
(c) Information on investment in Mainland China
(d) Information on major shareholder
(14)Segment Information

Page

1
2
3
4
5
6
7
8
8
8～9
9～10
11
11～32
32
32
33
33
33
33
34～37
37
38
39
39～40

～2～

Independent Auditors’ Review Report

To the Board of Directors of Zippy Technology Corp.:

Introduction

We have reviewed the accompanying consolidated balance sheets of Zippy Technology Corp. (“Company”) and its subsidiaries (“Group”) as of September 30, 2023 and 2022, and the related consolidated statements of comprehensive income for the three months and nine months ended September 30, 2023 and 2022, as well as the changes in equity and cash flows for the nine months ended September 30, 2023 and 2022, and notes to the consolidated financial statements, including a summary of significant accounting policies. 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 Accounting Standard 34, “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

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

Basis for Qualified Conclusion

As stated in Note 4(b), the consolidated financial statements included the financial statements of certain non-significant subsidiaries, which were not reviewed by independent auditors. These financial statements reflect the total assets amounting to $801,705 thousand and $874,919 thousand, constituting 15.17% and 15.70% of consolidated total assets as of September 30, 2023 and 2022, respectively, total liabilities amounting to $82,358 thousand and $90,885 thousand, constituting 4.95% and 4.52% of consolidated total liabilities as of September 30, 2023 and 2022, respectively, and total comprehensive income (loss) amounting to $19,072 thousand, $22,376 thousand, $17,907 thousand and $53,459 thousand, constituting 10.39%, 9.67%, 3.90% and 9.01% of consolidated total comprehensive income (loss) for the three months and nine months ended September 30, 2023 and 2022, respectively.

～3～

Qualified Conclusion

Except for the adjustments, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries and equity accounted investee companies described in the Basis for Qualified Conclusion paragraph above been reviewed by independent auditors, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as of September 30, 2023 and 2022, and of its consolidated financial performance for the three months and nine months ended September 30, 2023 and 2022, as well as its consolidated cash flows for the nine months ended September 30, 2023 and 2022 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors’ review report are Rou-Lan Kuo and Ying-Ru Chen.

KPMG

Taipei, Taiwan (Republic of China) November 8, 2023

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ audit report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and consolidated financial statements, the Chinese version shall prevail.

～3-1～

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS AS OF September 30, 2023 AND 2022 ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

September 30, 2023, December 31, 2022 and September 30, 2022 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

ASSETS Current Assets： 1100 Cash and cash equivalents (Notes (6)(a)) 1110 Current financial assets at fair value through profit or loss (Notes (6)(b)) 1150 Notes receivable, net (Notes (6)(c)) 1170 Accounts receivable, net (Notes (6)(c)) 1200 Other receivables (Notes (6)(d)) 130X Inventories, net (Notes (6)(e)) 1470 Other current assets Non-current Assets： 1600 Property, plant and equipment (Notes (6)(f) and (8)) 1755 Right-of-use assets (Notes (6)(g)) 1760 Investment property, net (Notes (6)(h) and (8)) 1780 Intangible assets (Notes (6)(i)) 1840 Deferred income tax assets (Notes (4) and (6)(o)) 1915 Prepayments for business facilities 1920 Guarantee deposits paid TOTAL ASSETS	2023.09.30	2022.12.31	2022.09.30 LIABILITIES AND EQUITY Amount ％ Current Liabilities： 543,557) 10)2100 Short-term borrowings (Note (6)(j), (6)(x) and (8)) 95,836) 2)2130 Current contract liabilities (Note (6)(r)) 13,293) - 2150 Note payable 444,453) 8)2170 Accounts payable 7,730) - 2200 Other payables (Note (4) and (6)(n)) 939,528) 17)2230 Current tax liabilities (Note (4) and (6)(o)) 45,991) 1)2280 Current lease liabilities (Notes (6)(l) and (6)(x)) 2,090,388) 38)2320 Long-term borrowings, current portion (Note (6)(k) , (6)(x) and (8)) 2399 Other current liabilities, others Non-current Liabilities： 1,255,304) 23)2540 Long-term borrowings (Note (6)(k) , (6)(x) and (8)) 12,389) - 2570 Deferred income tax liabilities (Notes (4) and (6)(o)) 2,134,199) 38)2580 Non-current lease liabilities (Notes (6)(l) and (6)(x)) 20,755) - 2640 Net defined benefit liability, non-current (Notes (4) and (6)(n)) 34,820) 1)2645 Guarantee deposits received 22,643) - 505) - Total Liabilities 3,481,615) 62) Equity attributable to owners of parent (Note (6)(p))： 3110 Ordinary share 3200 Capital surplus 3300 Retained earnings 3400 Other equity interest Total equity attributable to owners of parent 36xx Non-controlling interests Total Equity 5,572,003) 100) TOTAL LIABILITIES AND EQUITY	2023.09.30	2022.12.31	2022.09.30
	Amount ％ $ 739,344) 14) 133,123) 3) 11,814) - 285,691) 5) 5,333) - 654,403) 12) 38,821) 1) 1,868,529) 35) 1,210,406) 23) 9,973) - 2,120,647) 40) 20,378) - 34,754) 1) 20,462) 1) 447) - 3,417,067) 65) $ 5,285,596) 100)	Amount ％ 719,386) 13) 92,215) 2) 19,411) - 370,964) 7) 5,276) - 889,267) 16) 31,227) 1) 2,127,746) 39) 1,247,284) 22) 11,679) - 2,127,882) 38) 21,082) - 34,157) 1) 16,667) - 502) - 3,459,253) 61) 5,586,999) 100)		Amount ％ $ 13,564) - 10,741) - 4,759) - 144,334) 3) 187,226) 4) 128,846) 2) 1,817) - 50,000) 1) 12,280) - 553,567) 10) 1,070,500 20) - - 294 - 16,639 - 24,013 1) 1,111,446 21) 1,665,013 31) 1,526,487) 29) 135,562) 3) 1,927,841) 36) (492) - 3,589,398) 68) 31,185) 1) 3,620,583) 69) $ 5,285,596) 100)	Amount ％ 13,083) - 13,809) - 11,644) - 263,342) 5) 206,456) 4) 167,090) 3) 2,014) - 50,000) 1) 11,729) - 739,167) 13) 1,108,000) 20 - - 1,661) - 17,223) - 23,933) 1) 1,150,817) 21) 1,889,984) 34) 1,526,487) 27) 135,564) 2) 2,024,209) 36) (23,961) - 3,662,299) 65 34,716) 1) 3,697,015) 66 5,586,999) 100)	Amount ％ 12,484) - 14,037) - 13,507) - 350,524) 6) 216,494) 4) 165,093) 3) 2,102) - 50,000) 1) 10,415) - 834,656) 14) 1,120,500 20) 390 - 2,120 - 28,450 1) 23,529 - 1,174,989 21) 2,009,645 35) 1,526,487) 27) 135,564) 3) 1,874,552) 34) (9,320) - 3,527,283) 64) 35,075) 1) 3,562,358) 65) 5,572,003)100)

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

～4～

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Three months and Nine months Ended September 30, 2023 AND 2022 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

