EXHIBIT 99.1

Stock code:2311

  Advanced Semiconductor Engineering,Inc. Prospectus

(2016 Statement of Issuance of New Shares Through Capital Increase)

I. Name of Company: Advanced Semiconductor Engineering, Inc.

II. Purpose for the publication of this prospectus: 2016 Statement of Issuance of New Shares Through Capital Increase

(I) Source of new shares: Cash capital increase.

(II) New share type: Registered as ordinary shares, each share has the face value of NT$10.

(III) Number of new shares: 300,000,000 shares.

(IV) Amount of shares issued: NT$3,000,000,000.

(V) Issuance condition:

1. This is an issuance of 300,000,000 new shares through cash capital increase, with a par value of NT$10 per share. The price of each new share is NT$34.3. The amount of funds that can be raised is estimated at NT$10,290,000,000.

2. Pursuant to the provisions provided by Article 267 of the Company Act, 10% of the newly issued shares; or 30,000,000 shares; are reserved for employee subscription. In compliant with Article 28-1 of the Securities Exchange Act, 10% of the newly issued shares; or 30,000,000 shares; will be publicly offered. The remaining 80% of the newly issued shares; or 240,000,000 shares; will be subscribed by the existing shareholders based on the shareholding percentages on the base date. Shareholders will independently combine fractional shares within five days starting from the ex-dividend date for subscription. Existing shareholder and employee who have waived their right to subscribe or who hold fractional shares failing to combine will authorize the Chairman to contact a designated party for subscription.

3. The new shares issued by this cash capital increase shall have the same rights and obligations as those of the ordinary shares originally issued.

(VI) Publication underwriting ratio: 10% of the newly issued shares, or 30,000,000 shares will be publicly underwritten.

(VII) Underwriting and rationing method: Method of underwriting is underwriting on a commitment basis, and the shares will be publicly offered for public underwriting.

III. Summary of the purpose for the fund application plan and the potential benefits that may be generated: Please read page 144 of this prospectus.

IV. Costs associated to this issuance

(I) Underwriting costs: NT$5,000,000.

(II) Other expenses: Approx. NT$1,000,000, including accountant fees, attorney fees, and printing fees.

V. The effectiveness of the securities cannot be used as proof for declarations or as propaganda to guarantee the value of the securities.

VI. In the event of any false statement or non-disclosure in this Prospectus, the issuer, its representative or any other persons who sign or endorses its name on the Prospectus shall be held liable therefor.

VII. Investors shall read the contents of this prospectus in detail from the information reporting website designated by the Financial Supervisory Commission (FSC) and pay attention to risk related matters for the company: Please read page 8 of this prospectus.

VIII. The par value of ordinary shares of the Company is NT$10 per share.

IX. The review website for this prospectus: Market Observation Post System:http://mops.twse.com.tw

Company website:http://www.aseglobal.com

Compiled by Advanced Semiconductor Engineering, Inc.

Printed on February 2, 2017

I. Source of paid-up capital before this publication

Unit: NT$;%

capital source	Amount	As a percentage of paid-in capital
Startup	100,000,000	0.12%
Capital increase by cash	3,416,902,520	4.30%
Capital increase by earnings	57,709,883,680	72.59%
Capital increase by employee bonus	2,831,488,480	3.56%
Capital increase by capital reserve	10,998,134,680	13.83%
Ordinary share converted from foreign convertible corporate bonds	640,492,830	0.81%
Ordinary share converted from employee stock option	4,584,181,900	5.77%
Consolidated capital increase	2,823,154,370	3.55%
Treasury shares canceled	(3,604,490,000)	(4.53)%
Paid-up capital (total)	79,499,748,460	100.00%

II. Distribution of the Prospectus

(I) Display locations: The Prospectus shall be distributed to regulatory authorities according to regulations, and it shall be stored in the Company and the Company's shareholder service agency.

(II) Distribution method: In accordance with Article 31 of the Securities and Exchange Act

(III) Obtaining method: Please visit the aforementioned display locations or visit the Market Observation Post System to download the electronic file.（http://mops.twse.com.tw）

III. Securities underwriter's name, address, website, and telephone

Name:	KGI Securities Co., Ltd.	Website:	www.kgieworld.com.tw
Address:	No. 700, Mingshui Rd, Zhongshan District, Taipei City	Telephone:	(02)2181-8888

IV. Name, address, website, and telephone of the corporate bond guarantee institution: Not applicable.

V. Name, address, website, and telephone of the corporate bond consigned institution: Not applicable.

VI. Name, address, website, and telephone of the stock or corporate bond authenticating institution: Not applicable.

VII. Name, address, website, and telephone of the stock transfer handling institution:

Name:	President Securities Corp. Department of Stock Affairs	Website:	www.uni-psg.com
Address:	B1, No. 8 Dongxing Road, Songshan District, Taipei City	Telephone:	(02)2746-3797

VIII. Name, address, website, and telephone of the credit rating institution: Not applicable.

IX. Name, address, website, and telephone of the corporate bond authenticating certified public accountant, attorney, and firm: Not applicable.

X. Name, address, website, and telephone of the firm and certified public accountant who issued the financial report for the most recent year.

Account name:	CPAs Chen Zhen-li and Jiang Jia-lin
Name of CPA firm:	Deloitte Touche	Website:	www.deloitte.com.tw
Address:	3F., No. 88, Chenggong 2nd Rd, Qianzhen District, Kaohsiung City	Telephone:	(07)530-1888

XI. Name, law firm name, address, website, and telephone of the review attorney

Name of lawyer:	Qiu Ya-Wen
Name of law firm:		Handsome Attorneys-at-Law	Website:	www.fsi-law.com
Address:	8F, No. 6, Songde Road, Xinyi District, Taipei City		Telephone:	(02)2345-0016

XII. Name, job title, contact telephone, and Email address of the spokesperson as well as the deputy spokesperson

Spokesperson name:	Tien Wu	Deputy Spokesperson name:	Joseph Tung
Title:	Chief Operating Officer	Title:	Chief Financial Officer
Telephone:	(02)8780-5489	Telephone:	(02)8780-5489
Email:	ir@aseglobal.com	Email:	ir@aseglobal.com

XIII. Company website: http://www.aseglobal.com

Prospectus Summary of Advanced Semiconductor Engineering, Inc.

Paid-up Capital: NT$79,499,748,460 Company address: No.26, Jing 3rd Rd., Nantz Processing Export Zone, Kaohsiung City Telephone: (07)361-7131

Date of establishment March 23, 1984 Website:www.aseglobal.com

Listing date: July 19, 1989 Over the counter date: N/A Public offering date: May 1988 Stock management date: N/A

Responsible person: Chairman, Jason C.S. Chang  President, Richard H.P. Chang  Spokesperson:  Deputy Spokesperson:  Tien Wu  Joseph Tung  (Title: Chief Operating Officer)  (Title: Chief Financial Officer)  

Stock transfer agency: Telephone:(02)2746-3797 Website:www.uni-psg.com

Stock Affairs Agent for Advanced Semiconductor Engineering, Inc. Address: B1, No. 8 Dongxing Road, Songshan District, Taipei City

Stock underwriting agency: Telephone:(02)2181-8888 Website:www.kgieworld.com.tw

KGI Securities Co., Ltd. Address: No. 700, Mingshui Rd, Zhongshan District, Taipei City

Certified public accountant for the most recent year: Chen Zhen-li and Jiang Jia-lin Telephone:(07)530-1888 Website:www.deloitte.com.tw

Name of law firm: Deloitte Touche Address: 3F., No. 88, Chenggong 2nd Rd, Qianzhen District, Kaohsiung City

Review attorney: Qiu Ya-Wen Telephone:(02)2345-0016 Website:www.fsi-law.com

Name of law firm: Handsome Attorneys-at-Law Address: 8F, No. 6, Songde Road, Xinyi District, Taipei City

Credit rating agency: N/A               Telephone: N/A Website: N/A Address: N/A

The rating of the subject	Issuing company:－	No þ; Yes □, Rating date: －	Rating level:－
	This corporate bond issuance:－	No þ; Yes □, Rating date:－	Rating level:－

Director election date: June 23, 2015; term of office: 3 years	Supervisor election date: N/A (Currently the Company has no audit committee)
Shareholding ratio by all directors: 18.04% (December 31, 2016)	Shareholding ratio by all supervisors: N/A

Director, supervisor, shareholders holding over 10% of shares; and other shareholding ratios:  (December 31, 2016)

Title Name Percentage of shares Remarks Title Name Percentage of shares Remarks

Chairman	Jason C.S. Chang	16.71%	Representative, ASE Enterprises Ltd.	Director	Rutherford Chang	0.02%	－
Vice Chairman	Richard H.P. Chang	1.31%	－	Director	Chen Tien-chi	16.71%	Representative, ASE Enterprises Ltd.
Director	Tien Wu	16.71%	Representative, ASE Enterprises Ltd.	Independent Directors	You Sheng-Fu	－	－
Director	Joseph Tung	16.71%	Representative, ASE Enterprises Ltd.	Independent Directors	Ta-lin Hsu	－	－
Director	Raymond Lo	16.71%	Representative, ASE Enterprises Ltd.	Independent Directors	Mei-yue Ho	－	－
Director	Jeffery Chen	16.71%	Representative, ASE Enterprises Ltd.	Major shareholders holding over 10% of shares	A.S.E. Enterprises Limited	16.71%	－

Factory Address: Please refer to page 1 of the prospectus Telephone: Please refer to page 1 of the prospectus  

Main Products: Manufacture, assembly, reprocessing, testing and export of integrated circuits of various types  Market structure: Domestic sales 11.52%, export sales 88.48%  Refer to page 77 of the prospectus

Risk items	Please read this prospectus.	Refer to page 8 of the prospectus
.Last (2015) year	Operating revenue: NT$283,302,536,000  Net income (loss) before tax: NT$25,288,253,000 (note) Earnings per share: NT$2.55 (note)	Refer to page 163 of the prospectus.

The type and amount of the securities issued during this fund raising	Please refer to the cover page of this prospectus
Condition of issuance	Please refer to the cover page of this prospectus.
Purpose of fund raising and overview of the expected production benefits	Please refer to page 144 of the prospectus.
Date of printing for this prospectus: February 2, 2017	Purpose of printing: Statement of Issuance of New Shares Through Capital Increase.

Brief description of other important matters and the pages of this text referenced: Please refer to the table of contents of this prospectus

Note: As of September 30, 2016, the Company has identified the investment cost and the difference in the net fair value of assets and liabilities that can be recognized by SPIL, and these amounts were retroactively adjusted in the 2015 financial statement. Pre-tax net profit was NT$25,006,896,000 and earnings per share was retroactively adjusted to NT$2.51.

		Prospectus Table of Contents
I. Company Overview			1
1.	Company Profile		1
	(1)	Date of establishment: March 23, 1984	1
	(2)	Addresses and telephone numbers of the headquarter, branch companies, and
		factories	1
	(3)	Company History	1
2.	Risk items		9
	(1)	Risk factors	9
	(2)	Litigation or non-litigation events	15
	(3)	Company directors, supervisors, managers, or major shareholders holding over
		10% of the company's shares have involved in financial turnover difficulties or
		suffer credit losses within the last two years and as of the printing of this
		prospectus; and the effects on the company's financial conditions must be
		specified: None.	16
	(4)	Other important issues: None.	16
3.	Company Organization		17
	(1)	Organization system	17
	(2)	Affiliation chart	21
	(3)	Background  information  of  President,  Vice  Presidents,  Assistant  Vice
		Presidents, and heads of various departments and branches	28
	(4)	Directors and Supervisors	33
	(5)	Sponsor: Not applicable..	37
	(6)	Remunerations to directors, supervisors, president, and vice presidents in the
		most recent year	38
4.	Capital and Shares		44
	(1)	Type of stock	44
	Note: The above table does not include the number of shares converted for
		employee stock options from October to November, 2016.	44
	(2)	Share capital formation process	44
	(3)	Recent equity ownership dispersion status	49
	(4)	Stock price, net worth, earnings, dividends and related information for the
		previous two years	53
	(5)	Dividend policy and implementation status	53
	(6)	Effect of the proposed stock dividends in the current year on company
		operating performance and earnings per share: Not applicable.	54
	(7)	Remuneration of employees, directors and supervisors	54
	(8)	Stock buyback	55
5.	Issuance of corporate bonds (including overseas corporate bonds)		57
6.	Issuance of preferred stocks: None.		62
7.	Issuance of global depositary receipts (GDR)		62
8.	Exercise of employee stock option plan (ESOP):		63
9.	Restricted stock awards: None.		66
10	Acquisitions and mergers: None.		66

11. Any issue of new shares in connection with any acquisition of shares of another
company, where still in process: None.	66
II.    Business Overview	67
1.   Company profile	67
(I)  Business Content	67
(II) Market, production and sales	99
(3) Number of employees during the past 2 years	118
(4) Spending on environmental protection	118
(5) Employees-employer relations	141
2.   Property, plants and equipment and other real estate:	145
(1) Self-owned assets:	145
(2) Rental properties:	146
(3) Each plant's current condition and facility productivity ratio in the most recent
2 fiscal years:	150
3.   Reinvestment business	152
(1) Overview of reinvestment business:	152
(B) Comprehensive shareholding ratio:	162
(3) The status of the subsidiaries who have held or disposed of shares of this
company during the most recent 2 fiscal years and up to the prospectus'
publishing date and the status of the shares pledged, and setting forth the
origin of capital and other influences on the company's financial performance
and financial condition. There was no major impact on the company's financial
performance and financial status.	164
(4) Any occurrences of the situations of Article 185 of the Company Act, or
transferring part of the business operation or results of the research and
development to a subsidiary during the most recent 2 fiscal years and up to the
prospectus' publishing date, the status of waiving subscription rights to the
cash capital increase in the subsidiary company, the name of the subscribing
counter  party,  and  the  relationship  with  the  company,  the  directors,
supervisors  and  shareholders  who  hold  more  than  10  percent  of  the
outstanding shares, and the number of the subscribed shares shall be disclosed.
None	165
4.   Important contracts	165
III.   Issuance Plans and Implementation	167
1. I. The items that shall be included in the analysis regarding the allocation plan for capital raised through the previous cash capital increase, issuance of new shares to carry out a merger or acquisition, or to accept transfer of shares of another company; or issuance of corporate bonds:	167
3. Assignment of new shares issued by other companies: Not applicable.	195
Matters that should be reported for the current issuance of new shares in connection with
acquisition or merger: Not applicable.	195
IV.   Financial Summary	196
1.   Financial information for the most recent 5 fiscal years (note)	196
(1) Condensed balance sheet and consolidated profit and loss statement	196
Current assets	198
Fund and investment	198
(2) Changes which affect the above condensed financial statements' consistency
such as accounting changes, merger of companies or cessation of business

units and their impact on the current year's financial reports: None	203
(3) Names of auditors and audit opinions of the most recent 5 fiscal years	203
(4) Financial analysis	203
(6) Description of material changes in accounts Compare the accounts of the
balance sheet and income statement of the most recent two fiscal years. If the
change in the amount is 10% or more and the amount is 1% of the total assets
of the current fiscal year, the reasons for the change should be analyzed in
details.	210
II.   Items that should be included in the financial report	212
(1) The financial statements and CPA audit reports for the two preceding fiscal
years as of the time when the issuer registered the offering and issuance of
securities, and the financial report for the most recent quarter publicly
announced and reported:	212
(2) The issuer's parent company financial reports for the two most recent fiscal
years, audited and certified by a CPA:	213
(3) If there are CPA audited and certified, or reviewed financial reports and parent
company financial reports for the most recent period during the time after the
issuer has registered the offering and issuance of securities and up to the date
of publication of the prospectus, disclose these reports: None.	213
III.  The information that should be included in the financial summary and other important
matters	213
(1) If the company and its affiliated enterprises have experienced any financial
difficulties in the most recent two fiscal years, or in the current year up to the
date of publication of the prospectus, indicate the impact on the company's
financial position. None.	213
(2) The information shall be disclosed, in case of occurrence of the events under
Article 185 of the Company Act in the most recent two years and up to the
date of publication of the prospectus: None.	213
(3) Subsequent events: None	213
(4) Others: None	213
IV.  Review and analysis of the company's financial condition and operating performance .. 213
(1) Financial status	213
(2) Financial Performance	213
(3) Cash flow	214
(4) Impact of major capital spending on financial position and business operation
in the previous year	215
(5) Reinvestment policy in the most recent year, the main reason for profit or loss,
improvement plan, and investment plan for the coming year:	215
(6) Other material issues: None.	216
V.   Special Notes	217
1.   Implementation of internal control system	217
2.   Those who have retained an FSC-approved or -recognized credit rating institution to
conduct a credit rating/evaluation shall disclose the credit rating/evaluation report
issued by the credit rating institution: Not applicable	217
3.   Summary opinion from the securities underwriter's assessment: Please read Page 100
of this Prospectus.	217
4.   Attorney's legal opinion: Please read Page 101 of this Prospectus.	217

5.    Summary opinion stated in the case checklist schedule written by the issuer and
reviewed by a CPA: Not applicable.	217
6.   The improvement status of the items notified to be corrected, if at the time the company registered (or applied for approval of) the previous offering and issuance of
securities the FSC had notified it to make self-correction on certain items: None.	217
7.    The items notified to be further disclosed, if at the time the company registered the
current offering and issuance of securities the FSC had notified it to make
supplemental disclosure on certain items: Not applicable.	217
8.    The statement or promised items disclosed in the prospectus from the company's registration (application) for offering and issuance of securities for the first time, the     preceding time, and within the most recent three fiscal years, and the current state of
fulfillment of such: None.	217
9.    The major content of any dissenting opinion of any director or supervisor regarding any material resolution passed by the board of directors, where there is a record     or written statement of such opinion, for the most recent fiscal year and up to the date
of publication of the prospectus. None.	217
10.  Any legal sanctions against the company or its internal personnel, or any disciplinary action taken by the company against its own personnel for violation of internal controls, during the most recent fiscal year or during the current fiscal year up to the date of publication of the prospectus; and a description of the main shortcomings in the company's internal control system as well as an indication of measures for improvement: None	217
11.   The statement issued by the securities underwriter, the issuer, and the issuer's directors, supervisors, General Manager, financial or accounting officer, and the managerial officers involved in the current registration for public offering and
issuance of securities, specifying that no underwriting related fees will be refunded
or collected: Please refer to Appendix 7.	217
12.   For a case that involves the issuer conducting a cash capital increase or an offering of corporate bonds with equity characteristics and adopting book building and public underwriting, the statement issued by the securities underwriter and issuer,
specifying that allocation to related parties and insiders is prohibited. Not applicable. . 217
13.  Where depending on the nature of its operations, the issuer has engaged experts with
professional knowledge and vast experience in technology, operations and finance
etc. to conduct analysis and give opinions on the issuer's existing operating status
and future development after current issuance of securities, the assessment opinions
of such experts shall be disclosed: Not applicable.	218
14.  Other necessary supplemental information: None.	218
15.  Matters relating to the state of its implementation of corporate governance that should
be recorded by a company listed on the stock exchange or traded on an OTC market: . 218
VI.   Important Resolutions, Articles of Incorporation and Relevant Laws and Regulations . 244
1. Key resolution records and text of resolution on the current issue:	244

Annexes: 1. Capital increase price calculation

2. The consolidated financial statements and CPA audit reports of 2014

3. The consolidated financial statements and CPA audit reports of 2015

4. The Q3 consolidated financial statements and CPA audit reports of 2016

5. The individual financial statements and CPA audit reports of 2014

6. The individual financial statements and CPA audit reports of 2015

7. Statement for non-refund underwriting costs

I. Company Overview

1. Company Profile

(1)        Date of establishment: March 23, 1984

(2)        Addresses and telephone numbers of the headquarter, branch companies, and factories

Headquarter

Address: No.26, Jing 3rd Rd., Nantz Processing Export Zone, Kaohsiung City

Telephone:(07)3617131

Fax:(07)3613094、3614546

Taipei Office

Address: Rm. 1901, 19F, No. 333, Section 1, Keelung Rd, Xinyi District, Taipei City

Telephone:(02)87805489、66365678

Fax:(02)27576121

Zhongli Branch

Address: No. 550, Section 1, Zhonghua Rd, Zhongli District, Taoyuan City

Telephone:(03)4527121

Fax:(03)4628658

Nantou Branch

Address: No. 135, Lane 351, Section 1, Taiping Rd, Caotun Township, Nantou County

Telephone:(049)2350876

Fax:(049)2315924

Kaohsiung Factory

Address: No.26, Jing 3rd Rd., Nantz Processing Export Zone, Kaohsiung City

Telephone:(07)3617131

Zhongli Factory

Address: No. 516, 550, Section 1, Zhonghua Rd, Fuhua Village, Zhongli District, Taoyuan City

Telephone:(03)4527121

Nantou Factory

Address: No. 135, Lane 351, Section 1, Taiping Rd, Caotun Township, Nantou County

Telephone:(049)2350876

(4)    Company History

The Company was founded on the spirit of contributing to the country through industrial development, a belief embraced by Jason Chang and Richard Chang, who actively supported the government's high-tech development policy, used cash and specialized technologies to raise capitals. The Company primarily engages in the manufacturing, assembly, reprocessing, testing, and export of integrated circuit of various types. Time line of the Company:

March 1984 The Company was established.

July 1984 The Company's first factory was opened.

August 1984 Began exporting Plastic Dual In-Line Package (PDIP) to European countries, North America, and Japan.

February 1985 Began exporting Ceramic Dual In-Line Package (CDIP) to Japan, European countries, and North America.

October 1985 Began exporting high-quality Plastic Leaded Chip Carriers (PLCC) to the United States.

May 1987 Began exporting high-quality Pin Grid Array (PGA) and plastic Pin Grid

Array (PPGA) to European countries and North America.

May–July 1989   Approved by the Securities and Futures Commission (1989) Tai-Cai-Zheng-1 No. 24594 and Taiwan Securities Exchange (1989) Shang-Zi No. 4461 to meet the ownership diversity standard on May 25, 1989, and began trading on the Taiwan Stock Exchange on July 19, 1989.

March 1990          Entered the semiconductor test market by acquiring 99.9% of the shares of ASE Test Inc., equivalent to NT$105,006,183.

March 1991         Established ASE Malaysia to engage in manufacture, reprocessing, assembly, testing, and export of integrated circuits of various types. Established ASE Hong Kong to facilitate transfer and acceptance of overseas (Malaysia) production base orders and customer service.

August 1991        Began mass production of Plastic Enhanced Quad Flat Package (EQFP).

November 1991   The Company's product received the Award of Excellence for Quality from Motorola.

April 1992            Achieved ISO9002 quality certificate.

July 1995             Issued 8,600,000 units of DRs to Asian, American, and European countries. Each DR represents five common shares of the Company. In total, 43,000,000 shares were issued, par value of NT$10 per share and sold at US$15.25 per unit. The funds raised were equivalent to NT$3.39 billion.

June 1996             ASE Test Limited began trading on NASDAQ.

September 1997   Issued Euro Convertible Bonds to the value of US$200 million.

November 1997   Passed the Semiconductor Assembly Council (SAC) certification.

January 1998       ASE Test Limited (Singapore) issued 120,000,000 TDRs by using 1,500,000 ordinary shares, and began trading on Taiwan Stock Exchange.

March 1998         Awarded QS 9000 certification for quality management.

September 1998  Awarded ISO 14001 certification for environment quality management.

March 1999         ASE Test Limited (Singapore) issued TDRs for the second time through issuing of 2,500,000 ordinary shares and began trading on Taiwan Stock Exchange.

May 1989            ASE Test Limited (Singapore) acquired 70% of the shares of ISE LAB.

July 1999             Acquired Motorola's manufacturing facilities in Chungli, Taiwan and Paju, Korea. This acquisition promoted the long-term strategic alliance between ASE and Motorola, strengthened ASE's vertical integration, and increased product scope.

February–July 1999 Obtained operating rights and 20.67% of the shares of Universal Scientific Industrial Co., Ltd. (USI), to broaden ASE's scope of OEM, increase service items for customers, and expand customer group.

September 2000 To enhance the Company's competitiveness in the global semiconductor market and thereby strengthen its image and international visibility, the Company issued 20,000,000 ADRs on September 25 in U.S. time, each representing five ordinary shares of the Company. In total, 100,000,000 ordinary shares were issued, with par value of NT$10. The

issue price was US$7 per unit, and the funds raised were equivalent to NT$4.38 billion.

September 2002 Won the 10th Outstanding Award from the Industrial Technology Development Award of Ministry of Economic Affairs.

July 2003             Combined wholly owned subsidiaries ASE New Investment Co., Ltd. and ASE Investment Co., Ltd.

September 2003  Issued Euro Convertible Bonds to the value of US$200 million.

October 2003      The Company's Board of Directors resolved to combine subsidiaries ASE Co., Ltd. and ASE Technology Co., Ltd. The conversion ratio was set as one share of ASE Co., Ltd. for 0.85 share of ASE Technology Co., Ltd. and as one share of ASE Technology Co., Ltd. for 0.5 share of the Company. The Company anticipated to combine and convert 282,315,437 shares.

February 2004     Signed the agreement to purchase the shares of NEC and acquired NEC Electronics' IC packaging and test operations in Takahata, Japan.

July 2004             Established ASE (Kunshan) Inc., which was resolved in the meeting of the board in June 2004. The amount invested was US$12 million. This establishment was approved by the Investment Commission on July 23, 2004.

August 2004       The Company merged with subsidiaries ASE Semiconductor Co., Ltd. and ASE Technology Co., Ltd., with the Company being the surviving company, and a Zhongli Branch was established. The Company acquired the ASE Semiconductor Co., Ltd. (Shanghai), which was a company set up in China by Omniquest Industrial Limited, a company invested by ASE Semiconductor Co., Ltd. This acquisition was approved by the Investment Commission on August 10, 2004. Established ASE Electronics Inc. (Shanghai), which was resolved in the meeting of the board in July 2004. The amount invested was US$12 million. This establishment was approved by the Investment Commission on August 20, 2004.

November 2004 The Board of Directors resolved in September 2004 to increase the capital of ASE (Shanghai) Inc. by US$30 million, and this resolution was approved by the Investment Commission on November 25, 2004.

June 2005           The Board of Directors resolved in May 2005 to increase the capital of ASE (Shanghai) Inc. by US$30 million, and this resolution was approved by the Investment Commission on June 30, 2005.

October 2005      Won the 13th Outstanding Award from the Industrial Technology Development Award of Ministry of Economic Affairs.

November 2005 The Board of Directors resolved in August 2005 to increase the capital of ASE (Shanghai) Inc. by US$30 million, and this resolution was approved by the Investment Commission on November 2, 2005. Won the Philippine President Award on the night of the award ceremony for Excellent International Manufacturers by the Philippine President.

December 2005   Established ASE New High-Tech (Shanghai), which was resolved in the meeting of the board in November 2005. The amount invested was US$15 million. This establishment was approved by the Investment Commission on December 21, 2005.

March 2006          Invested NT$30 million in establishing a wholly owned subsidiary, ASE Electronics Inc.

May 2006            Approved by the Board of Directors to transfer material business department to subsidiary ASE Electronics Inc. The conversion ratio was NT$10 of the operating value of the transferred material business department for one ordinary share of ASE Electronics Inc.

August 2006      Officially transferred material business department to ASE Electronics Inc., and obtained 294,929,700 ordinary shares of the ASE Electronics Inc. The Company was approved by the Board of Directors in June 2006 to increase the capital of ASE (Kunshan) Inc. by US$30 million. This capital increase was approved by the Investment Commission on August 1, 2006.

September 2006  Transferred 147,500,000 ordinary shares and 147,429,700 shares of the Company's ASE Electronics Inc. to subsidiaries ASE Labuan Inc. and ASE Mauritius Inc., respectively, in support of the company's global operation strategy and financial planning.

December 2006   Passed the resolution of the Board of Directors in November 2006 to adopt the US$60 million capital of subsidiary J&R Holding Limited to accept and transfer 100% of the shares of Weiyu Technology Testing Fengzhuang Limited Company in China. This adoption was approved by the Investment Commission on December 29, 2006. The Company's subsidiary ASE Mauritius Inc. transferred 147,429,700 shares of the Company's ASE Electronics Inc. to subsidiary ASE Labuan Inc. in support of the company's global operation strategy and financial planning.

June 2007            Transferred 3,000,000 ordinary shares of the Company's ASE Electronics Inc. to subsidiary ASE Labuan Inc. in support of the company's global operation strategy and financial planning.

July 2007             Acquired 60% of the shares of NXP Semiconductors Suzhou Ltd. held by NXPB.V. with its own capital of US$21,600,000 through its subsidiary J&R Holding Limited in March 2007. This acquisition was approved by the Investment Commission on July 2, 2007. (Approved on March 7, 2008, the name was changed to Suzhou ASE Semiconductor Ltd.)

August 2007      To integrate the name of the company group, the Company renamed the Weiyu Technology Testing Fengzhuang Limited Company in China to ASE Assembly & Test (Shanghai) Ltd., and this renaming was approved by the Investment Commission on August 29, 2007.

February 2008     Approved by the Board of Directors in October 2007 to increase the capital of ASE Assembly & Test (Shanghai) Ltd. by US$30 million. This capital increase was approved by the Investment Commission on February 20, 2008. Passed the resolution of the Board of Directors in January 2008 to adopt US$7 million in capital to accept and transfer 100% of the shares of Weihai Shiyi Electronic Co.,Ltd. in China through subsidiary J&R Holding Limited. This adoption was approved by the Investment Commission on February 15, 2008. (Approved on May 22, 2008, the name was changed to ASE Semiconductor Ltd. (Weihai)).

May 2008            Approved by the Board of Directors in March 2008 to increase the capital of ASE Assembly & Test (Shanghai) Ltd. by US$90 million. This capital increase was approved by the Investment Commission on May 16, 2008. Approved by the Board of Directors in June 2006 to increase the capital of ASE Semiconductor Ltd. (Weihai) by US$13 million. This capital increase was approved by the Investment Commission on May 22, 2008.

August 2008      Approved by the Board of Directors in July 2008 to increase the capital of ASE Electronics (Kunshan) Ltd. by US$6 million. This capital increase was approved by the Investment Commission on August 7, 2008.

November 2008 To safeguard the Company's credit and shareholders' rights and interests, the Company was approved by the Board of Directors in November 2008 to repurchase 144,037,000 ordinary shares for the first time and eliminate these shares accordingly.

January 2009     To safeguard the Company's credit and shareholders' rights and interests, the Company was approved by the Board of Directors in January 2009 to repurchase 73,937,000 ordinary shares for the second time and eliminate these shares accordingly.

February 2009    Approved by the Board of Directors in December 2008 to increase the capital of ASE Semiconductor Ltd. (Weihai) by US$20 million. This capital increase was approved by the Investment Commission on February 4, 2009.

July 2009             Approved by the Board of Directors in June 2009 to increase the capital of ASE Semiconductor Ltd. (Kunshan) by US$20 million. This capital increase was approved by the Investment Commission on July 31, 2009.

November 2009  Passed the resolution of the Board of Directors in November 2009 to publicly acquire the shares of Universal Scientific Industrial Co., Ltd. (USI) taking into consideration of cash and the Company's ordinary shares (306,596,000 shares) held by J&R Holding Limited (107,308,600 shares) and ASE Test Singapore Inc. (199,287,400 shares).

February 2010    The aforementioned public acquisition was completed on February 9, 2010. Through this acquisition, the Company obtained 641,669,316 ordinary shares of USI in addition to 192,944,213 existing ordinary shares of the company before acquisition. After acquisition, the Company holds 78.1% of the voting shares of USI.

August 2010       The application to terminate the shares of USI was approved by the Board of Directors in April 2010. Concurrently, the Company committed to acquiring the shares of USI. Public acquisition was completed on August 5, 2010, acquiring 222,243,661 outstanding shares of USI in addition to the 834,613,529 existing shares of USI prior to acquisition. After acquisition, the Company holds 98.9% of the voting shares of USI.

November 2010 To safeguard the Company's credit and shareholders' rights and interests, the Company was approved by the Board of Directors in November 2010 to repurchase 37,000,000 ordinary shares for the third time and eliminate these shares accordingly. To comply with government policies, the Company issued shares by way of scripless issue as of November 26, 2010.

January 2011      Considering the group's operation strategy, the Company was approved by the Board of Directors in January 2011 to setup a Nantou Branch that undertakes the existing micro-electronic assembly business of USI.

March 2011         Approved by the Board of Directors in November 2011 to increase the capital of ASE Semiconductor Ltd. (Weihai) by using its own fund of US$60 million through ASE (Korea) Inc. This capital increase was approved by the Investment Commission on March 1, 2011.

June 2011             Passed the resolution of the Board of Directors in June 2011 to raise mid-to-long-term funds, repaying short-term debts to improve the

Company's financial structure. Within the limit of NT$8 billion, the Company issued ordinary corporate bonds guaranteed by five banks, including the Bank of Taiwan.

August 2011     Issued guaranteed ordinary corporate bonds of NT$8 billion. To safeguard the Company's credit and shareholders' rights and interests, the Company was approved by the Board of Directors in August 2011 to repurchase 34,000,000 ordinary shares for the fourth time and eliminate these shares accordingly.

September 2011 To safeguard the Company's credit and shareholders' rights and interests, the Company was approved by the Board of Directors in September 2011 to repurchase 50,000,000 ordinary shares and 30,000,000 shares for the 5th and 6th time respectively and eliminate these shares accordingly.

November 2011  To strengthen the resources, labor, and technological integration of the subsidiary Power ASE Technology ("Power ASE"), the Company was approved by the Board of Directors on November 8, 2011 to publicly acquire the ordinary shares of Power ASE held by shareholders other than those of the Company at NT$18.5 per share. The Company completed the public acquisition on November 18, 2011, acquiring 105,697,703 ordinary shares of Power ASE, approximately NT$1.96 billion in value. In addition to the 55.7% shares of Power ASE originally held by the Company, the Company now holds 99.2% of the shares of Power ASE.

December 2011  Won the Contribution Award from the National Invention and Creation Award of Ministry of Economic Affairs.

May 2012           To integrate resources and enhance business benefit and competitiveness, the Company received approval from the Board of Directors in March 2012 to merge with Power ASE by cash. The Company is the surviving company following the merge, and Power ASE is the dissolved company. The base date of the merge was May 1, 2012.

November 2012  The Company's 2011 CSR Report won the Taiwan Corporate Sustainability Report Award: Copper Award by the Taiwan Institute for Sustainable Energy.

December 2012   Won the Award of Excellence in Intellectual Property Management and the Award for Best Intellectual Property Report by the Ministry of Economic Affairs.

Since 2009 the Company has incorporated green building standards in the construction and planning of building K12, using Taiwan EEWH diamond certification and LEED platinum certification as the design criteria. Following a series of processes, including planning, designing, construction, validation, written review, and onsite inspections, the Company successfully passed the evaluation by the Ministry of Interior in December 2012 and won the Taiwan EEWH diamond certification.

July 2013            Taking into consideration ASE resource integration and economies of scale of the industry, the Company combined its two subsidiaries in China, ASE (Kunshan) Inc. and ASE Electronics (Kunshan). The ASE (Kunshan) Inc. merged with ASE Electronics (Kunshan), with the ASE Electronics (Kunshan) as the dissolved company. After merger, ASE Electronics (Kunshan) conducted liquidation. ASE (Kunshan) Inc. recovered/canceled

an investment of US$24 million.

August 2013       To integrate resources and enhance business benefit and competitiveness, the Company received approval from the Board of Directors in July 2013 to merge with Yang Ting Tech Co., Ltd., a subsidiary in which the Company holds 100% of voting shares,

in accordance with the Business Mergers and Acquisitions Act and other relevant laws and regulations. The Company was the surviving company after the merge, and Yang Ting Tech was the dissolved company. The base date of the merge was August 30, 2013.

September 2013   Issued the 3rd Overseas Zero Coupon Convertible Bonds to the value of US$400 million.

Issued 130,000,000 ordinary shares for capital increase.

October 2013      Approved by the Board of Directors in August 2013 to increase the capital of ASE Semiconductor Ltd. (Weihai) by by means of debt for equity using US$25 million through ASE (Korea) Inc. This capital increase was approved by the Investment Commission on October 29, 2013.

July 2014              Approved by the Board of Directors in July 2014 to increase the capital of ASE Semiconductor Ltd. (Weihai) through ASE (Korea) Inc by using its own fund of US$20 million. This capital increase was approved by the Investment Commission on August 18, 2014.

September 2014 Awarded Forbes Asia Fabulous 50 companies 2014, the only listed company in Taiwan to receive this award in 2014.

October 2014      Re-applied with Kaohsiung Customs, Customs Administration, for Authorized Economic Operator (AEO) safety certification. The Company passed on-site verification and again acquired AEO qualification.

January 2015      The Company's Chairman and CEO, Jason Chang, as well as the COO, Wu Tien-Yu, were honored with the 2014 SEMI Award at the Industry Strategy Symposium (ISS) in 2015, which was held in California, United States. This award recognizes ASE's dedication in developing and studying technologies for surpassing traditional gold wire bonding technologies and introducing copper wire bonding technologies.

May 2015           ASE and TDK Corporation engaged in a joint venture to establish ASE Embedded Electronics Incorporated. Monetary value in NTD equivalent to US$39,490,000 was invested in this joint venture, aiding the Company to acquire approximately 51% of share ownership, while TDK Corporation obtained roughly 49% of share ownership.

The Company's subsidiary, ASE Zhongli, passed the customs' AEO certification.

July 2015              Issued the 4th Currency Linked Zero Coupon Convertible Bonds due 2018 to the value of US$200 million.

Won the Best Trade Contribution Award by the Bureau of Foreign Trade, Ministry of Economic Affairs.

October 2015      Approved by the Board of Directors in August 2015 to acquire, for the first time, the ordinary shares of Siliconware Precision Industries Co., Ltd. (SPIL). Completed public acquisition in October 2015, acquiring 779,000,000 outstanding ordinary shares of SPIL, which account for

 24.99% of issued voting shares.

Kaohsiung Plants K11 and K12 obtained the Certification of Green Factory Label by the Industrial Development Bureau, Ministry of Economic Affairs, officially becoming a green factory that has been honored with the Green Factory label.

November 2015   In the Taiwan Corporate Sustainability Award competition held by the Taiwan Institute for Sustainable Energy in 2015, the Company won the Taiwan Top 50 Corporate Sustainability Report Silver Medal Awards in the Electronic Information Manufacturing Industry category.

The Company's Kaohsiung Plants, K4, K7, K8, K10, K11, and K12 obtained the ISO 15408 safety certification, EAL6 Site Certification, from the Germany Federal Office for Information Security (BSI), the only semiconductor wafer packaging and testing OEM plant across the world to obtain this certification.

December 2015   Rated by Fitch Ratings with a long-term credit rating of A+ (twn) on December 16, 2015.

Taking into consideration ASE resource integration and economies of scale of the industry, the Company completed the merge of its two subsidiaries in China, ASE (Shanghai) Inc. and ASE Electronics (Shanghai). To fulfill corporate social responsibility and strive toward sustainable develop, the Company was affirmed by the British Standards Institute four years in a row as of 2012 and won the received the 'Inclusive Green Growth Award' and the 'GRC (governance, risk management and compliance) Award'. The Company also obtained the Green Enterprise Paradigm Award, highlighting the Company's commitment in building a green enterprise.

Kaohsiung Plants K3 and K5 passed the green factory certification by the Industrial Development Bureau, Ministry of Economic Affairs, in December 2015. Kaohsiung Plant K9 passed the clean production certification on February 1, 2013, and obtained an extension of this certification by the Industrial Development Bureau, Ministry of Economic Affairs in December 2015.

January 2016     Kaohsiung Plant K8 passed the clean production certification on February 1, 2013, and obtained an extension of this certification by the Industrial Development Bureau, Ministry of Economic Affairs in January 2016.

March 2016         Approved by the Board of Directors in December 2015 to acquire, for the second time, the ordinary shares of Siliconware Precision Industries Co., Ltd. (SPIL). The Company will be acquiring 770,000,000 outstanding ordinary shares of SPIL, which account for 24.71% of issued voting shares. However, the Fair Trade Commission did not complete the review of this case by the end of the acquisition period. Therefore, the Company announced that the condition of acquisition was not met.
In accordance with the resolution of the Board of Directors, in March 2016 the Company paid NT$13,296,307,000 to acquire 201,548,000 ordinary shares and 9,690,000 depositary receipts in SPIL (each recognized as 5 ordinary shares), increasing the shareholding ratio from 24.99% to 33.02%.

April 2016           In accordance with the resolution of the Board of Directors, in April 2016 the Company acquired 8,300,000 ordinary in SPIL on the open market using NT$439,191,000 in cash, increasing the shareholding ratio from 33.02% to

  33.29%.

Ranked as a Top 6% to Top 20% listed company in the 2015 (2nd) Corporate Governance Assessment

June 2016            ASE and SPIL jointly entered into the execution of a joint share exchange agreement, in which ASE will apply for the establishment of ASE Investment Holding, which will acquire 100% equity of both ASE and SPIL by means of joint share exchange.

July 2016              Selected as the component of the TWSE Corporate Governance 100 Index by TWSE.

September 2016 In response to the capital increase of ASE Embedded Electronics Inc., share subscription was performed by all existing shareholders based on their shareholding percentage of ASE and TDK Corporation. After subscription, the Company invested NT$765,000,000, with shareholding percentage maintaining at 51%.

October 2016      The Zhongli Plant was the first packaging and testing OEM plant in the world to pass the ISO 26262 certification.

November 2016   Made the CDP’s Climate A List in 2016, the only company in Taiwan to receive A rating in the CDP climate change assessment.

The Company passed the resolution of the Fair Trade Commission that approves a joint holding company between ASE and SPIL.

II. Risk items

(I) Risk factors

1.  Within the last year and as of the printing of this prospectus, the effects that annual interest, exchange fluctuation, and inflation rates have on the profits and losses of the company as well as the future response measures

(1)  The effects that annual interest have on company profits as well as the future response measures:

The Company and its subsidiaries have made appropriate flexible adjustments with regards to the cash position required for the company's operating activities. The financial costs for the first three quarters in 2015 and 2016 were respectively NT$2,312,143,000 and NT$1,746,585,000, accounting for 0.82% and 0.88% of the net operating income for the year. These results suggest a minimal impact of interest rate on company profits. In future, we will continue to closely monitor the trends of interest rate and to employ low-interest financing instruments and beneficial interest rate conditions in order to maintain minimal financing cost and active credit limit. Subsequently, interest rate risks that are likely to occur in business operations can be averted.

(2)  The effects that exchange fluctuation have on company profits as well as the future response measures:

The Company and its subsidiaries conduct hedging by adopting natural hedging in conjunction with low-risk and safe hedge targets. The net profits on foreign currency exchange for Q3 in 2015 and 2016 were respectively NT$(713,213,000) and NT$2,235,621,000, accounting for (0.25)% and 1.13% of the net operating income. This suggests that the profits were not affected by exchange fluctuation. In future, we will pay attention to the global economy and changes in exchange rate and focus on reducing the risks of exchange rate variations as our main management practice.

Concurrently, we will also deliberately examine how the company allocate its funds and mitigate the effects of exchange rate fluctuations as a means of effective management.

(3) The effects that currency inflation have on company profits as well as the future response measures:

Currently inflation did not exert a material impact on the profits of the Company and its subsidiaries. In addition to closely monitoring price fluctuations in the market, the Company and its subsidiaries will maintain a positive interactive relation with their suppliers and customers and appropriately adjust product selling price and stock inventory. These efforts should be able to effectively mitigate the impact of currency inflation on the Company and its subsidiaries.

2. Within the last year and as of the printing of this prospectus, main policies for engaging in high-risk engagements, highly leveraged investments, endorsement guarantees, and derivative transaction policies; main reasons for profits and losses; and future response measures. The Company engages in the transactions listed in the preceding paragraph in accordance with relevant handling procedures as formulated by the Company.

    The Company and its subsidiaries adopt robust, conservative operating strategy and abstain from engaging in high-risk, high-leverage investments. The Company has complied with laws and regulations of the Securities and Futures Bureau (SFB) in developing internal management guidelines and operating procedures that are based on a sound financial and operational plan, including the Procedure for Lending Funds to Other Parties, Procedure for Making Endorsements and Guarantees, and Procedure for the Acquisition or Disposal of Assets. In future, the Company will continue to abide by procedural regulations and perform all transactions in accordance with relevant regulations.

3. Future R&D plans and anticipated investments in R&D expenses

(1) Future R&D plans

Please read pages 46 to 49 of this prospectus.

(2) Anticipated investments in R&D expenses

The Company and its subsidiaries anticipate to invest NT$430,000,000 in R&D for the pilot production of their packaging products, and NT$3,864,000,000 in R&D of other packaging products. It is anticipated that NT$480,000,000 will be invested in R&D for the pilot production of packaging products, and NT$5,000,000 in the R&D of other packaging products. NT$37,000,000 in R&D expense will be invested in the testing and pilot production of module process technologies.

(3) Factors influencing the success of future R&D

Ÿ Development of advanced packaging technology capability and integration with existing packaging technologies

Ÿ Optimal solution for minimizing the cost of producing existing packaging and testing technologies

Ÿ Process and manufacturing standardization and industry chain integration

Ÿ Verification and instant introduction of mass-produced new core facilities

Ÿ Development and cultivation of packaging, testing, substrate, module, and system integration capabilities

Ÿ Development and cultivation of substrate, element, and module design capabilities

Ÿ Complete product R&D process and project management system

Ÿ Integration of product development and existing production equipment to lower R&D costs

Ÿ Customer-oriented organizational design and internal operation mechanism

Ÿ Adequately monitor market supply and demand, and take the lead in developing advanced packaging, substrate, and testing technologies according to market dynamics and trends in order to ensure leading technological status and to provide customers with optimal solutions in a timely manner when new products are launched in the market

Ÿ Strengthening of R&D talent cultivation

Ÿ Implementation and reinforcement of knowledge management system

Ÿ Strengthening of IP strategy and management

Ÿ Designing, R&D, and manufacturing of Eco-design products that meet environmental protection regulations

Ÿ Effective management of R&D benefits, risks, scheduling, and personnel

Ÿ Formation of strategic alliance with benchmark customers, reduction of R&D costs and risks, and development of IC-package-system Co-design

Ÿ Development and advancement of testing development capabilities

Ÿ Development and advancement of R&D core technology capabilities

4. Within the last year and as of the printing of this prospectus, the effects of the key domestic and international policy and law changes have on the financial operations of the company as well as the response measures:

(1) According to Jin-Guan-Zheng-Fa No. 1030029342 and Jin-Guan-Zheng-Fa No. 1030010325 announced by the FSC, the Company began adopting the 2013 IFRS, IAS, IFRIC, and SIC (collectively, the “IFRSs”), which are announced by the IASB and approved by the FSC, as of 2015 as well as the Regulations Governing the Preparation of Financial Reports by Securities Issuers, to compile its consolidated financial reports. In addition, the Company adopts the IFRSs announced by the IASB but not yet approved by the FSC. Concerning the impact on the consolidated financial reports, the Company will continue to evaluate these reports and complete such evaluation by the specified due date in accordance with the schedule provided by the FSC.

(2) In response to the amendments to the Company Act and Securities and Exchange Act, the Company examined and amended its management guidelines at all times to ensure that legal compliance.

5. Within the last year and as of the printing of this prospectus, the effects that technological changes and industry changes have on the financial operations of the company as well as the response measures

(1) The uncertainty and discontinuity of the global economy are a major challenge of the semiconductor industry. ASE overcomes this challenge by cooperating with customers and vendors to meet customer demands, reduce costs, mitigate risks, continuously observe market pulse, and maintain a closer interaction with customers to identify their needs and changes in their needs. Subsequently, we actively gathered and analyzed market information to alleviate the technological impact of changes in product requirements.

Customer competitiveness and the timing to launch a new product are the key to the success of introducing a new technology. ASE responds to this trend by monitoring market trends and supply/demand conditions, taking the lead to develop key technologies and patents according to market trends and product blueprint of benchmark customers in order to ensure a leading technological status. ASE also reduces R&D costs by ensuring that the process of product development is compatible with existing production equipment to provide customers with the best solution when new products are launched in the market.

(3) According to our experience in the R&D and innovation of new technologies, we found that R&D expenses and new core facilities are a critical component of these processes. Therefore, we respond by ensuring consistency between new technologies and ASE’s future blueprints, and by actively forming strategic alliance with customers to implement resource sharing and ultimately reduce R&D risks. ASE regularly visits its leading customers, participates in technological seminars, and works with benchmark customers to collectively plan product blueprints and product regulations that ensure that R&D technologies can facilitate meeting customers’ delivery deadline.

ASE Nantou Plant (ASENT) has long been devoted to developing electrical and electronic products, including military and industrial power modules for DC converters. The Plant offers multiple solutions to high-power electrical and electronic industrial applications. ASE actively interacts with its customers to determine their needs and changes in their needs. Moreover, the Company actively gathers and analyzes market information to mitigate the effects of technological changes. In future, ASE will place greater level of emphasis on intelligent energy conservation practices, using our extensive experiences and resources in the development of electrical and electronic products. We will also orient our development efforts toward incorporating insulated-gate bipolar transistor (IGBT) standard module packaging and IPM smart module.

6. Within the last year and as of the printing of this prospectus, the effects that corporate image have on corporate crisis management as well as the response measures

The Company and its subsidiaries have always operated under the concept of integrity, law-abiding, and fulfillment of social responsibility. In face of the accidental incident in 2013 involving leakage of wastewater from our Kaohsiung Plant, ASE faced the consequences of this incident with courage and proactively handled the situation, while continuing to make relevant improvements in order to endeavor to reshape the company's image.

7. Within the last year and as of the printing of this prospectus, expected benefits and possible risks of merger and acquisition as well as the response measures

(1) To engage in organizational adjustment and thereby enhance operational flexibility, subsidiary Universal Scientific Industrial Co., Ltd. (USI) passed the resolution of the meeting of the Board of Directors to take April 1, 2015 as the base date for the transfer of its investment business, and reducing the capital by NT$16,012,966,000, equivalent to eliminating 1,601,297,000 outstanding shares. The capital reduction ratio was 97.56%Regarding the operating value assumed by USI Inc. due to such transfer, 1,000,000,000 ordinary shares were issued to the existing shareholders of USI. The ratio was 609.27 ordinary shares per 1,000 shares held as of the base date. USI completed the registration for the capital reduction on April 17, 2015, and the new company was also registered on April 17, 2015. The transfer did not exert an influence on the Company’s net value per share and earnings per share or those of its subsidiaries, because the Company and its subsidiaries hold control over the USI Co.,

     Ltd. and USI Inc.

Integrating the resources along the industry chain of the Company and its subsidiaries’ electronic manufacturing services (EMS), and establishing reasonable separations in the operational models of semiconductor packaging and testing and EMS, would enhance the efficiency of these two areas. To this end, in February 2016, the Company disposed of 39,603 shares of its subsidiary USI Co. Ltd. to subsidiary Universal Global Scientific Industrial Co., Ltd. at NT$20 per share, the total value of the transaction was NT$792,064,000. The shareholding ratio of the Company and its subsidiaries in USI Co. Ltd. was lowered from 99.0% to 76.5%. This transaction did not change the Company’s control over its subsidiary USI Co. Ltd., the transfer was conducted in the form of an equity transaction, and the recognized capital reserve was reduced by NT$20,552,000.

(2) To integrate group resources, subsidiary USI Electronics Inc. was approved by the Board of Directors on March 25, 2015 to merge with USI America Inc. (known as USI Manufacturing Services, Inc. before May 2015) and USI @Work, Inc. USI America Inc. served as the surviving company, and USI @Work, Inc. served as the dissolved company. USI @Work, Inc. was completely merged and eliminated in August 2015. Such merge is anticipated to help USI America Inc. lower management cost and increase business performance, which positively influence the net value per share and earnings per share of USI America Inc.

(3) Taking into consideration ASE resource integration and economies of scale of the industry, the two subsidiaries in China, ASE (Shanghai) Inc. and ASE Electronics (Shanghai) passed a resolution of the meeting of the Board on December 17, in which ASE (Shanghai) Inc. used RMB99,318,000 in new shareholdings and its original investment company trading in its equities in ASE Electronics (Shanghai) to acquire ASE Electronics (Shanghai), with ASE (Shanghai) Inc. being the surviving company and ASE Electronics (Shanghai) being the dissolved company. The base date of the acquisition was temporarily set on January 1, 2016. As of the printing date of this prospectus, the acquisition is still in progress because approval from the competent authority is still pending. The anticipated benefit of such acquisition is that ASE (Shanghai) Inc. can directly obtain the funds of ASE Electronics (Shanghai) to improve its financial structure and lower operational cost, which positively influence the net value per share and earnings per share of ASE (Shanghai) Inc..

(4) In September 2015, the Company acquired 779,000,000 ordinary shares of SPIL at NT$45 per share and 10,650,000 depositary receipts, each recognized as 5 ordinary shares. This accounts for a total shareholding of 24.99%, which has a major effect on SPIL. Between March and April 2016, the Company acquired ordinary shares in SPIL on the open market using NT$13,735,498 in cash and 258,300,000 depositary receipts (each recognized as 5 ordinary shares), increasing the shareholding ratio from 24.99% to 33.29%.

In response to the future development and sustainable management of the semiconductor industry, the Company received approval from the Board in June 2016 to enter a share exchange agreement with SPIL. The Company will submit application to setup an ASE Investment Holding (hereafter referred to as “ASE Investment”) and to engage in share transfer with SPIL so that the ASE Investment will obtain 100% share ownership to ASE and SPIL. The consideration of such share transfer is to exchange one ordinary share of ASE for 0.5 ordinary share of ASE Investment, and one ordinary share of SPIL for cash of NT$55 (adjusted to NT$51.2 following earnings distribution in 2016).

As of the date of printing of this prospectus, the share transfer will be performed in accordance with the collective share transfer agreement and still requires multiple prerequisite conditions before it can be achieved (including but are not limited to the approval of shareholders’ meeting of the Company and SPIL, and the approval or consent of relevant competent authorities for this transaction). Unless otherwise agreed by the Company and SPIL, if the aforementioned condition cannot be met or has been exempted before December 31, 2017, then this agreement will be terminated automatically.

Because of the aforementioned collective share transfer agreement, the Company will handle its existing treasury stocks and converted equity corporate bonds that have been issued by adopting the following principles:

A. For outstanding 3rd overseas non-guaranteed convertible bonds that are issued by the Company, unless these bonds had been redeemed or repurchased and canceled or the bond holder has exercised his/her conversion right before the base date of the share transfer, the holder may, after the Company has obtained the approval of competent authorities, convert these bonds into newly issued ordinary shares of ASE Investment on the base date of share transfer in accordance with relevant laws and regulations, the consignment agreement of these bonds, and the conversion ratio.

B. To support the issuance of the 4th overseas non-guaranteed convertible bonds, the Company has repurchased treasury stocks for conversion before the share transfer base date, converting them into shares of ASE Investment on the basis of the conversion rate. These shares will be held by the Company, and the conversion rate specified in the share transfer agreement will be adjusted as the conversion price for overseas non-guaranteed convertible corporate bonds.

C. Before signing the collective share transfer agreement, ASE Investment will fulfill the Company's obligations as of the share transfer base date with regards to the issued stock options that are approved by the competent authorities. The price and quantity of share transfer shall be changed to new ordinary shares of ASE Investment in accordance with the adjustment of conversion rate and object of contract execution. The remaining issuance condition and original issuance condition shall be identical. However, the specific method of execution shall be conducted by the ASE Investment following relevant laws and regulations and the instructions approved by the competent authorities.

8. Within the last year and as of the printing of this prospectus, expected benefits and possible risks of factory expansions as well as the response measures

Because the growth of the semiconductor market presented an optimistic prospect, the Company and its subsidiaries anticipate that the magnitude of growth in 2016 will exceed that of 2015. Regarding investment, to adequately and effectively utilize existing production capacities, the Company and its subsidiaries have increased their production capacity in the past few years to an extent that they can now fulfill most of their orders. To improve the return rate and reduce investment risks, the Company and its subsidiaries focused primarily on our existing production capacities and equipment as well as investments in new equipment in order to boost market growth. In addition to using new plants, we will incorporate new investments into consideration depending on the actual market demands.

9. Within the last year and as of the printing of this prospectus, the risks of concentrated procurement or sales as well as the response measures

(1) Overly concentrated procurements easily disrupt the supply process because of

    production or quality abnormalities and also weaken suppliers' bargaining power. The Company and its subsidiaries have formulated policies for diversifying their suppliers of direct material and machinery equipment in order to identify the few alternative suppliers (2nd source) who can concentrate on supply resources and materials. Regarding the source of supply in a foreign oligopolistic market, we actively fostered domestic suppliers with potentials in technological R&D to disperse risks and reduce costs.

(2) The Company and its Subsidiaries were not involved in matters relating to concentrated sales.

10. Within the last year and as of the printing of this prospectus, the effects and risks that large-number transfers or replacements of directors, supervisors, or major shareholders holding over 10% of the company's shares have to the company as well as the response measures:

Within the last year and as of the printing of this prospectus, there were no large-number transfers or replacements of directors or major shareholders holding over 10% of the company's shares.

11. Within the last year and as of the printing of this prospectus, the effects and risks that operating rights changes have to the company as well as the response measures

In the most recent year and as of the printing date of this prospectus, the Company has never changed the operating rights.

12. Other important risks and response measures: None.

(II) Litigation or non-litigation events

1. Finalized judgments or pending litigations, non-litigations, or administrative disputes for the company in the last two years until the printing date of this prospectus whereby the results may have major impacts to the shareholders' rights or share prices

(1) The Company received a statement of charge from Taiwan Kaohsiung District Court in November 2015. The charge involved SPIL appealing to the Court for confirming the non-existence of the Company's right to request for being listed as a shareholder in the shareholders' roster of SPIL. Because SPIL did not pay the court fee by the specified deadline, the Taiwan Kaohsiung District Court dismissed the lawsuit, thus imposing no material influence on the consolidated financial status and financial performance of the Company and its subsidiaries.

(2) Kaohsiung City Government Environmental Protection Bureau (hereafter referred to as "EPB") fined the Company NT$102,014,000 (referred to as "Fine") for violating the Water Pollution Control Act. The Company filed an appeal against the said Fine and the appeal was dismissed by the Kaohsiung City Government. Subsequently, the Company filed an administrative lawsuit with the Kaohsiung High Administrative Court to request the Kaohsiung City Government to withdraw the decision and the Fine and to request the EPB to return the fine that the Company has already paid. The Kaohsiung High Administrative Court provided a ruling on March 22, 2016 to withdraw the decision and the Fine and to dismiss the remaining appeal (i.e., request for refund of the fine paid). On April 4, 2016, the Company lodged an appeal against the part of the ruling that negatively affects the Company. The case is currently being reviewed by the supreme administrative court.

Kaohsiung District Prosecutors Office filed a lawsuit against the Company in January 2014 for violating the Waste Disposal Act, and the Taiwan Kaohsiung District Court fined the Company NT$3,000,000 for violating Article 47 of the Waste Disposal Act. The Company appealed against the ruling in accordance with

legal procedures. The Taiwan High Court Kaohsiung Branch reached a verdict on September 29, 2015, ruling the Company not guilty.

2. Finalized judgments or pending litigations, non-litigations, or administrative disputes associated to the company's directors, supervisors, General Manager, responsible person, or major shareholders holding over 10% of the company's shares in the last two years until the printing date of this prospectus whereby the results may have major impacts to the shareholders' rights or share prices: None.

3. Company directors, supervisors, managers, or major shareholders holding over 10% of the company's shares have involved in matters described by Article 157 of the Securities and Exchange Act as well as the status of the case currently handled by the company within the last two years and as of the printing of this prospectus: None.

(III) Company directors, supervisors, managers, or major shareholders holding over 10% of the company's shares have involved in financial turnover difficulties or suffer credit losses within the last two years and as of the printing of this prospectus; and the effects on the company's financial conditions must be specified: None.

(IV) Other important issues: None.

3. Company Organization

(I) Organization system

1. Organization structure

 

2. Business operations of the various key business departments

Department		Duties
Operation	Human	Human resource management and organizational

17

Department		Duties
Support Center	Resource Division	development Ÿ  Human Resource Operation Service Division: Provide employee service, develop labor requirement plan, plan and manage employee recruitment, remuneration, welfare, and performance systems, and manage central security protection system Ÿ Human Resource Operation Development Division: Plan organizational development and strategies, strengthen employee care and concern, and participate in CSR and charity events
	Plant Affair Division:	Handle environmental protection tasks of plant and administrative areas, manage general affairs, and control and manage labor safety Ÿ New Construction Division: Devise plant expansion plans, monitor new construction works and manage construction acceptance tasks, and ensure operation development Ÿ Occupational Safety Division: Integrate organization of plant areas and plant affairs, strengthen laws and regulation identification and standardize practices, and assume responsibility in occupational safety and environmental management and sustainable development Ÿ Plant Affair Technological Integration Division: Integrate and strengthen the following aspects: supplier quality and reliability of plant affair system; integration and operation of plant safety and maintenance, introduction and planning of new technologies and equipment
	Procurement Management Division	Procure, manage, and control machines and product materials Ÿ Procurement Management Division 1: Integrate the procurement of production materials with supplier resource management Ÿ Procurement Management Division 2: Allocate repair, general affairs, and procurement tasks and integrate and manage cross-department resources Ÿ Procurement Management Division 3: Integrate mechanical equipment, procure resources, and develop and promote cross-unit systems
	Logistic Service Division	Handle matters pertaining to storage, import/export activities, and insurance and tax accounting
Front Line Service Center	Manufacturing Plant	Handle matters related to semiconductor packaging OEM, product production planning, product manufacturing, progress management, onsite management, and equipment maintenance
	Information Division	Construct company information system and implement e-management strategies and system services Ÿ Automated and Engineering Information Division: Manage strategic development of automated and engineering information system, innovation, framework planning, system integration, and system design and maintenance Ÿ Technical Information Division: Evaluate, integrate, setup,

18

Department		Duties
		and maintain software and hardware applications of the company information system Ÿ Operation and Customer Information Division: Plan, develop, maintain, and manage corporate operation management and customer information service IT application system Ÿ Manufacturing Information Division: Manage strategic development of manufacturing information system, innovation, framework planning, system integration, and system design and maintenance
	Production and Management Planning Division	Manage production planning and operational efficiency
	Operation Planning Division	Plan operation and project proposals, and integrate and implement administrative resource plans
	Quality Assurance Division	Examine and ensure product qualities Ÿ Quality Assurance Division: Ensure quality management mechanism and monitor product quality Ÿ Quality System Division: Establish product reliability and assure the accuracy of measuring instruments Ÿ Quality Engineering Division: Ensure customer communication and coordination, develop product testing process, and conduct quality control
	Engineering Center	Develop substrate designs and production technologies Ÿ Design Engineering Division: Develop new technologies and materials, integrate and automate system processes, and provide local support design services to customers worldwide Ÿ Packaging Engineering Division: Develop, introduce, and assess new equipment and materials, implement engineering tasks, and integrate systems
Others	R&D center	Research and develop advanced technologies, incorporate production technologies, develop design and manufacturing specifications, and research, develop, and assess new products and new technologies
	Business Division	Promote business development and sell products in Asian, American, and European regions
	Finance Division	Conduct financial and accounting tasks, including fund management, asset management, cost and management accounting, rental tax planning, and shareholder operations
	Internal Audit	Formulate internal policies, processes, and auditing standards, assess the appropriateness of internal control systems, and evaluate validity of each department
Zhongli Branch		Business units include administration, human resource and public relations, finance, quality assurance, production operation management, information, engineering development center, packaging and testing manufacturing facilities, wafer fabrication and packaging process, strategic

19

Department	Duties
	information and customer relation management
Nantou Branch	Business units include human resource and general affairs, finance and accounting, quality management, sales operation, product engineering, information, manufacturing, production management, logistic management, information material, engineering, and environmental safety

20

 

21

 

22

2. Relations between the company and its affiliates, mutual shareholding ratios, shares and actual investment amounts

September 30, 2016; Unit: NT$1,000, unless otherwise specified Shares

Name of investment company:	Name of affiliate (Note 1)	Relationship	Actual investment amount	Shares of investment company		Company's Shares held by the invested company
				Number of shares	Percentage (%)	Number of shares	Percentage (%)
Advanced Semiconductor Engineering Inc.	A.S.E. Holding Limited	Subsidiary of the Company	US$ 283,966,000	243,966	100.00%	-	-
	J & R Holding Limited	Subsidiary of the Company	US$ 479,693,000	435,128	100.00%	46,703,763	0.59%
	ASE Marketing & Service Japan Co., Ltd.	Subsidiary of the Company	JPY 60,000,000	1,200	100.00%	-	-
	Omniquest Industrial Limited	Subsidiary of the Company	US$ 250,504,000	250,504,067	70.63%	-	-
	Innosource Limited	Subsidiary of the Company	US$ 86,000,000	86,000,000	100.00%	-	-
	ASE Test Inc.	Subsidiary of the Company	20,698,867	1,131,452,502	100.00%	10,978,776	0.14%
	Universal Scientific Industrial Inc.	Subsidiary of the Company	20,836,477	1,112,236,706	99.17%	-	-
	LuZhu Development Inc.	Subsidiary of the Company	1,366,238	131,961,457	67.11%	-	-
ASE Test Inc.	Alto Enterprises Limited	Subsidiary of the Company	US$ 188,000,000	188,000,000	100.00%	-	-
	Super Zone Holdings Limited	Subsidiary of the Company	US$ 100,000,000	100,000,000	100.00%	-	-
	LuZhu Development Inc.	Subsidiary of the Company	372,504	37,250,448	18.94%	-	-
	TLJ Intertech Inc.	Subsidiary of the Company	89,998	2,119,080	60.00%	-	-
A.S.E. Holding Limited	ASE Test Limited	Subsidiary of the Company	US$ 84,889,000	11,148,000	10.19%	88,200,472	1.11%
	ASE Investment (Labuan) Inc.	Subsidiary of the Company	US$ 168,643,000	168,642,842	70.00%	-	-
J & R Holding Limited	ASE Test Limited	Subsidiary of the Company	US$ 964,524,000	98,276,087	89.81%	88,200,472	1.11%
	Omniquest Industrial Limited	Subsidiary of the Company	US$ 30,200,000	30,200,000	8.51%	-	-
	ASE (Nanzih) Inc.	Subsidiary of the Company	US$ 51,344,000	170,000,006	100.00%	-	-
	ASE Japan Co.,	Subsidiary	US$ 25,606,000	7,200	100.00%	-	-

23

Name of investment company:	Name of affiliate (Note 1)	Relationship	Actual investment amount	Shares of investment company		Company's Shares held by the invested company
				Number of shares	Percentage (%)	Number of shares	Percentage (%)
	Ltd.	of the Company
	ASE (U.S.) Inc.	Subsidiary of the Company	US$ 4,600,000	1,000	100.00%	-	-
	Global Advanced Packaging Technology Ltd.	Subsidiary of the Company	US$ 190,000,000	190,000,000	100.00%	-	-
	Anstock Limited	Subsidiary of the Company	US$ 10,000	10,000	100.00%	-	-
	Anstock II Limited	Subsidiary of the Company	US$ 10,000	10,000	100.00%	-	-
	Suzhou ASEN Semiconductors Co., Ltd.	Subsidiary of the Company	US$ 21,600,000	Note 1	60.00%	-	-
ASE Investment (Labuan) Inc.	ASE (Korea) Inc.	Subsidiary of the Company	US$ 160,000,000	20,741,363	100.00%	-	-
ASE Test Limited	ASE Holdings (Singapore) PTE Ltd.	Subsidiary of the Company	US$ 65,520,000	71,428,902	100.00%	-	-
	ASE Test Holdings, Ltd.	Subsidiary of the Company	US$ 222,399,000	5	100.00%	-	-
	ASE Investment (Labuan) Inc.	Subsidiary of the Company	US$ 72,304,000	72,304,040	30.00%	-	-
	ASE Singapore Pte. Ltd.	Subsidiary of the Company	US$ 55,815,000	30,100,000	100.00%	-	-
ASE Test Holdings, Ltd.	ISE Labs, Inc.	Subsidiary of the Company	US$ 221,145,000	26,250,000	100.00%	-	-
ASE Holdings (Singapore) 2te Ltd	ASE Electronics (M) Sdn. Bhd.	Subsidiary of the Company	US$ 60,000,000	159,715,000	100.00%	-	-
Omniquest Industrial Limited	ASE Corporation	Subsidiary of the Company	US$ 352,784,000	352,784,067	100.00%	-	-
ASE Corporation	ASE Mauritius Inc.	Subsidiary of the Company	US$ 217,800,000	217,800,000	100.00%	-	-
	ASE Labuan Inc.	Subsidiary of the Company	US$ 126,184,000	126,184,067	100.00%	-	-
ASE Labuan Inc.	ASE Electronics Inc.	Subsidiary of the Company	US$ 125,813,000	398,981,900	100.00%	-	-
Innosource Limited	Omniquest Industrial Limited	Subsidiary of the Company	US$ 74,000,000	74,000,000	20.86%	-	-
	ASE Electronics (Shanghai) Co., Ltd.	Subsidiary of the Company	US$ 12,000,000	Note 1	100.00%	-	-

24

Name of investment company:	Name of affiliate (Note 1)	Relationship		Actual investment amount	Shares of investment company		Company's Shares held by the invested company
					Number of shares	Percentage (%)	Number of shares	Percentage (%)
Universal Scientific Industrial Inc.	Huntington Holdings International Co., Ltd.		Subsidiary of the Company	8,370,606	255,856,840	100.00%	-	-
Huntington Holdings International Co.,Ltd.	Unitech Holdings International Co., Ltd.		Subsidiary of the Company	US$ 3,000,000	3,000,000	100.00%	-	-
	Real Tech Holdings Limited		Subsidiary of the Company	US$ 149,151,000	149,151,000	100.00%	-	-
	Universal ABIT Holding(Cayman) Co., Ltd.		Subsidiary of the Company	US$ 28,125,000	90,000,000	100.00%	-	-
	Rising Capital Investment Limited		Subsidiary of the Company	US$ 6,000,000	6,000,000	100.00%	-	-
	Rise Accord Limited		Subsidiary of the Company	US$ 2,000,000	20,000	100.00%	-	-
Real Tech Holdings Limited	USI Enterprise Limited		Subsidiary of the Company	US$ 210,900,000	210,900,000	99.59%	-	-
	Universal Global Technology (Kunshan) Co., Ltd.		Subsidiary of the Company	US$ 12,000,000	Note 1	100.00%
USI Electronics Inc.	Universal Global Technology Co., Limited		Subsidiary of the Company	RMB 324,185,000	390,000,000	100.00%	-	-
	Universal Global Technology (Kunshan) Co., Ltd.		Subsidiary of the Company	RMB 250,000,000	Note 1	100.00%
	Universal Global Electronics (Shanghai) Co., Ltd.		Subsidiary of the Company	RMB 1,330,000,000	Note 1	100.00%
	Universal Global Technology (Shanghai) Co., Ltd.		Subsidiary of the Company	RMB 50,000,000	Note 1	100.00%
	USI Electronics (Shenzhen) Co., Ltd.		Subsidiary of the Company	RMB 292,812,000	Note 1	50.00%
Universal Global Technology Co., Limited	Universal Technology Co., Ltd.		Subsidiary of the Company	US$ 11,000,000	85,800,000	100.00%	-	-
	Universal Global Scientific Industrial Co., Ltd.		Subsidiary of the Company	US$ 62,235,000	198,000,000	100.00%	-	-
	USI Japan Co., Ltd.		Subsidiary of the Company	US$ 885,000	6,400	100.00%	-	-
	Universal Scientific		Subsidiary of the	US$ 23,963,000	281,085,325	100.00%	-	-

25

Name of investment company:	Name of affiliate (Note 1)	Relationship		Actual investment amount	Shares of investment company		Company's Shares held by the invested company
					Number of shares	Percentage (%)	Number of shares	Percentage (%)
	Industrial De Mexico S.A. De C.V.		Company
	USI America Inc.		Subsidiary of the Company	US$ 9,500,000	250,000	100.00%
	USI Electronics (Shenzhen) Co., Ltd.		Subsidiary of the Company	US$ 37,500,000	Note 1	50.00%	-	-
Universal Global Scientific Industrial Co., Ltd.	Universal Scientific Industrial Co., Ltd.		Subsidiary of the Company	792,064	39,603,222	99.01%	-	-
ASE Mauritius Inc.	ASE (Shanghai)		Subsidiary of the Company	US$ 140,542,000	Note 1	100.00%	-	-
	ASE (Kunshan) Inc.		Subsidiary of the Company	US$ 80,000,000	Note 1	29.85%	-	-
ASE Investment (Kunshan) Inc.	ASE (Kunshan) Inc.		Subsidiary of the Company	US$ 122,000,000	Note 1	45.52%
Alto Enterprises Limited	ASE (Kunshan) Inc.		Subsidiary of the Company	US$ 66,000,000	Note 1	24.63%
ASE (Korea) Inc.	ASE (Weihai)		Subsidiary of the Company	US$ 126,500,000	Note 1	100.00%	-	-
ASE (Shanghai) Inc.	Shanghai Ding Hui Real Estate Development Co., Ltd.		Subsidiary of the Company	RMB 1,441,000,000	Note 1	40.03%	-	-
	Universal Scientific Industrial (Shanghai) Co., Ltd.		Subsidiary of the Company	RMB 12,900,000	18,098,476	0.83%	-	-
	ASE (Hong Kong) Inc.		Subsidiary of the Company	US$ 1,000,000	Note 1	100.00%
Global Advanced Packaging Technology Limited, Cayman Islands	ASE Assembly & Test (Shanghai) Limited		Subsidiary of the Company	US$ 180,000,000	Note 1	100.00%
Super Zone Holdings Limited	ASE Circuit Manufacturing Co., Ltd. (China)		Subsidiary of the Company	US$ 100,000,000	Note 1	100.00%	-	-
Alto Enterprises Limited	ASE Investment (Kunshan) Inc.		Subsidiary of the Company	US$ 122,000,000	Note 1	100.00%	-	-
ASE Assembly & Test (Shanghai) Limited	Wuxi Tongzhi Microelectronics Co., Ltd.		Subsidiary of the Company	RMB 70,000,000	Note 1	100.00%	-	-
	ASE Trading		Subsidiary	RMB 500,000	Note 1	100.00%	-	-

26

Name of investment company:	Name of affiliate (Note 1)	Relationship	Actual investment amount	Shares of investment company		Company’s Shares held by the invested company
				Number of shares	Percentage (%)	Number of shares	Percentage (%)
	(Shanghai) Ltd.	of the Company
	Shanghai Ding Hui Real Estate Development Co., Ltd.	Subsidiary of the Company	RMB 2,242,500,000	Note 1	59.97%
Shanghai Ding Hui Real Estate Development Co., Ltd.	Shanghai Ding Qi Property Management Co., Ltd.	Subsidiary of the Company	RMB 1,000,000	Note 1	100.00%	-	-
	Shanghai Ding Wei Real Estate Development Co., Ltd.	Subsidiary of the Company	RMB 1,548,000,000	Note 1	100.00%
	Shanghai Ding Yu Real Estate Development Co., Ltd.	Subsidiary of the Company	RMB 1,100,000,000	Note 1	100.00%
	Kun Shan Ding Hong Real Estate Development Co., Ltd.	Subsidiary of the Company	RMB 670,000,000	Note 1	100.00%
	Kun Shan Ding Yue Real Estate Development Co., Ltd.	Subsidiary of the Company	RMB 330,000,000	Note 1	100.00%
Shanghai Ding Wei Real Estate Development Co., Ltd.	Shanghai Ding Fan Department Store Co., Ltd.	Subsidiary of the Company	RMB 1,500,000	Note 1	100.00%	-	-
USI Enterprise Limited	Universal Scientific Industrial (Shanghai) Co., Ltd.	Subsidiary of the Company	US$ 251,163,000	1,683,749,126	77.38%	-	-

Note 1: The subsidiary is a corporation limited and therefore does not issue shares.

27

(3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.

December 31, 2016; Unit: Share; %

Title

Nationality

Name

Date onboard

Number of shares held

Shares held by spouse and children

Shares held in the names of others

Main work (education) experiences

Concurrent positions in other companies

Manager who is a spouse or a relative within second degree

The condition of managers obtaining employee stock options

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Title

Name

Relationship

31,929,000 shares

CEO

Singapore

Jason C.S. Chang

2003.05

85,070,931

1.07%

－

－

1,693,208,250 (Note1)

21.31%

Bachelor in Electrical Engineering, National Taiwan University Master’s degree from the Illinois Institute of Technology

Note 3

Vice Chairman Director

Richard H.P. Chang Rutherford Chang

Brother Son

President

Hong Kong

Richard H.P. Chang

2003.02

104,414,941

1.31%

121,929,346

1.53%

－

－

Bachelor’s degree in industrial engineering, Chung Yuan Christian University in Taiwan Chairman of Universal Scientific Industrial Co., Ltd. (Shanghai)

Note 3

Chairman

Jason C.S. Chang

Brother

Chief Operating Officer

Republic of China

Tien Wu

2007.02

4,953,386

0.06%

－

－

－

－

Doctorate degree in applied mechanics, University of Pennsylvania

Note 3

None

None

None

Chief Financial Officer

Republic of China

Joseph Tung

1994.12

5,151,908

0.06%

274,915

0.00%

－

－

Master’s degree in business administration, University of Southern California Vice President of Citibank

Note 3

None

None

None

President of ASE Kaohsiung

Republic of China

Raymond Lo

2006.04

3,565,643

0.04%

1,182

0.00%

－

－

Bachelor’s degree in electronic physics, National Chiao Tung University

Note 3

None

None

None

President of Shanghai Headquarter

Republic of China

Jeffery Chen

2016.05

2,100,802 (Note2)

0.03%

－

－

－

－

Master’s degree in business administration, University of British Columbia in Canada Vice President of Bankers Trust Taipei

Note 3

None

None

None

Vice President

Republic of China

Xu-Rui Yu

1999.08

519,259

0.01%

－

－

－

－

Department of Radio and Television, National Taiwan University of Arts Vice President of Eastern Broadcasting Co., Ltd. President of Xin Kai Broadcasting Co., Ltd.

Note 3

None

None

None

28

Title

Nationality

Name

Date onboard

Number of shares held

Shares held by spouse and children

Shares held in the names of others

Main work (education) experiences

Concurrent positions in other companies

Manager who is a spouse or a relative within second degree

The condition of managers obtaining employee stock options

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Title

Name

Relationship

31,929,000 shares

Vice President

Republic of China

Shih-Wen Lee

2004.01

1,016,234

0.01%

－

－

－

－

Bachelor’s degree in electronic physics, National Cheng Kung University

None

None

None

None

Vice President

Republic of China

Kwang-Chun Chou

2004.01

82,203

0.00%

－

－

－

－

Bachelor's degree in mechanical engineering, National Cheng Kung University

None

None

None

None

Vice President

Republic of China

Kuo-Tang Lin

2004.08

2,037,773

0.03%

3,242

0.00%

－

－

Bachelor's degree in eletrical engineering, Kun Shan University

None

None

None

None

Vice President

Republic of China

Huan-Hua Mo

2004.08

858

0.00%

－

－

－

－

Bachelor's degree in mechanical engineering, University of Birmingham

None

None

None

None

Vice President

Republic of China

Ching-Kun Yeh

2004.08

276,622

0.00%

－

－

－

－

Bachelor’s degree in physics, Soochow University

None

None

None

None

President of ASE Zhongli

Republic of China

Tien-Chi Chen

2015.08

1,492,504

0.02%

－

－

－

－

Bachelor’s degree in industrial engineering, Chung Yuan Christian University

Note 3

None

None

None

Vice President

Republic of China

Chen-Ming Cheng

2006.07

6,416

0.00%

－

－

－

－

Bachelor's degree in mechanical engineering, Tamkang University

None

None

None

None

Vice President

Republic of China

Song-Ching Hong

2011.01

723,275

0.01%

－

－

－

－

Doctrate in Machinery, University of Texas System

None

None

None

None

Vice President

Republic of China

Yen-Chieh Tsao

2012.12

－

－

－

－

－

－

Bachelor’s degree in physics, Chinese Culture University

None

None

None

None

Vice President

Republic of China

Chih-Bing Hong

2014.03

410,000

0.01%

25,000

0.00%

－

－

Doctrate in electronics, University of Paisley

None

None

None

None

Vice President and Chief of Accounting

Republic of China

Hong-Ming Kuo

2014.08

46,000

0.00%

－

－

－

－

Master’s degree in business administration, Boston University

Note 3

None

None

None

Note 1: Number of shares pledged was 248,471,522

Note 2: Number of shares pledged was 700,000

Note 3: Summary of concurrent positions in other companies

Title	Name	Concurrent positions in other companies
CEO	Jason C.S. Chang	CEO, Chairman, Director (representative) of ASE Inc.; Chairman, Director (representative) of ASE (Nanzih) Inc.; Director of ASE Japan Co., Ltd.; Chairman, Director (representative) of ASE Test Inc.; Director of ASE Test Holding, Ltd.; Director of ASE (Korea) Inc.; Director of ISE Labs, Inc.; Director of A.S.E. Holding Ltd. (Bermuda); Director of J&R Holding Ltd. (Bermuda); Director of Innosource Ltd.; Director of ASE (Kunshan) Inc.; Chairman of ASE Test Limited (Singapore); Chairman of ASE

29

Title	Name	Concurrent positions in other companies
		(Shanghai) Inc.; Director of ASE Electronics (Shanghai); Chairman of ASE Investment (Kunshan) Inc.; Chairman, Director (representative) of ASE Electronics Inc.; Director of ASE Mauritius Inc.; Director of ASE Corporation; Chairman of Suzhou ASEN Semiconductors Co., Ltd.; Director of ASE Labuan Inc.; Director of ASE Circuit Manufacturing Co., Ltd. (China); Director of ASE Singapore Pte. Ltd.; Director of Alto Enterprises Ltd.; Director of Super Zone Holdings Ltd.; Director of Anstock Limited; Director of Anstock II Limited; Director of USI Electronics Inc.; Director of Universal Scientific Industrial Co., Ltd. (Shanghai); Director of USI Co., Ltd.; Director of Sino Horizon Holdings Limited; Director of Wealthy Joy Co. Ltd.; Director of Beijing Ding Gu Ding Hao Enterprise Co., Ltd.; Director of Shanghai Ding Rong Real Estate Development Co., Ltd.; Director of Chongqing Ding Gu Real Estate Development Co., Ltd.; Director of Shanghai Ding Xing Property Ltd.; Supervisor of Kun Shan Ding Yao Real Estate Development Co., Ltd.; Supervisor of Shanghai Ding Jia Real Estate Development Co., Ltd.; Supervisor of Shanghai Ding Tong Real Estate Development Co., Ltd.; Supervisor of Shanghai Hong Xiang Property Ltd.; Supervisor of Shanghai Ming Long Construction Development Co., Ltd.; Director of Shanghai Ding Yi Real Estate Development Co., Ltd.; Director of True Elite Holdings Limited; Director of Wenzhou Hong De Construction Development Co., Ltd.; Director of ASE Enterprises; Director of Ding Chang Investment Inc.; Director of Ding Gu Investment Inc.; Chairman of Wan Chang Investment Inc.; Director of Wan Ya Investment Inc.; Director of Wei Dong Investment Inc.; Director of Rui Chang Investment Inc.; Director of Shao Chang Investment Inc.; Chairman of Jia Qing Investment Inc.; Chairman of Jia Ying Investment Inc.; Director of Ming Tong Investment Inc.; Director of Ming Xiang Investment Inc.; Director of Qi Chang Investment Inc.
President	Richard H.P. Chang	President and Vice Chairman of ASE Inc.; Director (representative) of ASE (Nanzih) Inc.; Director of Innosource Ltd.; Director of ASE (Shanghai) Inc.; Director (representative) of ASE Test Inc.; Director of Omniquest Industrial Ltd.; Director of ASE Test Limited (Singapore); Director of ASE (Korea) Inc.; Director of ASE Electronics (Malaysia), Sdn, Bhd.; Director of A.S.E. Holding Ltd. (Bermuda); Director of J&R Holding Ltd. (Bermuda); Chairman of ASE (Kunshan) Inc.; Chairman of ASE Electronics (Shanghai); Director of GAPT-Cayman; Director of ASE Assembly & Test (Shanghai) Ltd.; Director of ASE Japan Co., Ltd.; Chairman of ASE (Hong Kong) Inc.; Director of Suzhou ASEN Semiconductors Co., Ltd.; Director of ASE Labuan Inc.; Director of ASE Circuit Manufacturing Co., Ltd. (China); Director of Alto Enterprises Ltd.; Director of Super Zone Holdings Ltd.; Director of Anstock Limited; Director of RTH; Chairman of USI Electronics Inc.; Chairman of Universal Global Technology (Kunshan) Co., Ltd.; Chairman of USI Electronics (Shenzhen) Co., Ltd.; Chairman of Global Electronics Inc.; Director of Universal Technology Co., Ltd.; Director (representative) of Universal Global Scientific Industrial Co., Ltd.; Director of USI Enterprise Limited; Chairman of Universal Global Technology (Kunshan) Co., Ltd.; Director of Universal Scientific Industrial Co., Ltd. (Shanghai); Chairman of Huang Wei Electronics (Shanghai) Co., Ltd.; Chairman of Huang Hao Electronics (Shanghai) Co., Ltd.; Chairman of Sino Horizon Holdings Limited; Director of Wealthy Joy Co. Ltd.; Director of Peak Vision International Limited; Director of Great Sino Development Ltd.; Chairman of Beijing Ding Gu Ding Hao Enterprise Co., Ltd.;

30

Title Name Concurrent positions in other companies

		Chairman of Shanghai Ding Gu Property Co., Ltd.; Chairman of Shanghai Ding Jia Real Estate Development Co., Ltd.; Chairman of Shanghai Ding Tong Real Estate Development Co., Ltd.; Chairman of Shanghai Hong Xiang Property Ltd.; Chairman of Shanghai Ming Long Construction Development Co., Ltd.; Chairman of Shanghai Ding Rong Real Estate Development Co., Ltd.; Chairman of Shanghai Ding Lin Real Estate Development Co., Ltd.; Chairman of Shanghai Ding Xing Property Ltd.; Chairman of Kun Shan Ding Yao Real Estate Development Co., Ltd.; Chairman of Chongqing Ding Gu Real Estate Development Co., Ltd.; Director of Shanghai ASE Department Store Co., Ltd.; President of Chongqing Ding Gu Property Management Co., Ltd.; Chairman of Shanghai Ding Yi Real Estate Development Co., Ltd.; Executive Director of Wuxi Ding Gu Real Estate Development Co., Ltd.; Executive Director of Shanghai McCain Hospitality Co., Ltd.; Director of Wenzhou Hong De Construction Development Co., Ltd.; Director of ASE Enterprises; Director of Wend Di Development Co., Ltd.; Director of Jia Ying Investment Inc.; Chairman of Ming Xiang Investment Inc.; Director of Ming Tong Investment Inc.; Supervisor of Rui Chang Investment Inc.; Director of Jia Qing Investment Inc.; Chairman of Wei Dong Investment Inc.; Director of Shao Chang Investment Inc.; Director of Qi Chang Investment Inc.; Chairman of Ding Chang Investment Inc.; Director of Wan Chang Investment Inc.; Director of Wan Ya Investment Inc.; Supervisor of Ding Gu Investment Inc.
Chief Operating Officer	Tien Wu	COO and Director (representative) of ASE Inc.; Director of ISE Labs, Inc.; Director of ASE Japan Co., Ltd.; Director of ASE Marketing & Service Japan Co., Ltd.; Director of GAPT-Cayman; Director of ASE Assembly & Test (Shanghai) Limited; Director of Suzhou ASEN Semiconductors Co., Ltd.; Director of ASE (Weihai) Inc.; Director of Wuxi Tongzhi Microelectronics Co., Ltd.; Director (representative) of Universal Scientific Industrial Co., Ltd. (Shanghai); Director (representative) of Universal Scientific Industrial Co., Ltd.
Chief Financial Officer	Joseph Tung	CFO and Director (representative) of ASE Inc.; Director (representative) of ASE (Nanzih) Inc.; Supervisor of ASE Japan Co., Ltd.; Director (representative) of ASE Test Inc.; Supervisor of ASE Marketing & Service Japan Co., Ltd.; Director of Innosource Ltd.-; Director of J&R Holding Ltd. (Bermuda); Director of ASE Investment (Labuan) Inc.; Director of Holding Ltd. (Bermuda); Director of Omniquest Industrial Ltd.; Director of ASE Test Holding, Ltd.; Director of ASE (Korea) Inc.; Director of ASE Electronics (Malaysia) Sdn. Bhd.; Director of ASE Mauritius Inc.; Director (representative) of ASE Electronics Inc.; Director of ASE Labuan Inc.; Director of ASE Corporation; Director of Alto Enterprises Ltd.; Director of Anstock Limited; Supervisor of Universal Scientific Industrial Co., Ltd.; Supervisor of Universal Scientific Industrial Inc.; Supervisor of USI Electronics Inc.; Supervisor (representative) of Universal Technology Co., Ltd.; Director (representative) of LuZhu Development Inc.; Supervisor of Wuxi Tongzhi Microelectronics Co., Ltd.; Director of ASE Trading (Shanghai) Ltd.; Director of H.R.SILVINE-CMC Co., Ltd.; Independent Director of Ta Chong Bank; Director (representative) of Advanced Microelectronic Products, Inc.; Director of TLJ Intertech Inc.; Director (representative) of Asia Pacific New Industry Entrepreneurial Investment Inc.
President of ASE Kaohsiung	Raymond Lo	Director (representative) of ASE Inc.; President of ASE Kaohsiung; Director (representative) and President of ASE Test Inc.
Shanghai Headquarter President	Jeffery Chen	Director (representative) of ASE Inc. ; Director (representative) of ASE Test Inc.; Director of ASE (Kunshan) Inc.; Director of ASE Test Limited (Singapore); Director of ASE Test Holdings Ltd.; Director of Omniquest Industrial Ltd.; Director of ISE Labs, Inc.; Director of ASE Investment (Labuan) Inc.; Director of ASE Electronics (Shanghai); Supervisor of ASE Assembly & Test (Shanghai) Ltd.; Chairman of Shanghai Ding Hui Real Estate Development Co., Ltd.; Director (representative) of ASE

31

Title Name Concurrent positions in other companies

		Electronics Inc.; Director of ASE (Hong Kong) Inc.; Director of Suzhou ASEN Semiconductors Co., Ltd.; Chairman of Shanghai Ding Wei Real Estate Development Co., Ltd.; Chairman of Shanghai Ding Yu Real Estate Development Co., Ltd.; Chairman of Kunshan Ding Hong Real Estate Development Co., Ltd.; Chairman of Kunshan Ding Yue Real Estate Development Co., Ltd.; Chairman of Shanghai Ding Qi Property Co., Ltd.; Director of ASE Trading (Shanghai); Director of Super Zone Holdings Ltd.; Supervisor of USI Co., Ltd.; Supervisor of USI Inc.; Director of HHI; Independent Director and Compensation Committee Member of Mercuries & Associates, Holding Ltd.; Director of Jiangsu Longchen Greentech Co., Ltd.
Vice President	Xu-Rui Yu	Director of Shanghai Ding Hui Real Estate Development Co., Ltd.; Director of Ding Wei Real Estate Development Co., Ltd.; Director of Shanghai Ding Yu Real Estate Development Co., Ltd.; Director of Kunshan Ding Hong Real Estate Development Co., Ltd.; Director of Kunshan Ding Yue Real Estate Development Co., Ltd.; Director of Shanghai Ding Qi Property Co., Ltd.; Supervisor of USI Co., Ltd.; Supervisor of USI Inc.; Supervisor of Luzhu Development Co., Ltd.
President of ASE Zhongli	Chen Tien-chi	Director (representative of ASE Inc. and President of ASE Zhongli; Director (representative) of ASE Test Inc.; Director (representative) of Luzhu Development Co., Ltd.; Supervisor of Suzhou ASEN Semiconductors Co., Ltd.
Vice President and Chief of Accounting	Hong-Ming Kuo	Supervisor (representative) of ASE Test Inc.; Director of ASE Singapore Pte. Ltd.; Director of Anstock II Limited; Director of Luzhu Development Co., Ltd.

32

(4) Directors and Supervisors

1. Directors

December 31, 2016; Unit: Shares

Title

Name

Nationality

Date first elected

Date elected

Term

Number and percentage of shares held at the time of election

Current Holdings

Shares held by spouse and underage children

Shares held in the names of others

Main work (education) experiences

Current duties at the Company and at other companies

Spouse or relatives of second degree or closer acting as directors, supervisors, or other department heads

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Title

Name

Relationship

Director

Richard H.P. Chang (Vice Chairman)

Hong Kong

1984.03.11

2015.06.23

3 years

104,414,941

1.32%

104,414,941

1.31%

121,929,346

1.53%

－

－

Bachelor’s degree in industrial engineering, Chung Yuan Christian University in Taiwan  Chairman of Universal Scientific Industrial Co., Ltd. (Shanghai)

Note 2

Chairman

Jason C.S. Chang

Brother

Director

Rutherford Chang

United States

2009.06.25

2015.06.23

3 years

1,779,708

0.02%

1,779,708

0.02%

－

－

－

－

Bachelor’s degree in psychology, Wesleyan University

Note 2

Chairman

Jason C.S. Chang

Father

Director

A.S.E. Enterprises Limited

Hong Kong

1991.03.30

2015.06.23

3 years

1,327,202,773

16.82%

1,327,202,773 (Note 1)

16.71%

－

－

－

－

－

－

－

－

－

Director representative

Jason C.S. Chang (Chairman)

Singapore

3 years

Bachelor in Electrical Engineering, National Taiwan University  Master’s degree from the Illinois Institute of Technology

Note 2

Vice Chairman Director

Richard H.P. Chang  Rutherford Chang

Brother Son

Tien Wu

Republic of China

3 years

Doctorate degree in applied mechanics, University of Pennsylvania

Note 2

None

None

None

Joseph Tung

Republic of China

3 years

Master’s degree in business administration, University of Southern California Vice President of Citibank

Note 2

None

None

None

Raymond Lo

Republic of China

3 years

Bachelor’s degree in electronic physics, National Chiao Tung University

Note 2

None

None

None

Jeffery Chen

Republic of China

3 years

Master’s degree in business administration, University of British Columbia in Canada  Vice President of Bankers Trust Taipei

Note 2

None

None

None

33

Title

Name

Nationality

Date first elected

Date elected

Term

Number and percentage of shares held at the time of election

Current Holdings

Shares held by spouse and underage children

Shares held in the names of others

Main work (education) experiences

Current duties at the Company and at other companies

Spouse or relatives of second degree or closer acting as directors, supervisors, or other department heads

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Number of shares

Percentage of shares

Title

Name

Relationship

Chen Tien-chi

Republic of China

3 years

Bachelor’s degree in industrial engineering, Chung Yuan Christian University

Note 2

None

None

None

Independent Directors

You Sheng-Fu

Republic of China

2009.06.25

2015.06.23

3 years

－

－

－

－

4,632

0.00%

－

－

Department of Accounting, National Taiwan University College of Management  Master, Graduate Institute of Accounting, National Chengchi University

Note 2

None

None

None

Independent Directors

Ta-lin Hsu

United States

2009.06.25

2015.06.23

3 years

－

－

－

－

－

－

－

－

Bachelor of Physics, National Taiwan University  Master of Physics, NYU Polytechnic School of Engineering  Doctor of Electrical Engineering, University of California - Berkeley

Note 2

None

None

None

Independent Directors

Mei-Yue Ho

Republic of China

2015.06.23

2015.06.23

3 years

－

－

－

－

－

－

－

－

Bachelor of Agricultural Chemistry, National Taiwan University

Note 2

None

None

None

Note 1: Number of shares pledged was 248,471,522

Note 2: Summary of current duties at the Company and at other companies

34

Name	Concurrent positions in other companies
Jason C.S. Chang	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Richard H.P. Chang	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Tien Wu	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches .
Joseph Tung	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Raymond Lo	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Jeffery Chen	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Chen Tien-chi	Please refer to Note 3 under (3) Background information of President, Vice Presidents, Assistant Vice Presidents, and heads of various departments and branches.
Rutherford Chang	Director of ASE Inc.; Director of ASE (Shanghai) Inc.; Director of ASE Circuit Manufacturing Co., Ltd. (China); Director (representative) of ASE Test Inc.; ASE Assembly & Test (Shanghai) Ltd.; Supervisor of ASE (Kunshan) Inc.; Director of ASE (Weihai) Inc.; Director of Shanghai Ding Hui Real Estate Development Co., Ltd.; Director of Shanghai Ding Wei Real Estate Development Co., Ltd.; Director of Shanghai Ding Yu Real Estate Development Co., Ltd.; Director of Kunshan Ding Hong Real Estate Development Co., Ltd.; Director of Kunshan Ding Yue Real Estate Development Co., Ltd.; Director of USI Electronics Inc.; Director (representative) of USI Co., Ltd.; Director (representative) of USI Inc.; Director of Wuxi Tongzhi Microelectronics Co., Ltd.; Director of Beijing Ding Gu Ding Hao Enterprise Co., Ltd.; Director of ASE Investment (Kunshan) Co., Ltd.
You Sheng-Fu	Director of Arima Lasers Corp.; Supervisor of ; Supervisor of Dynapack International Technology Corporation; Supervisor of San Fu Chemical Co., Ltd.; Supervisor of Arima Communications Corp.
Ta-lin Hsu	Members of the Audit Committee and Compensation Committee; President and Founder of H&Q Asia Pacific; Chairman of Auspicious
Mei-yue Ho	Independent director and member of Audit Committee and Remuneration Committee of AU Optronics Corp.; Independent director and member of Audit Committee and Remuneration Committee of Bank of Kaohsiung; Independent director and member of Remuneration Committee of Kinpo Electronics, Inc.; Independent director of Ausnutria Dairy Corporation Ltd.