			For the three	months	ended September 30,	ended September 30,	For the nine months	For the nine months	ended September	30,
			2023	%	2022	%	2023	%	2022	%
4000	Total sales revenue (Notes (6)(r))	$	530,045)	100)	688,540)	100)	1,623,015)	100)	2,057,066)	100)
5110	Total operating costs (Notes (6)(e))		291,387)	55)	386,214)	56)	931,657)	57)	1,199,929)	58)
5900	Gross profit from operations		238,658)	45)	302,326)	44)	691,358)	43)	857,137)	42)
6000	Operating expenses (Notes (6)(c), (6)(l), (6)(n) and (6)(s)):
6100	Selling expenses		20,481)	4)	20,323)	3)	60,868)	4)	63,005)	3)
6200	Administrative expenses		53,792)	10)	59,978)	9)	166,724)	10)	193,983)	9)
6300	Research and development expenses		17,578)	4)	16,523)	2)	52,941)	3)	53,607)	3)
6450	Expected credit loss (gain)		86)	-	(1,190)	-	(392)	-	(2,454)	-
	Total operating expenses		91,937)	18)	95,634)	14)	280,141)	17)	308,141)	15)
6900	Net operating income		146,721)	27)	206,692)	30)	411,217)	26)	548,996)	27)
7000	Non-operating income and expenses (Note (6)(t)):
7100	Interest income		3,081)	1)	1,153)	-	12,754)	-	2,612)	-
7010	Other income		37,999)	7)	31,505)	5)	112,034)	7)	101,013)	5)
7020	Other gains and losses, net		13,907)	3)	26,824)	4)	29,746)	2)	49,175)	2)
7050	Finance costs, net		(6,014)	(1)	(4,955)	(1)	(17,396)	(1)	(13,124)	(1)
	Total non-operating income and expenses		48,973)	10)	54,527)	8)	137,138)	8)	139,676)	6)
	Profit (loss) from continuing operations before tax		195,694)	37)	261,219)	38)	548,355)	34)	688,672)	33)
7950	Less: Income tax expenses (Note (6)(o))		38,142)	7)	57,164)	8)	112,741)	7)	152,089)	7)
	Profit		157,552)	30)	204,055)	30)	435,614)	27)	536,583)	26)
	Other comprehensive income:
8360	Components of other comprehensive income (loss) that will be reclassified to profit or loss
8361	Exchange differences on translation of foreign financial statements		26,020)	5)	27,285)	4)	23,469)	1)	56,561)	3)
	Components of other comprehensive income that will be reclassified to profit or loss		26,020)	5)	27,285)	4)	23,469)	1)	56,561)	3)
	Other comprehensive income		26,020)	5)	27,285)	4)	23,469)	1)	56,561)	3)
8500	Total comprehensive income	$	183,572)	35)	231,340)	34)	459,083)	28)	593,144)	29)
	Profit (loss), attributable to:
8610	Profit (loss), attributable to owners of parent	$	158,238)	30)	202,900)	30)	437,902)	27)	534,838)	26)
8620	Profit (loss), attributable to non-controlling interests		(686)	-	1,155)	-	(2,288)	-	1,745)	-
		$	157,552	30)	204,055)	30)	435,614)	27)	536,583)	26)
	Comprehensive income attributable to:
8710	Comprehensive income, attributable to owners of parent	$	184,258)	35)	230,185)	34)	461,371)	28)	591,399)	29)
8720	Comprehensive income, attributable to non-controlling interests		(686)	-	1,155)	-	(2,288)	-	1,745)	-
		$	183,572)	35)	231,340)	34)	459,083)	28)	593,144	29)
9750	Basic earnings per share (NT dollars) (Notes (6)(q))	$		1.04)		1.33)		2.87)		3.50
9870	Diluted earnings per share (NT dollars) (Notes (6)(q))	$		1.03)		1.32)		2.86)		3.49

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

～ 5 ～

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY For the Nine Months Ended September 30, 2023 and 2022 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

		Equity attributable to owners ofparent	Equity attributable to owners ofparent	Equity attributable to owners ofparent	Equity attributable to owners ofparent			Non- Controlling Interests	Total Equity
Capital Stock	Capital Surplus		Retained Earnings			Other Equity	Total Equity Attributable to Owners of Parent
Share Capital		Legal Reserve	Special Reserve	Unappropriated Retained Earnings	Total	Exchange Differences on Translation of Foreign Financial Statements
	135,564) - -	798,109) - -	51,068 - -	948,483) 534,838) -	1,797,660) 534,838) -	(65,881) - 56,561)	3,393,830) 534,838) 56,561)	34,344) 1,745) -	3,428,174) 536,583) 56,561)
-	-	-	-	534,838)	534,838)	56,561)	591,399)	1,745)	593,144)
- - - -	- - - -	58,113) - - -	- 14,811) - -	(58,113) (14,811) (457,946) -	- - (457,946) -	- - - -	- - (457,946) -	- - - (1,014)	- - (457,946) (1,014)
	135,564)	856,222)	65,879	952,451)	1,874,552)	(9,320)	3,527,283)	35,075)	3,562,358)
	135,564) - -	856,222) - -	65,879 - -	1,102,108) 437,902) -	2,024,209) 437,902) -	(23,961) - 23,469)	3,662,299) 437,902) 23,469)	34,716) (2,288) -	3,697,015) 435,614) 23,469)
-	-	-	-	437,902)	437,902)	23,469)	461,371)	(2,288)	459,083)
- - - -	- - - (2) -	68,450) - - - -	- (41,919) - - -	(68,450) 41,919) (534,270) - -	- - (534,270) - -	- - - - -	- - (534,270) (2) -	- - - - (1,243)	- - (534,270) (2) (1,243)
	135,562)	924,672)	23,960	979,209)	1,927,841)	(492)	3,589,398)	31,185)	3,620,583)

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

～6～

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE) REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the Nine Months Ended September 30, 2023 and 2022 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

		For the nine months	ended
		September 30,
		2023	2022
Cash flows from operating activities:
Profit before tax	$	548,355)	688,672)
Adjustments:
Adjustments to reconcile profit:
Depreciation expense		64,405)	63,185)
Amortization expense		818)	711)
Expected credit gain		(392)	(2,454)
Interest expense		17,396)	13,124)
Interest income		(12,754)	(2,612)
Loss on disposal of property, plant and equipment		(38)	45)
Total adjustments to reconcile profit		69,435)	71,999)
Changes in operating assets and liabilities:
Changes in operating assets:
Financial assets at fair value through profit or loss, mandatorily measured at fair value		(41,068)	(10,396)
Notes receivable		7,596)	15,517)
Accounts receivable		85,652)	(37,586)
Other receivables		267)	6,245)
Inventories		234,791)	(37,442)
Other current assets		1,763)	2,297)
Total changes in operating assets		289,001)	(61,365)
Changes in operating liabilities:
Contract liabilities		(3,068)	(4,106)
Notes payable		(6,885)	(16,599)
Accounts payable		(119,008)	(192,652)
Other payables		(19,500)	27,586)
Other current liabilities		551)	(1,919)
Net defined benefit liabilities, non-current		(584)	(11,457)
Total changes in operating liabilities		(148,494)	(199,147)
Total changes in operating assets and liabilities		140,507)	(260,512)
Total adjustments		209,942)	(188,513)
Cash inflow (outflow) generated from operations		758,297)	500,159)
Interest received		12,550)	2,531)
Interest paid		(17,274)	(12,845)
Income taxes paid		(160,342)	(164,930)
Net cash flows from (used in) operating activities		593,231)	324,915)
Cash flows from investing activities:
Acquisition of property, plant and equipment		(4,371)	(20,287)
Proceeds from disposal of property, plant and equipment		22)	790)
Increase in guarantee deposits paid		55)	(11)
Acquisition of intangible assets		(114)	(120)
Increase in prepayments for business facilities		(7,051)	(14,184)
Net cash flows (used in) from investing activities		(11,459)	(33,182)
Cash flows from financing activities:
Decrease in short-term borrowings		-	(31,238)
Repayments of long-term borrowings		(37,500)	(37,500)
Increase in guarantee deposits received		80)	2,518)
Payment of lease liabilities		(1,561)	(1,539)
Cash dividends paid		(534,270)	(457,946)
Change in non-controlling interests		(1,243)	(1,014)
Payment of overdue cash dividends		(2)	-
Net cash flows used in (from) financing activities		(574,496)	(526,719)
Effect of exchange rate changes on cash and cash equivalents		12,682)	24,297)
Net increase (decrease) in cash and cash equivalents		19,958)	(211,319)
Cash and cash equivalents at beginning of period		719,386)	754,876)
Cash and cash equivalents at end of period	$	739,344)	543,557)

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

～7～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(1) Company history

Zippy Technology Corp. (the “Company”) was established on April 25, 1983, which was a limited company. The Company reorganized into a company limited by shares in 1988. The shares of the Company was listed and traded at the ROC Securities Over-the-Counter Trading Center on May 25, 1996. Through the listing application to the Taiwan Stock Exchange in June 2000, the shares of the Company became officially listed and traded on the Taiwan Stock Exchange on September 11, 2000. The Company and its subsidiaries (together referred to as the “Group” and individually as “Group entities”). The Group engages primarily in the designing, manufacturing and trading of micro switches, power supplies. Please refer to Note 14 for details.

(2) Financial Statements Authorization Date and Authorization Process

The consolidated financial statements were authorized for issuance by the Board of Directors on November 8, 2023.

(3) New Standards, Amendments and Interpretations not yet Adopted:

(a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from January 1, 2023:

Amendments to IAS 1 “Disclosure of Accounting Policies”
Amendments to IAS 8 “Definition of Accounting Estimates”
Amendments to IAS 12 “Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction”

The Group has initially adopted the following new amendments, which do not have a significant impact on its consolidated financial statements, from May 23, 2023:

Amendments to IAS12 “International Tax Reform – Pillar Two Model Rules”
(b) The impact of IFRS issued by IASB but not yet endorsed by the FSC

The Group assesses that the adoption of the following new amendments, effective for annual period beginning on January 1, 2024, would not have a significant impact on its consolidated financial statements:

Amendments to IAS 1 “Classification of Liabilities as Current or Non-current”
Amendments to IAS 1 “Non-current Liabilities with Covenants”
Amendments to IAS 7 and IFRS 7 “Supplier Finance Arrangements”
Amendments to IFRS16 “Requirements for Sale and Leaseback Transactions”

～ 8 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The Group is evaluating the impact of its initial adoption of the abovementioned standards or interpretations on its financial position and financial performance. The results thereof will be disclosed when the Group completes its evaluation.

The Group expects that the adoption of the following IFRSs, which are issued by IASB but not yet endorsed by the FSC, would not have any material impact on its financial statements.

Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between an Investor and Its Associate or Joint Venture”
IFRS 17 “Insurance Contracts” and Amendments to IFRS 17 “Insurance Contracts”
Amendments to IAS 21 “Lack of Exchangeability”

(4) Summary of Material Accounting Policies

The accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of, the English and Chinese language consolidated financial statements, the Chinese version shall prevail.

(a) Statement of compliance

These consolidated financial statements have been prepared in accordance with the preparation and guidelines of IAS 34 “Interim Financial Reporting” which are endorsed and issued into effect by FSC, and do not include all of the information required by the Regulations and International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed and issued into effect by the FSC (hereinafter referred to IFRS endorsed by the FSC) for a complete set of the annual consolidated financial statements.

Except the following accounting policies mentioned below, the material accounting policies adopted in the consolidated financial statements are the same as those in the consolidated financial statement for the year ended December 31, 2022. For the related information, please refer to Note 4 of the consolidated financial statements for the year ended December 31, 2022.

(b) Basis of consolidation
List of subsidiaries in the consolidated financial statements

Principal Investor Name of Subsidiary activity	Shareholding Ratio 2023.9.30 2022.12.31 2022.9.30 Note
The Company ZIPPY USA Inc. Trading in micro switches, power supplies, and computer accessories 〞 ZIPPY International Holding Ltd. Reinvestment business	100.00% 100.00% 100.00% (Note 1) 100.00% 100.00% 100.00% (Note 2)

～ 9 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Principal Investor Name ofSubsidiary activity	Shareholding Ratio 2023.9.30 2022.12.31 2022.9.30 Note
〞 QUAN-FA Corporation Company Wire and cable manufacturing, electronic component manufacturing 〞 ZIPPY Technology Europe Gmbh Trading in electrical parts and computer accessories 〞 Landmark International Holding Ltd. Reinvestment business ZIPPY International Holding Ltd. ZIPPY (Dongguan) Electronics Co., Ltd. Mainly produce various switches, power supplies, molds, computer peripheral equipment, computer optical fiber parts and sales 〞 KOBOT International Inc. Leasing Landmark International Holding Ltd. ZIPPY (Suzhou) Electronics Co. , Ltd. Mainly sell computer key components, power supplies, precision ceramics, precision molds and key components of network equipment 〞 G-BRIM International Inc. Mainly engaged in electronic products, plastic products, rubber products, hardware products, import and export and related supporting businesses, etc.	63.92% 63.92% 63.92% (Note 2) 100.00% 100.00% 100.00% 〞 100.00% 100.00% 100.00% 〞 100.00% 100.00% 100.00% 〞 100.00% 100.00% 100.00% 〞 100.00% 100.00% 100.00% 〞 100.00% 100.00% 100.00% 〞

Principal
Investor
Name ofSubsidiary
activity

Shareholding Ratio
2023.9.30
2022.12.31
2022.9.30
Note

〞
QUAN-FA Corporation
Company
Wire and cable manufacturing,
electronic component
manufacturing
〞
ZIPPY Technology Europe
Gmbh
Trading in electrical parts and
computer accessories
〞
Landmark International
Holding Ltd.
Reinvestment business
ZIPPY
International
Holding Ltd.
ZIPPY (Dongguan)
Electronics Co., Ltd.
Mainly produce various switches,
power supplies, molds, computer
peripheral equipment, computer
optical fiber parts and sales
〞
KOBOT International Inc.
Leasing
Landmark
International
Holding Ltd.
ZIPPY (Suzhou) Electronics
Co. , Ltd.
Mainly sell computer key
components, power supplies,
precision ceramics, precision
molds and key components of
network equipment
〞
G-BRIM International Inc.
Mainly engaged in electronic
products, plastic products, rubber
products, hardware products,
import and export and related
supporting businesses, etc.

63.92%
63.92%
63.92%
(Note 2)
100.00%
100.00%
100.00%
〞
100.00%
100.00%
100.00%
〞
100.00%
100.00%
100.00%
〞
100.00%
100.00%
100.00%
〞
100.00%
100.00%
100.00%
〞
100.00%
100.00%
100.00%
〞

Note 1：The Company is a non-significant subsidiaries, its financial statements have been reviewed.

Note 2：The Company is a non-significant subsidiaries, its financial statements have not been reviewed.

Subsidiaries excluded from the consolidated financial statements: None.

(c) Income taxes

The income tax expenses have been prepared and disclosed in accordance with paragraph B12 of International Financial Reporting Standards 34, Interim Reporting.

Income tax expenses for the period are measured by multiplying together the pre-tax income for the interim reporting period and the management’s best estimate of effective annual tax rate. This should be recognized fully as tax expense for the current period.

Temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases shall be measured based on the tax rates that have been enacted or substantively enacted at the time of the asset or liability is recovered or settled, and be recognized directly in equity or other comprehensive income as tax expense.

(d) Employee benefits

The pension cost in the interim period was calculated and disclosed on a year to date basis by using the actuarially determined pension cost rate at the end of the prior fiscal year.

～ 10 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(5) Significant Accounting Judgments, Estimation, Assumptions, and Sources of Estimation Uncertainty The preparation of the consolidated financial statements in conformity with the Regulations and IFRSs (in accordance with IAS 34 “Interim Financial Reporting” and endorsed by the FSC) requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

The preparation of the consolidated interim financial statements, estimates and underlying assumptions are reviewed on an ongoing basis which are in conformity with the consolidated financial statements for the year ended December 31, 2022. For related information, please refer to Note 5 of the consolidated financial statements for the year ended December 31, 2022.

(6) Explanation to Significant Accounts

Except for the following disclosures, there is no significant difference as compared with those disclosed in the consolidated financial statements for the year ended December 31, 2022. Please refer to Note (6) of the 2022 annual consolidated financial statements.

(a) Cash and cash equivalents

Cash and cash equivalents
Cash $ Checking deposits Demand deposits Time deposits Cash and cash equivalents in consolidated statement of cash flows $	2023.09.30	2022.12.31	2022.09.30
	828 7,071 291,515 439,930	458 3,172 432,476 283,280	781 6,316 346,603 189,857
	739,344	719,386	543,557

Refer to Note 6(u) for the currency risk of the financial assets of the Group.

(b) Financial assets and liabilities at fair value through profit or loss
Financial assets and liabilities at fair value through profit or loss

Mandatorily measured at fair value through profit or loss - Beneficiary certificates $	2023.09.30	2022.12.31	2022.09.30
	133,123	92,215	95,836

1) Refer to Note 6(u) for the credit risks exposure of the financial instrument.
2) As of September 30, 2023, December 31, 2022 and September 30, 2022, the aforesaid financial assets were not pledged as collateral.

～ 11 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Notes receivable $ Accounts receivable Less: Loss allowance $	2023.09.30	2022.12.31	2022.09.30
	11,952 286,775 (1,222)	19,548 372,427 (1,600)	13,430 446,082 (1,766)
	297,505	390,375	457,746

The Group applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information. The loss allowance provisions in Taiwan and Mainland China were determined as follows:

	2023.09.30
Gross carrying amount	Weighted- average	Loss allowance provision
223,393 14,180	0.30% 19.60%	670 2,804
237,573		3,474

Note: as of the end of October 31, 2023, the amount that received by the Company is $14,180.

	2022.12.31
Gross carrying amount	Weighted- average	Loss allowance provision
283,872 20,377	0.30% 22.71%	852 4,628
304,249		5,480

	2022.09.30
Gross carrying amount	Weighted- average	Loss allowance provision
362,221 6,809	0.30% 22.71%	1,086 1,546
369,030		2,632

～ 12 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The loss allowance provisions in other foreign regions were determined as follows:

		2023.09.30	2023.09.30
Gross carrying amount		Weighted- average		Loss allowance provision
44,717 16,437		0.30% 0.20%~19.6% 2022.12.31		134 59
61,154				193

Gross carrying amount		Weighted- average		Loss allowance provision
58,457 29,269		0.30% 0.22%~0.69% 2022.09.30		175 64
87,726				239

Gross carrying amount		Weighted- average		Loss allowance provision
60,571 29,911				182 68
90,482				250
	2023		2022
			4,198) (2,454) 22)
			1,766)

The movement in the allowance for notes and accounts receivable was as follows:

As of September 30, 2023, December 31, 2022 and September 30, 2022, none of the receivables above are pledged as collateral for loans and borrowings.

(d) Other receivables

Other receivables $	2023.09.30	2022.12.31	2022.09.30
	5,333	5,276	7,730

～ 13 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

None of other receivables are past due.

Please refer to Note 6(u) for further credit risk information.

(e) Inventories

Finished goods $ Work in process Raw materials Materials and supplies in transit $	2023.09.30	2022.12.31	2022.09.30
	111,762 155,050 382,325 5,266	163,308 222,558 490,525 12,876	158,919 242,712 529,574 8,323
	654,403	889,267	939,528

For the three months ended September 30, 2023, the write-up of inventories to net realizable value amounting to $3,199 was included in operating cost.