35

2. Supervisors (N/A because the Company has setup an Audit Committee)

3. Major shareholders of corporate shareholders

February 29, 2016

Name of the corporate shareholders	Major shareholders of corporate shareholders
A.S.E. Enterprises Limited	Aintree Limited(100%)

4. The major shareholders of major corporate shareholders

February 29, 2016

Name of corporate shareholders	Corporate shareholders' main shareholders
Aintree Limited	JC Holdings Limited(100%)

5. The statuses of expertise and independence of the directors 

 

Note: Please fill-in a “ü” in the empty spaces for the various directors and supervisors who fits the following conditions two years prior to their appointments or during their tenures.

1. Not an employee of the Company or any of its affiliates.

2. Not a director or supervisor of the Company's affiliates (the same does not apply, however, in cases where the member is an independent director of the Company, its parent company, or any subsidiary in which the Company holds, directly or indirectly, more than 50 percent of the voting shares).

3. Not a natural-person shareholder whose shareholding, together with those of his/her spouse, minor children, and shares held under others' names, exceed 1% of the total number of outstanding shares of the Company, or ranks the person in the top ten shareholders of the Company.

4. Not a spouse, relative within second degree of kinship, or lineal relative within third degree of kinship of any of the persons in the preceding three paragraphs.

5. Not a director, supervisor or employee of a juristic-person shareholder that holds directly 5% or more of the total number of outstanding shares of the Company or ranks in the top five shareholders.

6. Not a director, supervisor, manager or shareholder holding 5% or more of the shares of a specified company or institution that has a financial or business relationship with the Company.

7. Not a professional or an owner, partner, director, supervisor, manager or a spouse of the abovementioned who provides commercial, legal, financial, accounting services or consultation to the Company or an

36

affiliate of the Company. excluding members of compensation committee who exercise power in accordance with Article 7 of the Regulations Governing the Appointment and Exercise of Powers by the Compensation committee of a Company Whose Stock is Listed on the Stock Exchange or Traded Over the Counter.

8. Not having a marital relationship or a relative within the second degree of kinship to any other director of the Company.

9. With no conditions listed by Article 30 of Company Act.

10. Not a government agency, juristic person, or its representative set forth in Article 27 of the Company Act of the R.O.C.

(5) Sponsor: Not applicable.

37

(6) Remunerations to directors, supervisors, president, and vice presidents in the most recent year

1. Remunerations to directors, supervisors, president, and vice presidents in the most recent year

(1) Remunerations to directors 

 

38

Note 1: The Company's shareholders' meeting passed a resolution on June 28, 2016 to distribute NT$140,000,000 as director remuneration for 2015 and NT$2,033,800,000 as employee remuneration for 2015 (in cash).

Note 2: The actual amount of pension paid by the Company for 2015 was NT$0; The pension amount specified represents the amount of pension contributed.

Note 3: This column excludes the employee stock option expense of the Company (NT$8,565,000) and the amount presented in the financial report (NT$15,532,000).

39

Remuneration grade table

Range of remuneration paid to each director	Name of director
	Total amount for the preceding four remunerations (A+B+C+D)		Total amount for the preceding seven remunerations (A+B+C+D+E+F+G)
	The Company	All companies mentioned in the financial report	The Company	All companies mentioned in the financial report
Less than NT$2,000,000	－	－	－	－
NT$2,000,000 (inclusive) to NT$5,000,000	Sheng-fu You, Ta-lin Hsu, Mei-yueh Ho	Sheng-fu You, Ta-lin Hsu, Mei-yueh Ho	Sheng-fu You, Ta-lin Hsu, Mei-yueh Ho	Sheng-fu You, Ta-lin Hsu, Mei-yueh Ho
NT$5,000,000 (inclusive) to NT$10,000,000	－	－	－	－
NT$10,000,000 (inclusive) to NT$15,000,000	－	－	－	－
NT$15,000,000 (inclusive) to NT$30,000,000	Jason C.S. Chang, Richard H.P. Chang, Tien Wu, Joseph Tung, Raymond Lo, Jeffery Chen, TS Chen, Rutherford Chang	Jason C.S. Chang, Richard H.P. Chang, Tien Wu, Joseph Tung, Raymond Lo, Jeffery Chen, TS Chen, Rutherford Chang	Jeffery Chen	－
NT$30,000,000 (inclusive) to NT$50,000,000	－	－	Richard H.P. Chang, Raymond Lo, TS Chen, Rutherford Chang	TS Chen, Rutherford Chang
NT$50,000,000 (inclusive) to NT$100,000,000	－	－	Tien Wu, Joseph Tung	Richard H.P. Chang, Tien Wu, Joseph Tung, Raymond Lo, Jeffery Chen
Greater than NT$100,000,000	－	－	Jason C.S. Chang	Jason C.S. Chang
Total	11 person(s)	11 person(s)	11 person(s)	11 person(s)

40

(2) Supervisor remuneration

An Annual Shareholders' Meeting convened on June 23, 2015 passed a resolution to elect only directors. Three elected independent directors formed an Audit Committee to replace supervisors as of June 24, 2015.

(3) Remunerations to President and Vice Presidents

41

December 31, 2015 Unit: NT$1,000; %

Title

Name

Salary (A) (Note 3)

Pension (B) (Note 2)

Bonuses, special expenses, etc. (C)

Employee remuneration (D)  (Note 1)

The total ratio (%) of net income amount accounted by A, B, C, and D

Number of employee stock options obtained

Number of new restricted employee shares obtained

Remuneration received from Investees other than subsidiaries

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

The Company

All companies mentioned in the financial report

Cash amount

Amount of shares

Cash amount

Amount of shares

CEO

Jason C.S. Chang

99,959

167,449

1,665

1,881

70,042

87,029

210,128

-

219,128

-

1.96%

2.44%

37,269,000 shares

50,519,000 shares

-

-

None

President

Richard H.P. Chang

Chief Operating Officer

Tien Wu

Chief Financial Officer

Joseph Tung

President of ASE Kaohsiung

Raymond Lo

President of ASE Zhongli

Chen Tien-chi

Vice President

Xu-Rui Yu

Vice President

Dao-You Chen

Vice President

Shih-Wen Lee

Vice President

Kwang-Chun Chou

Vice President

Kuo-Tang Lin

Vice President

Huan-Hua Mo

Vice President

Ching-Kun Yeh

Vice President

Chen-Ming Cheng

Vice President

Song-Ching Hong

Vice President

Yen-Chieh Tsao

Vice President

Chih-Bing Hong

Vice President and Chief of Accounting

Hong-Ming Kuo

Note 1: The Company's shareholders' meeting passed a resolution on June 28, 2016 to distribute NT$140,000,000 as director remuneration for 2015 and NT$2,033,800,000 as employee remuneration for 2015 (in cash).

Note 2: The actual amount of pension paid by the Company for 2015 was NT$0; The pension amount specified represents the amount of pension contributed. 

Note 3: This column excludes the employee stock option expense of the Company (NT$9,086,000) and the amount presented in the financial report (NT$15,834,000)

42

Remuneration grade table

ange of remuneration paid to each president and vice president	Names President and Vice Presidents
	The Company	All companies mentioned in the financial report
Less than NT$2,000,000	－	－
NT$2,000,000 (inclusive) to NT$5,000,000 (exclusive)	Ching-Kun Yeh	Ching-Kun Yeh
NT$5,000,000 (inclusive) to NT$10,000,000 (exclusive)	Huan-Hua Mo, Xu-Rui Yu, Kwang-Chun Chou, Dao-You Chen, Chen-Ming Cheng, Kuo-Tang Lin, Yen-Chieh Tsao, Hong-Ming Ku, Chih-Bing Hong, Shih-Wen Lee	Huan-Hua Mo,Kwang-Chun Chou, Dao-You Chen, Chen-Ming Cheng, Kuo-Tang Lin, Hong-Ming Ku, Chih-Bing Hong, Shih-Wen Lee
NT$10,000,000 (inclusive) to NT$15,000,000 (exclusive)	Song-Ching Hong	Xu-Rui Yu, Yen-Chieh Tsao, Song-Ching Hong
NT$15,000,000 (inclusive) to NT$30,000,000 (exclusive)	Richard H.P. Chang, TS Chen	－
NT$30,000,000 (inclusive) to NT$50,000,000 (exclusive)	Joseph Tung, Raymond Lo	Richard H.P. Chang, TS Chen
NT$50,000,000 (inclusive) to NT$100,000,000 (exclusive)	Jason C.S. Chang, Tien Wu	Richard H.P. Chang, Tien Wu, Joseph Tung, Raymond Lo
Greater than NT$100,000,000	－	－
Total	18 person(s)	18 person(s)

(4) Names and employee remuneration allotment status of the managers

Unit: NT$ 1,000

	Title	Name	Amount of shares	Cash amount (Note)	Total	The total ratio (%) of net income amount
Manager	CEO	Jason C.S. Chang	-	210,128	210,128	1.08%
	President	Richard H.P. Chang
	Chief Operating Officer	Tien Wu
	Chief Financial Officer	Joseph Tung
	President of ASE Kaohsiung	Raymond Lo
	President of ASE Zhongli	Chen Tien-chi
	Vice President	Xu-Rui Yu
	Vice President	Dao-You Chen
	Vice President	Shih-Wen Lee
	Vice President	Kwang-Chun Chou
	Vice President	Kuo-Tang Lin
	Vice President	Huan-Hua Mo
	Vice President	Ching-Kun Yeh
	Vice President	Chen-Ming Cheng
	Vice President	Song-Ching Hong
	Vice President	Yen-Chieh Tsao
	Vice President	Chih-Bing Hong
	Vice President and Chief of Accounting	Hong-Ming Kuo

Note: The Company's shareholders' meeting passed a resolution on June 28, 2016 to distribute NT$140,000,000 as director remuneration for 2015 and NT$2,033,800,000 as employee remuneration for 2015 (in cash).

43

2. Separately compare and describe total remuneration, as a percentage of net income stated in the Company on financial reports or individual financial reports, as paid by the Company and by each other company included in the consolidated financial statements during the past 2 fiscal years to directors, supervisors, general managers, and assistant general managers, and analyze and describe remuneration policies, standards, and packages, the procedure for determining remuneration, and its linkage to operating performance and future risk exposure

(1) Total remuneration as a percentage of net income

Title	2014		2015
	The Company	All companies mentioned in the financial statement	The Company	All companies mentioned in the financial statement
Directors and Supervisors (Note)	2.42%	2.94%	2.32%	3.03%
President and Vice Presidents	2.02%	2.27%	1.96%	2.44%

Note: An Annual Shareholders' Meeting convened on June 23, 2015 passed a resolution to elect only directors. Three elected independent directors formed an Audit Committee to replace supervisors as of June 24, 2015.

(2) Remuneration policies, standards, and packages, the procedure for determining remuneration, and its linkage to operating performance and future risk exposure

The salary paid to the Company's CEO and President is resolved by the Board of Directors of the Company. President remuneration is based on the standard in the peer industry. Each year, the Company regularly examines and compares with its competitors to ensure the competitiveness of the Company's salary. The bonus given is dependent on the Company's earnings and individual performance and is set to an amount that can attract and retain talented employees.

Director remuneration is based on the order of distribution in years with profit and will be specified in the Company's Articles of Incorporation.

IV. Capital and Shares

(1) Type of stock  

January 20, 2017; Unit: Share

Type of stock	Authorized capital			Note
	Shares issued and outstanding	Un-issued shares	Total
Registered as ordinary shares	7,949,974,846	2,050,025,154	10,000,000,000	Listed shares

Note: The above table includes the number of shares converted for employee stock options from January 1 to January 20, 2017, but the registration has not yet been changed with the competent authority.

44

(2) Share capital formation process

1. Share capital formation process

Unit: Share; NT$

Year Month	Issuance Price	Authorized capital		Paid-up capital		Remarks
		Number of shares	Amount	Number of shares	Amount	Share capital source	Subscriptions paid with property other than cash	Date and document number of approval
84.03	─	17,200,000	172,000,000	10,000,000	100,000,000	Startup (cash)	None	March 23, 1984 MOEA Export Processing Zone Administration (1984) She-Zi No. 414
84.05	─	20,000,000	200,000,000	20,000,000	200,000,000	Cash capital increase of NT$100,000,000	None	May 10, 1984 MOEA Export Processing Zone Administration (1984) Shang-Zi No. 3956
84.06	─	23,520,000	235,200,000	23,520,000	235,200,000	Cash capital increase of NT$35,200,000	Technology shares of 35,200,000	June 20, 1984 MOEA Export Processing Zone Administration (1984) Shang-Zi No. 5246
86.08	─	33,121,625	331,216,250	33,121,625	331,216,250	Cash capital increase of NT$96,016,250	None	August 12, 1986 MOEA Export Processing Zone Administration (1986) Shang-Zi No. 7725
88.06	─	39,495,000	394,950,000	39,495,000	394,950,000	Capital increase by earnings of 63,733,750	None	June 14, 1988 MOEA Export Processing Zone Administration (1988) Shang-Zi No. 5457
88.09	─	50,000,000	500,000,000	50,000,000	500,000,000	Capital increase by earnings of 105,050,000	None	September 20, 1988 MOEA Export Processing Zone Administration (1988) Shang-Zi No. 8760
90.01	─	62,000,000	620,000,000	62,000,000	620,000,000	Capital increase by earnings of 120,000,000	None	January 31, 1990 MOEA Export Processing Zone Administration (1990) Shang-Zi No. 0184
91.01	─	75,024,000	750,240,000	75,024,000	750,240,000	Capital increase by earnings and employee bonus of 117,840,000 Capital increase by capital reserve of 12,400,000	None	January 7, 1991 MOEA Export Processing Zone Administration (1991) Shang-Zi No. 000046
91.08	─	125,000,000	1,250,000,000	105,607,373	1,056,073,730	Capital increase by earnings and employee bonus of 80,761,730 Capital increase by capital reserve of 225,072,000	None	August 15, 1991 MOEA Export Processing Zone Administration (1991) Shang-Zi No. 006582
92.05	38	125,000,000	1,250,000,000	125,000,000	1,250,000,000	Cash capital increase of 193,926,270	None	May 18, 1992 MOEA Export Processing Zone Administration (1992) Shang-Zi No. 004195
92.10	─	150,600,000	1,506,000,000	150,600,000	1,506,000,000	Capital increase by earnings and employee bonus of 68,500,000 Capital increase by capital reserve of 187,500,000	None	October 24, 1992 MOEA Export Processing Zone Administration (1992) Shang-Zi No. 009364
93.09	─	165,660,000	1,656,600,000	165,660,000	1,656,600,000	Capital increase by capital reserve of 150,600,000	None	September 10, 1993 MOEA Export Processing Zone Administration (1993) Shang-Zi No. 007782
94.05	─	260,000,000	2,600,000,000	233,824,000	2,338,240,000	Capital increase by earnings and employee bonus of 491,131,000 Capital increase by capital reserve of 190,509,000	None	May 30, 1994 MOEA Export Processing Zone Administration (1994) Shang-Zi No. 4655
95.02	60	260,000,000	2,600,000,000	260,000,000	2,600,000,000	Cash capital increase of 261,760,000	None	February 6, 1995 MOEA Export Processing Zone Administration (1995) Shang-Zi No. 000907
95.05	─	500,000,000	5,000,000,000	356,800,000	3,568,000,000	Capital increase by earnings and employee bonus of 760,000,000 Capital increase by capital reserve of 208,000,000	None	May 26, 1995 MOEA Export Processing Zone Administration (1995) Shang-Zi No. 4553
95.07	79.7	500,000,000	5,000,000,000	399,800,000	3,998,000,000	Cash capital increase of 430,000,000	None	July 29, 1995 MOEA Export Processing Zone Administration (1995) Shang-Zi No. 6711

45

Year Month	Issuance Price	Authorized capital		Paid-up capital		Remarks
		Number of shares	Amount	Number of shares	Amount	Share capital source	Subscriptions paid with property other than cash	Date and document number of approval
						reserve of 1,199,400,000
97.06	─	1,400,000,000	14,000,000,000	1,017,000,000	10,170,000,000	Capital increase by earnings and employee bonus of 1,640,700,000 Capital increase by capital reserve of 1,239,300,000	None	June 11, 1997 MOEA Export Processing Zone Administration (1997) Shang-Zi No. 005745
98.05	─	2,200,000,000	22,000,000,000	1,780,000,000	17,800,000,000	Capital increase by earnings and employee bonus of 6,409,600,000 Capital increase by capital reserve of 1,220,400,000	None	May 8, 1998 MOEA Export Processing Zone Administration (1998) Shang-Zi No. 4310
99.08	─	2,200,000,000	22,000,000,000	1,980,000,000	19,800,000,000	Capital increase by earnings and employee bonus of 1,483,800,000 Capital increase by capital reserve of 516,200,000	None	August 11, 1999 MOEA Export Processing Zone Administration (1999) Shang-Zi No. 8494
00.06	─	2,400,000,000	24,000,000,000	1,980,355,086	19,803,550,860	3,550,860 ordinary shares that can be converted from overseas convertible corporate bonds	None	June 1, 2000 MOEA Export Processing Zone Administration (2000) Shang-Zi No. 005552
00.09	─	3,200,000,000	32,000,000,000	2,652,000,000	26,520,000,000	Capital increase by earnings and employee bonus of 6,716,449,140	None	September 17, 2000 MOEA Export Processing Zone Administration (2000) Shang-Zi No. 09740
00.10	43.81	3,200,000,000	32,000,000,000	2,752,000,000	27,520,000,000	Capital increase by issuing 1,000,000,000 DRs	None	October 23, 2000 MOEA Export Processing Zone Administration (2000) Shang-Zi No. 011577
01.08	─	4,150,000,000	41,500,000,000	3,254,800,000	32,548,000,000	Capital increase by earnings and employee bonus of 5,028,000,000	None	August 10, 2001 MOEA Export Processing San-Shang-Zi No. 0900007451
03.09	─	5,150,000,000	51,500,000,000	3,580,280,000	35,802,800,000	Capital increase by earnings of 97,644,000 Capital increase by capital reserve of 3,157,156,000	None	September 18, 2003 MOEA Export Processing San-Shang-Zi No. 09200088290
04.09	─	5,150,000,000	51,500,000,000	3,862,595,437	38,625,954,370	Capital increase by consolidation of 2,823,154,370	None	September 3, 2004 MOEA Export Processing San-Shang-Zi No. 09301027080
04.09	─	5,150,000,000	51,500,000,000	4,100,000,000	41,000,000,000	Capital increase by earnings of 2,219,773,600 Capital increase by employee bonus of 154,272,030	None	September 15, 2004 MOEA Export Processing San-Shang-Zi No. 09300078780
05.01	─	5,150,000,000	51,500,000,000	4,100,660,600	41,006,606,000	Conversion of 6,606,000 employee stock options	None	January 31, 2005 MOEA Export Processing San-Shang-Zi No. 09400004370
05.04	─	5,150,000,000	51,500,000,000	4,111,728,800	41,117,288,000	Conversion of 110,682,000 employee stock options	None	April 21, 2005 MOEA Export Processing San-Shang-Zi No. 09400032410
05.07	─	5,150,000,000	51,500,000,000	4,113,744,200	41,137,442,000	Conversion of 20,154,000 employee stock options	None	July 21, 2005 MOEA Export Processing San-Shang-Zi No. 09400059920
05.09	─	6,300,000,000	63,000,000,000	4,550,532,800	45,505,328,000	Capital increase by earnings of 2,878,547,980 Capital increase by employee bonus of 255,674,600 Capital increase by capital reserve of 1,233,663,420	None	September 29, 2005 MOEA Export Processing San-Shang-Zi No. 09400084400
05.10	─	6,300,000,000	63,000,000,000	4,557,372,300	45,573,723,000	Conversion of 68,395,000 employee stock options	None	October 21, 2005 MOEA Export Processing San-Shang-Zi No. 09400091660
06.01	─	6,300,000,000	63,000,000,000	4,563,877,540	45,638,775,400	Conversion of 65,052,400 employee stock options	None	January 19, 2006 MOEA Export Processing San-Shang-Zi No. 09500005220
06.04	─	6,300,000,000	63,000,000,000	4,573,895,020	45,738,950,200	Conversion of 100,174,800 employee stock options	None	April 24, 2006 MOEA Export Processing San-Shang-Zi No. 09500030630

46

Year Month	Issuance Price	Authorized capital		Paid-up capital		Remarks
		Number of shares	Amount	Number of shares	Amount	Share capital source	Subscriptions paid with property other than cash	Date and document number of approval
06.07	─	6,300,000,000	63,000,000,000	4,577,568,780	45,775,687,800	Conversion of 36,737,600 employee stock options	None	July 19, 2006 MOEA Export Processing San-Shang-Zi No. 09500059250
06.10	─	6,300,000,000	63,000,000,000	4,592,508,620	45,925,086,200	Conversion of 149,398,400 employee stock options	None	October 17, 2006 MOEA Export Processing San-Shang-Zi No. 09500088730
07.01	─	6,300,000,000	63,000,000,000	4,611,311,450	46,113,114,500	Conversion of 188,028,300 employee stock options	None	January 18, 2007 MOEA Export Processing San-Shang-Zi No. 09600005130
07.04	─	6,300,000,000	63,000,000,000	4,629,639,544	46,296,395,440	Conversion of 39,956,440 overseas non-guaranteed convertible corporate bonds and conversion of 143,324,500 employee stock options	None	April 20, 2007 MOEA Export Processing San-Shang-Zi No. 09600034690
07.07	─	6,300,000,000	63,000,000,000	4,645,295,431	46,452,954,310	Conversion of 85,688,270 overseas non-guaranteed convertible corporate bonds and conversion of 70,870,600 employee stock options	None	July 23, 2007 MOEA Export Processing San-Shang-Zi No. 09600063120
07.09	─	8,000,000,000	80,000,000,000	5,392,899,352	53,928,993,520	Capital increase by earnings of 6,941,010,710 Capital increase by employee bonus of 535,028,500	None	September 12, 2007 MOEA Export Processing San-Shang-Zi No. 09600079950
07.10	─	8,000,000,000	80,000,000,000	5,447,558,879	54,475,588,790	Conversion of 251,542,070 overseas non-guaranteed convertible corporate bonds and conversion of 295,053,200 employee stock options	None	October 23, 2007 MOEA Export Processing San-Shang-Zi No. 09600090450
08.01	─	8,000,000,000	80,000,000,000	5,466,030,849	54,660,308,490	Conversion of 145,603,600 overseas non-guaranteed convertible corporate bonds and conversion of 39,116,100 employee stock options	None	January 22, 2008 MOEA Export Processing San-Shang-Zi No. 09700004950
08.04	─	8,000,000,000	80,000,000,000	5,476,949,209	54,769,492,090	Conversion of 19,863,200 overseas non-guaranteed convertible corporate bonds and conversion of 89,320,400 employee stock options	None	April 22, 2008 MOEA Export Processing San-Shang-Zi No. 09700033570
08.07	─	8,000,000,000	80,000,000,000	5,484,848,118	54,848,481,180	Conversion of 61,524,590 overseas non-guaranteed convertible corporate bonds and conversion of 17,464,500 employee stock options	None	July 24, 2008 MOEA Export Processing San-Shang-Zi No. 09700063360
08.08	─	8,000,000,000	80,000,000,000	5,681,934,764	56,819,347,640	Capital increase by capital reserve of 1,094,938,940 Capital increase by employee bonus of 383,205,000 and capital increase by earnings of 492,722,520	None	August 28, 2008 MOEA Export Processing San-Shang-Zi No. 09700077400
08.10	─	8,000,000,000	80,000,000,000	5,690,427,734	56,904,277,340	Conversion of 32,763,800 overseas non-guaranteed convertible corporate bonds and conversion of 52,165,900 employee stock options	None	October 21, 2008 MOEA Export Processing San-Shang-Zi No. 09700094250
09.01	─	8,000,000,000	80,000,000,000	5,690,742,134	56,907,421,340	Conversion of 3,144,000 employee stock options	None	January 19, 2009 MOEA Export Processing San-Shang-Zi No. 09800005500
09.03	─	8,000,000,000	80,000,000,000	5,546,705,134	55,467,051,340	Cancellation of 1,440,370,000 treasury stocks	None	March 16, 2009 MOEA Export Processing San-Shang-Zi No. 09800023510
09.04	─	8,000,000,000	80,000,000,000	5,547,064,694	55,470,646,940	Conversion of 3,595,600 employee stock options	None	April 22, 2009 MOEA Export Processing San-Shang-Zi No. 09800037010
09.07	─	8,000,000,000	80,000,000,000	5,473,127,694	54,731,276,940	Cancellation of 739,370,000 treasury stocks	None	July 14, 2009 MOEA Export Processing San-Shang-Zi No. 09800065960

47

Year Month	Issuance Price	Authorized capital		Paid-up capital		Remarks
		Number of shares	Amount	Number of shares	Amount	Share capital source	Subscriptions paid with property other than cash	Date and document number of approval
09.07	─	8,000,000,000	80,000,000,000	5,473,529,914	54,735,299,140	Conversion of 4,022,200 employee stock options	None	July 21, 2009 MOEA Export Processing San-Shang-Zi No. 09800068350
09.10	─	8,000,000,000	80,000,000,000	5,479,878,254	54,798,782,540	Conversion of 63,483,400 employee stock options	None	October 20, 2009 MOEA Export Processing San-Shang-Zi No. 09800103260
10.01	─	8,000,000,000	80,000,000,000	5,488,458,214	54,884,582,140	Conversion of 85,799,600 employee stock options	None	January 25, 2010 MOEA Export Processing San-Shang-Zi No. 09900005410
10.04	─	8,000,000,000	80,000,000,000	5,495,212,494	54,952,124,940	Conversion of 67,542,800 employee stock options	None	April 23, 2010 MOEA Export Processing San-Shang-Zi No. 09900039480
10.07	─	8,000,000,000	80,000,000,000	5,499,659,994	54,996,599,940	Conversion of 44,475,000 employee stock options	None	July 19, 2010 MOEA Export Processing San-Shang-Zi No. 09900075180
10.08	─	8,000,000,000	80,000,000,000	6,049,157,072	60,491,570,720	Capital increase by capital reserve of 879,195,320 Capital increase by shareholder dividend of 4,615,775,460	None	August 9, 2010 MOEA Export Processing San-Shang-Zi No. 09900084320
10.10	─	8,000,000,000	80,000,000,000	6,051,987,182	60,519,871,820	Conversion of 28,301,100 employee stock options	None	October 22, 2010 MOEA Export Processing San-Shang-Zi No. 09900113120
11.01	─	8,000,000,000	80,000,000,000	6,029,118,452	60,291,184,520	Conversion of 141,312,700 employee stock options Cancellation of 370,000,000 treasury stocks	None	January 19, 2011 MOEA Export Processing San-Shang-Zi No. 10000006520
11.04	─	8,000,000,000	80,000,000,000	6,050,060,512	60,500,605,120	Conversion of 209,420,600 employee stock options	None	April 21, 2011 MOEA Export Processing San-Shang-Zi No. 10000043460
11.07	─	8,000,000,000	80,000,000,000	6,052,219,212	60,522,192,120	Conversion of 21,587,000 employee stock options	None	July 21, 2011 MOEA Export Processing San-Shang-Zi No. 10000083030
11.08	─	9,500,000,000	95,000,000,000	6,747,954,872	67,479,548,720	Capital increase by shareholder dividend of 6,957,356,600	None	August 30, 2011 MOEA Export Processing San-Shang-Zi No. 10000101280
11.10	─	9,500,000,000	95,000,000,000	6,753,563,242	67,535,632,420	Conversion of 56,083,700 employee stock options	None	October 19, 2011 MOEA Export Processing San-Shang-Zi No. 10000124020
12.01	─	9,500,000,000	95,000,000,000	6,650,130,772	66,501,307,720	Conversion of 20,425,300 employee stock options Cancellation of 1,054,750,000 treasury stocks	None	January 19, 2012 MOEA Export Processing San-Shang-Zi No. 10100007740
12.04	─	9,500,000,000	95,000,000,000	6,654,716,832	66,547,168,320	Conversion of 45,860,600 employee stock options	None	April 20, 2012 MOEA Export Processing San-Shang-Zi No. 10100043500
12.07	─	9,500,000,000	95,000,000,000	6,657,855,052	66,578,550,520	Conversion of 31,382,200 employee stock options	None	July 24, 2012 MOEA Export Processing San-Shang-Zi No. 10100081100
12.09	─	9,500,000,000	95,000,000,000	7,589,454,606	75,894,546,060	Capital increase by shareholder dividend of 9,315,995,540	None	September 4, 2012 MOEA Export Processing San-Shang-Zi No. 10100099460
12.10	─	9,500,000,000	95,000,000,000	7,594,149,626	75,941,496,260	Conversion of 46,950,200 employee stock options	None	October 18, 2012 MOEA Export Processing San-Shang-Zi No. 10100117650
13.01	─	9,500,000,000	95,000,000,000	7,602,121,666	76,021,216,660	Conversion of 79,720,400 employee stock options	None	January 18, 2013 MOEA Export Processing San-Shang-Zi No. 10200007680

48

Year Month	Issuance Price	Authorized capital		Paid-up capital		Remarks
		Number of shares	Amount	Number of shares	Amount	Share capital source	Subscriptions paid with property other than cash	Date and document number of approval
13.04	－	9,500,000,000	95,000,000,000	7,607,502,906	76,075,029,060	Conversion of 53,812,400 employee stock options	None	April 17, 2013 MOEA Export Processing San-Shang-Zi No. 10200044490
13.07	－	9,600,000,000	96,000,000,000	7,609,816,206	76,098,162,060	Conversion of 23,133,000 employee stock options	None	July 17, 2013 MOEA Export Processing San-Shang-Zi No. 10200082280
13.10	26.1	9,600,000,000	96,000,000,000	7,756,003,946	77,560,039,460	Cash capital increase of 1,300,000,000 Conversion of 161,877,400 employee stock options	None	October 17, 2013 MOEA Export Processing San-Shang-Zi No. 10200118400
14.01	－	9,600,000,000	96,000,000,000	7,787,159,546	77,871,595,460	Conversion of 311,556,000 employee stock options	None	January 21, 2014 MOEA Export Processing San-Shang-Zi No. 10300007950
14.04	－	9,600,000,000	96,000,000,000	7,810,454,946	78,104,549,460	Conversion of 232,954,000 employee stock options	None	April 22, 2014 MOEA Export Processing San-Shang-Zi No. 10300046040
14.07	－	10,000,000,000	100,000,000,000	7,824,220,046	78,242,200,460	Conversion of 137,651,000 employee stock options	None	July 18, 2014 MOEA Export Processing San-Shang-Zi No. 10300085480
14.10	－	10,000,000,000	100,000,000,000	7,852,537,846	78,525,378,460	Conversion of 283,178,000 employee stock options	None	October 24, 2014 MOEA Export Processing San-Shang-Zi No. 10300125920
15.01	－	10,000,000,000	100,000,000,000	7,860,491,546	78,604,915,460	Conversion of 79,537,000 employee stock options	None	January 20, 2015 MOEA Export Processing San-Shang-Zi No. 10400006750
15.04	－	10,000,000,000	100,000,000,000	7,887,881,546	78,878,815,460	Conversion of 273,900,000 employee stock options	None	April 21, 2015 MOEA Export Processing San-Shang-Zi No. 10400040900
15.07	－	10,000,000,000	100,000,000,000	7,893,157,596	78,931,575,960	Conversion of 52,760,500 employee stock options	None	July 16, 2015 MOEA Export Processing San-Shang-Zi No. 10400076760
15.10	－	10,000,000,000	100,000,000,000	7,902,928,996	79,029,289,960	Conversion of 97,714,000 employee stock options	None	October 19, 2015 MOEA Export Processing San-Shang-Zi No. 10400114270
16.01	－	10,000,000,000	100,000,000,000	7,909,741,896	79,097,418,960	Conversion of 68,129,000 employee stock options	None	January 20, 2016 MOEA Export Processing San-Shang-Zi No. 10500008440
16.04	－	10,000,000,000	100,000,000,000	7,918,272,896	79,182,728,960	Conversion of 85,310,000 employee stock options	None	April 26, 2016 MOEA Export Processing San-Shang-Zi No. 10500040560
16.07	－	10,000,000,000	100,000,000,000	7,923,622,596	79,236,225,960	Conversion of 53,497,000 employee stock options	None	July 20, 2016 MOEA Export Processing San-Shang-Zi No. 10500071110
16.10	－	10,000,000,000	100,000,000,000	7,936,473,546	79,364,735,460	Conversion of 128,509,500 employee stock options	None	October 20, 2016 MOEA Export Processing San-Shang-Zi No. 10500105140
17.01	－	10,000,000,000	100,000,000,000	7,944,875,346	79, 448,753,460	Conversion of 84,018,000 employee stock options	None	January 23, 2017 MOEA Export Processing San-Shang-Zi No 10600009350

49

2. Private fund raising ordinary share handling status for the last three years until the printing date of this prospectus: None.

(3) Recent equity ownership dispersion status

1. Shareholder structure

December 31, 2016; Unit: Shares 

Shareholder structure Quantity	Government institution	Financial institutions	other corporations	Individual investors	Foreign institutions and foreigners	Total
Number of people	4	2	366	169,978	1,310	171,660
Number of shares held	199,812,127	117,226,000	1,234,764,734	844,394,333	5,548,678,152	7,944,875,346
Shareholding ratio	2.51%	1.48%	15.54%	10.63%	69.84% (Note 1)	100%

Note : Shareholding ratio of Chinese investors was 0.0182%.

2. Ownership diversity

December 31, 2016; Unit: Shares 

Shareholding rating Number of shareholders Number of shares held Shareholding ratio

1–999	83,118	22,356,984	0.281%
1,000–5,000	57,624	136,106,084	1.713%
5,001–10,000	14,636	107,563,234	1.354%
10,001–15,000	5,440	67,042,096	0.844%
15,001–20,000	3,035	53,754,652	0.677%
20,001–30,000	2,502	61,649,956	0.776%
30,001–50,000	2,173	83,166,727	1.047%
50,001–100,000	1,395	97,641,335	1.229%
100,001–200,000	622	87,485,389	1.101%
200,001–400,000	339	94,417,975	1.188%
400,001–600,000	147	72,516,682	0.913%
600,001–800,000	101	69,988,481	0.881%
800,001–1,000,000	63	56,281,182	0.708%
Over 1,000,001	465	6,934,904,569	87.288%
Total	171,660	7,944,875,346	100.000%

3. Name list for major shareholders:

The names of shareholders with more than a 5% ownership interest or shareholders with the top ten shareholding ratios, number of shares held, and the percentage of their holding interest:

December 31, 2016; Unit: Shares

Shares Name of the main shareholders	Number of shares held	Shareholding ratio
A.S.E. Enterprises Limited	1,327,202,773	16.71%
Citibank N.A. manages ASE's depositary receipts	627,589,985	7.90%
HSBC is entrusted to manage the investment accounts of investment companies	321,454,196	4.05%
Cathay Life Insurance Co., Ltd.	224,554,000	2.83%

50

Shares Name of the main shareholders	Number of shares held	Shareholding ratio
Fubon Insurance Co., Ltd.	155,510,000	1.96%
New labor pension fund system	125,567,609	1.58%
Mei-Chen Feng	121,929,346	1.53%
Nan Shan Life Insurance Co.., Ltd	115,486,000	1.45%
Richard H.P. Chang	104,414,941	1.31%

Deutsche Bank Custodian University Retirement Equity Fund Investment Account 100,939,968 1.27%

4. The statuses of directors, supervisors, and shareholders with the shareholding ratio of over 10% for the past two years or the current year who have waived cash capital increase

(1) The statuses of directors, supervisors, and major shareholders who have waived cash capital increase: In the most recent year and as of the printing date of this prospectus, the Company did not increase its capital by cash.

(2) Subscription status of relevant personnel who have waived cash capital increase: None.

5. Equity transfer and equity pledge modification scenario of directors, supervisors, managers and shareholders holding more than 10% of the shares for the last two years until the printing date of this prospectus

(1) Changes in the equity of directors, supervisors, managers and shareholders holding more than 10% of the shares:

Unit: Shares

Title	Name	2014		2015		As of December 31, 2016
		Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged
Directors and major shareholders	A.S.E. Enterprises Limited	-	-	-	-	-	-
	Represented by: Jason C.S. Chang (Chairman and CEO)	2,000,000	-	-	-	-	-
	Represented by: Tien Wu (COO)	-	-	-	-	1,100,000	-
	Represented by: Joseph Tung (CFO)	120,000	-	-	-	1,200,000	-
	Represented by: Raymond Lo (President of ASE Kaohsiung) (appointed on June 24, 2015)	-	-	-	-	1,000,000	-
	Represented by: Jeffery Chen (President of Shanghai Headquarter; Note 1) (appointed on June 24, 2015)	(747,000)	-	-	-	1,056,000	-
	Represented by: TS Chen (President of ASE Zhongli; Note 2)			(530,000)	-	900,000	-
Director	Richard H.P. Chang (Vice Chairman and President)	-	-	-	-	-	-
Director	Rutherford Chang	-	-	-	-	-	-
Director	J&R Holding Ltd. (dismissed on June 23, 2015)	-	-	-	-	-	-
	Represented by: Raymond Lo (President of ASE Kaohsiung) (dismissed on June 23, 2015)	-	-	-	-	-	-
	Represented by: Jeffery Chen (dismissed on June 23, 2015)	(747,000)	-	-	-	-	-
Independent Directors	You Sheng-Fu	-	-	-	-	-	-
Independent Directors	Ta-lin Hsu	-	-	-	-	-	-
Independent Directors	Mei-yue Ho (appointed on June 24, 2015)	-	-	-	-	-	-
Supervisor	Jerry Chang (dismissed on June 23, 2015)	(612,000)-	-	-	-	-	-

51

Title	Name	2014		2015		As of December 31, 2016
		Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged	Increase (decrease) in the number of shares held	Increase (decrease) in the number of shares pledged
	(dismissed on June 23, 2015)
Supervisor representative	Tseng Yuan-Yi (dismissed on June 23, 2015)	90,000	-	-	-	-	-
	Pan Shih-hua (dismissed on June 23, 2015)	-	-	-	-	-	-
	Chen Tien-chi (dismissed on June 23, 2015)	350,000	-	-	-	-	-
	Chun-che Lee (dismissed on June 23, 2015)	350,000	-	-	-	-	-
Vice President	Xu-Rui Yu	(130,000)	-	(9,000)	-	100,000	-
Vice President	Dao-You Chen (transferred to other duties on November 30, 2016)	-	-	100,000	-	-	-
Vice President	Shih-Wen Lee	-	-	-	-	380,000	-
Vice President	Kwang-Chun Chou (Note 3)	-	-	40,000	-	-	-
Vice President	Kuo-Tang Lin	100,000	-	100,000	-	100,000	-
Vice President	Huan-Hua Mo	-	-	100,000	-	(109,000)	-
Vice President	Ching-Kun Yeh	61,000	-	25,000	-	51,000	-
Vice President	Chen-Ming Cheng	180,000	-	(60,000)	-	(114,000)	-
Vice President	Song-Ching Hong	-	-	100,000	-	170,000	-
Vice President	Yen-Chieh Tsao	-	-	-	-	-	-
Vice President	Chih-Bing Hong	2,000	-	95,000	-	106,000	-
Vice President	Kuo-An Tang (dismissed on February 28, 2015)	(70,000)	-	-	-	-	-
Vice President	Shih-Rong Lan (dismissed on July 31, 2015)	1,000	-	-	-	-	-
Vice President	He-Di Tseng (dismissed on August 4, 2015)	(150,000)	-	-	-	-	-
Vice President	Wen-Chih Shen (Note 4) (dismissed on August 10, 2015)	(72,000)	-	-	-	-	-
Vice President and Chief of Accounting	Hong-Ming Ku (Note 5)	-	-	18,000	-	-	-

Note 1: Manager who is newly appointed in May 2016. 

Note 2: Manager who is newly appointed in August 2015. 

Note 3: Manager who is newly appointed in January 2014. 

Note 4: Manager who is newly appointed in March 2014. 

Note 5: Manager who is newly appointed in August 2014.

(2) Information on the counterparty in any transfer of equity interests who is a related party: None.

(3) Information on the counterparty in any pledge of equity interests who is a related party: None.

6. Information on the relationship between any of the top ten shareholders (related party, spouse, or kinship within the second degree)

December 31, 2016; Unit: Shares

Name Shareholding Shares held by spouse and underage children Total shareholding by nominee arrangement Titles, names and relationships between top 10 shareholders who are a related party, spouse, or with kinship within the second degree. Remarks

52

	Number of shares	Percentage of shares	Number of shares	Percentage of shares	Number of shares	Percentage of shares	Title (or name)	Relationship
A.S.E. Enterprises Limited	1,327,202,773	16.71%	-	-	-	-
Citibank N.A. manages ASE's depositary receipts	627,589,985	7.90%	-	-	-	-	-	-
HSBC is entrusted to manage the investment accounts of investment companies	321,454,196	4.05%	-	-	-	-	-	-
Cathay Life Insurance Co., Ltd.	224,554,000	2.83%	-	-	-	-	-	-
Fubon Insurance Co., Ltd.	155,510,000	1.96%	-	-	-	-	-	-
New labor pension fund system	125,567,609	1.58%	-	-	-	-	-	-
Mei-Chen Feng	121,929,346	1.53%	104,414,941	1.31%	-	-	Richard H.P. Chang	Spouse (husband)
Nan Shan Life Insurance Co.., Ltd	115,486,000	1.45%	-	-	-	-	-	-
Richard H.P. Chang	104,414,941	1.31%	121,929,346	1.54%	-	-	Mei-Chen Feng	Spouse (wife)
Deutsche Bank Custodian University Retirement Equity Fund Investment Account	100,939,968	1.27%	-	-	-	-	-	-

(4) Stock price, net worth, earnings, dividends and related information for the previous two years

Unit: NT$; Shares

Year Item			2014	2015	As of November 30, 2016
Stock price	Before retroaction	High	42.15	48.05	39.90
		Low	26.60	29.75	28.10
	After retroaction	High	42.15	48.05	-
		Low	26.60	29.75	-
	Average		35.06	39.22	35.53
Net worth per share	Pre-distribution		19.47	20.21	19.27
	Post-distribution		17.45	18.60	－
Earnings per share	Weighted average shares		8,220,694,389 shares	8,250,064,481 shares	8,272,938,978 shares (Note 4)
	Earnings per share	Before retroaction	3.07	2.55 (Note 5)	1.79 (Note 4)
		After retroaction	3.07	2.55 (Note 5)	－
Dividends per share	Cash dividend		2.00379984	1.59718596	－
	Stock dividend	Earnings	－	－	－
		Capital surplus	－	－	－
	Accumulated unpaid dividend		－	－	－
Return on investment analysis	P/E ratio (Note 1)		11.42	15.38	19.85 (Note 4)
	Price-dividend ratio (Note 2)		17.50	24.56	－
	Cash dividend yield (Note 3)		0.06%	0.04%	－

Note 1: P/E ratio=Average closing price per share for the year/earnings per share.

Note 2: Price-dividend ratio=Average closing price per share for the year/cash dividend per share. 

Note 3: Cash dividend yield=Cash dividend per share/Average closing price per share for the year.

Note 4: Net worth per share and earnings per share were obtained from the financial report of the most recent quarter that is approved by the CFA. 

Note 5: As of September 30, 2016, the Company has identified the investment cost and the difference in the net fair value of assets and liabilities that can be recognized by SPIL, and these amounts were retroactively adjusted in the 2015 financial statement. Earnings per share was retroactively adjusted to NT$2.51.

(5) Dividend policy and implementation status

1. Dividend policy according to the Articles of Incorporation

ASE is now at the stage of steady growth. To provide ASE with the funds it needs to expand and satisfy shareholders' desire for cash inflow, ASE adopts a Residual Dividend Policy. With which, cash dividends shall not fall below 30% of all dividends, with the remainder distributed in the form of stock dividends. Dividend distribution proposals shall

53

be drafted by the board and approved by the AGM before they are implemented.

2. Previous discussions regarding dividend distribution for the current year

The Company’s shareholders' meeting passed a resolution on June 28, 2016 to distribute a shareholder dividend of NT$12,476,779,033 in cash at NT$1.6 per share. The above distribution of dividends to shareholders and the cash and stock dividend distribution rates are calculated based on the number (7,797,986,896) of shares recorded in the Register of Shareholders as of March 23, 2016 after treasury stocks that were already bought back by ASE were subtracted. If at a later date ASE’s ECB holders exercise the right of conversion, or new shares are issued to employees against Employee Stock Option warrants, or new shares are issued by ASE for cash increase, or there is a buyback of ASE’s stock, or transfer or cancellation of ASE’s treasury stocks, which affects the cash distribution rate of the shareholders’ bonus, requiring adjustment, the management has requested the shareholders’ meeting to authorize the Chairman to handle the situation and make adjustments accordingly.

(6) Effect of the proposed stock dividends in the current year on company operating performance and earnings per share: Not applicable.

(7) Remuneration of employees, directors and supervisors

1. Percentages or ranges of remuneration of employees, directors, and supervisors under the Articles of Incorporation:

According to Article 23 of the Company's Articles of Incorporation, if there is surplus profit, the Company shall set aside 5.25% to 8.25% (both inclusive) as compensation to employees and no more than 0.75% (inclusive) as remuneration to the directors; However, if the Company has accumulated losses, the Company shall set aside a part of the surplus profit first for covering the losses.

Regarding the aforementioned employee remuneration, the 5.25% portion shall be distributed to all employees in accordance with the employee remuneration distribution rules, while the portion exceeding 5.25% shall be distributed to individual employees (having special contributions) in accordance with the rules made by the Board of Directors with the authority granted hereby. Where employee remuneration is distributed in the form of stock or cash, it shall be resolved by a majority vote at a meeting attended by more than two thirds of the directors and shall be reported at the shareholders' meeting.

Employees referred to in the three subparagraphs include employees of subsidiary companies that meet certain conditions, which are to be prescribed by the Board of Directors. According to Article 23-1 of the Articles of Incorporation, ASE’s net profits each year after the actual budget shall be distributed in the following order:

(1) Make up losses.

(2) Allocation of 10% as the legal surplus reserve.

(3) Allocation or reversal of a special surplus reserve in accordance with laws or regulations set forth by the relevant competent authority.

(4) Addition or deduction of the portion of retained earnings that are equity investment gains or losses that have been realized or measured at fair value through other overall gains or losses. The remaining balance shall be added to the previous-year undistributed earnings, and the Board of Directors shall devise a dividend distribution proposal, which shall be submitted to a meeting of shareholders for resolution.

2. Basis for estimating the amount of remuneration of employees, directors and supervisors, basis for calculating the number of shares to be distributed as employee remuneration, and the accounting treatment of the discrepancy, if any, between the actual distributed amount and the estimated amount, for the current period:

Estimations of employee remuneration and director remuneration payable for 2015 shall be

54

respectively calculated according to 8.25% and 0.75% of net profit before tax (in which employee remuneration and director remuneration have not been deducted). Handling of the difference: The difference was recognized as changes in accounting estimates at the time the board passed the resolution. In case of a significant change to the amounts approved by the board of directors after the year has ended, the change is applied to adjust the expenses in the year in which they are recognized. If the amount still changes after the day the financial statements are passed, it shall be treated as changes in accounting estimates and entered into accounts in the following year.

3. Remuneration proposals passed by the Board of Directors None.

4. Remuneration report and results at the shareholders meeting

(1) To pay remuneration of employees, directors and supervisors in cash or stock. In case of any discrepancy between the amounts and the amortized estimates for the year, the differences, reasons, and responses should be disclosed.

The Company passed a resolution at the meeting of the Board of Directors on April 1, 2016 and at the shareholders' meeting on June 28, 2016 to distribute NT$2,033,800,000 (all in cash) as employee remuneration and NT$ 140,000,000 as director remuneration. The difference between the amount to be distributed and the combined amount of employee remuneration of NT$2,033,937,757 and remuneration to directors of NT$184,903,432 is NT$45,041,189. Handling of the difference: The difference was recognized as changes in accounting estimates at the time the board passed the resolution. In case of a significant change to the amounts approved by the board of directors after the year has ended, the change is applied to adjust the expenses in the year in which they are recognized. If the amount still changes after the day the financial statements are passed, it shall be treated as changes in accounting estimates and entered into accounts in the following year.