For the three months ended September 30, 2022, and for the nine months ended September 30, 2023 and 2022, the write-down of inventories to net realizable value amounting to $239, $4,987 and $5,996 were included in operating cost.

As of September 30, 2023, December 31, 2022 and September 30, 2022, the aforesaid inventories were not pledged as collateral.

(f) Property, plant and equipment

Land	Land	Building and construction	Machinery and equipment	Office equipment	Other facilities	Total
$ 753,342 $ 756,862 $ 746,923 $ 754,740		271,953	157,464	14,558	49,967	1,247,284
		264,302	138,737	11,248	39,257	1,210,406
		279,956	174,050	13,922	48,360	1,263,211
	754,740	276,697	161,965	15,346	46,556	1,255,304

The property, plant and equipment of the Group have no significant additions, dispositions, impairment, or reversals for the nine months ended September 30, 2023 and 2022. Please refer to Note 12 for the amount of depreciation, and for other related information, please refer to Note 6(f) of the consolidated financial statement for the year ended December 31, 2022.

Please refer to Note 8 for details of the above assets pledged as collateral for long-term, short-term borrowings and financing line guarantees.

～ 14 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(g) Right-of-use assets

Land Carrying amounts: Balance at January 1, 2023 $ 8,075 Balance at September 30, 2023 $ 7,895 Balance at January 1, 2022 $ 8,178 Balance at September 30, 2022 $ 8,244	Land	Building and construction	Total
		3,604	11,679
		2,078	9,973
		5,438	13,616
		4,145	12,389

The right-of-use assets of the Group have no significant additions, dispositions, impairment, or reversals for the nine months ended September 30, 2023 and 2022. Please refer to Note 12(a) for the amount of depreciation, and for other related information, please refer to Note 6(g) of the consolidated financial statement for the year ended December 31, 2022.

(h) Investment property

Investment property includes its own assets held by the Group. The original non-removable period of leased investment property is one to four years, and some lease contracts stipulate that the lessee has the option to extend the period upon expiration.

For all investment property leases, the rental income is fixed under the contracts.

Information about investment property of the Group is presented below:

Own assets Land and improvement Building and construction Carrying amounts: Balance at January 1, 2023 $ 1,799,575 328,307 Balance at September 30, 2023 $ 1,801,624 319,023 Balance at January 1, 2022 $ 1,795,609 339,094 Balance at September 30, 2022 $ 1,800,934 333,265	Total
	2,127,882
	2,120,647
	2,134,703
	2,134,199

The investment property of the Group has no significant additions, dispositions, impairment, or reversals for the nine months ended September 30, 2023 and 2022. Please refer to Note 12 for the amount of depreciation, and for other related information, please refer to Note 6(h) of the consolidated financial statement for the year ended December 31, 2022.

For the three months and nine months ended September 30, 2023 and 2022, the direct operating expenses incurred by the Group's investment property that generated rental income were $890, $876, $2,822 and $2,685, respectively.

～ 15 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The fair value of the investment property was not significantly different from those disclosed in the Note 6(h) of the annual consolidated financial statements for the year ended December 31, 2022.

Please refer to Note 8 for details of the investment property pledged as collateral.

(i) Intangible assets

Software Carrying amounts: Balance at January 1, 2023 $ 2,034 Balance at September 30, 2023 $ 1,330 Balance at January 1, 2022 $ 2,298 Balance at September 30, 2022 $ 1,707	Software	Other intangible assets	Total
		19,048	21,082
		19,048	20,378
		19,048	21,346
		19,048	20,755

The intangible assets of the Group have no significant additions, dispositions, impairment, or reversals for the nine months ended September 30, 2023 and 2022. Please refer to Note 12 for the amount of depreciation, and for other related information, please refer to Note 6(i) of the consolidated financial statement for the year ended December 31, 2022.

(j) Short-term borrowings

The significant details of short-term borrowings were as follows:

2023.09.30	2022.12.31	2022.09.30
	13,083	12,484
	2,227,041	2,226,947
4.64%	3.34%	0.90%~0.93%

Please refer to Note 8 for details of the related assets pledged as collateral.

(k) Long-term borrowings

The significant terms and conditions of long-term borrowings were as follows:

2023.09.30	2022.12.31	2022.09.30
	1,158,000 (50,000)	1,170,500 (50,000)
	1,108,000	1,120,500
1.71%~2.02%	1.11%~1.74%	1.11%~1.65%

～ 16 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Please refer to Note 8 for details of the related assets pledged as collateral.

Under credit/loan agreements, the Group shall maintain certain consolidated financial ratios on balance sheet date of semi and annual financial statements. (i.e. liabilities to equity ratio, interest coverage ratio, tangible net worth, etc.) Otherwise, the loans are due and payable immediately.

(l) Lease liabilities

The Group lease liabilities were as follows:

2023.09.30	2022.12.31	2022.09.30
1,817	2,014	2,102
294	1,661	2,120
6(u).

The amounts recognized in profit or losses were as follows:

For the three months ended September 30, 2023 2022 16 32 157 170	For the nine months ended September 30,	For the nine months ended September 30,
2023 16 157	2023	2022 106 532
	58
	494

The amounts recognized in the statement of cash flows for the Group was as follows:

The amounts recognized in the statement of cash flows	for the Group was as follows:	for the Group was as follows:
Total cash outflow for leases $	For the nine months ended September 30,
	2023 2,113	2022
		2,177

1. Real estate leases

As of September 30, 2023, December 31, 2022 and September 30, 2022, the Group leases houses and buildings as office premises and factories. The lease period of office premises is usually two to three years. The lease period of factories is usually five to six years. Part of the lease includes the option to extend the same period as the original contract when the lease period expires.

2. Other leases

The Group leases parking spaces, photocopying equipment and dormitories for a lease period of one year. These leases are short-term leases. The Group has elected not to recognize right-of-use assets and lease liabilities for these leases.

～ 17 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(m) Operating Leases

The Group leases its investment properties. Since almost all risks and rewards belonging to the ownership of the underlying asset have not been transferred and paid, these lease contracts are classified as operating leases. Please refer to Note 6 (h) Investment property for details.

Maturity analyses of lease payments, showing the undiscounted lease payments to be received after the reporting date are as follows:

Less than one year $ One to two years Two to three years Three to four years Four to five years More than five years Total undiscounted lease payments $	2023.09.30	2022.12.31	2022.09.30
	106,401 74,807 28,683 22,668 20,762 69,301	116,890 98,518 54,618 23,981 21,192 81,620	112,868 99,951 69,042 23,257 18,342 65,907
	322,622	396,819	389,367

Please refer to Note 6(t) for further information of the rental revenues incurred by leasing investment properties for the three months and nine months ended September 30, 2023 and 2022.

(n) Employee benefits

1. Defined benefit plans

Management believes that there was no material volatility of the market, no material reimbursement and settlement or other material one-time events since prior fiscal year. As a result, the pension cost in the accompanying interim consolidated financial statements was measured and disclosed according to the actuarial report as of December 31, 2022 and 2021.

The expenses recognized in profit or loss for the Group was as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
	55 6 91	266 13 30	165 19 273
	152	309	457

Defined contribution plans

～ 18 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The Group’s expenses under the pension plan cost to the Bureau of Labor Insurance were as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
	2,202 390 525 599	6,186 1,022 1,351 1,516	6,647 1,150 1,626 1,836
	3,716	10,075	11,259

The pension expenses contributed by the foreign entities following the local regulations amounted to $2,154, $2,061, $6,019 and $5,842 for the three months and nine months ended September 30, 2023 and 2022, respectively.

Provisions for Employee Benefits

The provisions for employee benefits for the Group were as follows:

Net defined benefit liability, non-current $ Accumulating compensated absences (Other payables) $	2023.09.30	2022.12.31	2022.09.30
	16,639 19,641	17,223 19,690	28,450 20,556
	36,280	36,913	49,006

(o) Income taxes
The components of income tax expense were as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
	57,404 -	113,177 (436)	152,089 -
	57,164	112,741	152,089

For the nine months ended September 30, 2023 and 2022, there were no income tax recognized in equity and other comprehensive income.

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

～ 19 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(p) Capital and reserves

Except for the following disclosure, there was no significant change for capital and other equity for the nine months ended September 30, 2023 and 2022. For the related information, please refer to note 6(p) of the consolidated financial statements for the year ended December 31, 2022.

Retained earnings

According to the Articles of Incorporation, after-tax earnings are initially used to offset cumulative losses, and 10% of the remainder is set aside as a legal reserve, except when the legal reserve of the Company reaches paid-in capital of the Company. Special reserve may be appropriated if necessary, and then any remaining profit together with any undistributed retained earnings shall be distributed according to the distribution plan proposed by the Board of Directors and submitted to the shareholders’ meeting for approval.

1) Legal reserve

If the Company experienced profit for the year, the meeting of shareholders shall decide on the distribution of the statutory earnings reserve either by new shares or by cash, of up to 25 percent of the actual share capital.