(2) The percentage of remuneration of employees to be paid in stocks out of the sum of the net profit after tax and total employee remuneration for the current period: Not applicable because employee remuneration for 2015 was distributed in cash.

5. Any discrepancy between actual distribution of remuneration of employees, directors and supervisors (including the number of shares, the amount and stock price) and the recognized remuneration of employees, directors and supervisors and disclosure of the differences, reasons and responses:

Earnings distribution plan and actual distribution of remuneration for 2014 passed in the Annual Shareholders' Meeting on June 23, 2015:

(1) The actual distribution of employee remuneration was NT$2,335,600,000 and director and supervisor remuneration was NT$211,200,000.

(2) The difference between the amount actually distributed and the combined amount of employee remuneration of NT$2,335,785,851 and remuneration to directors of NT$212,344,171 is NT$1,330,022.

Reason for the difference: Accounting estimate adjustments.

Handling status: The difference was recognized as changes in accounting estimates at the time the board passed the resolution.

(8) Stock buyback

November 30, 2016 

Phase of repurchase	7
Purpose of repurchase	To change share ownership
Period of repurchase	2015/03/03~2015/03/27
Range of repurchase price	NT$42–47

55

Type and quantity of repurchased shares	120,000,000 common shares
Amount of repurchased shares	NT$5,333,405,737
Quantity of shares eliminated and transferred	0 shares
Accumulated quantity of ASE shares held	120,000,000 shares
Accumulated quantity of ASE shares held to total outstanding shares (%)	1.51%

56

5. Issuance of corporate bonds (including overseas corporate bonds)

(1) Unredeemed corporate bonds and corporate bonds undergoing private placement

Issuing company	Advanced Semiconductor Engineering, Inc.
Item	3rd overseas non-guaranteed convertible corporate bonds	4th overseas non-guaranteed convertible corporate bonds	2015 1st non-guaranteed ordinary convertible bonds
Date of issue	September 5, 2013	July 2, 2015	January 12, 2016
Par value	US$200,000	US$200,000	NT$1,000,000
Issuing and trading location	Singapore Exchange (SGX)	Singapore Exchange (SGX)	Taipei Exchange (TPEx)
Issuing price	Issued at par value	Issued at par value	Issued at par value
Total	US$400,000,000	US$200,000,000	NT$900 million
Interest rate	0%	0%	Tranche A: Fixed annual interest rate of 1.30% Tranche B: Fixed annual interest rate of 1.50%
Period	5 years Maturity Date: September 5, 2018	2.75 years (2 years and 9 months) Maturity Date: March 27, 2018	Tranche A: 5 years, maturity date: January 12, 2021. Tranche B: 7 years, maturity date: January 12, 2023.
Guarantor institution	None	None	None
Trustee	Citicorp International Limited	Citicorp International Limited	Taipei Fubon Commercial Bank
Underwriting agency	Citigroup Global Markets Ltd,Credit Suisse(HK) Ltd,DBS Bank Ltd,CIMB Bank(L) Ltd	DBS, SC, CIMB, Citigroup and CS	Yuanta Securities Co., Ltd
Certified attorney	N/A	N/A	Yi & Cheng Attorneys-At-Law, Guo Hui-ji, Attorney at Law
CFA	N/A	N/A	Deloitte & Touche CPAs Chen Zhen-li and Jiang Jia-ling
Method of repayment	Bullet repayment	Bullet repayment	Bullet repayment for Tranche A and Tranche B
Unsettled amount	US$400,000,000	US$200,000,000	NT$900 million

57

Issuing company	Advanced Semiconductor Engineering, Inc.
Item	3rd overseas non-guaranteed convertible corporate bonds	4th overseas non-guaranteed convertible corporate bonds	2015 1st non-guaranteed ordinary convertible bonds
Provisions on repurchase or early settlement	(1) After three years of issuing corporates bonds, if the TWSE closing price of the issuing company's ordinary shares for 20 consecutive trading days has been converted into USD according to the exchange rate at the time, and the closing price equals 130% of the conversion price (converted into USD at a fixed exchange rate of US$1:NT$29.956 on the pricing day), then the issuing company may repurchase parts or all of the bonds at the repurchase price in advance. (2) When 90% of the Company's corporate bonds have been redeemed, repurchased and cancelled or the bond holder has exercised his/her conversion right, the issuing company may repurchase all of the bonds at the repurchase price in advance. (3) When changes in Taiwan's tax laws and regulations incur a tax increase on the issuing company's corporate bonds in the future, the issuing company may repurchase all of the bonds at the repurchase price in advance.	(1) As of March 19, 2015 after issuance of these bonds, if the TWSE closing price of the issuing company's ordinary shares for 20 consecutive trading days, out of 30 business days, has been converted into USD according to the exchange rate at the time, and the closing price equals more than 130% of the amount calculated as follows: the amount paid by the issuing company to repurchase the bonds in advance x the conversion price at the time (converted into USD at a fixed exchange rate on the pricing day) ÷ par value, then the issuing company may repurchase parts or all of the bonds at the repurchase price in advance (defined subsequently). (2) If over 90% of the bonds have been redeemed, converted, repurchased, or cancelled, the issuing company may redeem all of the outstanding bonds in advance at the repurchase price. The actual price at which the issuing company can repurchase bonds in advance shall be determined collectively by the issuing company and lead foreign underwriter according to the market condition on the day on which the bond is priced. (3) When changes in Taiwan's tax laws and regulations incur a tax increase, additional cost, or cost increase on the issuing company's corporate bonds in the future, the issuing company may repurchase all of the bonds at the repurchase price in advance in accordance with agreement. The actual price at which the issuing company can repurchase bonds in advance shall be determined collectively by the issuing company and lead foreign underwriter according to the market condition on the day on which the bond is priced. If a bond holder does not participate in redemption, the holder may not request the issuing company to bear additional tax or costs.	None
Restriction clauses	None	None	Applicable to only professional investors specified under the Taipei Exchange Rules Governing Management of Foreign Currency Denominated International Bonds
Name of credit rating institution, date of rating, and rating level	None	None	Fitch Ratings Ltd., Taiwan Branch Date of rating: December 16, 2015 Rating level: A+

58

Issuing company		Advanced Semiconductor Engineering, Inc.
Item		3rd overseas non-guaranteed convertible corporate bonds	4th overseas non-guaranteed convertible corporate bonds	2015 1st non-guaranteed ordinary convertible bonds
Other rights	Amount of ordinary shares that have been converted (exchanged or subscribed), DRs, or other securities	As of November 30, 2016, NT$0 corporate bonds have been converted into ordinary shares, for an accumulated total of 0 ordinary shares been converted.	As of November 30, 2016, NT$0 corporate bonds have been converted into ordinary shares, for an accumulated total of 0 ordinary shares been converted.	N/A
	Issuance and conversion (exchange or subscription) guidelines	In accordance with the Company's Guidelines for Issuance and Conversion of 3rd Foreign Non-Guaranteed Convertible Corporate Bonds	In accordance with the Company's Guidelines for Issuance and Conversion of 4th Foreign Non-Guaranteed Convertible Corporate Bonds	N/A
Possible dilution conditions and influence on shareholders' interests		The Company's unsettled principal for its foreign 3rd non-guaranteed convertible corporate bonds amounted to US$400,000,000 as of the end of November. According to the current conversion price of NT$28.99, it is anticipated that the corporate bonds can be converted to 413,328,734 shares, accounting for 5.21% of the total shares issued, which exert no material impact on shareholders' interests.	The Company's unsettled principal for its foreign 4th non-guaranteed convertible corporate bonds amounted to US$200,000,000 as of the end of November. According to the current conversion price of NT$49.52, it is anticipated that the corporate bonds can be converted to 124,911,147 shares, accounting for 1.57% of the total shares issued, which exert no material impact on shareholders' interests.	N/A
Custodian		N/A	N/A	N/A

59

(2) Corporate bonds to mature within one year

Issuing company		Anstock II Limited
Item		1st in 2014
Date of issue		July 24, 2014
Par value		US$200,000
Issuing and trading location		Singapore Exchange (SGX)
Issuing price		Issued at par value
Total		US$300,000,000
Interest rate		2.125%
Period		3 years, maturity date: July 24, 2017
Guarantor institution		Guaranteed by ASE Inc.
Trustee		The Hongkong and Shanghai Banking Corporation Limited
Underwriting agency		The Hongkong and Shanghai Banking Corporation Limited、Citigroup Global Markets Limited、DBS Bank Ltd
Certified attorney		Baker & McKenzie、Maples and Calder、Davis Polk & Wardwell
CFA		Deloitte & Touche
Method of repayment		Bullet repayment
Unsettled amount		US$300,000,000
Provisions on repurchase or early settlement		1. When a change in the controlling rights of the issuer and guarantor occurs, the issuer may, upon the request of the bond holder, redeem all issued bonds at a purchase price that equals 101% of the principal plus the accrued and unpaid interest (however, interest is calculated without including the day on which the change in controlling right occurred, and the day of redemption for the bond holder may be no later than 60 days after the day on which a change in the issuer's controlling right occurs. 2. When a change in both party's governmental tax policies causes a change in the principal and accrued interest, the bond issuer must notify the bond holder within 30 to 60 days.
Restriction clauses		None
Name of credit rating institution, date of rating, and rating level		Fitch Ratings on July 11, 2014: BBB
Other rights	Amount of ordinary shares that have been converted (exchanged or subscribed), DRs, or other securities	N/A
	Issuance and conversion (exchange or subscription) guidelines	N/A
Possible dilution conditions and influence on shareholders' interests		N/A
Custodian		N/A

(3) For any issued convertible corporate bonds which are convertible to common shares, overseas depositary receipts or any other securities:

Unit: NT$

Issuing company	Advanced Semiconductor Engineering, Inc.
Type of Corporate Bonds	3rd overseas non-guaranteed convertible corporate bonds	4th overseas non-guaranteed convertible corporate bonds

60

Year Item		2014	2015	As of November 30, 2016	2014	2015	As of November 30, 2016
Convertible corporate bond market	High	129.227	144.915	128.867	-	101.065	98.527
	Low	105.587	107.717	105.929	-	91.89	90.422
	Average	118.829	124.947	119.083	-	95.676	94.431
Conversion price		28.99 (applicable as of August 21, 2016)			49.52 (applicable as of August 21, 2016)
Issuing date and conversion price at time of issue		Date of issue: September 5, 2013 Conversion price at time of issue: 33.085			Date of issue: July 2, 2015 Conversion price at time of issue: 54.5465
Method for exercising of the conversion obligation		When a corporate bond holder exercises his/her conversion right, the issuing company shall, within five business days after receiving the conversion request, deliver new shares by the book entry of Taiwan Depository & Clearing Corporation. If the Company's bond holder who requested for conversion has not yet setup a foreign corporate bond depository account, the issuing company shall deliver new shares by book entry after the holder complete relevant account opening procedures.			When a corporate bond holder exercises his/her conversion right, the issuing company shall, within five business days after receiving the conversion request, deliver ordinary shares by the book entry of Taiwan Depository & Clearing Corporation. If the Company's bond holder who requested for conversion has not yet setup a foreign corporate bond depository account, the issuing company shall deliver ordinary shares by book entry after the holder complete relevant account opening procedures.

61

(4) The following matters shall be disclosed for any issued exchangeable corporate bonds: None.

(5) The following matters shall be disclosed if the company adopts the shelf registration method for the offering and issuance of ordinary corporate bonds: None.

(6) The following matters shall be disclosed for any issued corporate bonds with warrants: None.

(7) Status of private placements of corporate bonds in the three most recent years, and up to the date of publication of the prospectus: None.

6. Issuance of preferred stocks: None.

7. Issuance of global depositary receipts (GDR)

November 30, 2016 Unit: US$ 

Date of issue Item			September 2000	June 2003
Date of issue			September 2000	June 2003
Issuing and trading location			U.S. New York Stock Exchange	U.S. New York Stock Exchange
Total amount of issuance			US$140,000,000	US$86,808,000
Unit issuing price			US$7 per unit	US$2.65 per unit
Total number of issuing unit			20,000,000 units, each representing five ordinary shares of the Company	32,757,600 units, each representing five ordinary shares of the Company
Source of securities			Ordinary shares issued for capital increase	The Company's issued ordinary shares that are held by the Company's shareholders
Number and value of securities			100,000,000 ordinary shares, each share has a par value of NT$10.	163,788,000 ordinary shares, each share has a par value of NT$10.
Rights and obligations of DR holders			Same as those of common share holders
Trustee			None
Depository bank			Citibank
Custodian bank			Citibank Taipei Branch
Outstanding			Up to the printing date of the prospectus, the number of outstanding DRs was 125,517,996 units, representing 627,589,985 common shares of the Company.
Apportionment of expenses for issuance and maintenance			None
Terms and conditions in the depository agreement and custody agreement			None
Market price per unit	2013	High	5.38
		Low	3.87
		Average	4.22
	2014	High	6.89
		Low	4.44
		Average	5.77
	2015	High	8.12
		Low	4.54
		Average	5.97
	As of November 30, 2016	High	6.23
		Low	4.39
		Average	5.52

62

8. Exercise of employee stock option plan (ESOP):

To attract and retain potential professionals, encourage employees, and improve their loyalty, the Company received approval from the competent authority in November 2007, April, 2010, and April 2015 to issue 200,000,000 units of the 3rd employee stock options, 200,000,000 units of the 4th employee stock options, and 100,000,000 units of the 5th employee stock options, respectively. Each unit is subscribed as one ordinary share of the Company, and the subscription price is based on the closing price of the ordinary share on the day of issue. (The 1st and 2nd employee stock options have expired)

(1) Handling status of unexpired employee stock options as of the printing date of the prospectus and influence on shareholders' interest

November 30, 2016

Type of employee stock option	3rd employee stock option	4th employee stock option		5th employee stock option
		First Grant	Second Grant
Effective date	2007/11/22	2010/04/20		2015/04/17
Date of issue	2007/12/19	2010/05/06	2011/04/15	2015/09/10
Duration	The duration of these stock options is 10 years, and these options may not be transferred, except in the case of inheritance. At the end of the duration, any unexercised stock options will be considered to have been waived, and the holder may no longer make further claims.
Number of units for issuance as approved by the Board of Directors	200,000,000 units	200,000,000 units		100,000,000 units
The number of options that can be subscribed as a percentage of outstanding shares	3.66%	3.41%	0.20%	1.19%
Subscription period	2009/12/19~2017/12/18	2012/05/06~2018/05/05	2013/04/15~2021/04/14	2017/09/10~2025/09/09
Mode of implementation	The company will issue new common shares.
Vesting schedule (%)	Two years after the holder has been granted the employee stock options, the holder may subscribe these options according to the following vesting schedule. Vesting period Maximum percentage of exercisable options After 2 years     40% After 2.5 years  50% After 3 years     60% After 3.5 years  70% After 4 years     80% After 4.5 years  90% After 5 years    100%
Number of option shares exercised	117,714,800 shares	94,231,600 shares	3, 928,500 shares	0 shares

63

Type of employee stock option	3rd employee stock option	4th employee stock option		5th employee stock option
		First Grant	Second Grant
Value of option shares exercised	NT$ 2,614,674,479	NT$ 1,923,148,820	NT$ 88,784,100	NT$ 0
Number of option shares unexercised	43,707,700 shares	77,695,900 shares	7,187,500 shares	87,845,000 shares
Grant price per unexercised option share	NT$21.1	NT$20.4	NT$22.6	NT$36.5
Percentage of Shares Unexercised to Total Number of Outstanding Shares (%)	0.55%	0.98%	0.09%	1.11%
Influence on shareholders' interest	After the two-year holding period of these stock options, these options are exercised in three years, diluting the interests of the existing shareholders on a yearly basis. The dilution effect is limited.

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(2) Employee stock options granted to management team and to top 10 employees

November 30, 2016

Title

Name

Date of issue

Number of options granted

Percentage of Options Granted to Total Number of Outstanding Shares (%)

Exercised

Unexercised

Number of shares

Price of shares

Value of shares

Percentage of Options to Total Number of Outstanding Shares (%)

Number of shares

Price of shares

Value of shares

Percentage of Options to Total Number of Outstanding Shares (%)

Manager

CEO

Jason C.S. Chang

2007.12.19  2010.05.06  2011.04.15 2015.09.10

39,325,000

0.50%

7,396,000

21.47

158,780,900

0.09%

31,929,000

20.83 (Note)

665,071,600

0.41%

President

Richard H.P. Chang

Chief Operating Officer

Tien Wu

Chief Financial Officer

Joseph Tung

ASE Kaohsiung President

Raymond Lo

Shanghai Headquarter President

Jeffery Chen

Vice President. Chungli Branch

Chen Tien-chi

Vice President

Xu-Rui Yu

Vice President

Dao-You Chen

Vice President

Shih-Wen Lee

Vice President

Kwang-Chun Chou

Vice President

Kuo-Tang Lin

Vice President

Song-Ching Hong

Vice President

Chih-Bing Hong

Vice President

Huan-Hua Mo

Vice President

Ching-Kun Yeh

Vice President

Chen-Ming Cheng

Vice President

Yen-Chieh Tsao

Vice President and Chief of Accounting

Hong-Ming Kuo

Employee Stock Options Granted to Top 10 Employees

Rutherford Chang

96.12.19 99.05.06 100.04.15 104.09.10

11,020,000

0.14%

4,760,000

23.47

111,723,500

0.06%

6,260,000

20.70 (Note)

129,566,000

0.08%

Chun-che Lee

Chang Hsiang Ching-Ping

Zhi-qiang Lee

Pan Shih-hua

Jerry Chang

Shih-Song Lee

Rui-Ki Mi

Kui-Wen Lee

Dan-Ning Chang

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Note: Range of share price: NT$20.4-36.5.

9. Restricted stock awards: None.

10. Acquisitions and mergers: None.

11. Any issue of new shares in connection with any acquisition of shares of another company, where still in process: None.

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II. Business Overview

I.       Company profile

(I)       Business Content

1.       Business Scope

(1) The Company and its subsidiaries primarily offer three main categories of service, namely semiconductor packaging and testing products, electronic assembly products, and other types of service.

Semiconductor packaging and testing products

A. Packaging: Packaging and module design, IC packaging, multi-chip packaging, micro and hybrid module, memory packaging.

B. Testing: Front-end testing, wafer probing, final testing.

‚Electronic assembly products

Module and mother board design, product and system design, system integration, and logistics management.

lOther

Packaging material sales, real estate development, construction, housing property management, and shopping mall rentals.

(2) Business components

Unit: NT$1,000; %

Year Item	2014		2015
	Net operating income	Percentage	Net operating income	Percentage
Packaging products	121,336,453	47.29%	116,607,314	41.16%
Testing products	25,874,694	10.08%	25,191,916	8.89%
EMS products	105,784,427	41.23%	138,242,100	48.80%
Others	3,595,873	1.40%	3,261,206	1.15%
Total	256,591,447	100.00%	283,302,536	100.00%

(3) Current product/service lineup

The Company's current product (service) items mainly comprise packaging products, testing products, and electronic assembly products.

(4) New products (services) to be developed

jPackaging technology

Name	Context
Advanced Technology
3D SiP	1. Die-to-die, die-to-wafer stacking
	2. Fine pitch cu pillar fc solution
	3. Si interposer sip technology
	4. Si optical bench sip technology
	5. Thermo-compression bonding technology
	6. Wafer level mems packaging
	7. Fan-in map pop technology
	8. Fan-out map pop technology
	9. Thin core fc pop technology
	10. Integrated passive device

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Name	Context
	11. Embedded passive laminate substrate
	12. Embedded passive Si substrate
	13. Embedded active Si substrate
	14. Heterogeneous chip integration SiP
	15. Fine pitch CoC SiP solution
	16. Compartment shielding technology
	17. Double side selective molding technology
	18. 2nd fine line/space substrate stacking
	19. Panel level fan-out/pop technology
	20. Flexible substrate & assembly technology
Optoelectronic packaging (OEP)	1. High power / high brightness led packaging solution
	2. Wafer level white light led packaging solution
	3. Optical sensor packaging solution
	4. Optical-electronic interconnection
Wafer Level Chip Scale Packaging (WLCSP)	1. Through silicon via
	2. Silicon substrate technology
	3. 300mm wafer 2D fan-out WLP
	4. 200mm wafer 3D fan-out WLP
	5. Fine line Cu-plated RDL technology
	6. 4-layer polymer, Cu-plated RDL technology
	7. Low temperature cure polymer, Cu-plated RDL technology
	8. Sawn wafer probing
	9. High IO / Die shrinkage WLCSP
	10. IR through backside lamination (BSL)
	11. Wire redistribution process and protective layer stacking technology development
	12. 5um/5um wire redistribution process technology development
	13. Thin-film wafer BSL technology development
	14. Technology for reducing cutting risks
Flip-chip  packaging	1. Coreless flip chip package
	2. 20 nm ELK wafer lead-free FC
	3. 300mm TSV wafer 50 um CMP technology
	4. SD laser technology on thin ELK wafer
	5. Molded core embedded package
	6. Molded pre-singulated package
	7. Exposed mold under fill
	8. Flip chip quad flat no leads
	9. Very fine pitch cu pillar flip chip product
	10. HBPOP package development
	11. Cu bumping buried wiring substrates (<16-nm flip chip packaging)
	12. Wafer level 20-nm flip chip packaging and fine substrate structure combination (N20)
	13. High-order flip chip quad flat no-lead development (FC QFN development)
	14. 1 Layer embedded trace substrate (1L ETS) assembly
	15. 2.5D Advanced IC assembly

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Name Context

Radio frequency (RF)  Module	1. MCU + BLE + AoP wireless connection module total solution
	2. Irregular FC Cu-pillar multi-band multi-mode SiP module solution
	3. Embedded passive substrate wireless module
Wire bond package	1. 14-nm Cu / ELK wafer wire bond solution
	2. 15-um Cu wire bond technology development
	3. New Cu wire bonding material technology development
	4. New wire bonding material technology development
	5. Low-cost, high-performance aS3 / aQFN
	6. Single layer carrier package development
	7. FC QFN for ATV development
	8. High thermal HS evaluation
	9. Cap on die
Wireless communication SiP module	1. Composite packaging SiP module integrated with BB+RF(Multi-Bands)+DRAM+PMIC and peripheral passive components with the latest composite wireless communication technology (multiple mode communication SiP module solution)
	2. Highly miniaturized and integrated SiP communication function module solution
Bumping
Plating	1. Low Ag of Sn/Ag lead-free (LF) micro bump plating technology
	2. Single PI and single RDL for WLCSP
	3. Micro Cu pillar bumping
	4. RDL+LF bumping
	5. RDL+Cu pillar
	6. FOCoS Cu pllar

kTesting technology 

Name	Context
New Test Technology
Wafer probing	1. RF wafer probing testing technology
	2. High parallel site test solution
	3. Wafer level photonic laser diode burn-in test
	4. Pin coating technology for probe card
	5. Film frame probing solution
	6. Tri-temp wafer probing
	7. Copper pillars probing solution
	8. High parallel site test solution
	9. Thin-wafer test solutions
Final test	1. 802.11ac RF SOC test solution
	2. USB3.0/PCIE testing technology
	3. G sensor testing technology
	4. Gyro sensor testing technology
	5. Universal wireless SiP test system development
	6. Low cost non-ATE test methodology for low I/O count device test, IoT/wearable devices
	7. High UPH power management IC tester development
	8. Multi-channel multi-function, and multi-process SIP tester development
	9. High channel density SOC tester development

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Name	Context
	10. Hardware module controlled platform and common tester user interface development
	11. Optical sensor testing solution
	12. Industrial/consumer sensing IC testing solution
	13. USB3.0 Type-C testing technology
	14. MEMS testing technology
	15. SiP testing technology
	16. Strip device testing technology
	17. Tiny package testing technology
Test data analysis	Big data analysis/mining prototype system building

l IPM process technology 

Name	Context
New Process Technology
Solder paste print die bond to lead frame	1. >5-mm chip soldering in-line bonding for enhancing UPH.
	2. Solder paste interface with a pore size equaling 1% of the interface.
Solder paste print  passive component bond to lead frame	1. Solder paste once-off print and component bond to lead frame for enhancing UPH.
	2. Passive component solder paste bond to lead frame technology.
Al wire bonding to  lead frame	>5-mil Al-wire in-line bonding for enhancing UPH.
LF passive component  and exposed Cu heatsink molding	1. Void-free 50-µm passive component bond.
	2. Bonding technology to expose the backside of metal heatsink

m COB module process technology

Name	Context
New Process Technology
Wire bonding  on FPC	1. Moldering ball bond on a 120-µm think soft circuit board.
	2. Enhancing the yield of moldering 0.9-mil Au-wire onto soft circuit board.

nElectronic assembly products

It is a longstanding belief that a top-notch process capability, rigorous quality control, and real-time feedback system are the key factors for gaining customer trust and affirmation of the company. In a competitive industrial environment, however, relying on these factors is inadequate for expediting the company's growth dynamic. A company must continuously improve its R&D capacity, increase activities of product R&D, and constantly maintain its leading status in the market. The Company recruits outstanding R&D professionals from Taiwan and China to inject elements of vitality in developing new technologies and products, to integrate software/hardware applications with miniaturization capabilities, and to improve product values and profitability. In addition, the Company will also steer its R&D focus on the following products:

A. Wireless communication module products.

B. Electric circuits for headlamps.

C. Continuing to develop applications for miniature products, including existing

70

products, IoT, and virtual reality products, and to persist in process improvement.

D. Targeting cloud calculation R&D and network storage technologies and collaborating with wafer companies to introduce high-performing solid state drive.

E. Constantly developing green design products to reduce material and energy consumption.

2.       Industry overview

(1) Industry current trends and future outlook

Packaging and testing industry

The Company's packaging and testing products department leverages its core competency in advanced semiconductor packaging and testing technology and process R&D to provide advanced packaging and testing service for semiconductor manufacturers worldwide. The following describes the current status and development trend of the semiconductor industry:

Lukewarm global economic growth, the impact of Brexit, and the rebalancing of economic growth in China have led to predictions of lower economic growth in 2016 compared to 2015. However, the IMF has projected a gradual recovery in the global economy, driven by emerging markets and developing economies. Furthermore, the major economies such as the US, Europe, Japan and China have maintained stability. The IMF and HIS Global Insight both predict that global economic growth in 2017 will be better than 2016.

Predicted economic growth worldwide and in key economies

Unit: %

Year  Region	IMF			IHS Global Insight
	2015	2016	2017	2015	2016	2017
Global	3.2	3.1 (3.1)	3.4 (3.4)	2.7	2.4 (2.4)	2.8 (2.8)
Advanced economies	2.1	1.6 (1.8)	1.8 (1.8)	2.1	1.5 (1.5)	1.7 (1.8)
US	2.6	1.6 (2.2)	2.2 (2.5)	2.6	1.4 (1.5)	2.2 (2.4)
Eurozone	1.9	1.7 (1.6)	1.5 (1.4)	1.9	1.6 (1.6)	1.4 (1.3)
Japan	0.5	0.5 (0.3)	0.6 (0.1)	0.5	0.6 (0.6)	0.7 (0.7)
New and developing economies *	4.0	4.2 (4.1)	4.6 (4.6)	3.9	3.9 (3.9)	4.5 (4.5)
China	6.9	6.6 (6.6)	6.2 (6.2)	6.9	6.6 (6.6)	6.3 (6.3)

Note: The numbers in parentheses are the IMF’s predictions in July of this year, while GI’s predictions were made in September, as well as the official published data for 2015 by each country. 

* HIS Global Insight prediction for the economic growth of emerging markets 

Source: 1. IMF, World Economic Outlook, Oct. 4, 2016 

2. IHS Global Insight Inc., World Overview, Oct. 15, 2016

Gartner revised the sales value of the global semiconductor market for 2016 in October 2016 to US$ 331.8 billion, which reflects a decline of only 0.9% compared with the US$334.8 billion in 2015. This is due to a drop of 11% in the

71

memory market, including a fall of 20% in DRAM and a growth of 2% in Nand flash memory. Smart cars, electric cars, and the Internet of Things (IoT) will drive the development of semiconductor components in the direction of further miniaturization and low power consumption, leading to a rise in demand for semiconductors. The value is predicted to reach US$350.1 billion in 2017 (5.5% growth), US$365.1 billion in 2018 (4.3% growth), and US$372.6 billion in 2019 (2.1% growth). It is estimated that the scale of the global semiconductor market in 2020 will approach US$384.3 billion.

Forecasting of the global semiconductor market

 

Source: Gartner; IEK (2016/11)

According to IEK's estimation, the semiconductor industry in Taiwan will produce an output of NT$2.43 trillion with a growth of 7.5%. In particular, the output of the design industry was NT$660.1 billion, a growth of 11.4% over 2015. This is mainly due to China's policy of subsidizing smartphones, the entry of memory control IC manufacturers into the global production chain, and panel driver IC manufacturers increasing their production output in high-resolution panels for LCD televisions. The output of the manufacturing industry amounted to NT$1311.7 billion, a growth of 6.6% from 2015. This was mainly due to an influx of orders from advanced processes into the wafer foundry industry, as well as a fall in demand for computer IT products and its subsequent influence on the memory industry. The output of the packaging industry amounted to NT$461 billion, a growth of 4.46% from 2015, with the output of the packaging industry and IC testing industry at NT$322 billion and NT$139 billion, respectively, a growth of 3.9% and 5.8% respectively compared to 2015. This was mainly due to a recovery in demand for advanced packaging among advanced semiconductor processes. The table below presents the operating performance of IC design, manufacturing, packaging and testing industry in Taiwan for the period 2012–2015 and the estimated performance for 2016:2012–2016 output value of IC sub-industries in Taiwan

Unit: NT$ 100 million

Year Detailed items	2012	2013	2014	2015	2016(e)
IC industry output in Taiwan	16,342	18,886	22,033	22,640	24,328
IC design in Taiwan	4,115	4,811	5,763	5,927	6,601

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Year Detailed items	2012	2013	2014	2015	2016(e)
IC manufacturing in Taiwan	8,292	9,965	11,731	12,300	13,117
Foundry service	6,483	7,592	9,140	10,093	11,345
Memory device manufacturing	1,809	2,373	2,591	2,207	1,772
IC packaging and testing industry in Taiwan	3,935	4,110	4,539	4,413	4,610
IC packaging	2,720	2,844	3,160	3,099	3,220
IC testing	1,215	1,266	1,379	1,314	1,390

Note: (e) Estimates 

Source: TSIA, WSTS, IEK (2016/11)

According to the evolution of the output value of the IC industry in Taiwan in 2016, foundry service (accounting for 46.6%), IC design (accounting for 27.1%) IC packaging and testing (accounting for 18.9%) were the three main pillars of Taiwan’s semiconductor industry. Looking forward to 2017, economic recovery will drive demand in semiconductors, with associated growth in output for smartphone chips, PC chips (including Type-C), and SSD driver ICs. New applications such as vehicle ICs mean that IEK has predicted that the production output of Taiwan's semiconductor industry will grow by 7% in 2017, in which the output of the IC packaging (IC testing) industry will reach NT$343.5 billion (NT$153.3 billion), which reflects a growth of 6.7% (10.3%) compared with that in 2016. In summary, the IC packaging and testing industry in Taiwan will continue to growth 7.8% by 2017, thanks to a recovery in demand and a rise in the proportion of high-end packaging and testing products..

‚Overview of the electronic assembly product industry

The electronic assembly products of the Company and its subsidiaries fall under the electronic manufacturing services (EMS) category, also referred to as electronic contract manufacturing (ECM) or professional electronic OEM service. EMS refers to the provision of a service or multiple services other than brand sale service, including product development and design, material procurement, production and manufacturing, assembly, and after-sale service. EMS mode is classified into EMS and ODM depending on the scope of service, and EMS and ODM are collectively known as design manufacturing service (DMS). At the present stage, electronic domains generally define EMS and ODM modes differently, which are described in the table below.

Category	Service Scope
	Product Concept	R&D Design	Material Procurement	Production & Manufacturing	Logistics	Brand Sale	After-sales service
EMS	No	No	Yes	Yes	Yes	No	Yes

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Category	Service Scope
	Product Concept	R&D Design	Material Procurement	Production & Manufacturing	Logistics	Brand Sale	After-sales service
ODM	Autonomous or Joint	Autonomous or Joint	Yes	Yes	Yes	No	Yes

Note: DMS providers generally offer services that are free of product concepts, whereas ODM service providers with particularly strong R&D capability provide services that incorporate product concepts.

In summary, DMS is the collective name given to a series of service modes, including product R&D design, product testing, material procurement, production and manufacturing, logistics, repair and maintenance, and other after-sales service, that are provided by electronic product brand owners. Concurrently, because manufacturing service providers and brand customers generally specify their service scope and specific requirements by entering a contract agreement that integrates framework agreement and order forms. Therefore, DMS (including EMS and ODM) is also incorporated in the scope of the manufacturing agreement.

Unlike OEM, EMS provides global transports and global assembly services. With such a global advantage, EMS can engage in production activities in a region without having their imports/exports being withheld by customs, and this advantages saves them from tax costs. Moreover, a global assembly plant and a global transport system can expedite the rate of assembly and delivery processes. In other words, EMS providers can perform optimally in terms of speed and cost. Thanks to its close relationship with part manufacturers (satellite system), EMS providers generally integrate related upstream part manufacturers (by merging or forming a strategic alliance) to further minimize their operation and procurement costs. The global supply chain has increased to a greater scale. To shorten the time required to deliver products to the end consumer market, OEM industries have also extended their supply chain globally. In other words, EMS providers have evolved from offering point-to-point service to a comprehensive support service that facilitates increasing their core value among their competitors.Forecasting of the global EMS income

 

Unit: US$ million

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Source: MMI, 2016/06

The global EMS industry grew rapidly in 2013 by 10.7% and then increased by 8% in 2014, after which it experienced a slight decline of 2.4% in 2015 primarily due to the decrease in demand for computer products. In the long run however, EMS remains highly potential, particularly in non-traditional outsourcing applications such as industrial applications, medical industry, automobile, national defense security, and aviation industry. According to the 2016 report published by NVR, the global EMS/ODM income was predicted to reach US$430 billion in 2015, and increasing to US$580 billion by 2020. This suggests an annual compound growth of approximately 6.2% between 2015 and 2020.

(2) Relationships with suppliers in the industry's supply chain

Packaging and testing industry:

In the entire semiconductor supply chain, the Company and its subsidiaries are primarily responsible for supplying materials needed for midstream packaging and testing and downstream packaging. The Company and its subsidiaries offer customers wafer packaging and testing services for semiconductors, purchases wafers primarily from internationally acclaimed semiconductor companies, and maintains a favorable long-term relation with these companies. By vertical division of labor, we are able to enhance our competitiveness as well as that of our strategic alliances and partners.

Structural diagram of the semiconductor industry in Taiwan

 

Note: Numbers in the figure represent number of companies 

Source: MIC, 2016/01

‚EMS industry:

The upstream vendors of professional EMS providers primarily include material producers who specialize in PC boards, integrated circuits, other electronic components, etc. Their efficiency, quality, and price of material supplies will, to an extent, influence the delivery cycle, product quality, and price competitiveness of the EMS provider. The downstream vendors include brand owners who are involved in wireless network communication, household appliance, computers and servers, data storage, smart handheld devices for industrial use, commercial

75

sales, automobile electronics, etc. The changes in the demand of the downstream vendors directly influence the development and profitability of the EMS industry.

EMS industry needs to build a long-term, stable supply chain cooperative relationship with upstream suppliers and downstream brand owners. Through the integration of the entire supply chain resources, relationship coordination, and process optimization, a win-win outcome for members of the supply chain can be realized. Their value addition and competitiveness hinge on the intensity of their relationship with upstream and downstream vendors, and therefore these two factors a strongly associated with each other.

 

(3) Product development trends

Packaging and testing products

End electronic products have slowed in growth rate because of the increasing prevalence of electronic products ranging from personal computers smartphones. The next killer wave application that will dominate in the next 5 to 10 years is believed to be Internet of Things (IoT), in which the smart electronics will be the source of future business opportunities.

Compared with the billions of dollars of demands for semiconductors in computers or mobile devices, their demands in IoT will reach hundreds of billions. The market estimated that the world will have 30 billion internet-connecting devices by 2020, contributing to approximately US$1.9 trillion in value for IoT applications. Such tremendous opportunity has instigated intense competition among vendors around the world. A wide variety of smart applications, including smart city, smart car (Internet of Vehicles), smart home, smart medicine (telecare), smart individual (health and fitness), smart plant, and smart manufacturing, have been developed. In the future, the challenges that the IC industry will face are determining a method by which to extend PCs and mobile phones to other smart electronic applications, products, technologies, and markets.

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Unlike the previous single killer end-application market, IoT cannot only focus on a single process or product. Instead, it seeks diversity in industrial characteristics, while focusing its semiconductor technologies on advanced, mature process technologies and integration capability. The IoT will therefore induce a revolutionary change in the development of the global IC industry.

The emergence of IoT steered the semiconductor component technology toward process miniaturization, second-generation communication, sensor integration, and high-order multi-visual computation, and in-memory operation. These aspects can serve as a basis for deducing the future orientation of core technologies and new applications as the IoT applications become prevalently used in the semiconductor industry. Regarding product demand, IoT products must feature heterogonous integration and ultra-low power consumption. These characteristics can disassemble IoT products into components that are lightweight, that feature lengthy battery life, and that can connect to the Internet while consuming minimal power.

The development of high-spec, low-cost mobile devices has become a trend. The ability of these devices to integrate diversity of functions is now a basic function contributing to a continual increase in SiP demand. This function will attract increasingly more vendors to invest in the R&D of SiP in 2016, which will gradually orient SiP technologies toward a generation that prevalently uses IoT applications.

Hardware development must be based on semiconductor components and sensor communication interface in order to improve the quality of life for humans. These components include processor, analog IC, communication IC, memory, and sensors, and relevant technologies comprise ultra-low power and SiP technologies, which subsequently enable the integration of different functional wafers in single miniaturized packaging bodies.

To enhance performance and reduce power consumption, the market tends toward stacking the processor with memory devices during packaging because this approach can achieve reduced area, reduced power (short path and minimal impedance), and increased transmission speed (shortened electronic transmission path). This method therefore resulted in the development of 3D IC and TSV technologies, which are aimed at connecting stacked ICs for heterogeneous integration of vertical stacks.

Under the developing trend of end products (e.g., IoT and wearable devices), hardware systems have transformed from previously large devices (e.g., PC) into mid-sized mobile phones and subsequently into smaller wearable devices (e.g., smart watch). Such system miniaturization restricted the use of spaces in hardware packaging. Multiple functions and limited space led to the rise of SiP applications, such as the S1 chip in Apple Watch. Specifically, embedded technologies for substrate-embedded wafer or passive components are characterized by small area, effective heat dissipation, and reduced noise signal, which make them an excellent tool for utilizing the added function of substrates during SiP process.

In addition to embedding wafers in the substrate to achieve reduced area, developers can place wafers on top of a passive component to make use of space. The semiconductor embedded in substrate (SESUB) of TDK technology is one example of this approach. Therefore, the Company engaged in a joint venture with the Japanese firm TDK to introduce embedded technology in SiP. The goal was to combine SiP with embedded board technology and to enhance yield rate. Attributed to its outstanding performance in saving space, electrical property, and

77

heat transfer, embedded boards became the top choice for developing IoT SiP technology, thereby serving as the basis for future end IoT products.

Looking ahead of the future, the next opportunity for the semiconductor industry will come from the Internet of Things (IoT). 2016 will be the year in which IoT is upgraded to Smart IoT level. At the CES show, large firms all focused on the Internet of Everything, striving toward an Internet of Life. International semiconductor firms have shifted from emphasizing high-performing wafer hardware technologies to stressing the importance of innovative living applications and a perfect user experience. Their product applications are concentrated on smart cars (autonomous driving and driverless concepts), unmanned vehicle, smart home, wearable devices, virtual reality, and robots. With their advantage in technologies as the core, large firms will target the three major technologies required for IoT systems, namely, smart computing, smart sensing, and smart transmission. Furthermore, they will attempt to build an open industrial ecology in which interconnecting platforms are established for seeking strong, powerful partners.

Another aspect worth mentioning is the automobile industry; vehicles are advancing toward smart, automated, electric, and shared applications, making them safer and more reliable (e.g., autonomous car systems and active safety systems), more comfortable and convenient (e.g., vehicle information communication system, communication between smartphones and cars, apps exclusive for vehicles, head up display, and innovative human-machine interface), and more energy-efficient and environmentally friendly (e.g., electric cars).

Although electric cars still account for a small portion of the automobile industry, they are increasing annually in double digits. Except for the complexity of managing the power and IC of electric cars, the overall design idea of electric cars is steering toward the concepts of connected cars and Internet of Vehicles (IoV), thereby substantially increasing the demand for IC compared with that required for traditional vehicles. The electronic automobile market will exhibit the strongest growth in the future, Gartner has estimated that in 2016 the vehicle IC market worldwide was worth US$31.4 billion, which will rise to US$41 billion in 2020. As vehicles become increasingly more “intelligent” the cost of automobile electronics will elevate further, which also increases the content of semiconductors in each vehicle on average.

‚Electronic assembly products

Influenced by the rapid development of upstream businesses, the global electronic market has successively produced a diversity of products that feature customized appearances. As new products diversify, market demands continuously increase, further aggravating the intensity of competitions in the industry. In particular, the rapidly evolving network communication industry and the rise of the consumer electronic industries intensified the competition in the electronic product market, which prompts brand owners to demand for improved technologies, new products, immediate market response, and adjustments to product portfolios in a timely manner. Numerous large international brands have continued to outsource their services in order to enhance their competitiveness in the global market and increase their share in the market. Therefore, the increase in the overall sales volume of EMS providers offers a greater room for developing stable cooperation among members of the supply chain. Subsequently, smartphones, tablets, and other electronic products will be in great demand in the global end electronic product market.

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A. Global demand for outsourcing electronic products exhibits continuous growth trend

As the EMS mode matures and service quality improves, the global EMS industries continue to expand their service scope, which increases their OEM-based production volume both incrementally and annually. To meet the growing demand of brand owners, the scope of EMS increases incessantly, gradually covering the highest end of the product value chain. This trend provides a greater space for development to manufacturers, like us, who are equipped with the capability to plan, design, and research and develop products. It also motivates us to become the fastest growing manufacturer in the world.

B. The rapid development of wearable equipment expedites the development of miniature system modules

Wearable devices are devices that can be worn on the body as implants or accessories; these devices are integrated with multimedia, sensing, and multifunctional miniature technologies and support hand gesture and eye movements as a means of communication. Wearable devices are developed by employing wearable technologies to incorporate smart designs in people’s daily wearable accessories. Currently, wearable devices available in the market include smart bracelets, smart watch, smart spectacles, sports shoes, pace counter, apparels, and earphones. Attributable to 20 years of continuous efforts of industrial and academic experts, a wide variety of advanced wearable products and devices have been developed. Presently, technological leaders and small startup companies have entered the wearable device market, suggesting the powerful potential of this type of market.

C. The popularity of smart end devices accelerated the prevalence of wireless communication modules (WiFi)

A mature ecological system for electronic products and the diverse functions of application programs have increased people’s demand for better performing smartphones and tablet computers. Smart end devices have improved immensely in terms of function and complexity, from the most primitive functions such as camera functions to wireless data transfer via 3G, WiFi, and Bluetooth, to using GPS navigation functions, gyroscope, and speed sensors. Since 2013, 4G has become the standard network system in high-end smart devices, in addition to near field communication (NFC for mobile payment and data transmission) and fingerprint identification. Currently, increasingly more powerful functions such as enhanced photo color and motion sensor control are gradually maturing and have been integrated into mobile phones. Therefore, the functions of end smart devices are continuously improving.

Since its development, WiFi has been extensively applied to various types of digital mobile products, specifically smartphones and tablet computers. As the functions of end smart devices continue to improve, the smart mobile markets are also being rigorously developed, further increasing the demand for WiFi applications.

D. Division of labor in the electronic manufacturing industry and niche shift and clustering effect of manufacturing service industry

Influenced by the global economic integration, the division of labor in the electronic manufacturing profession, the continuously maturing EMS in Taiwan, and the relocation of the global EMS industry to Asia Pacific, particularly to China, the EMS industry in Taiwan has grown way faster than the entire electronic industry in the same period, and this trend will inevitably increase the overall market capacity and instigate a rapid development of the EMS industry.

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The electronic industry has significantly clustered in China as the global EMS industry gradually relocates to the Asia Pacific. In addition, the upstream and downstream supply chain of the EMS industry have matured significantly, including their centralized procurement of basic electronic components, R&D design packages, and global logistic support service, all of which are able to facilitate the globalization of the EMS industry.

(4) Competition Status

Packaging and testing industry

The effects of emerging markets and saturation of end products on the global semiconductor market elucidate the low operating revenue of the semiconductor industry around the world, including Taiwan. From IC manufacturers’ perspectives, although they did not perform as well as they did in 2014, many vendors have used this opportunity to readjust their business goals, development strategies, and continual investment technologies, as well as to cooperate with international businesses.

However, the Chinese government invested billions of RMB to actively promote its semiconductor industry, which resulted in the rapid rise of a red semiconductor supply chain. South Korean government also proposed a revitalization project for its semiconductor industry, and this project is advantageous for the vertical integration of integrated device manufacturers (IDM). Furthermore, Japanese and European governments have strategically advanced toward developing value-added and differentiated semiconductor technologies for medical, industrial, agricultural, and automobile uses, combining and applying automobiles and robots to pave their way into aviation industry and ultimately the universe.

The rapidly changing economic environment and intensifying industry competition have made it difficult for Taiwan to maintain their fundamental business. With the United States leading the world, it is difficult for Taiwan to aim for the top. The merger and acquisition among the semiconductor industries remain frequent in recent years, which suggest that Taiwanese firms must have a corresponding strategy to expedite their transformation.

‚EMS industry

According to the 2015 global EMS supplier ranking announced by the Manufacturing Market Insider (MMI), our Company’s subsidiary, USI Electronics Inc. was ranked No. 9. The top 8 suppliers were Hon Hai Precision Industry/Foxconn, Pegatron, Flextronics, Jabil Circuit, Sanmina, Celestica, New Kinpo Group, Wistron.

3.       Overview of Technology and R&D

(1) Technological level of company's operative business and R&D

Packaging and testing products

The prevalence of OEM industrial chain mode in the semiconductor industry, ASE has also followed the steps of major foundry service providers (e.g., TSMC, UMC) and advanced toward the R&D of high-order products, and advancement of its technologies in order to create multi-win outcomes. To accommodate the increasingly complex functions, miniaturization, and optimal cost effects, ASE has focused on specializing its advanced packaging and testing technologies, including 2.5D & 3D IC, SiP, CSP, flip chip, bumping, and WLP.

Orienting toward refining its existing technologies and developing advanced

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products, ASE Group allocates 3 to 5% of its operating revenue to the R&D of technologies, which is also why the company has obtained over hundreds of patients every year. This is aimed at maintaining the company’s leading status in the industry and sustaining its competitive edge. In addition to taking the lead in the market share, ASE must also stay on top of their competitors in the research and development of technological applications.

kElectronic assembly products

To further improve their service and product quality, the Company and its subsidiaries have focused on developing a diversity of innovative products in order to raise their competitiveness. Capitalizing on their exclusive R&D professional knowledge, they endeavored to optimize their products to offer their expansive customers high-performing products and services with high price-performance ratio as well as exceptional engineering and manufacturing capabilities. Currently, the Company and its subsidiaries have developed products that are used in computers and casings, telecommunication systems, industrial electronic product manufacturing services, automobiles, storage, and server programs.