2) Special reserve

In accordance with Permit No.1010012865 as issued by the Financial Supervisory Commission on 6 April 2012, a special reserve equal to the contra account of other shareholders' equity is appropriated from the current and prior period earnings. When the debit balance of any of the contra accounts in the shareholders' equity is reversed, the related special reserve can be reversed. The subsequent reversals of the contra accounts in shareholders' equity shall qualify for additional distributions.

3) Earnings Distribution

During the shareholder’s meeting on May 30, 2023 and May 27, 2022, the shareholders approved to distribute the 2022 and 2021 earnings. The earnings were appropriated as follows:

2022 Dividend per share ($) Amount Dividends distributed to common shareholders Cash $ 3.50 534,270	2022	2022	2021	2021
	Dividend per share ($)	Amount	Dividend per share ($)	Amount
		534,270	3.00	457,946

(q) Earnings per share

The following are the calculation of basic earnings per share and diluted earnings per share:

～ 20 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

For the three months ended September 30,	For the three months ended September 30,	For the three months ended September 30,	For the three months ended September 30,	For the three months ended September 30,
2023		2022	2023
		202,900	437,902
152,649		152,649	152,649
		1.33	2.87
		202,900	437,902
152,649 371		152,649 525	152,649 535
153,020		153,174	153,184
		1.32	2.86

	Power Supplies 55,767 97,436 14,420 48,299 300 22,199 238,421		Marco Switches 46,517 23,618 85,943 9,110 49,480 79,983 291,624	Total
				99,257 121,054 100,363 57,409 49,780 102,182
				530,045

～ 21 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

For the three months ended September 30, 2023	For the three months ended September 30, 2023	For the three months ended September 30, 2023
Power Supplies
238,421
Power Supplies	Marco Switches 136,329 72,837 242,994 27,945 165,201 219,692 864,998 864,998	Total
200,621 299,911 40,817 140,499 2,197 73,972		336,950 372,748 283,811 168,444 167,398 293,664
758,017		1,623,015
758,017		1,623,015

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

For the nine months ended September 30, 2022	For the nine months ended September 30, 2022	For the nine months ended September 30, 2022
Power Supplies	Marco Switches 139,160 85,208 209,737 31,136 135,318 256,542 857,101 857,101 2022.12.31	Total
402,857 385,459 122,781 168,198 3,517 117,153		542,017 470,667 332,518 199,334 138,835 373,695
1,199,965		2,057,066
1,199,965		2,057,066
2023.09.30		2022.09.30
10,741	13,809	14,037

Contract liabilities are mainly derived from the difference between the time when the Group transfers goods or services to the customer to meet the performance obligation and the time when the customer pays. The Group will transfer revenue when the performance obligation is met.

(s) Remuneration of employees, directors and supervisors

The Company’s articles of incorporation require that earnings shall first be offset against any deficit. A minimum of 2% will be distributed as employee remuneration and a maximum of 2% will be allocated as directors’ and supervisors’ remuneration. The recipients of shares and cash may include employees of the Company’s affiliated companies who meet certain conditions. Distribution remuneration for employees, directors and supervisors shall be submitted to the shareholders' meeting report.

The remuneration of employees amounted to $6,065, $7,680, $17,036 and $20,441 and the remuneration of directors amounted to $4,043, $5,120, $11,357 and $13,627 for the three months and nine months ended September 30, 2023 and 2022, respectively. These amounts are calculated using the Company's profit before tax for each period described above, and are determined using the earnings allocation method which stated under the Company's article. These remunerations were expensed under operating cost or expenses in September 30, 2023 and 2022. If there is a difference between the actual distribution amount in the following year and the estimated amount, it shall be dealt with according to the change in accounting estimates, and the difference shall be recognized as the profit and loss of the following year.

～ 23 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

The remuneration of employees amounted to $25,882 and $22,649, and the remuneration of directors amounted to $17,254 and $15,099. There were no differences between the amounts to be distributed as remuneration to employees and directors and those of the estimation made by the Company. Related information would be available at the Market Observation Post System after the meeting of the shareholders has been convened.

(t) Non-operating income and expenses
Interest income

The details of interest income were as follows:

Interest income $	For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
	2023	2022	2023	2022
	3,081	1,153	12,754	2,612

2. Other income

The details of other income were as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
30,202 7,797	23,411 8,094	90,642 21,392	76,801 24,212
37,999	31,505	112,034	101,013

3. Other income and losses

The details of other income and losses were as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
18 14,517 1,097 (1,725)	(48) 26,836 515 (479)	38 29,991 1,851 (2,134)	(45) 53,170 1,652 (5,602)
13,907	26,824	29,746	49,175

～ 24 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

4. Finance costs

The details of finance expenses were as follows:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
5,998 16	4,923 32	17,338 58	13,018 106
6,014	4,955	17,396	13,124

(u) Financial instruments

Except for the contention mentioned below, there was no significant change in the fair value of the Group’s financial instruments and degree of exposure to credit risk, liquidity risk and market risk arising from financial instruments. For the related information, please refer to Note 6(u) of the consolidated financial statements for the year ended December 31, 2022.

1. Credit risk of receivables

For credit risk exposure of note and trade receivables, please refer to Note 6(c). Other financial assets at amortized cost include other receivables; please refer to Note 6(d) for relevant information and the provision of allowance loss.

All of these financial assets are considered to have low risk, and thus, the impairment provision recognized during the period was limited to 12 months expected losses. Regarding how the financial instruments are considered to have low credit risk, please refer to Note 4(g) of the consolidated financial statements for the year ended December 31, 2022.

2. Liquidity risks

The following are the contractual maturities of financial liabilities of the Group, including the impact of estimation of interest:

Carrying amount September 30, 2023 Non-derivative financial liabilities Secured bank loans $ 1,120,500 Unsecured bank loans 13,564 Notes payable 4,759 Accounts payable 144,334 Lease liabilities 2,111 Other payables 187,226 Guarantee deposits received 24,013 $ 1,496,507	Carrying amount	Contractual cash flows	Less than 6 months	6 to 12 months	1 to 2 years	2 to 5 years	More than 5 years
		1,205,582 13,581 4,759 144,334 2,138 187,226 24,013	35,354 13,581 4,759 144,334 922 187,226 5,399	35,233 - - - 922 - 31	69,598 - - - 294 - 15,315	1,065,397 - - - - - 1,678	- - - - - - 1,590
		1,581,633	391,575	36,186	85,207	1,067,075	1,590

～ 25 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Carrying amount	Contractual cash flows	Less than 6 months	6 to 12 months	1 to 2 years	2 to 5 years	More than 5 years
	1,235,311 13,270 11,644 263,342 3,762 206,456 23,933	33,183 13,270 11,644 263,342 1,102 206,456 594	33,050 - - - 982 - 486	65,564 - - - 1,672 - 5,049	192,288 - - - 6 - 16,205	911,226 - - - - - 1,599
	1,757,718	529,591	34,518	72,285	208,499	912,825
Carrying amount	Contractual cash flows	Less than 6 months	6 to 12 months	1 to 2 years	2 to 5 years	More than 5 years
	1,249,398 12,506 13,507 350,524 4,337 216,494 23,529	32,968 12,506 13,507 350,524 1,109 216,494 704	32,925 - - - 1,079 - 366	65,245 - - - 1,854 - 5,049	191,469 - - - 295 - 16,908	926,791 - - - - - 502
	1,870,295	627,812	32,879	72,148	208,672	927,293

The Group is not expecting that the cash flows included in the maturity analysis could occur significantly earlier or at significantly different amounts.

Currency risks
1) Exposure to currency risks

The Group’s exposures to significant currency risk were those from its foreign currency denominated financial assets and liabilities as follows:

～ 26 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

	2023.09.30
Foreign currency (In thousand)	Exchange rate	TWD
	USD：TWD 32.2680 USD：EUR 0.9516 EUR：TWD 33.9104 CNY：TWD 4.4202 USD：TWD 32.2680 CNY：TWD 4.4202 EUR：TWD 33.9104 USD：TWD 32.2680 USD：EUR 0.9516 CNY：TWD 4.4202 2022.12.31	454,624 15,521 44,524 75,722 434,779 359,163 68,194 11,939 41,852 25,920
Foreign currency (In thousand)	Exchange rate	TWD
	USD：TWD 30.7080 USD：EUR 0.9388 EUR：TWD 32.7086 CNY：TWD 4.4175 JPY：TWD 0.2324 USD：TWD 30.7080 CNY：TWD 4.4175 EUR：TWD 32.7086 JPY：TWD 0.2324 USD：TWD 30.7080	455,338 19,407 39,463 88,169 6,149 396,686 345,957 60,805 7,975 37,617

～ 27 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

	2022.09.30
Foreign currency (In thousand)	Exchange rate	TWD
	USD:TWD 31.7430 USD:EUR 1.0170 EUR:TWD 31.2113 CNY:TWD 4.4752 JPY:TWD 0.2199 USD:TWD 31.7430 CNY:TWD 4.4752 EUR:TWD 31.2113 JPY:TWD 0.2199 USD:TWD 31.7430 TWD:CNY 0.2235	370,282 16,697 24,345 70,368 10,559 386,598 347,535 60,862 15,749 66,184 42,977

2) Sensitivity analysis

The Group’s exposure to foreign currency risk arises from the translation of the foreign currency exchange gains and losses on cash and cash equivalents, accounts receivable, other receivables, loans, accounts payable and other payables that are denominated in foreign currency. A 1% depreciation or appreciation of the functional currency against all the non-functional currency as of September 30, 2023 and 2022 would have increased or decreased the net profit after tax by $4,085 and $2,939, respectively. The analysis is performed on the same basis for both periods.