The Company and its subsidiaries have a significant advantage in the R&D and design of their primary products. Since their inception, they have established and reinforced a core development strategy that centers on autonomous R&D and technology, using their R&D center as the core of their business development. In terms of EMS technologies, the Company and its subsidiaries have built a team of over 1,800 R&D experts, each of whom is highly competent and experienced in product R&D and design.(2) Research & Development Personnel & Educational Qualifications

Unit: person; years 

Year Item		2013	2014	2015	2016  As of November
Educational Qualifications	Ph.D	69	81	101	109
	Masters	1,572	1,925	2,351	2,428
	Bachelors	4,239	4,367	4,186	4,224
	Senior High School	427	578	542	734
Total		6,307	6,951	7,180	7,495
Average years of service (years)		8.48	8.18	8.80	8.80

(3) R&D Expenses invested annually during the past 5 years

Unit: NT$1,000; % 

Year Item	2011	2012	2013	2014	2015
Research expense	7,117,964	7,877,408	9,069,018	10,289,684	10,937,566
Net operating income	185,347,206	193,972,392	219,862,446	256,591,447	283,302,536
As a percentage of net operating income	3.84%	4.06%	4.12%	4.01%	3.86%

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(4) Successfully-developed technologies and products during past 5 years

Packaging and testing products

 

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New technology developed 

WLCSP	2.5D TVS stacking mass production
	First in fan out packaging
	Wafer level system packaging
	Sensor TVS
	Passive component integration
	40um fine pitch Sn/Ag/Cu pillar bump plating
Flip Chip	16nm Cu/ELK Lead Free FC Solution
	Double side molding technology
	High density high bandwidth stacking packaging
	Multilayer thin line embedded coreless board
	20/28 nm flip chip certification
Wire Bond Package	Application development for embedded circuit substrates
	High-end FC QFN packaging and testing
	Ultra-fine pitch and diameter Cu/Au wire weding technology
	20/28 nm technology certification
Wireless Module	Wireless sensor module packaging
	Segmented electromagnetic interference masking
Wireless Communication Module	High-density SiP packaging communication modules
	Highly integrated multi-modes multi-bands 3G communication modules

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kElectronic assembly products

A.       Communication

Product Category	R&D Outcome
Wireless Modules	Wi-Fi, B, FM, GPS, WiMax, CMMB Combo (WiFi+BT, WiFi+BT+FM, WiFi+BT+GPS+FM)
Wireless network interface controller (NIC) module	Wi-Fi, BT, FM, GPS, WiMax, CMMB Combo (WiFi+BT, WiFi+BT+FM, WiFi+BT+GPS+FM)
Business wireless access point (WAP)-Indoor	802.11n 2*2 multi(single)-module WAP  802.11n 3*3 multi(single)-module WAP
Business wireless access point (WAP)-Outdoor	802.11n 2*2 multi(single)-module WAP 802.11n 3*3 multi(single)-module WAP

B.       Industrial Use

Product Category	R&D Outcome
POS	- All-In-One POS - POS PC - KIOSK
Computers	- A M MB - HMI MB
Smart Handheld Devices	- Rugged Handheld Mobile Computer - Enterprise Mobile Computer

C.       Computers and storage device

Product Category	R&D Outcome
Storage device
Network storage device	SMB: 1U4Bay/2U12Bay Rack Mount NAS
	SOHO: Tower 2/ 4/ 5/ 6/ 8 Bay NAS
	DMP (Digital Media Player)
Redundant array of independent disks (RAID)	SAS/SATA RAID Fiber RAID  Disk assembly
Host bus adapter	SAS/SATA adapter SAS/SATA RAID card 10G Ethernet card Infiniband adapter
Network storage server	2U24 IPS (Redbass) 2U12 SBB IPS (Thuban)
Solid state drive	2.5” SATA II 1.8” SATA II 2.5” SATA III
Computer products
Server motherboard	Single-core server motherboard Dual-core server motherboard Quad-core server motherboard
Server expansion card	SAS expansion card  Ethernet expansion card  Infiniband network expansion card
Server adapter	Various types of functional server adapter
Server backboard	Server power backboard  Server back network backboard

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Product Category	R&D Outcome
Computer peripherals	Touch screen control panel  Color identification instrument

D.       Consumer electronics

Product Category	R&D Outcome
Liquid crystal display module Printed circuit board (PCB) assembly	- Notebook/monitor/TV liquid crystal display control panel  - Notebook/monitor/TV LED light strip - Liquid crystal display source board  LED driver board
TV Set PCBA	- TV motherboard  - TV electrical power control panel  - TV keyboard

E.       Automotive electronics

Product Category	R&D Outcome
Design and manufacturing service
Voltage Regulator	- Original Equipment Product - After-Market Product
Rectifier	- Original Equipment Product - After-Market Product
LED Lighting PCBA	- Daytime Running Lights (DRL)  - Center High-Mounted Stop Lamp (CHMSL)  - Rear Combination Lamp (RCL)  - Fog Lights
Telematics Application	- Telematics Control Box (T-Box or TCU)  - Wifi/Bluetooth modules
Manufacturing service
Motor Controller PCBA	- Engine Cooling Fan, Sunroof, Wiper, Power Window, AFS
Driver Assistant PCBA	- Ultrasonic Parking Sensor and Parking Assistant Control Unit  - Blind Spot Radar Detector
Climate Control PCBA	- HVAC Climate Controls Panels  - Climate Control ECU
Security PCBA	- Electronic Steering Column Lock(ESCL)
Switch PCBA	- Window Regulator  - Steering Wheel  - Engine Switch  - Stop & Start Switch  - Hazard Warning
Sensor PCBA	- Torque Sensor
Control Unit PCBA	- Electronic Parking Brake  - Shift Interlock

4.       Business plan - long-term and short-term

(1) Short-term business plan

Maintain existing customers and attract more IDM customers

‚Implement production strategies and obtain the most advantageous allocation

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ƒSolicit orders for high-level packaging and increase profits

„Improve resource utilization rate and reduce resource consumption and wastage

nImprove production of green products and expedite product conversion rate to attract market opportunities

oAchieve mass production by test manufacturing

(2) Long-term business plan

Integrate group resources and provide complete services to customers

‚Improve cost structure and offer competitive prices

ƒImplement customer segmentation, strengthen customer satisfaction, increase overall production scale, pursue cost advantages, and increase price competitiveness

„Sustain our leading status in technological development to increase market share

(II)       Market, production and sales

1.       Market analysis

(1) Areas in which core products (services) are sold (provided)

Unit: NT$1,000; %

Year Sales Territory		2014		2015
		Amount	%	Amount	%
Domestic		36,747,699	14.32	32,631,149	11.52
Export	South & North America	173,912,974	67.78	205,730,670	72.62
	Europe	20,826,125	8.12	20,577,069	7.26
	Others	25,104,649	9.78	24,363,648	8.60
	Subtotal	219,843,748	85.68	250,671,387	88.48
Total		256,591,447	100.00	283,302,536	100.00

(2) Market Share

Packaging and testing products

Five Major Global Packaging and Testing Plants: Market Share of Outsourced Semiconductor Packaging and Testing Service for 2014-2015

Five Major Global Packaging and Testing Plants (note)	Market Share (%)(based on the operating revenue on semiconductors)
	2014	2015
ASE	19.1	18.7
Amkor Technology	11.5	11.3
SPIL	10.1	10.2
Jiangsu Changjiang Electronics Technology (JCET)	3.6	6.6
Powertech Technology	4.9	5.2

Source: Compiled according to the research report of GartnerMarket Share: Semiconductor Assembly and Test Services, Worldwide, 2015 Published: 12 April 2016, Analyst(s): Maria Valenzuela, Jim Walker and Masatsune Yamaji.

Note: This table is based on Gartner's estimation of the operating revenue of global semiconductor manufacturers that outsource their packaging and testing service. The operating revenues of Amkor for 2014 and 2015 exclude those of

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J-Devices. The operating revenue of JCET for 2015 includes the revenue of STATS ChipPAC for August to December 2015.

Influenced by the economy, the global semiconductor market that outsources its packaging and testing service projected a slight decline in its operating revenue for 2015. ASE’s market share decreased slightly to 18.7%, but it is still taking the lead. Amkor maintained in second place, with a market share of roughly 11.3%. However, it is expected that after Amkor merges officially with J-Devices, it will shorten its gap with the first place. SPIL remained in the No. 3 ranking in 2015, with a market share of approximately 10.2%. Because it completed merger with STATS ChipPAC in August 2015, JCET obtained a market share of 6.6%, entering the fourth place. Powertech Technology Inc. was ranked No. 5 with a market share of 5.2%. Surrounded by competitors who engage in merger and acquisition to increase their market share, the Company will continue to devote its effort in developing advanced processes and in strengthening our packaging and testing capabilities particularly in the system level, which will further widen the technological gap with our competitors. To accommodate for the requirements of electronic components, existing packaging technologies are oriented toward high density, high I/O number, low operating power, surface component modularization, and composite structure development so as to create highly integrated, affordable fine, lightweight products that feature multiple pins and multi-chip module packaging. These products include ultra-fine gap wire bond assembly, flip chip packaging, 2.5D and 3D stacking package, wafer level packaging, multi-chip module (MCM), system-in-package (SiP), copper process, and through-wafer via (TWV). Nevertheless, the Company and its subsidiaries have fully prepared themselves for the continual growth of production demands for high-order packaging and testing products, thanks to their extensive investments in technologies and production capacity. Looking forward to the future, we will continue to refine our process and simultaneously commit to improving our profits.

‚Electronic assembly products

According to NVR predictions, the global EMS income in 2015 was US$332.6 billion. The electronic assembly operating income of the electronic assembly department of our Company and its subsidiaries was NT$137,347,359,000 in 2015 (equivalent to US$4,292,105,000), accounting for 1.29% of the global EMS income.

(3) Future market demand-supply and growth potential

Packaging and testing products

A. Supply

Since 2015, the global top 10 packaging and testing plants have entered a merger and acquisition phase, leading to the rise of the three packaging and testing leaders: ASE and SPIL in Taiwan, Amkor and J-Devices in the United States, and STATS ChipPAC in China. These three leaders are all based on logic IC packaging and testing, with a stronger focus on packaging than on testing. The degree of centralization of King Yuan Electronics (8.9% of the global market share) was higher compared with that of other firms, which are still in a dispersed state. Wafer level packaging and testing technologies are primarily focused on logic products; however, because these types of products require higher capital expenditure for business expansion and sustenance, the governing rights remain in the hands of large firms, and merger and acquisition

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are beneficial for the allocation of funds and production resources.

B. Demand

Negatively affected by the low demand for smartphones, tablet computers, and other electronic products, the semiconductor assembly and test services (SATS) projected a scale of US$25.5 billion in 2015, which is a 5.9% decline compared with that in 2015 (US%27.1 billion). We envision that as demands for new applications (e.g., IoT, wearable devices, automobile IC) mature, SATS will project an annual composite growth rate of approximately 4% between 2015 and 2020.

International IDMs are gradually outsourcing their packaging and testing services primarily because of the increasing diversity of consumer electronic products, which increases the complexity of customized packaging and testing designs. The rate at which system circuit boards can be miniaturized is no longer in sync with the fine processes, and these two factors rely only on packaging and testing technologies to bridge the gap between them. Furthermore, the costs and technical level of packaging and testing are increasing, which leads to a rise in the costs of packaging and testing R&D. Therefore, increasingly more wafer manufacturers are seeking to outsource packaging and testing tasks in order to reduce costs. This phenomenon simultaneously highlights the inability of large IDMs to invest in high-order packaging and testing equipment. Subsequently, outsourcing OEM will inevitably become more frequent.

 

Source: Gartner and IEK (2016/06)

‚Electronic assembly products

A. Supply

MMI announced the top 50 EMS suppliers around the world in 2015. The operating revenue of the top 50 EMS companies registered a record high of US$272.5 billion, in which the operating revenue of Hong Hai Precision (Foxconn) accounted for approximately 52% of the total revenue of the top 50 EMS companies. The Company's subsidiary USI Electronics Inc., which was responsible for the electronic assembly product department, was ranked No. 9.

2014–2015 Ranking of Top 10 EMS Companies

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Year Ranking 2015 2014

1	Hon Hai Precision Industry /Foxconn	Hon Hai Precision Industry /Foxconn
2	Pegatron	Pegatron
3	Flextronics	Flextronics
4	Jabil Circuit	Jabil Circuit
5	Sanmina	New Kinpo Group
6	Celestica	Sanmina
7	New Kinpo Group	Celestica
8	Wistron	Benchmark Electronics
9	Universal Scientific Industrial (USI)	Shenzhen Kaifa Technology
10	Plexus	Universal Scientific Industrial (USI)

Source: MMI

B. Demand

The operating income of the Company’s electronic assembly product department is sourced from EMS OEM activities, in which the main customers are internationally acclaimed electronic companies that sell OEM products, including communication, consumer electronics, computers and storage devices, industrial-use products, and electronics for automobiles. According to NVR, the size of the global electronic assembly market in 2015 was US$1.3 trillion , in which communication products accounted for the highest at 29.2% (US$387.8 billion), followed by computer products at 24.8% (US$329.6 billion), consumer electronics at 20.3% (US$269.7 billion), and industrial-use products and electronics for automobiles at 8.7% (US$115.5 billion) and 7.3% (US$96.3 billion) respectively. It is estimated that the global electronics assembly market will reach US$1.6 trillion by 2020.Forecasting of global electronics assembly market scale (by product category)

Unit: US$ billion

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Source: NVR

(4) Competition niche

The overall market in 2016 will exhibit a slight decline. In response, the Company and its subsidiaries have attached a greater level of importance to our internal operation as well as enhancing our capability to develop technologies, in an effort to excel in our performance again amidst the global economy. An analysis of the competitive advantages of the Company and its subsidiaries is as follows:

jContinuously researching and developing technologies to sustain our leading status in high-order product technologies and quality

The prevalence of OEM industrial chain mode in the semiconductor industry, the Company has also followed the steps of major foundry service providers (e.g., TSMC, UMC) and advanced toward the R&D of high-order products, and advancement of its technologies in order to create multi-win outcomes. To accommodate the increasingly complex functions, miniaturization, and optimal cost effects, the Company has focused on specializing its advanced packaging and testing technologies, including 2.5D & 3D IC, SiP, CSP, flip chip, bumping, optical package, and WLP.

Orienting toward refining its existing technologies and developing advanced products, the Company and its subsidiaries allocate 3 to 5% of its operating revenue to the R&D of technologies, which is also why the company has obtained over hundreds of patients every year. This is aimed at maintaining the company’s leading status in the industry and sustaining its competitive edge. In addition to taking the lead in the market share, ASE must also stay on top of their competitors in the research and development of technological applications.

kActively engaging in development to capture business opportunities of IDMs in a timely manner

To maintain the efficiency of semiconductor management and reduce costs, international IDMs must focus on Fab lite development to build their foundation for increasing OEM outsourcing. To accommodate this increasing trend, the Company and its subsidiaries have constantly reviewed their business strategies to develop their business in China and to approach customers and the market in order to capture potential business opportunities. All international firms are vying for a stake in China yet they cannot find the appropriate partner. Nevertheless, our strategy is likely to encourage more firms to outsource their packaging and testing operations, which will attract more business opportunities without influencing the foundation that Taiwan has in this domain.

ƒ Integrated advantages

The electronic assembly product departments of the Company and its subsidiaries have the advantages of professional design and producuction expertise in a variety of electronic products (including electronic components, parts, and whole machines) as well as system assembly, as well as the advantages of strategic division and integration of product categories. We leverage the strategy of “selecting the finest” and careful observation of market developments, client demands, and trends in electronics and information technologies. Furthermore, the core advantages developed over many years by the Company allow it to target electronics and IT market segments with strong growth and large scale. The “selecting the finest” strategy forms the basis for the Company and its subsidiaries’ horizontal integration of segmented markets and

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industries, to account for the trend of greater integration in the electronics industry. This allows the Company to have its finger on the pulse of market trends at every stage, thus dynamically creating the most advantageous product combinations and driving the stable growth of the Company. The Company and its subsidiaries strengthen their core competencies in the horizontal and vertical integration of the component and whole machine production chains, in order to emphasize service value and improve interactions with clients. This then leads to stronger strategic positions in the production chain.

(5) Favorable and adverse factors for long-term growth and response strategy

jFavorable factors

A. The gradually increasing demand for new products and new technologies is a highly profitable opportunity for the Company, due to its significant advantage in R&D and innovation.

B. The way that IDMs are managing their business is constantly contributing to the release of packaging and testing orders, which in future will continue to bring greater business opportunities to the IC packaging and testing industry.

C. Thin, lightweight, and small-sized products with high-performance and high efficiency will be the mainstream in the future, making 2.5D and 3D ICs an extremely crucial technology. The Company has invested a substantial amount of resources in the R&D of these technologies and has taken a lead among its peer industries in technologies that are unrelated to packaging.

D. AS a packaging and testing plant in Taiwan that owes a substrate production line and the capability to manufacture robust high-order substrates, which not only enable us to hold the key to high-order packaging materials but also effectively reduce IC manufacturing costs to enhance our profitability.

E. In addition to traditional VGA, QFP, and QFN packaging products, a wide range of high-order products such as chipsets, graphic cards, optoelectronic products, wireless communication modules, and other relevant chips, as well as potential customers, are a bigger, potential market with a profound development potential.

F. Chinese manufacturers will continue to demand for IC products in the next few years. Based on the principles of cluster effect and supply chain, the Company has fully prepared itself in terms of geographical location and resource utilization in order to embrace this growth and business opportunity.

G. Exceptional R&D technologies: An exceptional R&D technology ensures the future development of a high-tech company. Therefore, the Company has been committed to cultivating R&D personnel, introducing advanced technologies, and accumulating years of experience to improve its R&D outcomes. The Company has also acquired ISO9001 plant management quality certification as well as the US military performance specification (MIL-PRF-38534).

H. Complete management system: The Company has computerized all of its production operations, including order processing, materials management, production control, on-site management, warehouse system, and delivery operations, to monitor the entire process. In addition, a large quantity of automated equipment is used in place of manual operations to enhance product yield, reduce production cost, and improve product competitiveness.

kAdverse factors

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A. The Company and its subsidiaries' local competitors have attempted to actively solicit our customers. In addition, the alliance mechanisms of our competitors are likely to influence the Company.

B. The gradual decline in the barrier to entry for new technologies, the progressive improvement in competitors’ ability to imitate, and the shortening of product profit cycle pose an imminent threat to a technology-oriented company such as us. Because the research and development of new technologies require substantial funds and labor, the subsequent prices charged for using these technologies are not flexible, which is a major challenge in a micro-profit generation.

C. Increasingly more customers are demanding for better quality standards in the backend stage of IC packaging and testing. If the Company wishes to grow significantly, it must exceed the expectations of its competitors and customers.

D. The backend packaging and testing activities of the semiconductor industry are considered a capital-intensive industry, rendering them vulnerable to the economic impact of the semiconductor market. The quality of their business operation is also easily influenced by the economy. IC packaging and testing industries must carefully assess their investment plans as well as their plans concerning personnel, machines, funds, and technologies. Doing so enables them to prepare themselves for the substantial orders which might arise when the economy is good and for the impact of reduced orders when the economy is bad.

E. Power electronic industries are mainly responsible for tasks involving DC-DC conversion, AC-DC conversion, and motor operation, which require lighter, smaller, more efficient, and more affordable products. Currently, four types of technologies are employed to meet these requirements: Silicon IGBT, Super Junction (SJ) MOSFETs, Gallium Nitride (GaN), and Silicon Carbide (SiC)-based devices.

F. GAN and SiC are currently not mature enough for the power electronics market, with the former requiring improved manufacturing techniques (particularly with regards to extension and thickness), while the latter is an expensive material that makes it unsuitable for use in the consumer market. Therefore, the IGBT remains the mainstream before 2015.

G. A number of GaN competitors have also entered the competition in the market because of the large quantity of hot money entering the market. Generally, developing and testing a type of semiconductor material are time-consuming; however, the successive investments by large firms around the world have increased the likelihood that GaN products will be commercialized in the next two to three years.

H. A large number of IGBT module manufacturers are fiercely competing against each other, which easily results in a price war that reduces the gross profit. To mitigate the effect of competition on company profits, it is critical that firms cooperate with one another to disperse risks and strengthen their cost control mechanisms, as well as increase the economies of scale of their production activity.

ƒResponse measures

A. Leverage our advantage to provide turnkey service, integrate group resources, and share technological information to create more values and greater economic

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benefits, which help us strengthen our competitive advantage to capture more business opportunities in the future market.

B. Take advantage of the Company’s advanced processes, flexible production capacity, and diverse production lines to meet customers' demand for more new products, new technologies, and real-time services.

C. Develop a sound financial structure to facilitate providing stable and adequate supply of resources and funds that are required for developing new technologies and new products.

D. Leverage our advantage in technology to improve design deficiencies, build an optimal process, improve process stability, strengthen the competitiveness of the Company and its subsidiaries in terms of cost and quality, and vie for the greatest business opportunity in the market.

E. Capitalize on the Company’s advantages in advanced technology, capital, and integrated resources to cultivate existing customers and gain more potential customers to extend business development.

F. Encourage our plants to exchange information on advanced technologies and motivate different departments to coordinate with one another in order to increase synergy.

G. ASE has vertically integrated and horizontally linked various aspects of its business operation, including materials, packaging, testing, and systems. This not only enables ASE to reinforce its competitiveness and to provide comprehensive services, but also improves ASE's flexibility in adjusting and confronting external challenges at any time.

H. Continue to strengthen our technological advantage, satisfy the diverse needs of customers, improve service quality, and build a patent protective network to solidify the Company's competitive niche.

I. Motivate customers to use the Company’s turnkey service, accelerage solution integration, and offer customers the fastest and most satisfactory services with the most comprehensive framework.

J. Customize marketing service systems, enhance the dependent relationship and strategic alliance with customers and utilize our existing R&D capabilities and product marketing abilities to actively establish a body of supply chains that are competitively advantaged in production, marketing, and research, in order to sustain the Company's core advantages in the industry.

K. Actively improve processes and designs to enhance quality, meet a diversity of customer needs, shorten delivery waiting time, enhance product competitiveness, and actively explore new customer markets.

L. In addition to continuously developing packaging and testing of power chip modules, the Company will endeavor to build a competitive threshold with its high-standard technologies and product qualities to sustain our advantage and profitability.

M. Plan and implement improvements to our supplier (supply chain) management practice, with hopes of integrating upstream and downstream industry value chain and share information costs with cooperating vendors to obtain mutually beneficial and profitable outcomes that will lower production/sales-related costs and improve product competitiveness.

2. Major uses of core products and production processes:

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(1) Major applications of core products

1 Packaging products

Major packaging products	Major Applications
·Plastic dual in-line package (PDIP)	u Primarily used in household appliance, communication device, automotive components, airplane, weapons, space shuttles, and other computer remote information system and navigation devices.
·Plastic leaded chip carriers (PLCC) ·Quad flat package (QFP) ·Bump chip carrier (BCC) ·Flip chip package ·Low/thin profile quad flat package (L/TQFP) ·Ball grid array (BGA, TFBGA, LBGA) ·Flip-chip BGA (HFC BGA) ·Thermally enhanced BGA (TE BGA) ·Very fine pitch ball grid array (VF BGA) ·Land grid array (LGA) ·Exposed pad QFP ·Heat slug BGA (HSBGA) ·QFN grid array ·Flip chip CSP	u Primarily used in microprocessor, communication device, automatic automotive components, personal computers, smartphone, tablet computers, and smart handheld device. u Wireless communication network, PDA, digital camera, information household appliance, and mobile phones. u Personal computers and notebooks. u TV games, DVD, MOD, etc. u Personal computers, notebook, wireless communication network, PDA, digital camera, information household appliance and smartphones, smart handheld device, etc. u Computers—graphic/chip card, cloud computing server, PCS and server microprocessor, voltage regulator, flash memory, hard disk, and other peripheral products. u Network communication products—WAN and LAN servers, converters, switches, routers, and cellular network. u Consumer products—video camera, digital camera, DVD, TV games, set-top box, PDA, and MID. u Other products—automatic automotive components, telematics.
·Small outline integrated circuits (SOP, SOJ) ·Thin small outline integrated circuits (TSOP) ·Super CSP	u Primarily used in memory IC. u Personal computers and peripheral equipment. u Primarily used in memory IC.
·3D package ·2.5D package ·Stacked BGA ·Multi-chip module (MCM) BGA	u Primarily used in various types of portable information products, including mobile phones, PDA, digital camera, etc. u Primarily used in high-level and cloud computing servers, including graphic processor, network processor, etc. u Notebook and hard disks for personal computers, etc.

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Major packaging products	Major Applications
l Wafer level CSP l Flip chip CSP l TSV technology l Integrated passive device (IPD) l Si interposer l Wafer level MEMS l Fine Pitch 3D chip stacking technology l Heterogeneous chip integration SiP l Fine pitch CoC SiP solution l Embedded active/passive substrate l eCompass magnetic sensor package	u Primarily used in mobile phones, PDA, digital camera, etc. u Primarily used in mobile phones, NBs, digital camera, etc. u Primarily used in mobile phones, NB/network, digital camera, etc. u Primarily used in wearable/portable consumer electronics, and NB/IoT u Primarily used in portable consumer electronics. u Primarily used in mobile phones, NBs, and network server. u Primarily used in portable consumer electronics. u Primarily used in NB, servers, and biomedical care. u Primarily used in mobile phones and game console. u Primarily used in portable consumer electronics.
l MEMS-based micro display l Safety control sensing component l DDR2 800 memory l Fan-out map pop technology l Fan-out WLP l Wireless connectivity SiP module l Wireless communication SiP module l Optical communication module	u Primarily used in projectors and high definition (HD) TVs. u Primarily used in personal computers, notebooks, network commercial applications, and other safety recognition device. u Primarily used in memory devices for computer, communication, and consumer electronics (3C products). u Primarily used in SiP products in 3C products (ASIC + MCP memory, BB+SDRAM) u Primarily used in portable consumer electronics. u Primarily used in wireless communication modules for 3C products, including BT, WiFi, GPS, DVB-H/T. u Primarily used in NBs, personal tablet, network communication products, and communication application for IoT industrial product devices. u Primarily used in optical transceivers, cloud server, data center, and communication application for high-speed computing server.

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2 New testing products

Core Products	Core Products
l Quad flat package (QFP) l Bump chip carrier (BCC) l Flip chip package l Low/thin profile quad flat package (L/TQFP) l Ball grid array (BGA, TFBGA, LBGA) l Flip-chip BGA (HFC BGA) l Thermally enhanced BGA (TE BGA) l Very fine pitch ball grid array (VF BGA) l Land grid array (LGA) l Exposed pad QFP l Heat slug BGA (HSBGA) l QFN grid array l aQFN grid array l Advanced single-sided substrate l SiP	l Primarily used in microprocessor, communication device, automatic automotive components, personal computers, handheld communication module, chipset, etc. l Wireless communication network, digital camera, information household appliance, liquid crystal TV, smartphone, etc. l Personal computers and notebooks. l TV games, DVD, MOD, etc. l Personal computers, notebook, wireless communication network, digital camera, information household appliance and smartphones, etc. l Mobile phone chipset, MP3 processor. l Consumer products—video camera, digital camera, DVD, TV games, set-top box, PDA, and MID. l Smartphones. l Wearable products. l Tablet computers. l Health management system, medical application. l Commercial application, IoT-related products. l Automotive safety system. l Industrial sensing component.
l Small outline integrated circuits (SOP, SOJ) l Thin small outline integrated circuits (TSOP) l Super CSP	l Primarily used in memory IC. l Personal computers and peripheral equipment. l Power management IC & portable device.

3 Electronic assembly application

Core Products

Core Products

l DC/DC converter module l IGBT, standard IPM module package

l Used in military aircraft or power systems on carriers, which require a higher standard of product quality and reliability; production process is based on application of electronic assembly involving die bond and wire bond. l Used in electric cars and smart home appliance industry; production process is based on a variety of package technologies including SMT, die bond, wire bond, pressFIT insertion, and gel potting.

mElectronic assembly products

Product name	Product function	Scope of application
1. Communications
Wireless communication module	Key parts of mobile electronics that integrate WiFi functions, Bluetooth, GPS, and digital	To accommodate the miniaturization of handheld and mobile electronics, primarily used

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Product name	Product function	Scope of application
	video; these parts have been developed into modules to accommodate products that are small and lightweight	in smartphones, game consoles, and personal audio/video entertainment devices, and other handheld electronics
NIC	A part that links computers or other equipment to the Internet	Primarily used in wireless network communication for notebooks
Customer-provided equipment (CPE)	Terminal equipment that can transmit wireless network signals and provide wireless access point	Wireless signal transmitters for home, business, and telecommunication operators, including various types of access points, routers, and wireless gateway, etc.
2. Computers and storage
(1) Computer motherboard
Motherboard for desktop and notebook computers and server motherboards	Core components that connect to CPU and internal access through main line and chipsets, forming the core of a computer. These components receive the energy provided by the power source of a computer and subsequently distribute the energy. They also have multiple ports that can connect to external hard drives, keyboards, and mouse.	Desktop and notebook computers and servers
(2) Commercial and network storage
Network attached storage (NAS)	NAS is a data storage device with network connections.	Primarily used in data storage management for SMEs or network companies
Grid array system	A technology that synchronizes the reading/writing of multiple hard drives, reduces errors, and increases efficiency and reliability by controlling the connection of multiple hard drives with a single hard drive controller	Primarily used in corporate headquarters and financial institutions or areas where remotely backing up and storing information are required to store the massive volume of corporate data and manage the storage of cloud data
3. Consumer electronics
Liquid crystal display control panel (VPD)	Circuit board for receiving signals and controlling liquid crystal display	LCD TVs and liquid crystal displays for desktop and notebook computers
Backlight module control panel	Circuit board that controls the backlight intensity of liquid crystal displays according to signals
4. Industrial products
Smart handheld device (SHD)	Industrial SHD that features a variety of functions, including reading, transmitting,	An extensive range of applications for warehouse logistics management system, including

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Product name	Product function	Scope of application
	processing, storing, and wirelessly communicating data	barcode data collectors, terminal equipment for mobile communication data, IC card handheld terminal equipment, terminal fingerprint collector, and recording meter
Point of sale (POS) terminal equipment	A PC-based commercial cash register that is installed in contract business owners and forms a network with the computers of the place where a retail transaction is taking place. This setup realizes ETF payment function and supports purchasing, preauthorization, balance enquiry, and bank transfer functions	Extensively used in various applications such as payment collection and other management practices of restaurants and retail stores
5. Other products
LED headlight module	LED headlight modules can control the brightness, color, beam distribution, and beam angle	For the automobile industry and other automotive electronics, products primarily comprise LED headlight modules, voltage regulator, and other printed circuit board assembly (PCBA) products
Voltage regulator	Voltage regulator maintains constant output voltage in an alternator under working condition
Other PCBA products for automobiles	Meeting corresponding functions according to the requirement of electronic products in vehicles; for example:  circuit board for windscreen wiper and air-conditioning control

(2) Production process

1 Packaging products

Ÿ Lead-frame products:

Wafer cutting→die bonding→Au wire bonding→seal mold→print→form outer lead→examine outer appearance→package

Ball grid products:

Wafer cutting→die bonding→Au wire bonding→seal mold→print→implant solder ball→cut and form→examine outer appearance→package

Ÿ Flip-chip products:

Wafer bump→wafer cutting→flip-chip die bond→underfill→print→implant solder ball→examine outer appearance→package

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Ÿ TSV products:

TSV→through via insulation layer→through via Cu-plated filling→through via wafer thinning→double-sided Cu wire→implant solder ball→stack→examine outer appearance→package

Ÿ Wireless connectivity SiP module:

Solder paste printing→component placement→high-temperature reflow→molding process→laser printing→cut and form→anti-electromagnetic coating→examine outer appearance→package

2 Testing products

Ÿ Lead-frame/ball array products:

IC test→product aging test (if requested by customer)→oven bake→examine product outer appearance→roll packaging→final product packaging

Ÿ High-frequency module products/power management module products:

Test system selection→develop program→verify and troubleshooting→pilot production→mass production

3 Electronic assembly application

Ÿ DC/DC converter module

Prepare material→print solder paste/silver gel→chip attachment→substrate attachment (reflow)→wire bonding→part placement→hand soldering→cleaning→laser modification→prepare top cover material→examine outer appearance→solder sealing→high/low-temp cycling→centrifugal test→foreign substance test→function test→burn test→solder soaking→package and shipment

Ÿ Standard IGBT module

Prepare material→chip bonding→chip cutting→solder paste printing (reflow)→die bonding→part soldering→vacuum reflow→cleaning→wire bonding→intermediate testing→terminal preparation→outer cover assembly→oven bake→inject gel→oven bake→final test (detection PIND test)→thermal grease printing→oven bake→package and shipment

Ÿ Standard IPM module

Prepare material→chip bonding→chip cutting→die soldering→die placement (epoxy die)→oven bake→Cu-wire bonding→gel potting→oven bake→final test→oven bake→package and shipment

mElectronic assembly products

Electronic assembly products are primarily produced using the same method, which involves three major operations: surface mount technology (SMT), assembly, and testing. Whether products require plug-ins is dependent on the specific purpose of use and customer requirements. The Company's three major operations, surface mount technology (SMT), assembly, and testing, are illustrated below:SMT

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113

Assembly operation process

  

114

Test operation process

 

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3. State of supply of key raw materials

(1) Packaging

The Company offers customers wafer packaging and testing services for semiconductors, purchases wafers primarily from internationally acclaimed semiconductor companies, and maintains a favorable long-term relation with these companies.

Main packaging material: Lead frame, substrate, Au wire, Cu wire, compound, etc. We employ excellent-performing suppliers who have passed our quality control evaluation. In particular, the Company obtains substrates from its subsidiary, ASE (Shanghai) Inc. and ASE Electronics Inc. so that the Company can monitor the entire process of material procurement.

Name of main raw materials	Source	Market condition	Procurement strategy
Substrate	ASEMTLSH/ASEE/Company A/Company B/Company C	Supply–demand balance	Cooperating vendors
Lead frame	Company D/E/F	Supply–demand balance	Cooperating vendors
Gold wire	Company G/H/I	Supply–demand balance	Cooperating vendors
Copper wire	Company J/I	Supply–demand balance	Cooperating vendors
Compound	Company D/K/L	Supply–demand balance	Cooperating vendors

(2) EMS activity

The Company and its subsidiaries primarily use IC, PCB, structural parts, and other electronic components as raw materials for production activities. The Company and its subsidiaries have built a comprehensive material procurement and management system to ensure that purchases are made instantly, quality is controlled, and procurement cost is minimized. Currently, the Company and its subsidiaries are fully equipped with an effective procurement mechanism inside and outside of China, and have established long-term, stable cooperative relationship with numerous component suppliers inside and outside of China.

4. Explanations on changes in type of core products or gross profit margin (by department) during the past 2 years

(1) Changes in gross profit margin during the past 2 years

Unit: NT$1,000; %

Year	Operating revenue	Gross profit	Gross profit margin (%)	Changes in gross profit margin (%)
2014	256,591,447	53,588,529	20.88	－
2015	283,302,536	50,135,228	17.70	(15.23)

(2) Price difference analysis

The changes in the gross profit margin of the Company and its subsidiaries did not exceed 20%, and therefore price difference analysis was not conducted.

5. List of main suppliers and buyers

(1) Names of suppliers who accounted for more than 10% of the purchases in the last two years, and purchase as a percentage of total purchase, with explanation on causes for such increase/decrease

116

Unit: NT$1,000; % 

	2014				2015				As of Q3 of 2016
Item	Name	Amount	Percentage of total net purchase	Relation with issuer	Name	Amount	Percentage of total net purchase	Relation with issuer	Name	Amount	Percentage of total net purchase as of the end of Q3 2016	Relation with issuer
1	Company A	16,360,849	11.95		Company A	22,842,407	14.46	None	Company A	12,028,049	11.95	None
	Others	120,563,319	88.05	－	Others	135,158,159	85.54	－	Others	88,590,459	88.05	－
	Procurements Net value	136,924,168	100.00	－	Procurements Net value	158,000,566	100.00	－	Procurements Net value	100,618,508	100.00	－

Reason for changes: Primarily due to the effect of customer demand.

(2) Names of customers who accounted for more than 10% of the sales in any of the last two years, and sales as a percentage of total sales, with explanations of the increase/decrease of such sales

Unit: NT$1,000; % 

2014

2015

As of the end of Q3 2016

Item

Name

Amount

Percentage of net sales

Relation with issuer

Name

Amount

Percentage of net sales

Relation with issuer

Name

Amount

Percentage of net sales as of the end of Q3 2016

Relation with issuer

1

Company B

54,431,222

21.21

None

Company B

88,311,697

31.17

None

Company B

44,706,306

22.61

None

Others

202,160,225

78.79

－

Others

194,990,839

68.83

－

Others

153,049,168

77.39

－

Sales Net value

256,591,447

100.00

－

Sales Net value

283,302,536

100.00

－

Sales Net value

197,755,474

100.00

－

Reason for changes: Primarily due to the influence of product sales of Company B.

6. Output volume and value during the most recent two years

Unit: 1,000; NT$ 1,000

Year Production value	2014			2015
Core Products	Production capacity	Production volume	Production output	Production capacity	Production volume	Production output
Packaging products	32,937,997	28,656,057	88,296,216	36,603,997	27,604,076	86,258,77
Test products (Note 1)	－	－	16,242,669	－	－	16,166,199
Electronic assembly products	500,805	465,749	96,665,532	708,773	595,142	128,808,721
Other (Note 2)	－	－	1,798,501	－	－	1,933,618
Total	33,438,802	29,121,806	203,002,918	37,312,730	28,199,218	233,167,308

Note 1: Based on test duration; therefore, quantity was not disclosed

Note 2: Quantity was not disclosed due to inconsistent quantity

Reason for changes: The overall production capacity and output in 2015 increased from those in 2014 because of an increase in the order for electronic assembly products in 2015.

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7. Sales volume and value during most recent two years

Unit: 1,000; NT$ 1,000

Year Sales value	2014				2015
	Domestic		Export		Domestic		Export
Core Products	Qty	Value	Qty	Value	Qty	Value	Qty	Value
Packaging products	5,370,470	25,024,909	23,285,587	96,311,544	4,494,130	22,795,108	23,109,946	93,812,206
Test products (Note 1)	－	1,691,568	－	24,183,126	－	1,661,491	－	23,530,425
Electronic assembly products	63,882	9,118,368	401,867	96,666,059	56,610	7,369,646	538,532	130,872,454
Other (Note 2)	－	912,854	－	2,683,019	－	804,904	－	2,456,302
Total	5,434,352	36,747,699	23,687,454	219,843,748	4,550,740	32,631,149	23,648,478	250,671,387

Note 1: Based on test duration; therefore, quantity was not disclosed

Note 2: Quantity was not disclosed due to inconsistent quantity

Reason for changes: Total sales in 2015 increased compared with that in 2014 primarily because of an increase in the export orders for electronic assembly products.

(3) Number of employees during the past 2 years

Unit: person; Year; %

Year			2014	2015	As of November 30, 2016
Number of employees	Technicians		16,420	17,198	17,167
	Managerial personnel		3,496	3,698	3,853
	General affairs personnel		6,008	6,201	6,110
	Operator		42,176	38,692	40,018
	Total		68,100	65,789	67,148
Average age			30.9	31.7
Average years of service			4.8	5.3
Education Distribution Percentage		Masters and Ph.D	6.03%	6.98%	7.03%
		Bachelors	47.01%	47.23%	48.62%
		Senior High School and below	46.96%	45.79%	44.35%

(4) Spending on environmental protection

1. According to prevailing laws and regulations, a company is required to apply for permit for installation of waste treatment facilities or that for discharge of such waste or any waste prevention or treatment charges or institute units or personnel dedicated to environmental protection. In such a case its application, payment or institution shall be as follows

The Company and its subsidiaries have, as required by law, applied for operating permit for stationary pollution source and permit for water pollution prevention,

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and have paid for pollution prevention fees and selected employees to participate in training and obtain environmental protection certificates.

(1) Status of application for permit for installation of waste treatment facilities or that for discharge of such waste or any waste prevention

Types of Permit	Explanation
Operating Permit for Stationary Pollution Source	Zheng-Shu-Zi No. (ASE Kaohsiung):  (1) MOEA Export Processing Si-Zing-Zi No.ABO03790, effective period: 2016/4/20 ~ 2021/4/19  (2) MOEA Export Processing Si-Zing-Zi No.AAN03791, effective period: 2015/8/21 ~ 2020/8/20  (3) MOEA Export Processing Si-Zing-Zi No.AEN20241, effective period: 2015/12/25 ~ 2020/12/24  (4) MOEA Export Processing Si-Zing-Zi No.AEN17291, effective period: 2015/12/25 ~ 2020/12/24  (5) MOEA Export Processing Si-Zing-Zi No.AENA7191, effective period: 2015/12/28 ~ 2020/12/27  (6) MOEA Export Processing Si-Zing-Zi No.AAOA5890, effective period: 7/7/2016 ~ 7/6/2021  (7) MOEA Export Processing Si-Zing-Zi No.AAOA5790, effective period: 7/7/2016 ~ 7/6/2021  (8) MOEA Export Processing Si-Zing-Zi No.AAOA5990, effective period: 7/8/2016 ~ 7/7/2021  (9) MOEA Export Processing Si-Zing-Zi No.AAN16075, effective period: 10/1/2015 ~ 9/30/2020  (10) MOEA Export Processing Si-Zing-Zi No.ACO16070, effective period: 1/12/2016 ~ 1/11/2021  (11) MOEA Export Processing Si-Zing-Zi No.ACO16071, effective period: 1/8/2016 ~ 1/7/2021  (12) MOEA Export Processing Si-Zing-Zi No.AEO16073, effective period: 11/9/2016 ~ 11/8/2021  (13) MOEA Export Processing Si-Zing-Zi No.AAOA6980, effective period: 6/17/2016 ~ 6/16/2021  (14) MOEA Export Processing Si-Zing-Zi No.AAO53650, effective period: 6/15/2016 ~ 6/14/2021  (15) MOEA Export Processing Si-Zing-Zi No.AEN53653, effective period: 11/20/2015 ~ 11/19/2020  (16) MOEA Export Processing Si-Zing-Zi No.AEN53652, effective period: 11/18/2015 ~ 11/17/2020  (17) MOEA Export Processing Si-Zing-Zi No.AAOA2660, effective period: 3/21/2016 ~ 3/20/2021  (18) MOEA Export Processing Si-Zing-Zi No.ACNA2660, effective period: 7/21/2015 ~ 7/20/2020  (19) MOEA Export Processing Si-Zing-Zi No.AANA5151, effective period: 9/10/2015 ~ 9/9/2020  (20) MOEA Export Processing Si-Zing-Zi No.ACOA5150, effective period: 8/4/2016 ~ 8/3/2021  (21) MOEA Export Processing Si-Zing-Zi No.AAKA5152, effective period: 10/22/2012 ~ 10/21/2017  (22) MOEA Export Processing Si-Zing-Zi No.AAOA8060, effective period: 7/4/2016 ~ 7/4/2021  (23) MOEA Export Processing Si-Zing-Zi No.AAO68350, effective period: 3/28/2016 ~ 3/27/2021  (24) MOEA Export Processing Si-Zing-Zi No.AAN68350, effective period: 4/8/2015 ~ 4/7/2020  (25) MOEA Export Processing Si-Zing-Zi No.AEN68351, effective period: 7/3/2015 ~7/2/2020
	(26) MOEA Export Processing Si-Zing-Zi No.ABN68352, effective period: 11/3/2015 ~ 11/2/2020  (27) MOEA Export Processing Si-Zing-Zi No.AEOA6341, effective period: 9/22/2016 ~ 9/21/2021  (28) MOEA Export Processing Si-Zing-Zi No.AAMA6340, effective period:

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5/20/2014 ~ 5/19/2019  (29) MOEA Export Processing Si-Zing-Zi No.AAOA0780, effective period: 5/17/2016 ~ 5/16/2021  (30) MOEA Export Processing Si-Zing-Zi No.AENA0780, effective period: 11/4/2015 ~ 11/3/2020  (31) MOEA Export Processing Si-Zing-Zi No.AAMA6920, effective period: 4/25/2014 ~ 4/20/2019  (32) MOEA Export Processing Si-Zing-Zi No.AENA6921, effective period: 12/1/2015 ~ 11/30/2020  (33) MOEA Export Processing Si-Zing-Zi No.AANA6301, effective period: 4/1/2015 ~ 3/31/2020  (34) MOEA Export Processing Si-Zing-Zi No.ACNA6922, effective period: 12/1/2015 ~ 11/30/2020  (35) MOEA Export Processing Si-Zing-Zi No.AAOA6920, effective period: 5/24/2016 ~ 5/23/2021  (36) MOEA Export Processing Si-Zing-Zi No.AAOA6921, effective period: 9/8/2016 ~ 9/7/2021  (37) MOEA Export Processing Si-Zing-Zi No.ABNA3852, effective period: 12/8/2015 ~ 3/4/2020  (38) MOEA Export Processing Si-Zing-Zi No.AAOA6307, effective period: 11/8/2016 ~ 11/7/2021  (39) MOEA Export Processing Si-Zing-Zi No.AEOA6304, effective period: 5/25/2016 ~ 4/19/2021  (40) MOEA Export Processing Si-Zing-Zi No.AANA6301, effective period: 4/1/2015 ~ 3/31/2020  (41) MOEA Export Processing Si-Zing-Zi No.AEOA6305, effective period: 5/25/2016 ~ 4/20/2021  (42) MOEA Export Processing Si-Zing-Zi No.AAOA6300, effective period: 1/28/2016 ~ 1/27/2021  (43) MOEA Export Processing Si-Zing-Zi No.AEOA6306, effective period: 5/27/2016 ~ 4/20/2021  Zheng-Shu-Zi No. (ASE Zhongli):  (1) Packaging and testing plant 1 (H4032809): M01 Cao-Zheng-Zi No.H4517-05  M03 She-Zheng-Zi No.H3966-01  (2) Packaging and testing plant 4 (H43A2093): M01 Cao-Zheng-Zi No.H4901-04

Permit for Water Pollution Prevention

Zheng-Shu-Zi No. (ASE Kaohsiung):  (1) Kaohsiung City Government Huan-Tu-Zhu-Xu-Zi No.00011-04 (effective period: 2/22/2016~12/27/2017)  (2) Kaohsiung City Government Huan-Tu-Pai-Xu-Zi No.00734-03 (effective period: 10/17/2016~1/15/2018)  (3) Kaohsiung City Government Huan-Tu-Pai-Xu-Zi No.00626-05 (effective period: 3/8/2016~10/1/2018)  (4) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00519-03 (effective period: 2/22/2016~8/2/2017)  (5) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00674-03 (effective period: 3/3/2016~3/2/2021)  (6) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00776-02 (effective period: 2/22/2016~6/19/2018)  (7) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00822-01 (effective period: 2/22/2016~2/21/2021  (8) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00925-01 (effective period: 8/29/2016~8/28/2021)  (9) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00879-02 (effective period: 10/14/2016~7/8/2019)  (10) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00769-04 (effective period: 10/14/2016~5/21/2017)  (11) Kaohsiung City Government Huan-Tu-Shui-Cuo-Zi No.00864-04 (effective period: 10/3/2916~4/22/2019)  Zheng-Shu-Zi No. (ASE Zhongli):  (1) Packaging and testing plant 1 (H4032809): Taoyuan City Huan-Pai-Xu-Zi No.H1980-07

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(2) Packaging and testing plant 4 (H43A2093): Taoyuan City Huan-Pai-Xu-Zi No.H2107-05  (3) Packaging and testing plant 5 (H43A0700): Taoyuan City Huan-Pai-Xu-Zi No.H2108-09  (4) Packaging and testing plant 6 (H43B3840): Taoyuan City Huan-Pai-Xu-Zi No.H2976-05  (5) Packaging and testing plant 7 (H43C1277): Taoyuan City Huan-Pai-Xu-Zi No.H3435-02  (6) Packaging and testing plant 8 (H43C1811): Taoyuan City Huan-Pai-Xu-Zi No.H3525-01  (7) Underground sewage center (H4310703): Taoyuan City Huan-Pai-Xu-Zi No.H1382-06

Industrial Waste Disposal Plan

Zheng-Shu-Zi No. (ASE Kaohsiung):  (1) 1050910 MOEA Export Processing Si-Zing-Zi No. 10501042450  (2) 1041202 MOEA Export Processing Si-Zing-Zi No. 10400126810  (3) 1041202 MOEA Export Processing Si-Zing-Zi No. 10400126800  (4) 1050826 MOEA Export Processing Si-Zing-Zi No. 10500086690  (5) 1041217 MOEA Export Processing Si-Zing-Zi No. 10400134180  (6) 1050902 MOEA Export Processing Si-Huan-Zi No. 10500089500  (7) 1050908 MOEA Export Processing Si-Zing-Zi No. 10501041990  (8) 1050907 MOEA Export Processing Si-Zing-Zi No. 10501041510  (9) 1050107 MOEA Export Processing Si-Zing-Zi No. 10400144040  (10) 1050926 MOEA Export Processing Si-Zing-Zi No. 10500097900  (11) 1050907 MOEA Export Processing Si-Zing-Zi No. 10501041700  (12) 1050617 MOEA Export Processing Si-Zing-Zi No. 10500058350  (13) 1050901 MOEA Export Processing Si-Zing-Zi No. 10501040870  (14) 1050910 MOEA Export Processing Si-Zing-Zi No. 10500091660  (15) 1050910 MOEA Export Processing Si-Zing-Zi No. 10500091670  (16) 1050927 MOEA Export Processing Si-Zing-Zi No. 10501044310  (17) 1040623 MOEA Export Processing Si-Zing-Zi No. 10400061140  (18) 1050203 MOEA Export Processing Si-Zing-Zi No. 10500013270  (19) 1051006 MOEA Export Processing Si-Zing-Zi No. 10500099650  (20) 1050707 MOEA Export Processing Si-Zing-Zi No. 10500066370  (21) 1050527 MOEA Export Processing Si-Zing-Zi No. 10500051630 approved  Zheng-Shu-Zi No. (ASE Zhongli):  (1) Packaging and testing plant 1 (H4032809): H09211160001  (2) Packaging and testing plant 4 (H43A2093): H09509070010  (3) Packaging and testing plant 5 (H43A0700): H09412120001  (4) Packaging and testing plant 6 (H43B3840): H10009070004  (5) Packaging and testing plant 7 (H43C1277): H10306250002  (6) Packaging and testing plant 8 (H43C1811): H10310290006  (7) Packaging and testing plant 9 (H43C8785): H10506200001  (8) Underground sewage center (H4310703): H095050011