3) Gains or losses on foreign exchange

As Group deals with diverse foreign currencies, therefore, the gains or losses on foreign exchange were summarized as a single amount. For the nine months ended September 30, 2023 and 2022, the foreign exchange gain (loss), including realized and unrealized, amounted to $29,991 and $53,170, respectively.

4. Fair value of financial instruments

1) Fair value hierarchy

Financial assets at fair value through profit or loss are measured on a recurring basis. However, for financial instruments not measured at fair value whose carrying amount is estimated

～ 28 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

reasonably close to the fair value and for equity investments that has no quoted prices in the active markets and lease liabilities information is not required:

		2023.09.30
Book Value		Fair	Value
	Level 1	Level 2	Level 3	Total
	83,064	-	50,059	133,123
739,344 302,838 447	- - -	- - -	- - -	- - -
1,042,629	-	-	-	-
	83,064	-	50,059	133,123
	- - - - -	- - - - -	- - - - -	- - - - -
	-	-	-	-

		2022.12.31
Book Value		Fair	Value
	Level 1	Level 2	Level 3	Total
	-	-	92,215	92,215
719,386 395,651 502	- - -	- - -	- - -	- - -
1,115,539	-	-	-	-
	-	-	92,215	92,215
	- - - - -	- - - - -	- - - - -	- - - - -
	-	-	-	-

～ 29 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

		2022.09.30
Book Value		Fair	Value
	Level 1	Level 2	Level 3	Total
	-	-	95,836	95,836
543,557 465,476 505	- - -	- - -	- - -	- - -
1,009,538	-	-	-	-
	-	-	95,386	95,386
	- - - - -	- - - - -	- - - - -	- - - - -
	-	-	-	-

2) Valuation techniques and assumption for financial instruments measured at fair value:

The fair value of financial assets and liabilities were decided in accordance with the solutions as follows:

(2.1) Funds are financial assets with standard terms which are traded in the active markets. Their fair values are based on the quoted market prices.
(2.2) The fair value of unquoted equity instruments were estimated using either the discounted cash flow model in which future cash flow were estimated and discounted or the fair value of the recognized assets and liabilities of the consolidated subsidiaries on the measurement day.
3) Transfers between levels

There were no transfers between any level of the fair value for the nine months ended September 30, 2023 and 2022.

4) The following table shows the movements in fair value measurements under level 3 of the fair value hierarchy:

～ 30 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Balance as of January 1, $ Purchase Disposals/pay off Effect of movements in exchange rate Balance as of September 30, $	At fair value through profit or loss	At fair value through profit or loss
	For the nine months ended September 30,
	2023	2022
	92,215 13,456 (55,452) (160)	82,775 44,511 (34,115) 2,665
	50,059	95,836

The Group's measurement of the fair value of financial instruments is reasonable, but the use of different evaluation models or evaluation parameters may lead to different evaluation results. For financial instruments classified as level 3, a 0.5% up or down of the evaluation parameter changes would have increased (decreased) the net profit by $250.

5) Quantified information for significant unobservable inputs (Level 3) used in fair value measurement

The Group uses level 3 inputs to measure financial assets at fair value through profit or loss. Quantified information of significant unobservable inputs was as follows:

Item Financial assets at fair value through profit or loss－ beneficiary certificate	Valuation Technique Net Asset Value Method	Significant Non-observable Input ‧Market Interest Rate ‧Net Asset Value	The Relationship between Significant Non-observable Input and FairValue
			‧The higher discount rate is, the lower fair value will be.

(v) )Financial risk management

There were no significant differences of the Group’s financial risk management and policies with those disclosed in Note (6)(v) of the consolidated financial statements for the year ended December 31, 2022.

(w) Capital Management

Management believes that the objectives, policies and processes of capital management of the Group have been applied consistently with those described in the consolidated financial statements for the year ended December 31, 2022. Also, management believes that there were no significant changes in the Group’s capital management information as disclosed in Note (6)(w) for the year ended December 31, 2022.

～ 31 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(x) Investing and financing activities not affecting current cash flow
The Group’s financing activities not affecting current cash flow were acquisition of right-of-use assets from leasing. Please refer to Note 6(g).

Reconciliation of liabilities arising from financing activities was as follows:

Non-cash changes January 1, 2023 Cash flows Foreign exchange movement September 30, 2023 Short-term borrowings $ 13,083 - 481 13,564 Lease liabilities 3,675 (1,561) (3) 2,111 Total liabilities from financing activities $ 16,758 (1,561) 478 15,675 Non-cash changes January 1, 2022 Cash flows Lease revised Foreign exchange movement September 30, 2022 Short-term borrowings $ 43,803 (31,238) - (81) 12,484 Lease liabilities 5,499 (1,539) 194 68 4,222 Total liabilities from financing activities $ 49,302 (32,777) 194 (13) 16,706	September 30, 2023	September 30, 2023
		13,564 2,111
		15,675
		September 30, 2022
		12,484 4,222
		16,706

(7) Related Party Transactions

(a) Significant transactions with related parties: None.
(b) Key management personnel compensation

Key management personnel compensation includes:

For the three months ended September 30,	For the three months ended September 30,	For the nine months ended September 30,	For the nine months ended September 30,
2023	2022	2023	2022
17,459 241	16,042 216	50,017 649	46,835 668
17,700	16,258	50,666	47,503

(8) Pledged Assets

The carrying values of pledged assets were as follows:

Pledged assets	Object 2023.09.30 long-term, short-term borrowings $ 800,583 long-term borrowings 1,975,620 $ 2,776,203	2023.09.30	2022.12.31	2022.09.30
Property, plant and equipment Investment property Total			803,862 1,983,301	804,955 1,985,862
			2,787,163	2,790,817

～ 32 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS

ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(9) Significant Commitments and Contingencies: None.

(10) Losses Due to Major Disasters: None.

(11) Subsequent Events: None.

(12) Other

(a) The employee benefits, depreciation, depletion and amortization expenses categorized by function were as follows:

By function By item	For the three months ended September 30, 2023	For the three months ended September 30, 2023	For the three months ended September 30, 2023	For the three months ended September 30, 2022	For the three months ended September 30, 2022	For the three months ended September 30, 2022
	Operating costs	Operating and non-operating expense	Total	Operating costs	Operating and non-operating expense	Total
Employee benefits Salary Labor and health insurance Pension Others Depreciation Amortization	74,412 7,257 3,565 2,524 13,664 85	47,020 3,593 2,105 1,337 7,745 189	121,432 10,850 5,670 3,861 21,409 274	75,377 7,353 3,537 3,398 13,439 85	58,876 4,522 2,392 1,710 7,866 154	134,253 11,875 5,929 5,108 21,305 239

By function By item	For the nine months ended September 30, 2023			For the nine months ended September 30, 2022
	Operating costs	Operating and non-operating expense	Total	Operating costs	Operating and non-operating expense	Total
Employee benefits Salary Labor and health insurance Pension Others Depreciation Amortization	219,227 21,671 10,194 8,590 41,154 254	150,626 12,481 6,209 6,401 23,251 564	369,853 34,152 16,403 14,991 64,405 818	244,112 22,190 10,444 10,118 39,539 260	188,482 12,563 7,114 6,250 23,646 451	432,594 34,753 17,558 16,368 63,185 711

～ 33 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(13) Other disclosures

(a) Information on significant transactions

The following is the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group for the nine months ended September 30, 2023:

1. Loans to other parties:

(In Thousands of USD)

Number	Name of lender	Name of borrower	Account name	Related party	Highest balance of financing to other parties during the period	Ending balance	Actual usage amount during the period	Range of interest rates during the period	Purposes of fund financing for the borrower	Transaction amount for business between two parties	Reasons for short-term financing	Allowance for bad debt	Collateral	Collateral	Individual funding loan limits	Maximum limit of fund financing
													Item	Value
1	Zippy USA Inc.	Kobot International Inc.	Other receivables- related parties	Y	61,959 (USD 1,920)	61,959 (USD 1,920)	61,959 (USD 1,920)	1.51~ 2.50	2	-	Working Capital	-		-	606,214	606,214

Note 1: Purpose of fund financing for the borrower:

(1) For those companies with business contact, please fill in 1.
(2) For those companies with short-term financing needs, please fill in 2.

Note 2: (1) The Company’s total fund financing amount cannot exceed 40% of its net asset value.

(2) For those companies with business contact, the amount of each fund financing cannot exceed the trading amount between the two parties. If the trading amount exceeds 10% of its net asset value, the amount of each fund financing cannot exceed 10%of its net asset value. The trading amount means the higher of sales or purchases.
(3) For those companies with short-term financing needs, the amount of each fund financing cannot exceed 10%of its net asset value.
Note 3: The policies of loans to other parties for the subsidiaries:
(1) Total financing amount cannot exceed 2 times of the subsidiary’s net asset value.
(2) For those companies with short-term financing needs, the amount of each fund financing cannot exceed 10% of the subsidiaries net asset value.
(3) For the subsidiary leading to the foreign companies that are 100% directly or indirectly owned by the Company, the amount of fund financing cannot exceed 2 time of the subsidiary’s net asset value.
Note 4: The transactions and its limits with the Group, which were calculated based on the exchange rate at the end of the period, were eliminated in the consolidated financial statements.
Guarantees and endorsements for other parties:

											(In Thou	sands of EUR/USD)	sands of EUR/USD)
No.	Endorsement/ guarantee provider	Counter-part	y	Limitation on endorsement/ guarantee amount provided to each guaranteed party (Note 2)	Maximum balance for the year(Note 2)	Ending balance	Amount actually drawn	Amount of endorsement/ guarantee collateralized by properties	Ratio of accumulated endorsement/ guarantee to net equity per latest financial statements	Maximum endorsement guarantee amount allowance (Note 2 and 3)	Guarantee provided by parent company	Guarantee provided by a subsidiary	Guarantee provided to subsidiaries in Mainland China
		Name	Nature of relationship (Note 1)
0 0	The Company 〞	Zippy (Dongguan) Electronics Co., Ltd. Zippy Technology Europe GmbH.	4 4	1,435,759 1,435,759	48,405 (USD 1,500) 50,910 (EUR 1,500)	48,405 (USD 1,500) 50,910 (EUR 1,500)	- 13,576 (EUR 400)	- -	1.35% 1.42%	1,794,699 1,794,699	Y Y	N N	Y N

Note 1: (1) The Company has business with the receiving parties.

(2) The Company holds directly or indirectly more than 50% of the common stock of the subsidiaries.
(3) The Company holds directly or indirectly more than 50% by the investee.
(4) The Company holds directly or indirectly more than 90% of the common stock of the subsidiaries.
(5) Based on the needs of contracting projects, companies in the same industry or jointly created mutual insurance companies in accordance with contractual provisions.
(6) The stockholders of the Company provide guarantee for the investee to their stockholding percentage.
(7) The inter-industry is engaged in joint and several guarantees for the performance of the pre-sale house sales contract in accordance with the regulations of the Consumer Protection Law.
Note 2: (1) The maximum guarantees and endorsements provide by the Company cannot exceed 50% of net asset of the Company.
(2) The maximum guarantees and endorsements for individual counter party cannot exceed 40% of net asset of the Company.
(3) The maximum guarantees and endorsements provide by the Company and subsidiaries cannot exceed 50% of net asset of the Company.
(4) For those companies with business contact, the amount of each guarantees and endorsements cannot exceed the trading amount within twelve months between the two parties.

～ 34 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Note 3: the policies of loans to other parties for the subsidiaries:

(1) Total amount of guarantees and endorsements cannot exceed 2 times of the subsidiary’s net asset value.
(2) The amount of guarantees and endorsements for individual counter party cannot exceed 40% of net asset of the subsidiary or the net asset of the endorsed company is limited; if approved by the board of directors, the maximum endorsement guarantee of the subsidiary to other subsidiaries hold directly or indirectly 100% by a single parent company cannot exceed 2 time of the subsidiary’s net asset value.

Note 4: The amount of guarantees and endorsements were exchanged to New Taiwan Dollars in the actual exchange rate at the time of guarantee.

Securities held as balance sheet date (excluding investment subsidiaries, associates and joint ventures) :

Name of holder	Category and name of security	Relationship with the Company	Account title		Ending balance	Ending balance		Note
				Shares/Units (thousands) (Note)	Carrying value	Percentage of ownership (%)	Fair value
The Company G-BRIM International Inc. Zippy (Dongguan) Electronics Co.,Ltd.	Fuh Hwa Money Market Beneficiary certificate Beneficiary certificate	- - -	Financial assets at fair value through profit or loss 〞〞	5,633 - -	83,064 27,958 22,101	- - -	83,064 27,958 22,101

Note: Refers to the number of fund units (thousand units)

Individual securities acquired or disposed of with accumulated amount exceeding the lower of TWD300 million or 20% of the Company’s paid-in capital:

Company holding securities	Security type and name	Account	Counter -party	Relation -ship	Beginning	Beginning	Purc	hase		S	ale		Ending (Note)	Ending (Note)
					Shares (in thousands)	Amount	Shares (note 1)	Amount	Shares (note 1)	Price	Cost	Gain (loss) on disposal	Shares (in thousands)	Amount
The Company	Fuh Hwa Money Market	Financial assets at fair value through profit or loss	-	-	-	-	54,845	807,000	49,212	724,814	724,000	814	5,633	83,064

Note 1 : Refers to the number of fund units (thousand units) Note 2 : Including the profit and loss on the valuation of financial assets at the end of the period

Acquisition of individual real estate with amount exceeding the lower of TWD300 million or 20% of the Company’s paid-in capital: None.
Disposal of individual real estate with amount exceeding the lower of TWD300 million or 20% of the Company’s paid-in capital: None.
Related-party transactions for purchases and sales with amounts exceeding the lower of TWD100 million or 20% of the Company’s paid-in capital:

Name of company	Related party	Nature of relationship		Transaction details	Transaction details		Trans diffe	actions with terms rent from others	Notes/Accounts re	ceivable (payable)	Note
			Purchase/ Sale	Amount	Percentage of total purchases/sale	Payment terms	Unit price	Payment terms	Ending balance	Percentage of total notes/accounts receivable (payable)
The Company 〞〞	Zippy (Dongguan) Electronics Co., Ltd. Zippy USA Inc. Zippy (Suzhou) Electronics Co. , Ltd.	Associate under equity method 〞〞	Purchases Sales Sales	250,244) (229,278) (188,020)	62.29% 15.00% 12.31%	2~4 months 2~4 months 2~4 months	Note 1 Note 1 Note 1	Note 2 Note 2 Note 2	- 4,203 33,910	- % 1.41% 11.39%

～ 35 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Note 1: Based on the negotiated price while trading.

Note 2: Normal customers are within one to two months, while related party transactions are within two to four months.

Receivables from related parties with amounts exceeding the lower of NT$100 million or 20% of capital stock: None.
Trading in derivative instruments: None.
Business relationships and significant inter-company transactions:

No.	Name of company	Name of counterparty	Existing relationship with the counter- party		Tr	ansactions
				Account name	Amount	Terms of trading	Percentage of the consolidated total revenue or total assets
0 0 0 0 0 0 0 0 0 0 1 2 2 3	The Company 〞〞〞〞〞〞〞〞〞 ZIPPY USA Inc. Zippy (Dongguan) Electronics Co., Ltd. QUAN-FA Corporation Company 〞	ZIPPY USA Inc. Zippy Technology Europe Gmbh. ZIPPY(Suzhou) Electronics Co. , Ltd. G-BRIM International Inc. Zippy (Dongguan) Electronics Co., Ltd. ZIPPY USA Inc. Zippy Technology Europe Gmbh. ZIPPY(Suzhou) Electronics Co. , Ltd. G-BRIM International Inc. Zippy (Dongguan) Electronics Co., Ltd. Kobot International Inc. The Company The Company 〞	1 1 1 1 1 1 1 1 1 1 3 2 2 2	Sales Sales Sales Sales - Accounts Receivable Accounts Receivable Accounts Receivable Accounts Receivable Other Receivable Other Receivable Sales Sales Accounts Receivable	229,278 99,931 188,020 8,639 97,394 4,203 42,398 33,910 1,597 25,921 61,959 250,244 31,317 9,044	Negotiated price Negotiated price Negotiated price Negotiated price Procurement Two to four months Two to four months Two to four months Two to four months Note 1 Loan Negotiated price Negotiated price Two to four months	14.13% 6.16% 11.58% 0.53% -% 0.08% 0.80% 0.64% 0.03% 0.49% 1.17% 15.42% 1.93% 0.17%

Note 1: In principle, the payment period depends on the capital needs, and the purchase is made by prepayment of part of the payment for the payment.

Note 2: The labeling method is as follows:

(1) Parent company labeled 0.

(2) Subsidiaries labeled in number sequence from 1.