(2) Payment of treatment charges

Company/plant name	Category	2014	2015
ASE Kaohsiung/Chungli/Nantou	Industrial waste disposal	NT$ 99,436,000	NT$ 158,137,000
ASE Kaohsiung/Chungli/Nantou	Air pollution prevention	NT$ 23,405,000	NT$ 39,206,000
ASE Kaohsiung/Chungli/Nantou	Wastewater treatment	NT$ 64,136,000	NT$ 44,975,000

(2) Units or personnel dedicated to environmental protection:

Company/plant name	Name	Responsible technology	Certificate No.
K1	Ming-Hao Liao	Category A wastewater treatment personnel	(2013) EPA-Xun-Zheng-Zi No.GA270128
	Han-Wei Lee	Category A wastewater treatment personnel	(2012) EPA-Xun-Zheng-Zi No.GA200350
	Wen-Yao Chou	Category B wastewater treatment personnel	(2016) EPA-Xun-Zheng-Zi No.GB030217

121

K3	Shih-Hsien Chang	Category A wastewater treatment personnel	(2009) EPA-Xun-Zheng-Zi No.GA350079
	Chih-Hsien Wu	Category A wastewater treatment personnel	(2009) EPA-Xun-Zheng-Zi No.GA380094
	De-Sheng Deng	Category B wastewater treatment personnel	(2013) EPA-Xun-Zheng-Zi No.GB080555
K5	Chih-Yang Kuo	Category A wastewater treatment personnel	(2007) EPA-Xun-Zheng-Zi No.GA230008
	Chih-Hong Chang	Category A wastewater treatment personnel	(2009) EPA-Xun-Zheng-Zi No.GA480511
	Ying-Hong Yeh	Category A wastewater treatment personnel	(2010) EPA-Xun-Zheng-Zi No.GA450643
K7	Wen-Hui Chiu	Category A wastewater treatment personnel	(2005) EPA-Xun-Zheng-Zi No.GA110199
	Chung-Pu Tsai	Category A wastewater treatment personnel	(2013) EPA-Xun-Zheng-Zi No.GA301021
	Pi-Yuan Wang	Category A wastewater treatment personnel	(2006) EPA-Xun-Zheng-Zi No.GA150036
K11	Chung-Hsun Yu	Category A wastewater treatment personnel	(98) Huan-Shu-Shun-Zheng-Zi-GA070596
	Gu Li-Hua	Class 1 qualified wastewater treatment officer	(96) Huan-Shu-Shun-Zheng-Zi-GA020289
	Zhou Jia-Cheng	Class 1 qualified wastewater treatment officer	(103) Huan-Shu-Shun-Zheng-Zi-GA320875
K12 (Wafer Bumping 2B Plant)	Zhang Jian Shi-Xian	Class 1 qualified wastewater treatment officer	(84) Huan-Shu-Shun-Zheng-Zi-GA430162
	Wang Wen-De	Class 1 qualified wastewater treatment officer	(93) Huan-Shu-Shun-Zheng-Zi-GA090102
	Yan Jia-Fu	Class 2 qualified wastewater treatment officer	(103) Huan-Shu-Shun-Zheng-Zi-GB130131
K12 (No. 12 Factory)	Wang Guan-Lin	Class 1 qualified wastewater treatment officer	(103) Huan-Shu-Shun-Zheng-Zi-GA320954
	Hong Ming-Mao	Class 1 qualified wastewater treatment officer	(98) Huan-Shu-Shun-Zheng-Zi-GA190155
	Yang Ming-Rui	Class 2 qualified wastewater treatment officer	(104) Huan-Shu-Shun-Zheng-Zi-GB240031
K21	Lin Wei-Zong	Class 1 qualified wastewater treatment officer	(91) Huan-Shu-Shun-Zheng-Zi-GA060032
	Zheng Qing-Lun	Class 1 qualified wastewater treatment officer	(102) Huan-Shu-Shun-Zheng-Zi-GA160359
	Zeng Peng-Cheng	Class 2 qualified wastewater treatment officer	(85) Huan-Shu-Shun-Zheng-Zi-GB351484
K14	Wang Shi-Hao	Class 1 qualified wastewater treatment officer	(98) Huan-Shu-Shun-Zheng-Zi-GA250919
	Xiao Yi-Xiang	Class 1 qualified wastewater treatment officer	(92) Huan-Shu-Shun-Zheng-Zi-GA140293
	Diao Qi-Yi	Class 2 qualified wastewater treatment officer	(97) Huan-Shu-Shun-Zheng-Zi-GB021005
K22	Su Jing-Ming	Class 1 qualified wastewater treatment officer	(94) Huan-Shu-Shun-Zheng-Zi-GA150192
	Lin Kun-Zhi	Class 1 qualified wastewater treatment officer	(101) Huan-Shu-Shun-Zheng-Zi-GA300292
	Wang Shi-Jie	Class 1 qualified wastewater treatment officer	(99) Huan-Shu-Shun-Zheng-Zi-GA070208
K8	He Si-Ying	Class 1 qualified wastewater treatment officer	(97) Huan-Shu-Shun-Zheng-Zi-GA200599
K9	Wu Hui-Long	Class 1 qualified wastewater treatment officer	(98) Huan-Shu-Shun-Zheng-Zi-GA490009
	Su Zhen-Jia	Class 1 qualified wastewater treatment officer	(104) Huan-Shu-Shun-Zheng-Zi-GA410050
	Xie Jia-Hong	Class 2 qualified wastewater treatment officer	(88) Huan-Shu-Shun-Zheng-Zi-GB250320
K15	Xu Zhi-Wei	Class 1 qualified wastewater treatment officer	(95) Huan-Shu-Shun-Zheng-Zi-GA150342
	Lin Zhi-Hong	Class 1 qualified wastewater treatment officer	(92) Huan-Shu-Shun-Zheng-Zi-GA100357
	Ye Li-Bin	Class 2 qualified wastewater treatment officer	(96) Huan-Shu-Shun-Zheng-Zi-GA050802

122

K1	Wang Min-Jie	Class 1 qualified air pollution control officer	(103) Huan-Shu-Shun-Zheng-Zi-FA220557
K3	Qian Jia-Yuan	Class 1 qualified air pollution control officer	(99) Huan-Shu-Shun-Zheng-Zi-FA040430
K5	Chen Kun-Cun	Class 1 qualified air pollution control officer	(104) Huan-Shu-Shun-Zheng-Zi-FA220089
K7	Liu Xuan-Xuan	Class 1 qualified air pollution control officer	(102) Huan-Shu-Shun-Zheng-Zi-FA320046
K11	Zhong Yu-Cheng	Class 1 qualified air pollution control officer	(103) Huan-Shu-Shun-Zheng-Zi-FA140443
K21	Wang Qiao-Zhi	Class 1 qualified air pollution control officer	(99) Huan-Shu-Shun-Zheng-Zi-FA010083
K12	Huang Yong-Cheng	Class 1 qualified air pollution control officer	(103) Huan-Shu-Shun-Zheng-Zi-FA140444
K22	Zhang Rui-Rui	Class 1 qualified air pollution control officer	(101) Huan-Shu-Shun-Zheng-Zi-FA170447
K26	He Shang-Feng	Class 1 qualified air pollution control officer	(90) Huan-Shu-Shun-Zheng-Zi-FA160457
K9	Chen Xin-Nan	Class 1 qualified air pollution control officer	(103) Huan-Shu-Shun-Zheng-Zi-FA140490
K15	Su Zhi-Cheng	Class 1 qualified air pollution control officer	(92) Huan-Shu-Shun-Zheng-Zi-FA030121
K16	Hong Mao-Zhe	Class 1 qualified air pollution control officer	(95) Huan-Shu-Shun-Zheng-Zi-FA010438
ASE Embedded Electronics  Incorporated	Qiu Feng-Ze	Class 1 qualified air pollution control officer	(95) Huan-Shu-Shun-Zheng-Zi-FA010395
Advanced Semiconductor Engineering  Co., Ltd.	Lin Yi-Hua	Class 1 qualified waste disposal officer	(96) Huan-Shu-Shun-Zheng-Zi-HA390493
	Tu Hong-Zhong	Class 1 qualified waste disposal officer	(102) Huan-Shu-Shun-Zheng-Zi-HA280488
	Chen Jia-Ling	Class 1 qualified waste disposal officer	(104) Huan-Shu-Shun-Zheng-Zi-HA410288
	Lin Feng-Qing	Class 2 qualified waste disposal officer	(103) Huan-Shu-Shun-Zheng-Zi-HB180203
	Chen Yi-Jun	Class 1 qualified waste disposal officer	(100) Huan-Shu-Shun-Zheng-Zi-HA340323
	Ou Su-Jie	Class 1 qualified waste disposal officer	(93) Huan-Shu-Shun-Zheng-Zi-HA290515
	Yu Yan-Bin	Class 1 qualified waste disposal officer	(104) Huan-Shu-Shun-Zheng-Zi-HA410327
	Chen Yan-Hong	Class 2 qualified waste disposal officer	(103) Huan-Shu-Shun-Zheng-Zi-HB210707
ASE Test  Incorporated	Lv Wen-Hong	Class 1 qualified waste disposal officer	(98) Huan-Shu-Shun-Zheng-Zi-HA050079
	Jian Yu-Zhi	Class 1 qualified waste disposal officer	(90) Huan-Shu-Shun-Zheng-Zi-HA440902
ASE Electronics  Incorporated	Chen Pin-Zhen	Class 1 qualified waste disposal officer	(98) Huan-Shu-Shun-Zheng-Zi-HA470311
	Cai Meng-Han	Class 1 qualified waste disposal officer	(97) Huan-Shu-Shun-Zheng-Zi-HA500691
	Xu Shu-Yan	Class 1 qualified waste disposal officer	(103) Huan-Shu-Shun-Zheng-Zi-HA310153
ASE Embedded Electronics  Incorporated	Wang Si-Yu	Class 2 qualified waste disposal officer	(98) Huan-Shu-Shun-Zheng-Zi-HB370015
No. 1 Packaging and Test Plant	Li Qi-Yu	Class 1 qualified air pollution control officer	(98) Huan-Shu-Shun-Zheng-Zi-FA210023
No. 1 Packaging and Test Plant	Li Qi-Yu	Class 1 qualified wastewater treatment officer	(95) Huan-Shu-Shun-Zheng-Zi-GA070046
No. 1 Packaging and Test Plant	Lin Jia-Wei	Class 1 qualified wastewater treatment officer	(101) Huan-Shu-Shun-Zheng-Zi-GA140254
No. 1 Packaging and Test Plant	Wu Zhen-Jia	Class 1 qualified wastewater treatment officer	(101) Huan-Shu-Shun-Zheng-Zi-GA300968
No. 1 Packaging and Test Plant	Li Qi-Yu	Class 1 waste disposal technician	(96) Huan-Shu-Shun-Zheng-Zi-HA500363
No. 4 Packaging and Test Plant	Wang Zhi-Fa	Class 1 qualified air pollution control officer	(99) Huan-Shu-Shun-Zheng-Zi-FA260064

123

No. 4 Packaging and Test Plant	Guo Wei-Yan	Class 1 qualified wastewater treatment officer	(99) Huan-Shu-Shun-Zheng-Zi-GA240896
No. 4 Packaging and Test Plant	Guo Wei-Yan	Class 1 waste disposal technician	(99) Huan-Shu-Shun-Zheng-Zi-HB220950
No. 5 Packaging and Test Plant	Zan Wu-Lie	Class 1 qualified wastewater treatment officer	(100) Huan-Shu-Shun-Zheng-Zi-GA050427
No. 5 Packaging and Test Plant	Xu Chen-Zhi	Class 1 qualified wastewater treatment officer	(102) Huan-Shu-Shun-Zheng-Zi-GA270233
No. 5 Packaging and Test Plant	Lv Yang-Ren	Class 2 qualified wastewater treatment officer	(97) Huan-Shu-Shun-Zheng-Zi-GB580008
No. 5 Packaging and Test Plant	Zan Wu-Lie	Class 1 waste disposal technician	(93) Huan-Shu-Shun-Zheng-Zi-HA281344
No. 6 Packaging and Test Plant	Lin Jian-Hong	Class 1 qualified wastewater treatment officer	(97) Huan-Shu-Shun-Zheng-Zi-GA450955
No. 6 Packaging and Test Plant	Lin Jian-Hong	Class 1 waste disposal technician	(92) Huan-Shu-Shun-Zheng-Zi-HA110872
No. 7 Packaging and Test Plant	Yang Ji-Zong	Class 1 qualified wastewater treatment officer	(99) Huan-Shu-Shun-Zheng-Zi-GA610175
No. 7 Packaging and Test Plant	Xu Ji-Yin	Class 1 waste disposal technician	(105) Huan-Shu-Shun-Zheng-Zi-HA120785
No. 8 Packaging and Test Plant	Yang Shun-Ming	Class 1 waste disposal technician	(93) Huan-Shu-Shun-Zheng-Zi-HA260860
No. 9 Packaging and Test Plant	Zhu Xiu-Cheng	Class 2 waste disposal technician	(101) Huan-Shu-Shun-Zheng-Zi-HB211074
Sewage Pipe Center	Zhong Xin-Zhao	Class 1 qualified wastewater treatment officer	(102) Huan-Shu-Shun-Zheng-Zi-GA340325
Sewage Pipe Center	Hong Zheng-Guang	Class 1 qualified wastewater treatment officer	(88) Huan-Shu-Shun-Zheng-Zi-GA160087
Sewage Pipe Center	Yang Qing-Fu	Class 2 qualified wastewater treatment officer	(103) Huan-Shu-Shun-Zheng-Zi-GB140381
Sewage Pipe Center	Zhong Xin-Zhao	Class 1 waste disposal technician	(96) Huan-Shu-Shun-Zheng-Zi-HA180158

2. List of the Company's investments in key equipment on prevention and treatment of environmental pollution; their use and anticipated benefits

November 30, 2016 Unit: NT$ 1,000 

Name of Equipment	Quantity	Date Obtained	Investment Cost	Balance before Depreciation	Use and anticipated benefit
K7-8F indoor waste gas exhaust pipes and central dust pipe production and installation works	1	2003/7/31	19,000	6,413	Prevention and control of air pollution
BUMPING waste water and gas treatment system assmebly works	1	2001/9/30	13,500	－	Prevention and control of water pollution
K7-NUMPING II 300mm waste water and gas production and installation works	1	2003/7/31	16,300	5,501	Prevention and control of water pollution
K7-10F waste gas and central dust-collection equipment (one-off assembly) work	1	2003/7/31	11,200	3,780	Prevention and control of air pollution
K7-3F waste gas treatment and central dust-collection work for Phase 1	1	2003/10/31	33,900	11,865	Prevention and control of air pollution
Wastewater land-borne discharge pipe work and planning design	1	2001/9/30	19,848	4,879	Prevention and control of water pollution
K7 wastewater treatment system	1	2002/8/31	24,030	1,335	Prevention and control of water pollution
K1/K2 organic/inorganic waste gas treatment work	1	2001/11/30	12,244	68	Prevention and control of air pollution
K7-11F indoor waste gas exhaust	1	2004/7/31	11,200	4,340	Prevention and

124

Name of Equipment	Quantity	Date Obtained	Investment Cost	Balance before Depreciation	Use and anticipated benefit
pipes and central dust pipe production and installation works					control of air pollution
K7-5F BUMPING extension A.D Section waste gas/water discharge/central dust pipe work	1	2004/7/31	24,500	9,494	Prevention and control of air pollution
K11 Phase 1 waste treatment equipment and central dust-collection works	1	2005/6/30	28,850	12,502	Prevention and control of air pollution
K7-9F waste gas exhaust pipes and central dust pipe production and installation works	1	2005/9/30	12,337	5,500	Prevention and control of air pollution
K7 cutting and cleaning wastewater recovery system	1	2006/2/28	25,572	7,388	Prevention and control of water pollution
K11 air-conditioner main unit room and rooftop cooling water tower power distribution and piping works	1	2006/5/31	38,171	18,290	Prevention and control of water pollution
K11 wastewater treatment plant equipment and construction	1	2006/8/31	32,629	16,043	Prevention and control of water pollution
K7 new organic waste gas treatment equipment	1	2006/9/30	14,821	7,349	Prevention and control of air pollution
Sludge baking equipment work	1	2007/11/30	14,775	5,992	Waste Disposal/Treatment
K7 Phase 1 purified water system improvement (2B3T+MB) work	1	2009/10/31	31,046	20,180	Prevention and control of water pollution
K7 wastewater recovery system work	1	2011/12/31	16,130	10,933	Prevention and control of water pollution
K12-2F plant-construction DW, PCW water recovery pipe work	1	2012/5/31	14,546	10,263	Prevention and control of water pollution
K12 wastewater treatment plant new construction work	1	2012/11/30	84,100	62,141	Prevention and control of water pollution
K12-RF main waste gas treatment equipment work	1	2013/3/31	70,425	53,601	Prevention and control of air pollution
K7 column scrubber machine addition work (Phase 1)	1	2014/5/31	16,686	13,997	Prevention and control of air pollution
K5 wastewater recovery and treatment works	1	2014/5/31	17,650	14,806	Prevention and control of water pollution
K11-4F production process DS/SS wastewater recovery system work	1	2014/7/31	28,092	23,878	Prevention and control of water pollution
K21-B1F Block A main wastewater system work	1	2014/11/30	78,065	68,090	Prevention and control of water pollution
K12 wastewater recovery system work	1	2014/12/31	13,112	11,509	Prevention and control of water pollution
K21 production process SS/DS new recovered water and recovered organic water work	1	2015/4/30	45,152	40,637	Prevention and control of water pollution
K7RF air pollution control system	1	2015/4/30	94,342	87,266	Prevention and

125

Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

work					control of air pollution
K22-RF exhaust system main equipment work	1	2015/7/31	21,975	20,602	Prevention and control of air pollution
Environmental Protection Building central water recovery exhaust equipment	1	2015/9/30	24,116	22,809	Prevention and control of water pollution
Environmental Protection Building central work recovery equipment	1	2015/9/30	226,898	214,496	Prevention and control of water pollution
K14B Environmental Protection Building central water recovery buried-pipe work	1	2015/11/30	62,943	59,936	Prevention and control of water pollution
K11-RF (P011) air pollution system expansion work	1	2016/3/31	52,767	50,715	Prevention and control of air pollution
K22 new main exhaust system work	1	2016/3/31	149,631	145,267	Prevention and control of air pollution
K22 VOCS new waste gas treatment system work	1	2016/4/30	123,755	120,661	Prevention and control of air pollution
K16-RF plant section exhaust system Phase 1	1	2016/5/31	25,566	25,033	Prevention and control of air pollution
K5 wastewater treatment work	1	1998/10/31	10,500	－	Prevention and control of water pollution
K5 damper purchasing and installation work	1	2012/3/31	22,540	17,375	Prevention and control of noise and vibration
K5 shock resistance enhancement work	1	2012/4/30	27,449	21,273	Prevention and control of noise and vibration
K14B Environmental Protection Building new renovation and landscaping works	1	2014/11/30	62,261	54,305	Prevention and control of water pollution
K14B Environmental Protection Building new M&E works	1	2014/11/30	23,042	20,833	Prevention and control of water pollution
K14B Environmental Protection Building new fire safety work	1	2014/11/30	13,615	11,875	Prevention and control of water pollution
No. 2 Park five major pipe inter-section connection and pre-cast work	1	2015/7/31	71,267	66,813	Prevention and control of water pollution
K14B-2F continuous-type heat pump environmentally-friendly sludge dryer	1	2016/9/3	15,331	15,331	Prevention and control of water pollution
K26-RF main exhaust system plant-construction work - 40% completed	1	2016/9/3	10,020	10,020	Prevention and control of air pollution
C Building waste gas treatment work	1	2004/10/31	66,800	－	Reduction of air pollution
Block C basement 1F wastewater treatment plant Phase 1	1	2004/12/31	36,490	26,248	Prevention and control of water pollution
B8F waste gas treatment and central	1	2005/6/30	44,175	10,798	Reduction of air

126

Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

dust-collection system works					pollution
Block B Packaging and testing plant waste gas treatment work	1	2005/9/12	22,400	－	Reduction of air pollution
B Plant Administration Section 13F wastewater recovery system Phase 1	1	2005/9/12	38,912	－	Prevention and control of water pollution
B Plant Administration Section 13F wastewater recovery system Phase 2	1	2006/5/4	21,500	1,792	Prevention and control of water pollution
Block B wastewater treatment Phase 1	1	2006/7/1	82,000	7,243	Prevention and control of water pollution
Black B materials plant Phase 1 main waste gas system work	1	2006/8/31	79,800	－	Reduction of air pollution
A10F clean room exhaust pipe work (new)	1	2008/3/10	17,500	3,208	Reduction of air pollution
Block A waste gas treatment system (new)	1	2008/3/10	31,000	6,200	Reduction of air pollution
A-RF recovered water system	1	2010/9/20	23,780	14,400	Prevention and control of water pollution
B-B1F purified water recovery system work	1	2010/9/21	33,000	19,983	Prevention and control of water pollution
A-8F primary exhaust system	1	2010/9/23	15,275	6,237	Reduction of air pollution
A-RF waste gas treatment system Phase 2 (includes main air pipe for utility distribution room)	1	2010/9/23	22,300	13,504	Reduction of air pollution
B-B1F recovered water system Phase 2 expansion work	1	2011/7/22	33,000	22,367	Prevention and control of water pollution
A-2F equipment section and utility distribution room waste gas work	1	2011/12/8	10,800	5,490	Reduction of air pollution
B-B2 wastewater circulation environmental indicator control and wastewater works	1	2014/3/7	700	554	Prevention and control of water pollution
B-B1F combined sludge tank and flotation system - Chemical mixing system	1	2014/3/27	4,776	3,741	Prevention and control of water pollution
Blocks A, B and C wastewater treatment plant release pool PH-monitoring Alarm Call system work (central control room)	1	2014/4/16	138	71	Prevention and control of water pollution
Block A wastewater treatment plant SS SENSOR connection work	1	2014/4/16	122	63	Prevention and control of water pollution
Block B wastewater treatment plant release pool environmental information continuous-monitoring Alarm Call system work (central control room)	1	2014/4/16	104	53	Prevention and control of water pollution
A-RF wastewater treatment plant and dust-collection exhaust vent's additional installation of ventilation pipe and fan coil unit work (201402)	1	2014/4/22	6,134	3,885	Prevention and control of water pollution
Blocks A and C wastewater monitoring equipment new connection and Block B wastewater	1	2014/4/23	255	136	Prevention and control of water pollution

127

Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

treatment plan system work (1 unit of surveillance video camera for Blocks A and C)
Block AB 1F wastewater temporary storage tank pipeline work	1	2014/4/30	2,016	1,647	Prevention and control of water pollution
B-13F recovery system UF membrane water-supply work	1	2014/5/27	9,900	3,850	Prevention and control of water pollution
B-B1F recovered water Phase 3 water-supply work	1	2014/5/27	33,871	13,172	Prevention and control of water pollution
Dehydrating equipment - Block B wastewater plan sludge dehydrating machine PAM-60 procurement	2	2014/6/6	7,160	5,609	Prevention and control of water pollution
C-B1F wastewater plant new CDA gas pipeline work (gas supply)	1	2014/6/11	15	3	Prevention and control of water pollution
Block LM 1200CMD cutting and grinding processes wastewater recovery system work	1	2014/6/17	23,800	19,635	Prevention and control of water pollution
L-RF purified water and waste gas scrubber infrastructural base addition work	1	2014/6/26	6,194	5,506	Prevention and control of water pollution
Blocks A, B and C wastewater plant fiber optics and communication monitoring work	1	2014/7/10	370	210	Prevention and control of water pollution
B-RF air pollution control equipment VOC (volatile organic compounds) concentration monitor work	1	2014/7/23	2,385	1,550	Reduction of air pollution
Nitrogen-hydrogen mixing section and Block A 8-11F plant administration section noise prevention work	1	2014/7/23	2,200	1,833	Prevention and control of noise
Gas exhaust work - Block B top floor Phases 1 and 2 AOP link-corridor work	1	2014/8/14	270	231	Reduction of air pollution
Block F wastewater treatment plant (civil construction)	1	2014/8/15	370,834	350,747	Prevention and control of water pollution
Blocks A, B and C released water recovery system purchasing and installation work	1	2014/8/26	193,605	183,925	Prevention and control of water pollution
L-10F (main pipeline) sewerage/wastewater works	1	2014/9/29	1,150	910	Prevention and control of water pollution
A-WWTP (Waste Water Treatment Plant) sludge-dehydrating machine work	1	2014/10/14	4,800	4,000	Prevention and control of water pollution
Blocks A, B and C wastewater plant man-machine interface integrated surveillance work	1	2014/10/16	1,800	1,570	Prevention and control of water pollution
Block A wastewater plant sand-filter pump additional installation of inching starter	1	2014/10/30	140	113	Prevention and control of water pollution
Blocks A, B and C B1F release water recovery system additional space construction work (201408)	1	2014/11/11	3,080	2,926	Prevention and control of water pollution

128

Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

Block A B1F release water recovery system space - fire safety work	1	2014/11/14	840	798	Prevention and control of water pollution
A-b1F new production process recovery system - water supply work	1	2014/11/26	35,000	32,278	Prevention and control of water pollution
Retracting door work for Second Entrance at South Gate	1	2014/11/26	300	263	Prevention and control of water pollution
B-RF M02 column scrubber air volume air-flow meter exhaust work	1	2014/12/12	315	277	Reduction of air pollution
Blocks K, L, M B3F sewerage and normal water diversion work	1	2014/12/18	479	391	Prevention and control of water pollution
L-RF new pneumatic valve air-source pipeline work	1	2014/12/25	640	562	Reduction of air pollution
C-RF noise prevention and control work	1	2015/1/13	9,223	8,454	Prevention and control of noise
I-RF noise prevention and control work	1	2015/1/13	2,235	2,030	Prevention and control of noise
Block A wastewater plant temporary sludge storage section - addition of rolling shutter (201412)	1	2015/2/25	320	286	Prevention and control of water pollution
F-b3F sewerage and organic wastewater tank #9-13 FRP works	1	2015/3/5	1,070	936	Prevention and control of water pollution
F-b3F sewerage and organic wastewater tank #9-13 FRP works	1	2015/3/5	1,070	936	Prevention and control of water pollution
A-B1F release water recovery system tank body FRP/Epoxy materials	1	2015/3/5	2,638	2,374	Prevention and control of water pollution
Blocks A, B production process recovery system integrated water-supply work	1	2015/3/27	10,700	10,403	Prevention and control of water pollution
Block B release water filtration equipment installation work	1	2015/3/27	6,100	5,490	Prevention and control of water pollution
B-9F F/E waste liquid container testing structure secondary distribution work - POU Hantang	1	2015/3/31	15	7	Prevention and control of water pollution
Blocks A, B and C water recovery system - new exhaust pipe work (201501)	1	2015/4/17	5,661	5,000	Prevention and control of water pollution
Block A wastewater plant SS SENSOR water-discharge secondary distribution work (201401)	1	2015/4/23	110	58	Prevention and control of water pollution
A-WWTP TK-607 additional installation of diverging three-way valve to TK-1000 work	1	2015/5/8	171	146	Prevention and control of water pollution
L-b3F additional water-supply work for production process recovery Phase 2 system	1	2015/5/27	27,970	26,922	Prevention and control of water pollution
A-b1F additional tank body for production process recovery system	1	2015/6/10	950	876	Prevention and control of water pollution
B-b2F wastewater surveillance cabinet power-distribution work (201503)	1	2015/6/16	150	137	Prevention and control of water pollution

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Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

Purified/wastewater chemical tank over-flow barrier water-supply work	1	2015/7/10	2,400	2,280	Prevention and control of water pollution
CMP reclaimed water recycling system	1	2015/7/16	2,707	2,223	Factory floor grinding/scribing wastewater recycling
B-B1F ABC wastewater pool FRP laying work (201501)	1	2015/8/7	5,986	5,786	Prevention and control of water pollution
C-b1F wastewater system additional emergency power distribution work (201503)	1	2015/8/10	1,480	1,365	Prevention and control of water pollution
Release water quality and volume automatic monitoring (surveillance) and linked-transmission wastewater work (201407)	1	2015/8/11	2,261	2,085	Prevention and control of water pollution
Blocks A/B/C b-1F release water, production process recovery system power distribution work (201408)	1	2015/8/14	1,424	1,313	Prevention and control of water pollution
Exhaust work - No. 4 Packaging and Testing Plant - additional zoelite rotor system	1	2015/9/9	26,500	26,500	Reduction of air pollution
L-3F RUN CARE RUN 4 additional exhaust-cover work	1	2015/10/1	960	864	Reduction of air pollution
Block A wastewater plant chemical tank - addition of content gauge	1	2015/10/5	570	513	Prevention and control of water pollution
L-1F East corridor sound-reduction shuttle installation work	1	2015/10/7	285	257	Prevention and control of noise
Wastewater project - F-WWTP recovery system additional work	1	2015/10/29	249,800	249,800	Prevention and control of water pollution
Block A 3F-7F mounted opening noise insulation work	1	2015/11/3	240	218	Prevention and control of noise
Blocks A, B, C wastewater plant new PH meter system work	1	2015/11/5	140	127	Prevention and control of water pollution
Blocks A, B, C wastewater pool - addition of RC partitioning wall (201501)	1	2015/11/23	969	909	Prevention and control of water pollution
Release water quality and volume - Automatic monitoring (surveillance) and link-transmission equipment	1	2015/12/7	590	556	Prevention and control of water pollution
Block B B1F release water recovery system space - fire safety work	1	2015/12/28	1,680	1,596	Prevention and control of water pollution
Blocks A, B, C b1F release water recovery equipment section storeroom - Support pillar traffic and additional or protecting steel plate	1	2016/1/13	680	629	Prevention and control of water pollution
Block C B1F release water water recovery system space - fire safety work	1	2016/1/18	280	266	Prevention and control of water pollution
Blocks A, B, C wastewater pool - further addition of RC partitioning wall (PO#4500258069)	1	2016/2/5	330	315	Prevention and control of water pollution
WWTF release water abnormality emergency response meter control	1	2016/2/15	2,826	2,826	Prevention and control of water

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Name of Equipment Quantity Date Obtained Investment Cost Balance before Depreciation Use and anticipated benefit

and pipeline work					pollution
B WWTP release pipe - addition of breaching chemical to wastewater	1	2016/2/26	690	650	Prevention and control of water pollution
L-1F Northeast side elevator lobby - Emergency exit sound insulation work	1	2016/4/15	210	200	Prevention and control of noise
Blocks A. B, C cooling water recovery work	1	2016/4/22	1,890	1,843	Prevention and control of water pollution
Block A Support, Blocks L/M industrial water pool - water-supply pipeline	1	2016/4/22	2,700	2,685	Prevention and control of water pollution
B-WWTP discharge - addition of automatic monitoring of cooper ions	1	2016/4/25	790	751	Prevention and control of water pollution
Block B sewerage screening machine installation - wastewater work	1	2016/4/25	470	447	Prevention and control of water pollution
Block L sewerage screening machine installation - wastewater work	1	2016/4/25	430	409	Prevention and control of water pollution
Wastewater work - Block A WWTP organic sediment pool installation work (201503) - 30% completed	1	2016/7/21	5,290	5,290	Prevention and control of water pollution
L-B3F organic and inorganic waste liquid storage tank - addition alarm work (201602)	1	2016/7/26	168	164	Prevention and control of water pollution
Waste recovery section surveillance camera and remote monitoring control work (201605)	1	2016/8/17	197	194	Prevention and control of water pollution

3. The Company's history of reducing environmental pollution, any disputes involving such pollution and the Company's handling of such disputes during the past 2 years and as of the date of printing and publication of this Prospectus: None

4. Total amount of losses incurred by the Company (including compensation paid) and fines paid during the past 2 years and as of the date of printing and publication of this Prospectus; disclosure by the Company on its future response measures (including improvement measures) and likely expenses (including estimated amount of potential losses, fines and compensation as a result of failure of implementing such measures; where estimated amount for the above-mentioned cannot be given, explanation should be given about the facts that make such estimates incapable of being given):

Kaohsiung Head Office

(1) Kaohsiung K1 Plant

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: ○ , 1 )1The Plant (i.e. K1 Plant) had on March 5, 2014 obtained approval for change of trash clearance permit; the means of disposing waste lubricant (D-1703) was approved as physical disposal. Insofar as subsequent disposal by the Plant differs from existing disposal means, the Plant would be required to apply for change of trash

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clearance permit. (1) The Plant has set aside a temporary waste lubricant (i.e. D-1703) storage area. The layout plan for the said temporary storage area is attached to the trash clearance permit. The Plant has confirmed triplicate application for clearance, filing of waste production volume, and temporary storage and means of disposal etc.

(3) Kaohsiung K3 Plant

The Plant was duly fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government on September 24, 2014 for violation of Article 24, Paragraph 2 of the Air Pollution Control Act on June 24, 2014. Response measures: (1) Application for variation (change) to raise the volume of raw materials used. (2) Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

(3) Kaohsiung K5 Plant

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: (1) According to the Trash Clearance Contract dated February 4, 2014 (vendor: Kingdom Resource Technology Co., Ltd.) the means of collection and disposal of waste lubricant would be heat treatment. Appropriate changes to the trash clearance permit was approved on March 5, 2014. Insofar as subsequent disposal by the Plant differs from existing disposal means, the Plant would be required to apply for change of trash clearance permit. (2) The respective Plants were expected to set aside temporary waste lubricant (i.e. D-1703) storage area. The layout plan for the said temporary storage area would be attached to the trash clearance permit. The said Plants were also expected to confirm matters such as triplicate application for clearance, filing of waste production volume, and temporary storage and means of disposal etc.

As a result of M11 production process (wafer packing process) and M13 production process (wafer packing process) on September 24, 2014, the Plant was on 24, 2014 fined NT$200,000 by Environmental Protection Bureau of Kaohsiung City Government for violation of Article 24, Paragraph 2 of the Air Pollution Control Act. Response measures: (1) Application for variation (change) to raise the volume of raw materials used. (2) Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

(4) Kaohsiung K6 Plant:

As a result of M05 production process (wafer packing process) on September 24, 2014, the Plant was on June 24, 2014 fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government for violation of Article 24, Paragraph 2 of the Air Pollution Control Act. Response measures: (1) Application for variation (change) to raise the volume of raw materials used. (2) Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

(5) Kaohsiung K7 Plant:

As a result of violation of Article 24, Paragraph 2 of the Air Pollution Control Act on February 21, 2014, the Plant was on March 20, 2014 fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government.

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Response measures: Closed the secondary sodium chlorate tank's channel valve and the pipelines, and changed the contents of operating permit.

As a result of violation on December 17, 2013 of Articles 13 and 20 of the Employment Management Regulations of Environmental- Protection Dedicated Units or Personnel formulated pursuant to Article 21 of the Water Pollution Control Act, the Plant was on March 25, 2014 fined NT$30,000 by Environmental Protection Bureau of Kaohsiung City Government. The Kaohsiung District Prosecutors Office prosecuted the Company in January 2014 for violations of the Waste Disposal Act and other laws, and the Taiwan Kaohsiung District Court fined the Company NT$3 million for violating Article 47 of the Waste Disposal Act. Response measures: (1) This was mainly because the Environmental Protection Bureau had determined some disparity with respect to the persons-in-charge. The latter were carrying out other plant-related work, including wastewater. (2) As a result the relevant personnel was replaced. K7 wastewater plant's services were also determined.

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: (1) Comprehensive planning for waste lubricant (D-1703) temporary storage area. (2) Matters such as triplicate application for clearance, filing of waste production volume, and temporary storage and means of disposal etc. were also implemented.

As a result of violation of Article 24, Paragraph 2 of the Air Pollution Control Act on June 24, 2014 for its M21 production process (IC production) and M22 production process (IC production), the Plant was on September 24, 2014 fined NT$200,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: (1) Application for variation (change) to raise the volume of raw materials used. (2) Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

(6) Kaohsiung K8 Plant

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: (1) Change of trash clearance permit with addition of disposal means for D-1703: Interim treatment would be physical disposal. (2) When issuing triplicate notes upon clearance of waste, such triplicates would have to be issued in accordance with the type and volume of waste and disposal method in the trash clearance permit. (3) Formulation of Trash Clearance Contracts: Clearance tools, means and venues were all compliant with law.

As a result of violation on August 21, 2014 of Article 18 of the Water Pollution Control Act, the Plant was on November 11, 2014 fined NT$10,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Installation of released water flow-volume gauge in accordance with the Environmental Protection Bureau's requirements. The measure was also recorded in water-control documents.

As a result of violation on November 10, 2015 of Article 21, Paragraph 2 of the Water Pollution Control Act, the Plant was on December 14, 2015 fined NT$10,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Establishment of system for appointment of

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officers to ensure that resignation of personnel or changes in employment could be promptly noted.

(7) Kaohsiung K9 Plant

As a result of violation on December 17, 2013 of Articles 13 and 20 of the Employment Management Regulations of Environmental- Protection Dedicated Units or Personnel formulated pursuant to Article 21 of the Water Pollution Control Act, the Plant was on March 25, 2014 fined NT$30,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Coagulation of wastewater failed because of erroneous pipeline layout for production line chemicals. The pipeline layout was upgraded, with raw liquid being separately collection. Operating personnel also underwent training.

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: (1) Comprehensive planning for waste lubricant (D-1703) temporary storage area. (2) Matters such as triplicate application for clearance, filing of waste production volume, and temporary storage and means of disposal etc. were also implemented.

As a result of violation on August 15, 2014 of Article 18 of the Water Pollution Control Act, the Plant was on November 10, 2014 fined NT$20,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: (1) Proposed changes to water-treatment documents, including separation of unused troughs from the treatment process; they were labeled unused at the site. (2) Removal of restricted pipelines or addition of new pipelines in conjunction with removal of production machinery. Changes were also made to water-treatment documents.

(8) Kaohsiung K11 Plant

As a result of violation on February 11, 2014 of Article 7, Paragraph 1 of the Water Pollution Control Act and Article 2 of the Released Water Standard, the Plant was on February 12, 2014 fined NT$140,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: 1Addition of real-time monitoring system to enable continuous monitoring of water quality. The system was also linked to set internal control standard within the monitoring system and could promptly trigger alarm. 2In the event of abnormality discharge of abnormal water volume would be cut off. It would also trigger emergency response mechanism (with report to the production unit) which is linked to competent authority. Abnormality emergency processes would also be carried out.

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on April 28, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: The Plant management was required to list information filed on-line with such information requiring confirmation by environmental safety supervisor and records of such information retained.

As a result of violation of Article 24, Paragraph 2 of the Air Pollution Control Act on June 24, 2014 for its M03 production process (IC production), the Plant was on September 24, 2014 fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: (1) Application for

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variation (change) to raise the volume of raw materials used. 2Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

As a result of violation of Article 8, Paragraph 2 of the Regulations Governing Approval of Registration of Toxic Chemical Substances on December 18, 2015, the Plant was on February 26, 2016 fined NT$60,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Establishment of standard operating procedure for confirmation of basic information. Through controls in the system any changes in basic information would promptly captured and handled.

(9) Kaohsiung K12 Plant

As a result of violation on January 16, 2014 of Articles 4 and 29 of the Regulations Governing Water Pollution Control Measures and Filing of Inspection promulgated pursuant to Article 18 of the Water Pollution Control Act, the Plant was on March 25, 2014 fined NT$20,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: 1. K12 Plant (Convex Crystal 2B) had already made fresh application to competent authority for changes to water-treatment measures. 2. It intended to increase the treatment volume from 1,500CMD originally to 4,750CMD.

The Plant was duly fined NT$12,000 by Environmental Protection Bureau of Kaohsiung City Government on July 30, 2014 for violation of Trash Clearance Act on January 22, 2014. Response measures: (1) K12 Plant had approved plan for waste lubricant (D-1703) temporary storage area. (2) Matters such as triplicate application for clearance, filing of waste production volume, and temporary storage and means of disposal etc. were also implemented.

As a result of violation of Article 24, Paragraph 2 of the Air Pollution Control Act on June 24, 2014 for its M01 production process (IC production) , the Plant was on September 24, 2014 fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: 1Application for variation (change) to raise the volume of raw materials used. 2Control of draw down of raw materials to ensure that the volume used did not exceed the approved volume.

(10) Kaohsiung K22 Plant

As a result of violation of Article 24, Paragraph 2 of the Air Pollution Control Act on June 28, 2016, the Plant was on July 22, 2016 fined NT$100,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Strengthening of professional staff's concept of operating in accordance with permit.

As a result of violation of Article 5, Paragraph 2 of the Regulations Governing Approval of Registration of Toxic Chemical Substances on July 19, 2016, the Plant was on August 17, 2016 fined NT$60,000 by Environmental Protection Bureau of Kaohsiung City Government. Response measures: Establishment of standard operating procedure for confirmation of basic information. Through controls in the system any changes in basic information would promptly captured and handled.

Chungli Branch Company

The Environmental Protection Bureau of Taoyuan County Government had on January 16, 2014 ordered fine of NT$30,000 for breach on January 15, 2014

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of Article 31, Paragraph 1, Sub-paragraph 2 of the Trash Clearance Act. Response measures: (1) Made supplemental filing based on actual circumstances on the site. (2) Set standard system for raw materials.

The Environmental Protection Bureau of Taoyuan County Government had on March 28, 2014 ordered fine of NT$10,000 for breach on March 26, 2014 of Article 18 of Water Pollution Control Act. Response measures: Carried out changes to permit.

The Environmental Protection Bureau of Taoyuan County Government had on January 17, 2014 ordered fine of NT$30,000 for breach on January 15, 2014 of Article 31, Paragraph 1, Sub-paragraph 2 of the Trash Clearance Act. Response measures: (1) Made supplemental filing based on actual circumstances on the site. (2) Set standard system for raw materials.

The Environmental Protection Bureau of Taoyuan County Government had on March 27, 2014 ordered fine of NT$60,000 for breach on March 26, 2014 of Article 36 of the Trash Clearance Act. Response measures: Set comprehensive labels and records in compliance with regulations.

The Environmental Protection Bureau of Taoyuan County Government had on March 28, 2014 ordered fine of NT$10,000 for breach on March 26, 2014 of Article 18 of Water Pollution Control Act. Response measures: Made changes to permit in accordance with law.

The Environmental Protection Bureau of Taoyuan County Government had on January 15, 2014 ordered fine of NT$10,000 for breach on January 15, 2014 of Article 18 of the Water Pollution Control Act. Response measures: Made changes to permit in accordance with law.

The Environmental Protection Bureau of Taoyuan County Government had on January 20, 2014 ordered fine of NT$30,000 for breach on January 16, 2014 of Article 31, Paragraph 1, Sub-paragraph 2 of the Trash Clearance Act. Response measures: (1) Made supplemental filing based on actual circumstances on the site. (2) Set standard system for raw materials.

The Environmental Protection Bureau of Taoyuan County Government had on March 28, 2014 ordered fine of NT$10,000 for breach on March 26, 2014 of Article 18 of Water Pollution Control Act. Response measures: Made changes to permit in accordance with law.

The Environmental Protection Bureau of Taoyuan County Government had on January 21, 2014 ordered fine of NT$30,000 for breach on January 16, 2014 of Article 31, Paragraph 1, Sub-paragraph 2 of the Trash Clearance Act. Response measures: (1) Made supplemental filing based on actual circumstances on the site. (2) Set standard system for raw materials.

The Environmental Protection Bureau of Taoyuan County Government had on March 28, 2014 ordered fine of NT$10,000 for breach on March 26, 2014 of Article 18 of Water Pollution Control Act. Response measures: Made changes to permit in accordance with law.

The Environmental Protection Bureau of Taoyuan County Government had on January 15, 2014 ordered fine of NT$60,000 for breach on January 13, 2014 of Article 18 of Water Pollution Control Act. Response measures: (1) Changed operations in permit. (2) Revamped site road signs.

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The Environmental Protection Bureau of Taoyuan County Government had on February 14, 2014 ordered fine of NT$120,000 for breach on February 12, 2014 of Article 31, Paragraph 1, Sub-paragraph 2 of the Trash Clearance Act. Response measures: Made supplemental filing based on actual circumstances on the site.

The Environmental Protection Bureau of Taoyuan County Government had on February 20, 2014 ordered fine of NT$420,000 for breach on February 17, 2014 of Articles 18 and 31, Paragraph 1 of the Water Pollution Control Act. Response measures: (1) Change of permit, (2) strengthened monitoring and system improvement with daily review of changes in water quality and volume.

The Environmental Protection Bureau of Taoyuan County Government had on March 27, 2014 ordered fine of NT$60,000 for breach on March 26, 2014 of Article 36 of the Trash Clearance Act. Response measures: (1) Change of permit, (2) complete signs and records in compliance with regulations.

The Environmental Protection Bureau of Taoyuan County Government had on March 28, 2014 ordered fine of NT$60,000 for breach on March 26, 2014 of Articles 19 the Water Pollution Control Act (with Articles 14 and 18 of the said Act applying mutatis mutandis.) Response measures: 1Change of permit, 2increased rate of inspection.

The Environmental Protection Bureau of Taoyuan County Government had on September 4, 2015 ordered fine of NT$10,000 for breach on September 3, 2015 of Article 3, Paragraph 1, sub-paragraph 1 of the Trash Clearance Act by No. 5 Packaging and Testing Plant. Response measures: (1) Adjustment of water treatment volume. (2) Trash clearance plan changed in accordance with new water treatment volume.

The Environmental Protection Bureau of Taoyuan County Government had on September 4, 2015 ordered fine of NT$10,000 for breach on September 3, 2015 of Article 3, Paragraph 1, sub-paragraph 1 of the Trash Clearance Act by No. 6 Packaging and Testing Plant. Response measures: (1) Adjustment of water treatment volume. (2) Trash clearance plan changed in accordance with new water treatment volume.

The Environmental Protection Bureau of Taoyuan County Government had on November 24, 2015 ordered fine of NT$60,000 for breach on November 23, 2015 of Article 38, Paragraph 1 of the Trash Clearance Act. Response measures: (1) Communicated with customer on local trash clearance method. (2) All defective products that were to be returned to customer were shipped as "defective IC/wafer", with no action to be taken.

The Environmental Protection Bureau of Taoyuan County Government had on March 25, 2016 ordered fine of NT$147,000 for breach of Article 45, Paragraph 2 of the Water Pollution Control Act following an audit on November 17, 2015. Response measures: Strengthened monitoring of water quality, with simultaneous inspection and testing during audit.

Nantou Branch Company

The Environmental Protection Bureau of Nantou County Government had on January 22, 2014 ordered fine of NT$300,000 for breach on January 21, 2014 of Article 31, Paragraph 1, sub-paragraph 2 of the Trash Clearance Act.

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Response measures: (1) The wastewater storage permit was submitted for review by the Environmental Protection Bureau on January 7, 2014. On January 28, 2014 the Bureau requested additional documents. These documents were submitted to the Bureau on February 17, 2014. At present the permit documents are under review by the Bureau. (2) Filing of full-time offer was completed on January 31, 2014.

Total losses (including compensation) and penalties incurred by the company and its subsidiaries during the past 2 years until the date of printing of the Prospectus: The total amount penalties incurred in fiscal year 2014 was NT$2.464 million. The total amount of penalties incurred in fiscal year 2015 was NT$297,000. The total amount of penalties incurred in fiscal year 2016 until date of printing of Prospectus is NT$172,000.

5. Existing pollution and improvement/treatment thereof which will have an impact on company's profit, competitive position and capital expenses and major environmental-protection capital expenses during the next 2 years:

Nantou Branch Company Equipment for pollution control used in the 4th and part of the first floor of the building of "USI Incorporated" are all owned by USI; Nantou Branch Company does not have its won pollution control equipment or facilities. Therefore there has been no major maintenance or repair expenses for environmental protection equipment.