Note 3: Relationship is classified into three types:

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

～ 36 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

Note 4: The transaction amount is calculated as a proportion of the consolidated revenue or assets. If categorized as an asset or liability, the calculation is compared with the consolidated asset; if categorized as income or loss, the calculation is compared with the consolidated income or loss.

Note 5: The transactions with the Group were eliminated in the consolidated financial statements.

(b) Information on investment:

The following is the information on investees for the nine months ended September 30, 2023 (excluding investees in Mainland China):

Unit: Thousand Shares

Investor company	Investee company	Location	Main businesses and products	Original i amo	nvestment unt	Balance as of September 30, 2023	Balance as of September 30, 2023	Balance as of September 30, 2023	Net income (loss) of the investee (Note 1)	Share of profits/losses of investee (Note 1)	Note
				September 30,2023	September 30,2022	Shares/Units (In thousands)	Percentage of ownership	Carrying value
The Company 〞〞〞〞 Zippy International Holding Ltd.	Zippy USA Inc. Zippy International Holding Ltd. QUAN-FA Corporation Company Zippy Technology Europe GmbH. Landmark International Holding Ltd. Kobot International Inc.	USA BVI Taiwan Germany Samoa USA	Trading in micro switches, power supplies, and computer accessories Reinvestment business Wire and cable manufacturing, electronic component manufacturing Trading in electrical parts and computer accessories Reinvestment business Leasing	8,247 325,823 5,360 12,573 145,906 16,470	8,247 325,823 5,360 12,573 145,906 16,470	300 10,234 4,493 (Note 2) 4,425 (Note 2)	100.00% 100.00% 63.92% 100.00% 100.00% 100.00%	286,217 295,851 55,255 40,782 183,646 131,684	7,182 28,601 (6,341) 5,091 (3,138) 10,038	7,182 28,601 (4,053) 5,091 (3,138) 10,038	Subsidiary 〞〞〞〞 Indirect subsidiary

Note 1: Based on the financial report of the investment company audited by CPA to recognize under equity method.

Note 2: Obtaining equity.

Note 3: The aforementioned inter-company transactions were eliminated in the consolidated financial statements.

～ 37 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(c) Information on investment in Mainland China:
The names of investees in Mainland China, the main businesses and products, and other information:

==> picture [471 x 244] intentionally omitted <==

----- Start of picture text -----

(In Thousands of USD)
Investment flows Accumulated
Accumulated outflow of Investment Accumulated
Total amount Method of investment from outflow of investment from Taiwan as of Net income income (losses) remittance ofearnings in
Main businesses of paid-in investment Taiwan as of September 30, (losses) of the Percentage of (Note 2 and Book value current period
Name of investee and products capital (Note 1) January 1, 2023 Out-flow Inflow 2023 investee ownership 3) (Note 2 and 3) (Note 10)
Zippy (Dongguan) Mainly produce 276,957 (2) 276,957 - - 276,957 16,041 100.00% 16,041 171,943 -
Electronics Co., Ltd. various switches, power supplies, molds, computer (USD 8,500 and equipment (USD 8,783) (USD 8,783)
peripheral investment
equipment, USD 283)
computer optical
fiber parts and sales
ZIPPY(Suzhou) Mainly sell 82,375 (2) 82,375 - - 82,375 (423) 100.00% (423) 80,926 -
Electronics Co. , Ltd. computer key components, power (USD 2,500) (USD 2,500) (USD 2,500)
supplies, precision
ceramics, precision
molds and key
components of
network equipment
G-BRIM Mainly engaged in 49,333 (2) 49,333 - - 49,333 (2,688) 100.00% (2,688) 106,296 -
International Inc. electronic products,
plastic products, (USD 1,500) (USD 1,500) (USD 1,500)
rubber products,
hardware products,
import and export
and related
supporting
businesses, etc.
----- End of picture text -----

Note 1: There are three ways of investments as following:

(a) Direct investment in Mainland China.
(b) Indirect investment in Mainland china through a subsidiary in a third place (Zippy International Holding Ltd. and Landmark International Ltd.). (c) Others

Note 2: The base of recognition of investment income (loss) is the financial statement audited by CPA of the investee company.

Note 3: The inter-company transactions with the Company were eliminated in the consolidated financial statements

2. Limitation on investment in Mainland China:

imitation on investment in	Mainland China:
Accumulated Investment in Mainland China as of September 30, 2023	Investment Amounts Authorized by Investment Commission, MOEA	Upper Limit on Investment (Note 3,4)
412,482) (USD 12,783)	419,484) (USD 13,000)	2,153,639

Note 1: The amount of paid-in capital and accumulated investment in Mainland China were exchanged to New Taiwan Dollars in historical exchange rates. Others were exchanged to New Taiwan Dollars in spot rate at the date of the audited entity's financial reports. Note 2: The upper limit on investment is 60% of net value.

3. Significant transactions:

The significant inter-company transactions, which eliminated in the consolidated financial statements, with the subsidiary in Mainland China for the nine months ended September 30, 2023, are disclosed in “Information on significant transactions”.

～ 38 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(d) Information on major shareholder:

Shareholding Shareholder’s Name	Shares	Percentage
Chung, Yen-Yen	10,337,267	6.77%
Chou, Chin-Wen	9,918,432	6.49%
Kao, Ming-Chuan	7,825,423	5.12%

(14) Segment Information

(a) Information about reportable segments and their measurement and reconciliations

The Group reportable segments: Power Supply Division, Switch Division, and others. Each division independently manufactures and sells related products. The reportable ds of the Group provide different products based on product business units. Since each product business unit requires different technologies and marketing strategies, it must be managed separately. Taxation is not able to be allocated to each reportable segment. In addition, all reportable segments include depreciation and amortization and other significant non-cash items. The reportable amount is the same as the report used by the chief operating decision maker. The operating segment accounting policies are similar to those described in Note (4) “Significant accounting policies”. Reportable segment profit or loss is based on operating profit or loss before taxation, and as the base of performance evaluation.

Information and reconciliations of operating segments of the Group:

	For the three months endedSeptember 30, 2023	For the three months endedSeptember 30, 2023	For the three months endedSeptember 30, 2023
Power supply	Switch	Other	Adjustment and Elimination	Total
	291,624 160,869	- -	- (256,310)	530,045 -
	452,493	-	(256,310)	530,045
	109,044	5,362	14,148	195,694

	For the three months endedSeptember 30, 2022	For the three months endedSeptember 30, 2022	For the three months endedSeptember 30, 2022
Power supply	Switch	Other	Adjustment and Elimination	Total
	280,904 157,000	- -	- (284,292)	688,540 -
	437,904	-	(284,292)	688,540
	90,350	4,980	5,487	261,219

～ 39 ～

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

	For the nine months ended September 30, 2023	For the nine months ended September 30, 2023	For the nine months ended September 30, 2023
Power supply	Switch	Other	Adjustment and Elimination	Total
	864,998 437,421	- -	- (806,586)	1,623,015 -
	1,302,419	-	(806,586)	1,623,015
	283,262	14,308	(1,070)	548,355

	For the nine months ended September 30, 2022	For the nine months ended September 30, 2022	For the nine months ended September 30, 2022
Power supply	Switch	Other	Adjustment and Elimination	Total
	857,101 476,826	- -	- (906,398)	2,057,066 -
	1,333,927	-	(906,398)	2,057,066
	267,982	12,755	(13,966)	688,672

Intersegment revenues for the three months and nine months ended September 30, 2023 and 2022, which amounted to $256,310, $284,292, $806,586 and $906,398, respectively, should be eliminated from total revenues of reportable segments.

～ 40 ～

AI assistant

ZIPPY Technology Corp. — Interim / Quarterly Report 2023

52069_rns_2023-11-08_bb9fc009-92e5-4be1-9e60-913853be1215.pdf

ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

Table of contents

Independent Auditors’ Review Report

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

KPMG

Notes to Readers

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS AS OF September 30, 2023 AND 2022 ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

(ENGLISH TRANSLATION OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN CHINESE)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Three months and Nine months Ended September 30, 2023 AND 2022 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(1) Company history

(2) Financial Statements Authorization Date and Authorization Process

(3) New Standards, Amendments and Interpretations not yet Adopted:

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(4) Summary of Material Accounting Policies

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(c) Income taxes

(d) Employee benefits

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(6) Explanation to Significant Accounts

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(d) Other receivables

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(g) Right-of-use assets

(h) Investment property

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(i) Intangible assets

(k) Long-term borrowings

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

(l) Lease liabilities

1. Real estate leases

2. Other leases

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(m) Operating Leases

1. Defined benefit plans

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(p) Capital and reserves

1) Legal reserve

2) Special reserve

(q) Earnings per share

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(s) Remuneration of employees, directors and supervisors

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

(Expressed in Thousands of New Taiwan Dollars, Unless Otherwise Specified)

2. Other income

3. Other income and losses

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

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ZIPPY TECHNOLOGY CORP. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONT’D) September 30, 2023 and 2022

4. Finance costs

ZIPPY Technology Corp. Interim / Quarterly Report 2023