The following are the improvement plans and projected major environmentally-related capital expenses for the next 2 years for Kaohsiung Plant and Chungli Branch Company, and description of their impact on the company's profit, competitiveness and capital expenses:

Item	2016	2017
Proposed improvements:
(1) Improvement plan	(1) Renewal of ISO14001 environmental management system certification (2) Reduction of greenhouse gas emission in accordance with ISO14064 greenhouse gas management system operation (3) Promotion of eco-design of the company's products (4) Continued implementation of ISO50001 energy management system (5) Continued implementation of product carbon footprint and water footprint audit and verification (6) Continued promotion of the company's sustainable development in conjunction with Taiwan Sustainable Innovation Forum (7) Continued promotion of use of mass rapid transit system to reduce energy consumption and CO2 emission (8) Introduction of energy-saving product and improvement of	(1) Renewal of ISO14001 environmental management system certification (2) Reduction of greenhouse gas emission in accordance with ISO14064 greenhouse gas management system operation (3) Promotion of eco-design of the company's products (4) Continued implementation of ISO50001 energy management system (5) Continued implementation of product carbon footprint and water footprint audit and verification (6) Continued promotion of the company's sustainable development in conjunction with Taiwan Sustainable Innovation Forum (7) Continued promotion of use of mass rapid transit system to reduce energy consumption and CO2 emission (8) Introduction of energy-saving product and improvement of energy-saving projects

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	energy-saving projects (9) Clearance and improvement of wastewater control equipment, with strengthened volume and benefit of wastewater recovery (10) Increased reclaimed water plant's recovery rate and recovery (11) Replacement of filter materials in wastewater treatment sand column and active carbon column (12) Construction of high-efficiency pollution control facilities (13) Replacement of filtration materials in dust-collection equipment (14) Replacement of filling materials and reduction of VOC volume for waste gas control equipment (15) Reduction of waste materials and volume and recycling (16) Reduction of weight and volume of sludge and recycling of metallic components (17) Optimization of volume of chemicals used (18) Prevention of odors in peripheral area (19) Emergency response training and rehearsals (20) Strengthened noise prevention and control (21) 2015 Industrial Safety and Environmental Protection Month event (22) Installation of new waste scrubbing column (23) Installation of new dust-collection machine (24) Maintenance of existing advance oxidation furnace (25) Consideration of best viable treatment equipment for air pollution control (26) Maintenance of existing zoelite rotor equipment (27) Installation of new production process wastewater recovery system (28) Maintenance of membrane in griding process wastewater recovery system (29) Recycling of packaging materials (30) Sludge collection system (31) Exhaust collection system (32) Introduction of sludge volume reduction plan	(9) Clearance and improvement of wastewater control equipment, with strengthened volume and benefit of wastewater recovery (10) Increased reclaimed water plant's recovery rate and recovery (11) Replacement of filter materials in wastewater treatment sand column and active carbon column (12) Construction of high-efficiency pollution control facilities (13) Replacement of filtration materials in dust-collection equipment (14) Replacement of filling materials and reduction of VOC volume for waste gas control equipment (15) Reduction of waste materials and volume and recycling (16) Reduction of weight and volume of sludge and recycling of metallic components (17) Optimization of volume of chemicals used (18) Prevention of odors in peripheral area (19) Emergency response training and rehearsals (20) Strengthened noise prevention and control (21) 2016 Industrial Safety and Environmental Protection Month event (22) Installation of new waste scrubbing column (23) Installation of new dust-collection machine (24) Maintenance of existing advance oxidation furnace (25) Consideration of best viable treatment equipment for air pollution control (26) Maintenance of existing zoelite rotor equipment (27) Installation of new production process wastewater recovery system (28) Maintenance of membrane in griding process wastewater recovery system (29) Recycling of packaging materials (30) Sludge collection system (31) Exhaust collection system (32) Introduction of sludge volume reduction plan
(2) Proposed purchase of equipment or	(1) Implementation of improvement proposals by respective departments	(1) Implementation of improvement proposals by respective departments

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expenses on equipment as part of projected environmental protection-related capital expenses in next 2 years	at their own initiative (2) Installation of new wastewater/waste gas control equipment and improvement of existing ones (3) Low-frequency noise control works (4) Replacement of environmental-protection equipment (5) Landscaping of surrounding environment (6) Implementation of recovery of waste and discarded items and installation of volume-reduction equipment (7) Use of energy-saving lighting and introduction of green energy source (8) Installation of energy management monitoring system (9) Improvement and expansion of reclaimed water recovery system (10) Waste gas column scrubber (11) High-efficiency oxidation equipment (12) Maintenance of existing zoelite rotor equipment (13) Best and most viable air pollution control equipment (14) Dust-collection machine (15) Wastewater recovery, filtration and distillation equipment (16) Sludge drying equipment (17) Purchase of sludge baking equipment	at their own initiative (2) Installation of new wastewater and waste gas control equipment and improvement of existing ones (3) Low-frequency noise control works (4) Replacement of environmental-protection equipment (5) Landscaping of surrounding environment (6) Implementation of recovery of waste and discarded items and installation of volume-reduction equipment (7) Use of energy-saving lighting and introduction of green energy source (8) Installation of energy management monitoring system (9) Improvement and expansion of reclaimed water recovery system (10) Waste gas column scrubber (11) High-efficiency oxidation equipment (12) Maintenance of existing zoelite rotor equipment (13) Best and most viable air pollution control equipment (14) Dust-collection machine (15) Wastewater recovery, filtration and distillation equipment (16) Sludge drying equipment (17) Purchase of sludge baking equipment
Projected Improvements	(1) Reduction of energy consumption and CO2 emission (2) Control of odor at boundaries (3) Extension of equipment lifespan (4) Reduction of wastewater/waste/air pollutant volume and recovery of resources (5) Reduction of noise in surrounding areas (6) Reduction of energy consumption (7) Improvement of level of comfort of work environment (8) Recovery of water resources/reduction of volume of water used (9) Control and monitoring of pollution	(1) Reduction of energy consumption and CO2 emission (2) Control of odor at boundaries (3) Extension of equipment lifespan (4) Reduction of wastewater/waste/air pollutant volume and recovery of resources (5) Reduction of noise in surrounding areas (6) Reduction of energy consumption (7) Improvement of level of comfort of work environment (8) Recovery of water resources/reduction of volume of water used (9) Control and monitoring of pollution
Expenses	NT$581,315,000	NT$1,242,715,000
(3) Impact after Improvement
Impact on net profit	Increase of about NT$65,335,000	Increase of about NT$101,855,000
Impact on	Corporate social responsibility (CSR)	Corporate social responsibility (CSR)

140

competitiveness	and sustainable development An environmentally-friendly policy enhanced the company's corporate image, and was in conformity with the investors' objective for sustainable development of the company	and sustainable development An environmentally-friendly policy enhanced the company's corporate image, and was in conformity with the investors' objective for sustainable development of the company
Areas in which no response measures were taken	N/A	N/A

(5) Employees-employer relations

1. List of the company's employee welfare measures, further learning, training, retirement regulations and the status of their implementation, and employer-employee collective agreements, and various measures protecting employee rights

(1) Employee welfare

The company accepts solidarity between shareholders and employees. In the meeting of its Board of Directors held on January 14, 2016 a resolution was passed on amendment (the resolution would be submitted to the company's Shareholders Meeting on June 28, 2016 for approval) which provides for 5.25~8.25% of profits be set aside each year for the following: employee remuneration and comprehensive improvement of employees' cultural and leisure facilities including library, society events, annual tours, cultural and sporting competition etc. The above would give employees an opportunity to achieve balanced lifestyle. Other measures to strengthen employee benefit and employer-employee relationship include:

l Free group medical insurance for employees and their family members

l Full improvement of the plants' safety and sanitation in order to maintain a clean and comfortable environment

l Regular or ad hoc employer-employee meetings

l Establishment of plant environmental safety and health committee

l Establishment of welfare committee to handle employee benefits

l Self-service canteen and welfare society

l Marriage gift, bereavement subsidy, hospitalization gift and study bursary

l Comprehensive retirement system

l Employee medical check

l Share and cash bonus

l Disbursement of benefits during major festivals

l Employee tours and diverse items offered for purchase by employees

l Employees on business trips entitled to travel insurance cover of NT$15 million

l Free meals during public holidays

l Establishment of employees' recreation and fitness center

l Establishment of employee health clinic and physical fitness check center

l Employee share-subscription warrants

(2) Employee learning and implementation

l Employees who obtain educational qualification during their self-study could participate in education upgrading examinations. They would also be entitled to substantive salary increase.

141

l Provision of school cooperative program for employees; undertook "on-the-job" training bureau flagship plan.

(3) Employee training and implementation

l Provided new recruits with orientation guide, professional training and new staff appraisal.

l Designed and implemented supervision management skills training and career development.

l Designed and implemented engineer professional skills training.

l Provided employees with professional skills and second-skill training (OJT).

l Cultivated company's internal speakers and trainers.

l Designed and implemented industrial safety and environment-related training.

l Provided employees opportunity to participate in external training or seminars.

l To more effectively integrate the company's resources, the company had formulated "Rules on External Training and Subsidy for Certificates". The Rules consisted of 2 major sections: External training (department staff sent to outside training) and subsidy for certificates (subsidy for personal advancement through self-study). To encourage employees to carry out self-studying and acquisition of professional skills for personal advancement, the company engaged external training to supplement its internal training. A standardized review and post-training feedback mechanism was established to facilitate the company's external training system. Control by supervision was made easier by electronic external training and attendance systems.

l The company's subsidy for an employee's self-study, depending on the employee's appointment ranking, ranged from NT$20,000 to NT$100,000 over 2 years. Such subsidy would be given out upon approval after the employee had at his cost registered and underwent course. Application would be to the Training Department along with submission of training certificate.

l In 2015 ASE joined the Electronic Industry Citizenship Coalition (EICC). In keeping with EICC Code of Conduct as well as the concept of sustainable operation, while also promoting a sustainable supply chain for ASE and its suppliers, the company had in 2015 begun implemented EICC Code of Conduct in its education and training for employees and suppliers. To-date more than 20,000 persons in ASE's Kaohsiung Plant have undergone EICC training. Refresher training held at least once annually provided the means of disseminating information on latest laws and regulations to employees.

l In 2015 ASE established its first corporate university, combining experts and academics in various fields to provide first-class training for senior managers. The total number of management course was 78 hours and such courses included strategic development, operation management, and team management. Total training was 3,744 man/hours.

l In fiscal year 2015 the company's total training expenses for its employees was NT$17,150,359.

l Certification mandated by competent authority and obtained by the company and employees involved in financial information transparency is as follows: One of the company's internal audit staff obtained the International Internal Auditor certificate from the International Internal Auditor Association.

142

l In fiscal year 2015 the company conducted more than 1,500 training classes (including on-line courses) involving 120,500 person/session for total training hours of 450,000 hours.

l Type of training courses conducted by the company in fiscal year 2015:

New recruits: Orientation, foundation training and job guidance.

General training; Training courses on government laws and regulations and company policies etc. 

Special skills training: Professional skills training required by the company's respective departments.

(4) Retirement system and implementation

l Beginning in November 1986 the company had in place Labor Retirement Rules in compliance with Basic Labor Law. It also established a Labor Pensions Provision Supervisory Committee. Labor pension provisions were deposited on a monthly basis into the Bank of Taiwan for employees' withdrawal upon retirement.

l Beginning in July 2005 the company had complied with the New Labor Pension Rules promulgated pursuant to the Labor Pensions Act, by setting aside on a monthly basis 6% into employees' special pensions account in the Bureau of Labor Insurance. Upon reaching the age of 60 employees can apply to withdraw their pensions from their personal pensions account.

l Retirement conditions: An employee with a work tenure of more than 15 years, and the employee's age combined with his work tenure is 70 or above may apply for retirement.

(5) Labor agreement

l The company has established communication channels (paper and electronic) for employees. The respective plants also regularly held employee forums to facilitate communication with employees. As such the company was not involved in labor disputes.

(6) Measures upholding employees' rights

l The company protects employee's rights in accordance with Basic Labor Law.

l The company provides a work environment with gender equality and that is free of sexual harassment in accordance with the Act of Gender Equality in Employment.

l Measures by the company for raising employee welfare or rights compared with previous year:

Salary increase in the beginning of 2015.

The monthly operating performance incentive based on the company's operating performance was higher than that in the previous year. 

Increase in the coverage of employee group insurance policy and employee health check items.

Increase in the number of societies in which employees could join. 

Hosted various activities and competitions such as tree planting, participation in social welfare events, employee day, sporting events and calligraphy etc. to foster care for society and employees' physical and mental health.

l Average salary adjustments by the company in fiscal year 2015: The company's policy is to directly or indirectly adjust employees' annual salary on a sustainable and steady basis.

143

(7) Measures protecting work environment and employee's personal safety (measures taken by the company to prevent occupational injury)

l Continued certification under OHSAS 18001 and TOSHMS.

l Sustained operation of plant safety and health performance review, with annual awards for plants that achieved excellent performance.

l Continued to strengthen the operation of contractor organization meeting, with annual awards for contractors which achieved excellent performance in safety and health.

l Established plant health risk assessment model and implementation of health management system.

l Implemented system for verification of hazards and risk assessment by respective departments and strengthened their safety and health improvement proposals.

l Continued implementation of protection and improvement to machines.

l Introduction of regulations of the National Fire Protection Association (NFPA) for new plants to strengthen their fire safety facilities.

l Counseled main contractors on the establishment of proprietary safety and health management systems.

l Continued implementation of practice to establish own OHSAS 18001 system by contractors and verification mechanism.

l Establishment of team overseeing contractor's safety management.

l Participation in the selection competition for National Labor Safety Awards organized by Council of Labor Affairs, Executive Yuan.

l Participated in selection competition for Outstanding Unit for National Labor Safety & Health Awards organized by Council of Labor Affairs, Executive Yuan.

l Site commander response drills conducted in high-risk areas in plants.

l Continued strengthening of plants' safety protection for their machine and chemical systems.

l Continued implementation of risk assessment and improvements for plants' surrounding areas to strengthen their fire safety.

l Continued implementation of EICC Code of Conduct to regularize management and completed verification of implementation.

l Continued implementation of the plants' safety culture assessment system in order to improve their safety culture.

l Organized monthly health and safety culture events.

(8) Employee work regulations and code of ethics

l Employees who held differing opinions were reminded to communicate with their supervisors in a sincere manner and at appropriate time and place. They were reminded not to express their views in a strong manner in the presence of visitors or others.

l Meetings were required to be held punctually. Individuals who could not attend were required to appoint others to attend on their behalf. They should also inform others about documents to be prepared. The meeting's chairperson had to be informed.

l If meetings with vendors crossed over lunch or dinner hours, employees could order take-away meals for vendors and claim reimbursement. Employees were prohibited from privately entertaining vendors.

144

l Employees were strictly forbidden from taking the company's products, spare parts or goods out of the processing sections. All goods that leave the plant area must be accompanied by bonded goods release form. Employees who failed to comply with the aforesaid would be dealt with in accordance with laws and regulations.

l Employees were required to respect the company's reputation. They were forbidden from publishing their personal opinion on any matter involving the company without prior approval.

l The company assiduously cultivated a culture of integrity and responsibility. In all operations employees should comply with the highest ethical standards.

2. Any loss suffered by the company due to labor disputes in the most recent two fiscal years and up to the date of publication of the Prospectus, and disclose an estimate for the amount of losses that have been incurred to date and may be incurred in the future, as well as response measures. If a reasonable estimate cannot be made, explain why not. None

2. Property, plants and equipment and other real estate:

(1) Self-owned assets:

1. Property, plant and equipment if the acquisition cost is 20 percent or more of the paid-in capital or NT$300 million or more:

November 30, 2016 Unit: NT$1,000 % 

Immovable Properties, Plant Buildings & Name of Equipment	Unit	Amount	Month and year of acquisition	Original cost	Revaluation gain	Non-depreciated balance	Utilization status			Insurance status	Encumbrances and any other restriction of rights
							Department Using	Rented	Idle
Plant	No.	1	2004/02	636,462	-	230,717	ASE Assembly & Test (Shanghai)	-	-	Insured	None
ASE Headquarters and R&D Center	Set	1	2014/05	345,625	-	324,633	ASE Assembly & Test (Shanghai)	-	-	Insured	None
LAND	EA	1	1997/10	496,229	-	496,229	ASE Korea	-	-	-	None
KS Plant phase 2 plant building (standard building)	No.	1	2012/12	438,180	-	390,824	ASE (Kunshan)	-	-	Insured	None
Civil construction of new plant buildings	No.	1	2009/11	549,468	-	357,424	ASEN Semiconductors (Suzhou)	-	-	Insured	None
LAND	EA	1	1999/07	1,429,881	-	1,429,881	Chungli Plant	-	-	-	None
1# civil construction cost	Building	1	2004/03	586,067	-	281,763	ASE (Shanghai)	-	-	Insured	None
2# civil construction cost	Building	1	2004/03	618,156	-	297,105	ASE (Shanghai)	-	-	Insured	None
Plant building for Shanghai No. 2 Plant/one main building consisting of several floors /including M&E, 1 each, CNY84,060,517.4	No.	1	2006/04	389,023	-	241,244	USI (Shanghai)	-	-	Insured	None
New plant CNY87169818.09	No.	1	2004/04	367,162	-	197,232	USI (Shanghai)	-	-	Insured	None

145

Immovable Properties, Plant Buildings & Name of Equipment	Unit	Amount	Month and year of acquisition	Original cost	Revaluation gain	Non-depreciated balance	Utilization status			Insurance status	Encumbrances and any other restriction of rights
							Department Using	Rented	Idle
Nangang Plant land and factory buildings	Ping	Land: 5,575.68 Factory: 20,344.49	2000/03	970,146	-	453,165	Universal Scientific Industrial Co., Ltd.	V	V	Insured	None
Warehousing building - K7 No. 109, North Inner Ring Road	SET	1	2001/12	998,336	-	626,040	Kaohsiung Plant	-	-	Insured	None
K11 - Block B, car park at No. 30 Zhongyang Road (Hong Lai)	SET	1	2005/07	351,875	-	252,177	Kaohsiung Plant	-	-	Insured	None
K15 Yawei Plant - purchase of plant-structure building	SET	1	2010/09	398,144	-	336,763	Kaohsiung Plant	-	-	Insured	None
K22 Wastewater and recycled water system construction	SET	1	2016/02	308,854	-	297,272	Kaohsiung Plant	-	-	Insured	None

2. Idle real properties and the real properties which have been held for 5 fiscal years or more for investment purposes:

November 30, 2016 Unit: NT$ 1,000 

Real Estate Name	Unit	Area:	Location	Acquisition Date: Year/Month	Acquisition Cost	Revaluation Increase in Value	Before depreciation and impairment Balance	Current value, appraised value or fair market value published	Future disposal or  development plan
Nangang Plant land and factory buildings	Ping	Land: 5,575.68 Factory: 20,344.48	No. 330, Gongye Rd, Nantou City	2000/03	970,146	－	3,165	1,216,086	Regular evaluations on whether the book value has fallen, in preparation for disposal,  expansion to the electronics assembly plant, or rental to other enterprises in the group, as needed. Currently the fifth floor has been rented to USI.

(2) Rental properties:

1. Financing lease (of an amount that is 20% of paid-up capital or NT$300 million): None.

2. Operating lease assets the rent amount of which exceeds NT$5 million a year:

November 30, 2016 Unit: USD'000

Asset Name	Unit	Amount	Lease Period	Rent		Lessor:	Calculation and Payment Method of Rent	Contractual Restrictions
Takahata factory lease	SET	1	2016/6/30~2020/5/31	JPY	8,650.81	Renesas Semiconductor Manufacturing	Agree Rent/Remittance Payment	None
L1  factory lease	SET	1	2016/1/1~2016/12/31	JPY	5,722.09	Yamagata Electronic Corporation	Agree Rent/Remittance Payment	None
L2  factory lease	SET	1	2016/1/1~2016/12/31	JPY	2,803.05	Yamagata Electronic Corporation	Agree Rent/Remittance Payment	None
Plant	Square meters	7,910.74	2014/7/16~2018/7/15	NTD	618.43	Orient Semiconductor Electronics Ltd.	Agree Rent/Remittance Payment	None
Plant	Square meters	4,355.8	2015/9/1~2018/8/31	NTD	523.00	ASE Inc.	Agree Rent/Remittance Payment	None

146

Plant	Square meters	4,509.66	2015/9/1~2018/8/31	NTD	541.00	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	4,558.5	2015/12/1~2018/11/30	NTD	546.00	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	6,900	2015/3/20~2018/12/31	CNY	394.29	ASE Assembly & Test (Shanghai) Limited	Agree Rent/Remittance Payment	None
Plant	Square meters	11,000	2014/11/24~2017/11/30	CNY	942.86	ASE Assembly & Test (Shanghai) Limited	Agree Rent/Remittance Payment	None
Plant	Square meters	2,420	2015/4/25~2018/4/30	CNY	209.50	ASE Assembly & Test (Shanghai) Limited	Agree Rent/Remittance Payment	None
Office	Square meters	2,300	2015/10/1~2018/9/30	CNY	138.00	ASE Assembly & Test (Shanghai) Limited	Agree Rent/Remittance Payment	None
Plant	Square meters	4,080	2016/5/1~2018/3/31	CNY	198.72	ASE (Kunshan)	Agree Rent/Remittance Payment	None
Plant	Square meters	41,827.93	2016/5/1~2018/3/31	CNY	597.61	ASE (Kunshan)	Agree Rent/Remittance Payment	None
Employee dormitory	Rooms	Calculated based on actual use	2015/12/1~2016/11/30	CNY	Calculated based on actual use	ASE (Kunshan)	Agree Rent/Remittance Payment	None
Employee dormitory	Rooms	Calculated based on actual use	2015/04/01~2017/04/30	CNY	Calculated based on actual use	ASE (Shanghai)	Agree Rent/Remittance Payment	None
Employee dormitory	Rooms	Calculated based on actual use	2015/5/1~2017/4/30	CNY	Calculated based on actual use	ASE (Shanghai)	Agree Rent/Remittance Payment	None
Employee dormitory	Rooms	Calculated based on actual use	2016/4/1~2016/3/31	CNY	Calculated based on actual use	ASE (Shanghai)	Agree Rent/Remittance Payment	None
Plant	Square meters	33,804	2013/12/01~2016/11/30	CNY	720.03	ASE Integrated Circuits (China)	Agree Rent/Remittance Payment	None
Office	Level	1	2013/11/1~2018/10/31	NTD	718.77	Century Development Corporation	Agree Rent/Remittance Payment	None
Office	Level	1	2013/11/1~2018/10/31	NTD	1,032.77	Century Development Corporation	Agree Rent/Remittance Payment	None
Office	Square meters	734.62	2014/3/1~2019/2/28	CNY	212.27	Shanghai Ting Gu Real Estate Company	Agree Rent/Remittance Payment	None
Employee dormitory	Buildings	1	2015/6/1~2017/5/31	NTD	450.00	Hong Yu Limited	Agree Rent/Remittance Payment	None
Employee dormitory	Rooms	Calculated based on actual use	2016/5/1~2017/4/30	CNY	Calculated based on actual use	Shenzhen Tianxiang Labor Paiqian Service Limited Company	Agree Rent/Remittance Payment	None
Handler	SET	1	2016/09/16~2017/03/15	NTD	1,400.00	Hon Technologies	Agree Rent/Remittance Payment	None
Tester	SET	1	2015/07/01~2018/06/30	USD	48.00	Gat Asset Taiwan Limited	Agree Rent/Remittance Payment	None
Tester	SET	1	2015/09/01~2018/08/31	USD	42.00	Gat Asset Taiwan Limited	Agree Rent/Remittance Payment	None
Tester	SET	1	2015/09/01~2018/08/31	USD	42.00	Gat Asset Taiwan Limited	Agree Rent/Remittance Payment	None
Tester	SET	1	2015/09/01~2018/08/31	USD	42.00	Gat Asset Taiwan Limited	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/04/02~2019/04/01	USD	15.00	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/04/02~2019/04/01	USD	15.00	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/04/02~2019/04/01	USD	15.00	Fan Tai Technology Company	Agree Rent/Remittance Payment	None

147

Tester	SET	1	2016/06/01~2019/05/31	USD	15.00	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/07/31	USD	22.05	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/07/31	USD	22.05	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/07/31	USD	21.85	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/07/31	USD	21.85	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/07/31	USD	21.85	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/07/01~2017/09/30	USD	20.98	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/07/01~2017/09/30	USD	20.98	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/07/01~2017/09/30	USD	20.98	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/07/01~2017/09/30	USD	20.98	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/07/01~2017/09/30	USD	20.98	Fan Tai Technology Company	Agree Rent/Remittance Payment	None
option	SET	1	2016/05/16~2017/05/15	USD	24.00	Test Advantage Capital Pte. Ltd.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/04/30	USD	19.22	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/04/30	USD	19.22	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/04/30	USD	19.22	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/04/30	USD	19.22	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/04/30	USD	19.22	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/03/31	USD	18.59	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/03/31	USD	18.59	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/03/31	USD	18.59	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/03/31	USD	18.59	ASE Inc.	Agree Rent/Remittance Payment	None
Tester	SET	1	2016/03/01~2017/03/31	USD	18.59	ASE Inc.	Agree Rent/Remittance Payment	None
UFLEX(SC3)	SET	1	2014/08/01~2017/07/31	USD	22.05	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
UFLEX(SC3)	SET	1	2014/08/01~2017/07/31	USD	22.05	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
UFLEX(SC3)	SET	1	2014/08/01~2017/07/31	USD	21.85	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None

148

UFLEX(SC3)	SET	1	2014/08/01~2017/07/31	USD	21.85	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
UFLEX(SC3)	SET	1	2014/08/01~2017/07/31	USD	21.85	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/04/30	USD	19.22	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/03/31	USD	18.59	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/03/31	USD	18.59	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/03/31	USD	18.59	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/03/31	USD	18.59	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Uflex Tester	SET	1	2014/07/01~2017/03/31	USD	18.59	Teradyne (Asia) Pte Ltd	Agree Rent/Remittance Payment	None
Sigma FXP	SET	1	2016/02/01~2019/01/31	USD	19.43	SPTS Technologies Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/07~2016/12	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/08~2017/01	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/08~2017/01	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex BB	Sets	1	2016/08~2017/01	USD	17.00	KeenHammer Tech Co., Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/07~2016/12	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/08~2017/01	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None
FT_Tester_iFlex RF	Sets	1	2016/08~2017/01	USD	19.00	Test Advantage Capital PTE,Ltd	Agree Rent/Remittance Payment	None

149

Plant	Square meters	7,290.18	2016/7/8~2017/7/7	CNY	149.45	Wuxi City New Distric Economy Development Group	Agree Rent/Remittance Payment	None
option	SET	1	2016/11/01~2017/04/30	USD	29	Hon Technologies	Agree Rent/Remittance Payment	None
Plant	Ping	8,446.07	2016/08/01~2019/07/31	NTD	1,047	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Ping	4,558.5	2016/05/01~2017/04/30	NTD	565	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Ping	4,558.5	2016/05/01~2017/04/30	NTD	547	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Ping	5,631.59	2016/11/01~2018/10/31	NTD	545	ASE Inc.	Agree Rent/Remittance Payment	None
Plant	Ping	5,631.59	2015/05/01~2017/04/30	NTD	545	ASE Inc.	Agree Rent/Remittance Payment	None
Company car rental	Sets	Calculated based on actual use	2016/6/1~2018/5/30	CNY	Calculated based on actual use	Shanghai Jin Xiang Auto Rental Service Company	Agree Rent/Remittance Payment	None
Plant	Square meters	7,594.01	2016/01/01~2018/12/31	NTD	911	ISE Labs, Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	5,240.68	2014/09/16~2017/08/31	NTD	628	ISE Labs, Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	5,241.99	2015/05/01~2017/04/30	NTD	629	ISE Labs, Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	5,208.68	2015/05/01~2017/04/30	NTD	625	ISE Labs, Inc.	Agree Rent/Remittance Payment	None
Plant	Square meters	8,991.06	2007/07/15~2017/07/14	NTD	820	Export Processing Zone Administration	Agree Rent/Remittance Payment	None
Plant	Square meters	1,3980.1	2014/10/16~2018/07/15	NTD	816	Orient Semiconductor Electronics Ltd.	Agree Rent/Remittance Payment	None
Plant	Square meters	5,943.64	2016/06/16~2018/06/15	NTD	1,228	LCY Chemical Corp.	Agree Rent/Remittance Payment	None
Land	Square meters	12,563.4	2015/07/01~2035/06/30	NTD	462	Export Processing Zone Administration	Agree Rent/Remittance Payment	None
Office	Square feet	40,200	10/1/10~09/30/20	USD	70	ISE Labs, Inc.	Agree Rent/Remittance Payment	None
Office	Square feet	4,070	01/01/14~12/31/16	USD	18	HTSG	Agree Rent/Remittance Payment	None

(3) Each plant's current condition and facility productivity ratio in the most recent 2 fiscal years:

1. Each plant's current condition:

November 30, 2016 Unit: ‘000 sq.ft./person 

Item  Plant	Building area	Number of employees	Types of production goods	Current use condition
Kaohsiung Plant	7,484	24,393	Packaging and testing products and BGA materials	Good
Chungli Plant	4,107	9,477	Packaging and testing products	Good
Nantou Plant	400	1,816	Packaging and electronic assembly products	Good
Shanghai Plant	5,900	11,448	Packaging/testing and electronic assembly products	Good

150

Item Plant	Building area	Number of employees	Types of production goods	Current use condition
Kaohsiung Plant	7,484	24,393	Packaging and testing products and BGA materials	Good
Chungli Plant	4,107	9,477	Packaging and testing products	Good
Nantou Plant	400	1,816	Packaging and electronic assembly products	Good
Shanghai Plant	5,900	11,448	Packaging/testing and electronic assembly products	Good
Suzhou Plant	433	1,648	Packaging and testing products	Good
Kunshan Plant	3,194	3,647	Packaging/testing and electronic assembly products	Good
Weihai Plant	759	1,589	Packaging and testing products	Good
Shenzhen Plant	683	3,860	Electronic assembly products	Good
Malaysia Plant	873	3,174	Packaging and testing products	Good
Singapore Plant	282	870	Packaging and testing products	Good
Korea Plant	1,079	2,909	Packaging and testing products	Good
Japan Plant	298	475	Packaging and testing products	Good
Mexico Plant	362	936	Electronic assembly products	Good

2. Facility productivity ratio in the most recent 2 fiscal years: 

Unit: ‘000 pieces NT$1,000 

Year Production Value	2014				2015
Core Products	Production Capacity	Production Volume	Production Capacity Utilization Rate	Production Value	Production Capacity	Production volume	Production Capacity Utilization Rate	Production Value
Packaging Products	32,937,997	28,656,057	87.00%	88,296,216	36,603,997	27,604,076	75.41%	86,258,770
Testing products (Note 1)	－	－	－	16,242,669	－	－	－	16,166,199
Electronic assembly products	500,805	465,749	93.00%	96,665,532	708,773	595,142	83.97%	128,808,721
Others (Note 2)	－	－	－	1,798,501	－	－	－	1,933,618
Total	33,438,802	29,121,806	－	203,002,918	37,312,730	28,199,218	－	233,167,308

Note 1: Pricing was based on testing hours, thus not able to disclose volume.

Note 2: Different unit of measurement, thus not able to disclose volume. 

151

III. Reinvestment business

(1) Overview of reinvestment business:

September 30, 2016 Unit: NT$'000/Other currencies ('000), shares, %

Name of investment company:	Reinvestment business	Main business	Investment cost	Book value	Investment shares		Net equity	Market price	Accounting methods:	Return on investment in most recent year		The amount of company shares
					Number of shares	Equity ratio (%)				Investment gains and losses	Dividends
Advanced Semiconductor Engineering Inc.	A.S.E. Holding Limited	Professional investment activities	USD283,966	14,699,286	243,966	100%	14,963,730	－	Equity method	480,474	－	－
	J & R Holding Limited	Professional investment activities	USD479,693	48,364,435	435,128	100%	50,716,458	－	Equity method	2,049,623	－	46,703,763
	ASE Marketing & Service Japan Co., Ltd.	Marketing, sales and customer services in semiconductor assembly and testing industry	JPY60,000	34,002	1,200	100%	34,002	－	Equity method	2,082	－	－
	Omniquest Industrial Limited	Professional investment activities	USD250,504	11,106,064	250,504,067	71%	11,404,656	－	Equity method	198,948	－	－
	Innosource Limited	Professional investment activities	USD86,000	3,945,550	86,000,000	100%	3,941,738	－	Equity method	77,641	－	－
	Hung Ching Guang Company	Rental of remaining proprietary stalls and office building	390,470	324,959	35,497,273	27%	324,959	－	Equity method	(9,694)	－	－
	Hung Ching Development & Construction Co., Ltd.	Engagement of contractors to build residential and commercial properties for rental; sale and purchase of all types of building materials and import and export trade thereof; property lease introduction; interior design and renovation works	2,845,913	1,269,613	68,629,782	26%	1,937,156	1,170,138	Equity method	64,151	75,493	－
	ASE Test Inc.	Semiconductor testing services	20,698,867	28,539,072	1,131,452,502	100%	28,856,075	－	Equity method	2,883,511	2,624,970	10,978,776
	Universal Scientific Industrial Inc.	Professional investment activities	20,836,477	42,418,825	1,112,236,706	99%	40,924,589	－	Equity method	1,239,134	－	－
	LuZhu Development Inc.	Land and building development	1,366,238	1,334,886	131,961,457	67%	1,334,886	－	Equity method	(1,527)	－	－
	ASE Embedded Electronics Incorporated	Production and sale of embedded substrate for ICB	765,000	703,684	76,500,000	51%	376,736	－	Equity method	(4,274)	－	－

152

Advanced Semiconductor Engineering Inc.

Siliconware Precision Industries Co., Ltd.

Manufacture, processing, sale & purchase and testing services for various ICB packages

48,790,498

45,613,346

1,037,300,000

33%

21,400,373

48,753,100

Equity method

410,937

3,941,740

－

Deca Technologies Inc.

Holding company, with Group carrying our manufacture, assembly, processing, testing and sale of semiconductors

USD59,882

1,892,542

98,489,803

22%

917,010

－

Equity method

Note 3

－

－

Advanced Microelectronic Products, Inc.

OEM for wafer and ICB

178,861

11,453

33,308,452

17%

11,453

83,271

Equity method

(58,390)

－

－

ASE Test Inc.

Alto Enterprises Limited

Professional investment activities

USD188,000

4,240,162

188,000,000

100%

4,240,162

－

Equity method

Note 2

－

－

Super Zone Holdings Limited

Professional investment activities

USD100,000

3,129,882

100,000,000

100%

3,129,882

－

Equity method

Note 2

－

－

LuZhu Development Inc.

Land and building development

372,504

376,736

37,250,448

19%

376,836

－

Equity method

Note 2

－

－

TLJ Intertech Inc.

Information Software Services.

89,998

89,624

2,119,080

60%

10,158

－

Equity method

Note 2

－

－

A.S.E. Holding Limited

ASE Test Limited

Professional investment activities

USD84,889

USD107,774

11,148,000

10%

USD99,208

－

Equity method

Note 2

－

88,200,472

ASE Investment (Labuan) Inc.

Professional investment activities

USD168,643

USD343,234

168,642,842

70%

USD343,234

－

Equity method

Note 2

－

－

J & R Holding Limited

ASE Test Limited

Professional investment activities

USD964,524

USD1,072,382

98,276,087

90%

USD874,378

－

Equity method

Note 2

－

88,200,472

Omniquest Industrial Limited

Professional investment activities

USD30,200

USD43,817

30,200,000

8%

USD43,817

－

Equity method

Note 2

－

－

ASE (Nanzih) Inc.

Lease of all types of ICB packaging and testing equipment and lead frame equipment

USD51,344

USD31,885

170,000,006

100%

USD31,885

－

Equity method

Note 2

－

－

ASE Japan Co., Ltd.

Packaging and manufacturing of ICB

USD25,606

USD86,492

7,200

100%

USD85,771

－

Equity method

Note 2

－

－

153

J & R Holding Limited

ASE (U.S.) Inc.

Marketing support and customer service etc.

USD4,600

USD12,693

1,000

100%

USD12,209

－

Equity method

Note 2

－

－

Global Advanced Packaging Technology Limited, Cayman Islands

Professional investment activities

USD190,000

USD353,014

190,000,000

100%

USD340,338

－

Equity method

Note 2

－

－

Anstock Limited

Professional investment activities

USD10

USD345

10,000

100%

USD345

－

Equity method

Note 2

－

－

Anstock II Limited

Professional investment activities

USD10

USD189

10,000

100%

USD189

－

Equity method

Note 2

－

－

Suzhou ASEN Semiconductor Co.,Ltd.

Assembly and testing of semiconductors and technical advisory services

USD21,600

USD78,302

－(Note 1)

60%

USD78,302

－

Equity method

Note 2

－

－

ASE Investment (Labuan) Inc.

ASE (Korea) Inc.

Manufacturing of electronic components and communication machinery

USD160,000

USD490,377

20,741,363

100%

USD484,981

－

Equity method

Note 2

－

－

ASE Test Limited

ASE Holdings (Singapore) Pte Ltd

Professional investment activities

USD65,520

USD146,168

71,428,902

100%

USD146,168

－

Equity method

Note 2

－

－

ASE Test Holdings, Ltd.

Professional investment activities

USD222,399

USD100,347

5

100%

USD100,347

－

Equity method

Note 2

－

－

ASE Investment (Labuan) Inc.

Professional investment activities

USD72,304

USD147,100

72,304,040

30%

USD147,100

－

Equity method

Note 2

－

－

ASE Singapore Pte. Ltd.

Semiconductor testing services

USD55,815

USD157,950

30,100,000

100%

USD157,950

－

Equity method

Note 2

－

－

ASE Test Holdings, Ltd.

ISE Labs, Inc.

Semiconductor testing services

USD221,145

USD100,346

26,250,000

100%

USD100,346

－

Equity method

Note 2

－

－

ASE Holdings (Singapore) Pte Ltd

ASE Electronics (M) Sdn. Bhd.

Manufacture, assembly, reprocessing, testing and export of integrated circuits of various types.

USD60,000

USD146,168

159,715,000

100%

USD146,168

－

Equity method

Note 2

－

－

Omniquest Industrial Limited

ASE Corporation

Professional investment activities

USD352,784

USD515,094

352,784,067

100%

USD515,094

－

Equity method

Note 2

－

－

ASE Corporation

ASE Mauritius Inc.

Professional investment activities

USD217,800

USD385,060

217,800,000

100%

USD385,060

－

Equity method

Note 2

－

－

ASE Labuan Inc.

Professional investment activities

USD126,184

USD129,983

126,184,067

100%

USD129,983

－

Equity method

Note 2

－

－

154

ASE Labuan Inc.

ASE Electronics Inc.

Wholesale and retail of electronic materials and international trade

USD125,813

USD129,416

398,981,900

100%

USD129,416

－

Equity method

Note 2

－

－

Innosource Limited

Omniquest Industrial Limited

Professional investment activities

USD74,000

USD107,407

74,000,000

21%

USD107,407

－

Equity method

Note 2

－

－

ASE Electronic Components (Shanghai) Ltd.

Production and sale of new electronic components and provision of technical advisory services

USD12,000

USD18,298

－(Note 1)

100%

USD18,298

－

Equity method

Note 2

－

－

ASE (Shanghai)

ASE (Hong Kong)

Trade and related activities

USD1,000

USD8,810

－(Note 1)

100%

USD9,761

－

Equity method

Note 2

－

－

USI Electronics Inc.

Design and manufacture of electronic products, manufacture and processing of new electronic components, high-performance motherboards for computers and wireless network communication components etc.

RMB12,900

RMB60,187

18,098,476

1%

RMB60,187

－

Equity method

Note 2

－

－

Shanghai Ding Hui Real Estate Development Ltd.

Real estate project development, construction and commercial property sale and property management

RMB1,441,000

RMB1,619,453

－(Note 1)

40%

RMB1,619,453

－

Equity method

Note 2

－

－

Universal Scientific Industrial Inc.

Huntington Holdings International Co., Ltd.

Holding company

8,370,606

43,453,577

255,856,840

100%

43,453,577

－

Equity method

Note 2

－

－

155

Huntington Holdings International Co., Ltd.

Unitech Holdings International Co., Ltd.

Holding company

USD3,000

USD7,926

3,000,000

100%

USD7,926

－

Equity method

Note 2

－

－

Real Tech Holdings Limited

Holding company

USD149,151

USD1,319,977

149,151,000

100%

USD1,319,977

－

Equity method

Note 2

－

－

Universal ABIT Holding Co., Ltd.

Holding company

USD28,125

USD13

90,000,000

100%

USD13

－

Equity method

Note 2

－

－

Rising Capital Investment Limited

Holding company

USD6,000

USD1,140

6,000,000

100%

USD1,140

－

Equity method

Note 2

－

－

Rise Accord Limited

Holding company

USD2,000

USD150

20,000

100%

USD150

－

Equity method

Note 2

－

－

Real Tech Holdings Limited

USI Enterprise Limited

Investment consulting services and warehousing management

USD210,900

USD1,247,995

210,900,000

99.59%

USD1,247,995

－

Equity method

Note 2

－

－

Huan Quan Electronics (Kunshan) Ltd.

Manufacture of computer auxiliary system and high-performance motherboards, wireless network communication card etc.

USD12,000

USD10,518

－(Note 1)

100%

USD10,518

－

Equity method

Note 2

－

－

USI Enterprise Limited

USI Electronics Inc.

Design and manufacture of electronic products, manufacture and processing of new electronic components, high-performance motherboards for computers and wireless network communication components etc.

USD251,163

USD840,269

1,683,749,126

77%

USD840,269

－

Equity method

Note 2

－

－

156

USI Electronics Inc.

Universal Global Technology Co., Limited

Holding company

CNY324,185

CNY1,736,583

390,000,000

100%

CNY1,736,583

－

Equity method

Note 2

－

－

Huan Hong Electronics (Kunshan) Ltd.

Design and manufacturing services for electronic products

CNY250,000

RMB562,692

－(Note 1)

100%

RMB562,692

－

Equity method

Note 2

－

－

Universal Global Electronics (Shanghai) Co., Ltd.

Research, development and manufacture of electronic components, new electronic components, high-performance computer motherboards, wireless network communication components, mobile communication products and modules, processing and maintenance of spare parts, sale of electronic products, communication products and spare parts, third-party logistics services, and import and export of goods and technology

CNY1,330,000

RMB628,297

－(Note 1)

100%

RMB628,297

－

Equity method

Note 2

－

－

Universal Global Technology (Shanghai) Co., Ltd.

Sale of electronic components, computer hardware and software, communication equipment and accessories, third-party logistics services, goods and technology import and export, transshipment trade, inter-company trade in zone and trading agency

CNY50,000

RMB53,598

－(Note 1)

100%

RMB53,598

－

Equity method

Note 2

－

－

USI Electronics (Shenzhen) Co., Ltd.

Design, manufacture and sale of computer motherboards and related peripherals and communication industry control products.

RMB292,812

RMB999,277

－(Note 1)

50%

RMB999,277

－

Equity method

Note 2

－

－

157

Universal Global Technology Co., Limited

USI Technology Ltd.

Trading and investment holding company

USD11,000

USD19,916

85,800,000

100%

USD19,916

－

Equity method

Note 2

－

－

Universal Global Scientific Industrial Co., Ltd.

Manufacture, product design and research & development for cable communication equipment, wireless communication equipment, electronic components, computer and peripherals, automotive and spare parts

USD62,235

USD130,444

198,000,000

100%

USD130,444

－

Equity method

Note 2

－

－

USI Japan Co., Ltd.

Manufacture and sale and purchase of computer and IT peripherals, ICB and electronic parts

USD885

USD893

6,400

100%

USD893

－

Equity method

Note 2

－

－

Universal Scientific Industrial De Mexico S.A. De C.V.

Motherboard and computer system assembly

USD23,963

USD46,823

281,085,325

100%

USD46,823

－

Equity method

Note 2

－

－

USI America Inc.

Assembly and manufacture of new motherboards, manufacture of wireless communication products, maintenance and repair services

USD9,500

USD5,518

250,000

100%

USD5,518

－

Equity method

Note 2

－

－

USI Electronics (Shenzhen) Co., Ltd.

Design, manufacture and sale of computer motherboards and related peripherals and communication industry control products.

USD37,500

USD150,028

－(Note 1)

50%

USD150,028

－

Equity method

Note 2

－

－

158

ASE Mauritius Inc.

ASE (Shanghai)

Manufacture of semiconductor materials

USD140,542

USD326,017

－(Note 1)

100%

USD326,017

－

Equity method

Note 2

－

－

ASE (Kunshan) Inc.

Manufacture of semiconductor materials and packaging and testing of semiconductor products

USD80,000

USD57,556

－(Note 1)

30%

USD57,556

－

Equity method

Note 2

－

－

ASE Investment (Kunshan) Inc.

ASE (Kunshan) Inc.

Manufacture of semiconductor materials and packaging and testing of semiconductor products

USD122,000

USD87,772

－(Note 1)

45%

USD87,772

－

Equity method

Note 2

－

－

Global Advanced Packaging Technology Limited, Cayman Islands

ASE Assembly and Test (Shanghai) Ltd.

Assembly and testing of semiconductor products

USD203,580

USD356,538

－(Note 1)

100%

USD356,538

－

Equity method

Note 2

－

－

ASE (Korea) Inc

ASE (Weihai)

Assembly and testing of general discretes

USD126,500

USD49,789

－(Note 1)

100%

USD49,789

－

Equity method

Note 2

－

－

ASE Assembly and Test (Shanghai) Ltd.

Wuxi Tongzhi Microelectronics Co., Ltd.

Assembly and testing of semiconductor products

RMB70,000

CNY93,489

－(Note 1)

100%

RMB93,489

－

Equity method

Note 2

－

－

ASE Trading (Shanghai) Ltd.

Goods and technology import and export

CNY500

CNY444

－(Note 1)

100%

CNY444

－

Equity method

Note 2

－

－

Shanghai Ding Hui Real Estate Development Ltd.

Real estate project development, construction and commercial property sale and property management

RMB2,242,500

RMB2,449,872

－(Note 1)

60%

RMB2,426,146

－

Equity method

Note 2

－

－

159

Shanghai Ding Hui Real Estate Development Ltd.

Shanghai Ding Qi Property Management Co., Ltd.

Property management, real estate agency

CNY1,000

CNY (867)

－(Note 1)

100%

CNY (867)

－

Equity method

Note 2

－

－

Shanghai Ding Wei Real Estate Development Co., Ltd.

Real estate project development, construction and commercial property sale and property management

RMB1,548,000

CNY1,528,067

－(Note 1)

100%

CNY1,528,067

－

Equity method

Note 2

－

－

Shanghai Ding Yu Real Estate Development Co., Ltd.

Real estate project development, construction and commercial property sale and property management

CNY1,100,000

CNY1,098,026

－(Note 1)

100%

CNY1,098,026

－

Equity method

Note 2

－

－

Kun Shan Ding Hong Real Estate Development Co., Ltd.

Real estate project development, construction and commercial property sale and property management

CNY670,000

CNY667,079

－(Note 1)

100%

CNY667,079

－

Equity method

Note 2

－

－

Kun Shan Ding Yue Real Estate Development Co., Ltd.

Real estate project development, construction and commercial property sale and property management

CNY330,000

CNY329,710

－(Note 1)

100%

CNY329,710

－

Equity method

Note 2

－

－

160

Super Zone Holdings Limited

ASE Circuit Manufacturing Co., Ltd. (China)

Semiconductor packaging and testing, after-sales service, consulting and factory building leasing

USD100,000

USD99,801

－(Note 1)

100%

USD99,801

－

Equity method

Note 2

－

－

Alto Enterprises Limited

ASE Investment (Kunshan) Inc.

Investment and holding company

USD122,000

USD87,718

－(Note 1)

100%

USD87,718

－

Equity method

Note 2

－

－

ASE (Kunshan) Inc.

Manufacture of semiconductor materials and packaging and testing of semiconductor products

USD66,000

USD47,492

－(Note 1)

25%

USD47,492

－

Equity method

Note 2

－

－

Shanghai Ding Wei Real Estate Development Co., Ltd.

Shanghai Ding Fan Department Stores Co., Ltd.

Departmental store and trading

CNY1,500

CNY1,494

－(Note 1)

100%

CNY1,494

－

Equity method

Note 2

－

－

Universal Global Scientific Industrial Co., Ltd.

Universal Scientific Industrial Co., Ltd.

Manufacture, processing and sale and purchase of computer peripherals, Thick Film Hybrid Circuit, electronic components and accessories and personal computer and accessories

792,064

1,130,788

39,603,222

99%

886,154

－

Equity method

Note 2

－

－

Note 1: No stocks issued as it is limited company.

Note 2: Profit and loss of the said invested company have been included in those of its parent company. 

Note 3: In July 2016 the company invested NT$1,934,062,000 (USD59,882,000) in 98,490,000 special shares issued by Deca at USD0.608 per share. After the said investment the company's shareholding percentage was 22%, giving it substantial influence on Deca.

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(B) Comprehensive shareholding ratio:

September 30, 2016 Unit: Share %

Invested Company	Investment by the Company		Investments by directors, supervisors, managers and directly or indirectly controlled enterprises		Comprehensive investment
	Number of shares	Shareholding ratio (%)	Number of shares	Shareholding ratio (%)(Note 2)	Number of shares	Shareholding ratio (%)
A.S.E. Holding Limited	243,966	100%	－	－	243,966	100%
J & R Holding Limited	435,128	100%	－	－	435,128	100%
ASE Marketing & Service Japan Co., Ltd.	1,200	100%	－	－	1,200	100%
Omniquest Industrial Limited	250,504,067	71%	104,200,000	29%	354,704,067	100%
Innosource Limited	86,000,000	100%	－	－	86,000,000	100%
Hung Ching Guang Company	35,497,273	27%	82,494,545	64%	117,991,818	91%
Hung Ching  Development & Construction Co. Ltd.	68,629,782	26%	63,580,900	25%	132,210,682	51%
Universal Scientific Industrial Co., Ltd.	－	－	39,603,222	77%	39,603,222	77%
ASE Test Inc.	1,131,452,502	100%	－	－	1,131,452,502	100%
USI	1,112,236,706	99%	－	－	1,112,236,706	99%
Lu Zhu Development Co., Ltd.	131,961,457	67%	37,250,448	19%	169,211,905	86%
Riyueyang Company	76,500,000	51%	－	－	76,500,000	51%
Siliconware Precision Industries Co.,  Ltd.	1,037,300,000	33%	－	－	1,037,300,000	33%
Deca Technologies Inc.	98,489,803	22%	－	－	98,489,803	22%
Advanced Microelectronic Products, Inc.	33,308,452	17%	10,000	－	33,318,452	17%
Alto Enterprises Limited	－	－	188,000,000	100%	188,000,000	100%
Super Zone Holdings Limited	－	－	100,000,000	100%	100,000,000	100%
TLJ Intertech Inc.	－	－	2,119,080	60%	2,119,080	60%
ASE Test Limited	－	－	109,424,087	100%	109,424,087	100%
ASE Investment (Labuan) Inc.	－	－	240,946,882	100%	240,946,882	100%
ASE Test Holdings, Ltd.	－	－	170,000,006	100%	170,000,006	100%
ASE Japan Co., Ltd.	－	－	7,200	100%	7,200	100%
ASE (U.S.) Inc.	－	－	1,000	100%	1,000	100%
Global Advanced Packaging Technology Limited, Cayman Islands	－	－	190,000,000	100%	190,000,000	100%
Anstock Limited	－	－	10,000	100%	10,000	100%
Anstock II Limited	－	－	10,000	100%	10,000	100%
ASE (Korea) Inc.	－	－	20,741,363	100%	20,741,363	100%
ASE Holdings (Singapore) Pte Ltd	－	－	71,428,902	100%	71,428,902	100%
ASE Test Holdings, Ltd.	－	－	5	100%	5	100%
ASE Singapore Pte. Ltd.	－	－	30,100,000	100%	30,100,000	100%
ISE Labs, Inc.	－	－	26,250,000	100%	26,250,000	100%

162

Invested Company	Investment by the Company		Investments by directors, supervisors, managers and directly or indirectly controlled enterprises		Comprehensive investment
	Number of shares	Shareholding ratio (%)	Number of shares	Shareholding ratio (%)(Note 2)	Number of shares	Shareholding ratio (%)
ASE Electronics (M) Sdn. Bhd.	－	－	159,715,000	100%	159,715,000	100%
ASE Corporation	－	－	352,784,067	100%	352,784,067	100%
ASE Mauritius Inc.	－	－	217,800,000	100%	217,800,000	100%
ASE Labuan Inc.	－	－	126,184,067	100%	126,184,067	100%
ASE Electronics Inc.	－	－	398,981,900	100%	398,981,900	100%
ASE (Hong Kong)	－	－	(Note)	100%	(Note)	100%
Huntington Holdings International Co., Ltd.	－	－	255,856,840	99%	255,856,840	99%
Unitech Holdings International Co., Ltd.	－	－	3,000,000	99%	3,000,000	99%
Real Tech Holdings Limited	－	－	149,151,000	99%	149,151,000	99%
Universal ABIT Holding Co., Ltd.	－	－	90,000,000	99%	90,000,000	99%
Rising Capital Investment Limited	－	－	6,000,000	99%	6,000,000	99%
Rise Accord Limited	－	－	20,000	99%	20,000	99%
USI Enterprise Limited	－	－	210,978,000	99.%	210,978,000	99.%
Universal Global Technology Co., Limited	－	－	390,000,000	77%	390,000,000	77%
USI (Shanghai)	－	－	85,800,000	77%	85,800,000	77%
USI	－	－	198,000,000	77%	198,000,000	77%
USI Japan Co., Ltd.	－	－	6,400	77%	6,400	77%
Universal Scientific Industrial De Mexico S.A. De C.V.	－	－	281,085,325	77%	281,085,325	77%
USI America Inc.	－	－	250,000	77%	250,000	77%
ASE (Shanghai) [ASE Global Semiconductor (Shanghai) Co.,Ltd]	－	－	(Note 1)	100%	(Note 1)	100%
ASE (Kunshan)	－	－	(Note 1)	100%	(Note 1)	100%
ASE Electronics Components (Shanghai) Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
ASE Assembly and Test (Shanghai) Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
ASEN Semiconductors (Suzhou)	－	－	(Note 1)	60%	(Note 1)	60%
ASE (Weihai)	－	－	(Note 1)	100%	(Note 1)	100%
Shanghai Ding Hui Real Estate Development Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Shanghai Ding Wei Real Estate Development Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Shanghai Ding Yu Real Estate Development Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Kunshan Ding Hong Real Estate Development Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Kunshan Ding Yue Real Estate Development Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
ASE Integrated Circuit Manufacture (China) Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%

163

Invested Company	Investment by the Company		Investments by directors, supervisors, managers and directly or indirectly controlled enterprises		Comprehensive investment
	Number of shares	Shareholding ratio (%)	Number of shares	Shareholding ratio (%)(Note 2)	Number of shares	Shareholding ratio (%)
ASE Investment (Kunshan) Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Wuxi Tong Zhi Microelectronics Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
ASE Trading (Shanghai) Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Shanghai Ding Qi Property Management Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
Shanghai Ding Fan Departmental Store Co., Ltd.	－	－	(Note 1)	100%	(Note 1)	100%
USI Electronics (Shenzhen) Co., Ltd.	－	－	(Note 1)	77%	(Note 1)	77%
USI (Shanghai)	－	－	1,701,847,602	77%	1,701,847,602	77%
Huan Quan Electronic Components (Kunshan) Co., Ltd.	－	－	(Note 1)	99%	(Note 1)	99%
USI (Kunshan)	－	－	(Note 1)	77%	(Note 1)	77%
Huan Wei Electronics (Shanghai) Co., Ltd.	－	－	(Note 1)	77%	(Note 1)	77%
Huan Hao Electronics (Shanghai) Co., Ltd.	－	－	(Note 1)	77%	(Note 1)	77%

Note 1: No stocks issued as it is limited company.

Note 2: Consolidated shareholding percentage for the whole group

(3) The status of the subsidiaries who have held or disposed of shares of this company during the most recent 2 fiscal years and up to the prospectus' publishing date and the status of the shares pledged, and setting forth the origin of capital and other influences on the company's financial performance and financial condition. There was no major impact on the company's financial performance and financial status.

Unit: (NT$1,000) Share % 

Subsidiaries Name	Paid-up Capital (NTD)	Capital Source	Shareholding ratio of the company	Date of acquisition or disposal	Shares acquired and amount	Shares disposed and amount	Investment Profit and loss	Number of shares held as at the end of the year or the date of printing of Prospectus and amount	Pledge	Amount endorsed by the company for its subsidiaries	Amount loaned by the company to its subsidiaries
ASE Test Inc.	11,314,525	Acquired as a result of merger of ASE with ASE Materials and ASE Chungli and distribution of profit	100%	Obtained free placement for 2010 to 2012 in August 2004, partially disposed of in February 2010	－	－	－	End 2014: 10,978,776 shares Book value 418,291 Amount transfered to treasury stock 196,677	－	－	－
					－	－	－	End 2015: 10,978,776 shares Book value 417,193 Amount transfered to treasury stock 196,677	－	－	－
					－	－	－	End 2016 to date printing of Prospectus: 10,978,776 shares Book value 372,181 Amount transfered to treasury stock 196,677	－	－	－

164

Subsidiaries Name	Paid-up Capital (NTD)	Capital Source	Shareholding ratio of the company	Date of acquisition or disposal	Shares acquired and amount	Shares disposed and amount	Investment Profit and loss	Number of shares held as at the end of the year or the date of printing of Prospectus and amount	Pledge	Amount endorsed by the company for its subsidiaries	Amount loaned by the company to its subsidiaries
ASE Test Ltd.	659,075	Acquired as a result of merger of ASE with ASE Materials and ASE Chungli and distribution of profit	100%	Obtained free placement for 2010 to 2012 in August 2004, partially disposed of in February 2010	－	－	－	End 2014: 88,200,472 shares (Note) Book value 3,360,438 Amount transfered to treasury stock 1,380,721	－	－	－
					－	－	－	End 2015: 88,200,472 shares (Note) Book value 3,351,618 Amount transfered to treasury stock 1,380,721	－	－	－
					－	－	－	End 2016 to date printing of Prospectus: 88,200,472 shares (Note) Book value 2,989,996 Amount transfered to treasury stock 1,380,721	－	－	－
J&R Holding Ltd. (Bermuda)	13,907,259	Acquired as a result of merger of ASE with ASE Materials and ASE Chungli and distribution of profit	100%	Obtained free placement for 2010 to 2012 in August 2004, partially disposed of in February 2010	－	－	－	End 2014: 46,703,763 shares Book value 1,779,413 Amount transfered to treasury stock 381,709	－	－	－
					－	－	－	End 2015: 46,703,763 shares Book value 1,774,743 Amount transfered to treasury stock 381,709	－	－	－
					－	－	－	End 2016 to date printing of Prospectus: 46,703,763 shares Book value 1,583,258 Amount transfered to treasury stock 381,709	－	－	－

Note: In compliance with local regulations ASE Test Ltd. placed 88,200,472 of the company's shares acquired by it to CTBC

(4) Any occurrences of the situations of Article 185 of the Company Act, or transferring part of the business operation or results of the research and development to a subsidiary during the most recent 2 fiscal years and up to the prospectus' publishing date, the status of waiving subscription rights to the cash capital increase in the subsidiary company, the name of the subscribing counter party, and the relationship with the company, the directors, supervisors and shareholders who hold more than 10 percent of the outstanding shares, and the number of the subscribed shares shall be disclosed. None

4. Important contracts

Nature of contract	Contracting parties	Start and end dates of the contract	Content	Restrictive Terms
Syndicated contracts	4 banks including Bank of Taiwan	2013.07-2018.07	Long-term USD loan contracts	Restrictions on financial ratio are as follows: 1. Current ratio not less than 100%. 2. Debt ratio no higher than 160%. 3. Interest cover ratio not less than 280%. 4. Net value of tangible assets not lower than NTD75 billion.

165

Patent contracts	FUJITSU LIMITED	1998.04.13- 2017.04.12	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party within 5 years of its cessation or termination (confidentiality clause)
Patent contracts	FLIP CHIP INTERNATIONAL, LLC. (FOC/RDL) (ULCSP)	2008.03.07- Expiration date of licensed patented technology	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party before its expiration date (confidentiality clause)
Patent contracts	Mitsui High-tec, Inc.	2007.06.25- 2017.06.24	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party before its expiration date (confidentiality clause)
Patent contracts	Infineon Technologies AG	2007.11.06- 2017.11.05	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party before its expiration date (confidentiality clause)
Patent contracts	Infineon Technologies AG	2013.04.11 - Expiration date of licensed patented technology	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)
Patent contracts	Siliconware Precision Industries Co., Ltd. and its related enterprises	2009.05.10 - Expiration date of licensed patented technology	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)
Patent contracts	STATs Chippac Ltd.	2012.01.01- 2016.12.31	Patent Licensing	Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)
Technology and patent contracts	TDK Corporation	2015.12.3 - until the patent rights and proprietary knowledge of TDK SESUB technology have expired	Technology and patent contracts	Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)
Technology and patent contracts	DECA TECHNOLOGIES INC.	2016.01.13- 2026.01.13	Technology and patent contracts	Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)
Land leasing contract	Export Processing Zone Administration, MOEA	2013.02.01- 2035.12.31	Land lease	No conversion to activities not related to business operation during the term of the leasing contract; payment of rental continues pursuant to contract
Joint share conversion agreement	Siliconware Precision Industries Co., Ltd.	2016.06.30- 2017.12.31.	The company entered into a joint share conversion agreement with Siliconware Precision Industries Co., Ltd. for the purpose of formation of industry holding company.	If the transaction in question cannot be completed or settled on the date of final transaction as a result of non-fulfillment of its conditions precedent, it shall be automatically terminated at zero hours of the date following the final transaction date, unless otherwise provided in the agreement. Not to disclose the terms and conditions in this contract to any third party (confidentiality clause)

166

III. Issuance Plans and Implementation

A. The items that shall be included in the analysis regarding the allocation plan for capital raised through the previous cash capital increase, issuance of new shares to carry out a merger or acquisition, or to accept transfer of shares of another company; or issuance of corporate bonds:

As at to-date the company has not issued securities for private placement. Previous fundraising and issuance of securities by the company involved only the fourth tranche of unsecured convertible corporate bonds issued overseas in July 2015. The completion of the funds raised was slightly later than its projected time. Furthermore during the second half of 2015 the semiconductor industry was affected by liquidation of excess inventory. Thus the industry's capital expenses tended to be conservative. During the first half of 2016 the overall semiconductor industry suffered from a lack of demand due to shortage of terminal products. As a result the company adopted a prudent and conservative approach for its procurement and payment schedule in relation to capital expenses. Thus expenses lagged behind projected expenses. With machinery and equipment being pt in place, the company continued to make payment in the second half of 2016 in accordance with procurement terms. As at the end of November 2016, 90.39% of such payments have been made. Except for the outstanding items, all other procurement plans have been completed. Previous fundraising and issuance of securities with the actual completion date that is less than 3 years from the current filing include the third tranche of foreign unsecured convertible corporate bonds and share capital cash increase in 2013, the fourth tranche of unsecured convertible corporate bonds issued overseas in 2015 and the first tranche of unsecured ordinary corporate bonds issued in 2015. The said programs and their implementation are set out below:

Report on the Company's third issue of foreign unsecured convertible corporate bonds.

1. Content of the project:

(1) Date and document number of approval issued by the competent authority of the industry: Tai-Yang-Wai-Wu-Zi-1020030332 of the Central Bank dated July 26, and Jin-Guan-Zheng-Fa-Zi-10200309101 of the Financial Supervisory Commission dated August 15, 2013.

(2) The total amount of funds required under the Project: USD400,000,000, based on an exchange rate of NTD30: 1, the amount is about NTD12,000,000,000.

(3) Source of funds: Issuance of foreign unsecured convertible corporate bonds for a total amount of USD400,000,000 (about NTD12,000,000,000)

B. Project item, expected fund utilization and anticipated benefit

(1) Project item and expected fund utilization

Unit: NTD/USD '000

(Based on USD/ (NTD conversion rate of 1: 30)

Project items	Expected Completion Date	Total funding needed		Anticipated fund utilization
				2013	2014
				4Q	1Q
Purchase of materials using foreign currency	2014Q1	USD	400,000	260,626	139,374
		NTD	12,000,000	7,818,780	4,181,220
Total		USD	400,000	260,626	139,374
		NTD	12,000,000	7,818,780	4,181,220

(2) Anticipated benefit:

(1) Injection of mid- to long-term operating capital in order to increase scale of operation. If calculated based on USD-denominated bank loan interest rate of

167

1.11%, there would be a saving of interest expense of USD4,440,000, or about NTD133,200,000 annually (tentatively based on exchange rate of USD to NTD of 1: 30.)

2. Reduction of exchange rate fluctuation risk, in particular for payment in foreign currency for purchase of materials.

A. Fund utilization and project implementation status

Unit: USD'000 % 

Project items	Implementation status:			Ahead or behind schedule Reasons and improvement plans
Purchase of materials using foreign currency	Expended amount	Expected	400,000	As the company had effectively controlled its inventory of raw materials, its actual expenses on materials to be paid in foreign currency were behind schedule. As as 2014Q2 all purchases had been implemented. Despite being behind schedule there was no major irregularity.
		Actual	400,000
	Implementation (%)	Expected	100%
		Actual	100%

As at 2014Q2 information on the company's fund utilization for the said fundraising project had been entered in the Market Observation Post System in accordance with regulations. In addition the project has been completed with no major irregularities.

4. Appraisal of benefit

Unit: (NT$1,000) %

Year Item		June 30, 2013 (Before fundraising)	September 30, 2013 (After fundraising)	June 30, 2014 (After fundraising)
Basic financial information	Current liabilities	51,341,442	51,325,274	55,666,748
	Total liabilities	90,501,000	100,450,735	104,266,432
	Operating revenue	37,700,420	59,707,645	43,443,038
	Gross operating profit	9,111,204	15,153,575	12,303,876
	Interest expense	341,110	536,112	504,264
	Earnings per share	0.79	1.36	1.08
Financial structure	Debt-to-assets ratio (%)	45.39%	46.38%	45.98%
	Long-term fund to fixed assets ratio (%)	247.84%	263.27%	251.38%
Solvency	Current ratio (%)	42.00%	69.18%	59.20%
	Quick ratio (%)	32.76%	60.81%	50.24%

The company had completed fundraising in 2013Q3. Although operating revenue from 2013Q3 and the first half of 2014 showed growth compared to before the fundraising, the company had actually controlled its inventory of raw materials. As such its actual expenditure on purchase of raw materials denominated in foreign currency was slightly behind the original schedule. As at 2014Q2 the funds raised under the project amounting to USD400,000,000 (about NTD12,000,000,000) had been fully utilized. With regard to the company's financial structure after completion of the

168

fundraising, the company's debt-asset ratio rose slightly from 45.39% at the end of June 2013 to 45.98% at the end of June 2014. The main reasons were that the project involved issuance of foreign unsecured convertible corporate bonds, and that demand was high during the first half of 2014. Thus in order to meet overwhelming demand during the second half of the year, the company had to increase its reserve of materials. This in turn led to increase in demand for operating capital, and loan amounts and accounts payable on the books increased, thereby increasing total debt amount. Furthermore long-term fund to fixed assets ratio rose from 247.84% at the end of June 2013 to 251.38% at the end of June 2014. In terms of debt-repayment ability, current ratio rose from 42.00% as at the end of June 2013 to 59.20% as at the end of June 2014, and quick ratio rose from 32.76% as at the end of June 2013 to 50.24% as at the end of June 2014. Operating income, operating margin and earnings per share all rose compared to before the fundraising. Upon completion of the fundraising project except for slight increase in its debt ratio, the company's financial structure and debt-repayment ability saw an improvement. Furthermore, the operating performance of the Company also showed improvement compared to before the fundraising. This is indication of the fundraising project's benefit of improving the company's financial structure and debt-repayment ability.

As indicated in the Table below, the company's interest expense during the first half of 2014 saw an increase of NTD168,247,000 compared to the same period in the previous year. This is because of increased operation during the first half of 2014, with the company's operating revenue increasing 15.23% over the same period last year, As a result of increased in operating demand during the second half of the year the company had to increase its reserve of materials. This had the effect of increased demand in operating capital, which in turn led to increase in overall loan. Therefore interest expense actually rose compared with the same period in 2013. Since the funds raised under the project were all used on purchase of raw materials denominated in foreign currency, the company actually benefited by saving interest rate expense.

Unit: NT$ 1,000

Year Item	2013H1 (Before fundraising)	2014H1 (After fundraising)
Interest expense	270,084	438,331

(2) 2013 issue of new shares for cash

1. Content of the project:

(1) Date and document number of approval issued by the competent authority of the industry: In accordance with the Financial Supervisory Commission's letter, Jin-Guan-Zheng-Fa No. 1020030910 on August 15, 2013.

(2) The total amount of funds required under the Project: NTD4,000,000,000

(3) Source of funds:

A. Issuance of 130,000 new ordinary shares for cash. The denomination was NTD10 per share, and the issue price was NTD26.10 per share. A total of NTD3,393,000,000 had been raised.

B. Others: Cash in hand or bank loan of NTD607,000,000.

2. Project item, expected fund utilization and anticipated benefit

(1) Project item and expected fund utilization

169

Unit: NT$ 1,000

Project items	Expected date of completion	Total funding needed	Anticipated fund use progress
			2013	2014
			Quarter 4 (Q4)		Quarter 1 (Q1)	Quarter 2 (Q2)
Purchase of machinery and equipment	2014Q2	4,000,000	750,000		650,000	2,600,000
Total		4,000,000	750,000		650,000	2,600,000

(2) Anticipated benefit:

Unit: '000 pieces NT$ 1,000

Year	Item	Output Volume	Sales Volume	Operating revenue	Gross operating profit	Net operating profit
2014	Purchase of machinery and equipment	896,756	896,756	3,040,000	663,024	328,624
2015		1,793,511	1,793,511	6,080,000	1,326,048	657,248
2016		1,933,405	1,933,405	6,226,528	1,371,777	686,859
2017		2,084,211	2,084,211	6,376,587	1,418,608	717,184
Total		6,707,883	6,707,883	21,723,115	4,779,457	2,389,915

3. Fund utilization and project implementation status

Unit: USD'000 %

Project items	Implementation status:			Ahead or behind schedule Reasons and improvement plans
Purchase of machinery and equipment	Expended amount	Expected	4,000,000	The company had used utilized the entire amount of funds raised on purchase of machinery and equipment. The project was competed in 2014Q2 according to schedule.
		Actual	4,000,000
	Implementation (%)	Expected	100%
		Actual	100%

The fund utilization program was completed in 2104Q2 in accordance with schedule. All information was set out in the Quarterly Report entered into the Internet system.

4. Appraisal of benefit

Unit: '000 pieces NT$ 1,000

Year	Item		Output Volume	Sales Volume	Operating revenue	Gross profit	Net operating profit
2014	Purchase of machinery and equipment	Estimated number	896,756	896,756	3,040,000	663,024	328,624
		Actual number	787,500	787,500	2,520,000	826,236	549,036
		Achievement Rate	87.82%	87.82%	82.89%	124.62%	167.07%
2015		Estimated number	1,793,511	1,793,511	6,080,000	1,326,048	657,248
		Actual number	2,891,372	2,891,372	6,482,389	1,706,150	1,144,431
		Achievement Rate	161.21%	161.21%	106.62%	128.66%	174.12%
2016		Estimated number	1,933,405	1,933,405	6,226,528	1,371,777	686,859
		Actual number (note)	2,141,059	2,141,059	4,741,099	1,414,282	999,759
		Achievement Rate	110.74%	110.74%	76.14%	103.10%	145.56%

Note: Until end of November 2016.

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 Purchase of machinery and equipment by the company was in anticipation of future business growth. Thus the machinery and equipment purchased during this exercise were advance semiconductor assembly and testing equipment, with such equipment being added to production in stages. Official production was expected to begin in 2014Q3. The increase in production volume, sales volume, operating income, gross operating profit and net operating profit for the company's assembly and testing products in 2014Q3 after commencement of production were respectively: 787,500,000 units, 787,500,000 units, NTD2,520,000,000, NTD826,236,000 and NTD549,036,000, with achievement rate respectively of 87.82%, 87.82%, 82.89%, 124.62% and 167.07%. The achievement rate of over 80% for production volume, sales volume and operating revenue was considered excellent. In addition the achievement rate for gross operating profit and net operating profit was also good since the orders' gross profit was higher than that originally estimated, with the company also exercising effective control of expenses. The increase in production volume, sales volume, operating income, gross operating profit and net operating profit for the company's assembly and testing products in 2015 after commencement of production were respectively: 2,891,372,000 units, 2,891,372,000 units, NTD6,482,389,000, NTD1,706,150,000 and NTD1,144,431,000, with achievement rate respectively of 161.21%, 161.21%, 106.62%, 128.66% and 174.12%, which were considered excellent. Furthermore the increase in production volume, sales volume, operating income, gross operating profit and net operating profit for the company's assembly and testing products as at the end of November 2016 after commencement of production were respectively: 2,141,059,000 units, 2,141,059,000 units, NTD4,741,099,000, NTD1,414,282,000 and NTD999,759,000, with achievement rate respectively of 110.74%, 110.74%, 76.14%, 103.10% and 145.56%. As a result of adjustment in product combination the achievement rate for operating revenue was lower than that of gross operating profit. IN addition gross operating profit and net operating profit were excellent as gross profit from orders was higher than expected estimated gross profit margin as well as due to effective control of expenses. In conclusion the benefit from the company's 2013 issuance of new shares for cash injection for use in purchase of new machinery and equipment was apparent.

(3) Report on the Company's fourth issue of foreign non-guaranteed convertible corporate bonds in 2015

1. Content of the project:

(1) Date and document number of approval issued by the competent authority of the industry: Tai-Yang-Wai-Wu-Zi-1040019282 of the Central Bank dated May 15, 2015 and Jin-Guan-Zheng-Fa-Zi-1040020328 of the Financial Supervisory Commission dated June 3, 2015.

(2) The total amount of funds required under the Project: USD220,000,000 or about NTD6,886,000,000. (based on an exchange rate of NTD31.3: USD1.)

(3) Source of funds:

A. Issuance of foreign unsecured convertible corporate bonds for the amount of USD200,000,000, or about NTD6,260,000,000. (based on an exchange rate of NTD31.3: USD1.)

B. Others: Cash in hand or bank loan amounting to USD200,000,000, or about NTD626,000,000. (based on an exchange rate of NTD31.3: USD1.)

2. Project item, expected fund utilization and anticipated benefit

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(1) Project item and expected fund utilization

Unit: NTD/USD '000

 (Tentative exchange rate of USD- NTD at 1: 31.3.)

Project items	Expected Completion Date	Total funding needed		Anticipated fund use progress
				2015		2016
				Quarter 3 (Q3)	Quarter 4 (Q4)	Quarter 1 (Q1)
Purchase of machinery and equipment	2016 Quarter 1 (Q1)	USD	220,000	78,081	113,835	28,084
		NTD	6,886,000	2,443,935	3,563,036	879,029
Total		USD	220,000	78,081	113,835	28,084
		NTD	6,886,000	2,443,935	3,563,036	879,029

(2) Anticipated benefit:

In anticipation of future business growth, the company planned to purchase semiconductor assembly and testing machinery and equipment for its Kaohsiung Plant. The company projected increase in operating revenue, gross operating profit and net operating profit in 2016~2019 to be NTD17,610,794,000, NTD4,937,175,000 and NTD2,999,988,000 respectively.

3. Fund utilization and project implementation status

Unit: NT$ 1,000 

Project items	Status of implementation as at the end of November 2016			The reason that the project is ahead of or behind schedule and improvement plan
Purchase of machinery and equipment	Expended amount	Expected	6,886,000	The company originally projected cumulative expenses as at 2016Q1 to be USD220,000,000 (about NTD6,886,000,000), and projected implementation progress to be 100.00%. However as at the end of November 2016 the company's actual cumulative expenses were USD198,850,000 (about NTD6,224,003,000), giving an actual cumulative implementation rate of 90.39%. The implementation was behind schedule mainly because the funds were in place on July 2, 2015 which was after the expected date. In addition the semiconductor industry was affected by moves to cut down inventory during the second half of 2015, thus causing the company to adopt a conservative approach for its expenditure. During the first half of 2016 the overall semiconductor
		Actual	6,224,003
	Implementation (%)	Expected	100.00%
		Actual	90.39%
Total	Expended amount	Expected	6,886,000
		Actual	6,224,003

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Project items	Status of implementation as at the end of November 2016			The reason that the project is ahead of or behind schedule and improvement plan
	Implementation (%)	Expected	100.00%	industry suffered from a lack of demand due to shortage of terminal products. As a result the company adopted a prudent and conservative approach for its procurement and payment schedule in relation to capital expenses. Thus expenses lagged behind projected expenses. During the second half of 2016 the machinery and equipment were duly delivered and the company made payment in accordance with the payment terms. In summary, although the implementation of fund disbursement was slightly behind schedule the company came to the conclusion upon assessment that this was mainly due to changes in the semiconductor industry chain, albeit with no major irregularity.
		Actual	90.39%

As at the end of November 2016 the cumulative amount originally projected by the company for purchase of machinery and equipment was NTD6,886,000,00 with implementation level of 100.00%. However the actual cumulative expenses of NTD6,224,003,000, with implementation of 90.39%. This was mainly because the time for overseas underwriting was longer than originally expected, with funds raised behind schedule. Thus fund utilization was also behind schedule. Moreover weak demand for terminal devices during the second half of 2015 while upstream customers also adjusting their inventories. The above causes prompted the company to take a conservative approach with respect to its capital expenses. Owing to weak seasonal demand during the first half of 2016 and lack of terminal devices for the semiconductor industry, the company adopted a prudent approach for its capital expenses both with regard to actual purchases and payment schedule. Therefore actual expenses were slightly behind schedule. With traditional peak season during the second half of 2016 and sustained demand for smart phones, the machinery and equipment ordered by the company have been duly delivered with the company making payment in accordance with the payment terms. Overall, although the implementation of the company's fourth foreign unsecured convertible corporate bonds was slightly behind schedule, the company had upon assessment concluded that it was due to changes in the entire semiconductor industry with no major irregularity. Thus it did not have any major adverse impact on the company's finances and operation as well as shareholder's equity. In conclusion the causes were reasonably expected, with no major irregularity.

4. Unspent amount: As of November 2016, USD1,150,000 (approximately NTD35,995,000) from this fundraising remains unspent and is placed in a savings account. The remaining USD20,000,000 (approximately NTD626,000,000) will be supplemented through proprietary funds.

5. Appraisal of benefit

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(1) Location of equipment installation: No. 2, Chuangyi Road S., Nantze Export Processing Zone (NEPZ), Kaohsiung and No. 26, Jingsan Road, NEPZ, Kaohsiung.

(2) Appraisal of benefit:

Unit: '000 pieces NT$ 1,000

Year	Item		Output Volume	Sales Volume	Operating revenue	Gross profit	Net operating profit
2016 (Note)	Purchase of machinery and equipment	Estimated number	1,172,481	1,172481	4,338,180	1,201,790	724,591
		Actual number	1,061,666	1,061,666	3,970,632	933,099	647,213
		Achievement Rate	90.55%	90.55%	91.53%	77.64%	89.32%

Note: Compiled up to the end of November 2016.

The current purchase of machinery and equipment by the company was mainly in anticipation of future business growth needs. As such the machinery consisting of semiconductor assembly and testing equipment was purchased, delivered and put in production in batches. The original plan was for mass production to begin in 2016Q1, but owing to weak demand for devices and adjustment of inventory by upstream customers, the company decided to adopt a conservative approach, thus causing the benefit to be slightly delayed. The increase in production volume, sales volume, operating income, gross operating profit and net operating profit for the company's assembly and testing products as at the end of November 2016 was respectively: 1,061,666,000 units, 1,061,666,000 units, NTD3,970,632,000, NTD 933,099,000 and NTD647,213, with achievement rate of 90.55%, 90.55%, 91.53%, 77.64% and 89.32%. The achievement rate of over 80% for production volume, sales volume, operating revenue and net operating profit was considered excellent. The achievement rate of gross operating profit was 77.64% since the orders' gross profit was lower than that originally estimated; however, net operating profit remained highly satisfactory due to the company’s effective control of expenses. The company expects that, with production capacity gradually stabilizing, shortening of semiconductor production process, returning demand for advance assembly and emerging smart phone application driving increasing market demand the effect of the company's purchase of new machinery and equipment will be demonstrated in due course.

6. Impact on shareholder's equity and future improvement plan

Utilization of funds from the fundraising project was behind schedule mainly because the time for overseas underwriting was longer than originally expected, with funds raised behind schedule. Moreover adjustments in the semiconductor industry of inventories and weak demand for terminal devices during the second half of 2015 prompted the company to take a conservative approach with respect to its capital expenses. The machinery and equipment purchased by the company had been put into production in stages. As at the end of November 2016, the achievement rate for additional production volume, sales volume, operating income, gross operating profit and net operating profit for the company's assembly and testing products as at the end of November 2016 was respectively: 90.55%, 90.55%, 91.53%, 77.64% and 89.32%. The achievement rate of over 80% for production volume, sales volume, operating revenue and net operating profit was considered excellent. In addition the achievement rate of 77.64% for gross operating profit was also good since the orders' gross profit was higher than that originally estimated, with the company also exercising effective control of expenses. Achievement of net operating profit was also excellent. The company expects

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that, with production capacity gradually stabilizing, shortening of semiconductor production process, returning demand for advance assembly and emerging smart phone application driving increasing market demand the effect of the company's purchase of new machinery and equipment will be demonstrated in due course. In conclusion there was no major adverse impact on shareholder's equity.

(4) 2015 first unsecured ordinary corporate bonds

1. Content of the project:

(1) Date and document number of approval issued by the competent authority of the industry: Zheng-Gui-Zhai-Zi-1040037031 dated January 4, 2016.

(2) The total amount of funds required under the Project: NTD9,000,000,000.

(3) Source of funds: Issuance of 2015 first unsecured ordinary corporate bond for NTD9,000,000,000.

2. Project item, expected fund utilization and anticipated benefit

(1) Project item and expected fund utilization

Unit: NTD/USD '000

(Tentative exchange rate of USD- NTD at 1: 31.3.)

Project items	Expected Completion Date	Total funding needed	Anticipated fund use progress
			2016
			Quarter 1 (Q1)
Repayment of debts	2016 Quarter 1	9,000,000	9,000,000
Total		9,000,000	9,000,000

(2) Anticipated benefit:

The interest rates for the company's long-term corporate bonds were at relatively modest level. The issuance of the current long-term corporate bonds would reduce the risk of rising interest rate. The issuance of long-term corporate bonds denominated in New Taiwan Dollars in order to increase its source of long-term funding meant that there was no exchange risk while also locking in the cost of long-term financing. This was in keeping with the principle of steady operation.

3. Fund utilization and project implementation status

Unit: USD'000 %

Project items	Implementation status:			Ahead or behind schedule Reasons and improvement plans
Repayment of debts	Expended amount	Expected	9,000,000	The company had utilized all the funds raised towards repayment of debts. The project was fully implemented during 2016Q1.
		Actual	9,000,000
	Implementation (%)	Expected	100%
		Actual	100%

As at 2016Q1 information on the company's fund utilization for the said fundraising project had been entered in the Market Observation Post System in accordance with regulations. In addition the project has been completed with no major irregularities.

4. Appraisal of benefit

(1 Adjustments in financial structure

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 List of Bank Loans Repaid and Interest Rate Saved

Unit: NT$ 1,000

Lending institution	Interest rate	Contractual Period	Original loan Purpose	Original loan Amount	Proposed repayment Amount	Reduced interest expense  (Note)
				NTD	NTD	2016
						NTD
DBS Bank	1.00%	2014/10/20-2017/10/19	Repayment of loan and working capital	1,100,000	1,100,000	--
Bank of Nova Scotia	1.01%	2015/2/4-2017/2/4	Repayment of loan and working capital	2,000,000	2,000,000	--
Standard Chartered Bank	1.00%	2014/12/31-2016/12/31	Repayment of loan and working capital	1,830,000	1,830,000	--
HSBC Bank (Taiwan) Limited	1.02%	2015/10/27-2017/10/26	Repayment of loan and working capital	3,530,000	3,470,000	--
KGI Bank	0.96767%	2015/5/19-2018/5/18	Repayment of loan and working capital	600,000	600,000	--
Total				9,060,000	9,000,000	--

Note: 1. The basis for calculation of reduction in interest was when the interest rate for the original loan was higher than that of the corporate bonds issued (Class A: fixed annual interest rate 1.30%; Class B: fixed annual interest rate 1.5%).

2. Part of the loans that were repaid carnied interest rates that were higher than that of the corporate bonds. However, considering that the current interest rate for mid- to long-term loans is still at a relatively low level, the current issuance of domestic corporate bonds was reasonable. Moreover it could reduce structural risk of the company's finances.

Unit: (NT$1,000) %

Year Item		End 2015 (Before fundraising)	2016Q1  (After fundraising)
Basic financial information	Total current assets	32,132,019	26,744,680
	Total assets	305,942,938	310,493,166
	Total current liabilities	91,305,117	94,091,727
	Total liabilities	149,026,934	153,039,266
	Operating revenue	94,206,807	21,527,239
	Earnings per share (NTD)	2.44	0.43
Financial structure (%)	Debt ratio	48.71	49.29
	Long-term fund/fixed assets	259.13	273.72
Solvency (%)	Current ratio	35.19	28.42
	Quick ratio	30.70	23.77

The company's 2015 first unsecured corporate bonds were issued to raise a total sum of NTD9,000,000,000. All the funds raised would be utilized in repayment of bank loans, and implementation of the project was completed during 2016Q1. The purpose was to reduce risk of the company's financial structure. The company's debt ratio during 2016Q1 was 49.29%. This was slightly higher than that at the end of 2015 (48.71%). Its current ratio and quick ratio as at 2016Q1 were respectively 28.42% and 23.77%, compared with 35.19% and 30.70% at the end of 2015 (before fundraising). This is mainly because during 2016Q1 the company increased its shareholding in Siliconware Precision Industries. As a result the increase in current assets and quick

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assets was significantly larger than the increase in current liabilities. However after the issuance of the ordinary corporate bonds the company's long-term capital increased to 273.73% of its fixed assets. This was indication of adjustment in the company's financial structure. In terms of operating income, due to adjustments in inventory in the semiconductor industry in the second half of 2014, weak demand in terminal devices, and the traditional low season, in the first quarter of 2016 the Company’s income was lower than the same period last year. However, rising demand for packaging in the communications, consumer electronics, industry, and vehicle industries has led to an end of the inventory clear-outs by downstream clients. Coupled with the traditional peak season, the Company’s performance in the first three quarters of 2016 showed a trend towards growth. This indicates the Company’s success in this issue of corporate bonds.

(2) Reduction of risk of rising interest rate

Furthermore judging by the yield trend of the 5th public debts in 2016 of the R.O.C., it has gradually risen from 0.6066% early in the year to 0.845% currently. This is an indication of the company locking in the cost of long-term financing by its issuance of 2015 first unsecured ordinary corporate bonds, thereby reducing the risk of rising interest rate.

In conclusion the effect of the company's 2015 first unsecured ordinary corporate bonds to repay bank loans is apparent.

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2. Other matters that should be reported in the current plan for cash capital increase, issuance of corporate bonds, issuance of employee stock warrants or new restricted employee shares:

(3) Source of funds:

(1) The total amount of funds required by the Project: NTD10,290,000,000

(2) Source of funds:

For the current project the company proposes to issue 300,000,000 new shares each with a face value of NTD10, and an issuing price fixed at NTD34.3 per share. The company expects to raise NTD10,290,000,000.

3. Project item, expected fund utilization and anticipated benefit

Unit: NT$ 1,000

Project items	Expected date of completion	Total funding needed	Anticipated fund use progress
			2017
			Quarter 2 (Q2)
Repayment of bank loan	2017Q2	10,290,000	10,290,000
Total		10,290,000	10,290,000
Anticipated  Benefit	The company expects to utilize NTD10,290,000,000 to repay bank loans. This means that for fiscal year 2017 it is expected to save about NTD70,739,000 in interest expense. Thereafter the company can save about NTD94,319,000 annually in interest expense.

(2) Current issuance of the corporate bonds shall, pursuant to Article 248 of the Company Law, disclose relevant matters and fundraising plan for repayment and means of custody: Not applicable.

(3) Current of special shares shall require disclosure of the face value of each share, offer/issuing price, impact of issuing conditions on holders of special shares, potential dilution of shareholding rights, impact on shareholders' interest and matters specified in Article 157 of the Company Law: Not applicable.

(4) For issuance/offering of unlisted or non-OTC special shares of unlisted or non-OTC companies, there shall be disclosed the purpose of the issuance/offering, reason for not listing on stock exchange or OTC, impact on the rights of existing shareholders or future investors and whether or not there are plans to apply for listing on stock exchange or OTC: Not applicable.

(5) Where the shares to be issued are those of companies traded by securities brokerages approved pursuant to Article 5 of "Taipei Exchange Rules Governing the Review of Emerging Stocks for Trading on TPEx", future listing (OTC) plans should be disclosed: Not applicable.

(6) Where the current issuance/offering involves employee's subscription warrant, the rules governing issuance of employee's subscription warrant and subscription thereto should be disclosed. Not applicable.

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(7) Where the current issuance/offering involves new shares with restricted employee's right, the rules governing issuance of such shares should be disclosed. Not applicable.

(8) The viability, necessity and reasonableness of the current project, with analysis of various sources of fund deployment and impact of dilution of earnings per share during the current and the next year.

1. Viability of the current funding plan involving offering and issuance of securities

(1) Viability of statutory procedure

The company's current issuance of new shares for cash has been approved by way of resolution at its Board of Directors meeting held on December 8, 2016. The company has determined that the issuance/offering is in compliance with the Company Law, Securities Exchange Act, Regulations Governing the Offering and Issuance of Securities by Issuers and other relevant laws and regulations. Furthermore the company's legal counsel has issued legal opinion with respect to the legal compliance of the share issuance/offering plan. As such the current issuance/offering is compliant with law,

(2) Viability of completion of fundraising

For the current project the company proposes to issue 300,000,000 new shares each with a face value of NTD10, and an issuing price tentatively fixed at NTD34.3 per share. The company expects to raise NTD10,290,000,000. Pursuant to the requirements under Article 267 of the Company Act, 10% of the new shares issued, i.e. 30,000,000 shares will be set aside for subscription by the company's employees. Furthermore pursuant to Article 28-1 of the Securities Exchange Act, 10% of new shares issued, i.e. 30,000,000 shares will be set aside for public offering through underwriter by way of open subscription. The remaining 80%, i.e. 240,000,000 shares will be subscribed by original shareholders with their respective shareholding ratios on the shareholders’ roster at subscription record date. For fractional part of a share subscribed by shareholders, such shareholders shall proceed to the company's registrar within 5 days of the cessation of transfer registration to process subscription through aggregation of fractional entitlement. For shares for which the original shareholders or employees have relinquished their subscription rights or fractional parts of shares, the Board of Directors authorizes the Chairman to negotiate with specific individuals to subscribe such shares or fractional parts at the issue price. In addition pursuant to Article 61 of the Taiwan Securities Association Rules Governing Underwriting and Resale of Securities by Securities Firms, for a firm commitment offering by public subscription, where subscriptions fall short of the number of units put up for sale, the underwriting syndicate may either place the remainder with a specific party or purchase the remainder on its own account. Therefor the current fundraising is considered viable.

(3) Viability of fund utilization plan

The company proposes to use all funds raised from the offering of new shares to repay bank loans in order to reduce its interest burden, improve its financial structure as well as flexibility of its financial channels. Upon perusal of the loan contracts for loans which the company proposes to repay and disbursement of monies, it has been ascertained that such loans actually exist and their contracts do not preclude early repayment or contain other special restrictions. Thus upon completion of the current fundraising the company can carry out repayment of bank loan in accordance with its fund utilization plan. This means that the proposal to use the funds raised to repay bank loans is reasonable and viable.

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In conclusion the company's issuance/offering of new shares is compliant with law. The completion of fundraising and fund utilization plan are also viable.

2. Necessity of fundraising plan

(1) Reduces interest expense and financial burden, and additional room for flexible use of funds

Unit: NT$ 1,000

Year Item	2014	2015	2016Q3
Total loans (note)	50,347,551	79,105,720	83,366,026
Interest cost (A) (note)	519,576	509,793	527,977
Operating profit (B)	18,278,988	13,892,786	8,365,544
Interest cost/Operating profit (A)/(B)(%)	2.84	3.67	6.31

Source: 2014–2015 financial reports inspected and certified by a CPA.

Note: “Loan” refers to bank loans (long- and short-term loans) short-term notes payable and short-term bonds payable

At present the company mainly carries out production, assembly, processing, testing and sale of all types of ICB. It leverages on its semiconductor assembly and testing technology and production process research and development to provide advance assembly and testing services for semiconductor manufacturers throughout the world. In the entire semiconductor supply chain the company's main operations involving assembly and testing in mid-stream and supply of assembly materials in the downstream. In 2015the assembly and testing industry was affected by weak demand for terminal devices. In addition upstream customers adjusted their inventories. Market competition also intensified, thus causing the company's operating revenue in 2015 to show marginal decline compared to that in 2014. Owing to weak seasonal demand during the first three quarters of 2016 and lack of terminal devices for the semiconductor industry, the company's operating revenue continued to show slight decline. With traditional peak season during the second half of 2016 and sustained demand for smart phones, the company's operating revenue during the third quarter rose slightly compared with the previous two quarter.s

It can be seen from the Table that at present the company's working capital consists entirely of loans. Thus, interest expense during 2014, 2015 and first three quarters of 2016 respectively made up 2.84%, 3.67%, and 6.31% of operating profit. This is indication that interest cost has significant impact on the company's profitability. In order to complement the company's financial structure and reduce interest expense, the company has fixed the amount required for this project to be NTD10,290,000,000. The company also proposes to utilize the entire amount to repay bank loans. Based on the interest rate of 0.90%～0.93% for loans for which the company proposes to repay, the company expects to save in 2017, interest expense of about NTD70,739,000, with saving of about NTD94,319,000 annually in subsequent years. The current fundraising plan will suitable reduce interest expense, thereby reducing the company's financial burden as well as its reliance on banks. This will enable it to respond better to changes in the industry. If the company continues to meet working capital needs through bank loans, the room for its working capital may well be significantly compressed in the event of downturn in economic outlook. Therefore the company's proposal to apply all the funds raised towards repayment of bank loans will not only reduce its reliance on financial institutions but will also convert short-term funds on loan to long-term funds, thereby reducing its financial and operational risks. The current fundraising plan is therefore of critical importance.

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(2) Improvement in financial structure and debt-repayment ability, while ensuring operating opportunities and maintaining long-term competitiveness

Financial ratios of ASE before and after fundraising

Year Item		Before fundraising			After fundraising
		2014	2015	2016 Quarter 3 (Q3)	2017 (note)
Financial structure	Debt ratio (%)	42.60	48.71	51.66	41.13
Solvency	Current ratio (%)	60.50	35.19	33.36	43.56
	Quick ratio (%)	53.66	30.70	27.43	34.40

Source: 2014–2015 financial reports inspected and certified by a CPA. 

Note: Projections based on financial statements for 2016Q3.

In terms of financial structure, the company's debt ratio as at the end of 2014~2015 and 2016Q3 is respectively 42.60%, 48.71% and 51.66%. The increase is mainly due to the company's issuance in 2015 of its fourth foreign unsecured convertible corporate bonds, issuance of unsecured ordinary corporate bonds in 2016Q1 and increase in bank loans to meet operating needs. With regard to the company's debt-repayment ability, as at the end of 2014~2015 and 2016Q3 the company's current ratio is respectively 60.50%, 35.19% and 33.36%, and its quick ratio 53.66%, 30.70% and 27.43% respectively. The decline year-by-year is mainly due to increase in demand for operating capital, causing the company's short-term liabilities to rise each year. Furthermore the corporate bonds issued at the end of 2015 have been transferred to corporate debts due within one year. The company is an advance semiconductor assembly and testing service provider. To meet its operating needs it depends on bank loans for its working capital. The current fundraising project is expected to be completed in 2017Q1 when all funds raised will be in place. The company is expected to then use the funds raised to repay its bank loans. It expects that following the fundraising the company's debt ratio will be reduced, and its current ratio and quick ratio will rise compared to those in 2015 and 2016Q3. If the company does not raise fresh capital to repay bank loans its financial structure may continue to weaken. Increase in interest expenses will also affect its debt-repayment ability and increase its liquidity and credit risks. All these will have adverse impact on the company's future business expansion. Following the fundraising the company's ratio and financial structure are expected to improve, thereby reducing its financial risk, improve its debt-repayment ability and maintenance of long-term competitiveness. As such the fundraising project is necessary.

(3) Finance and capital

The company's current fundraising involving issuance of new shares for cash is expected to raise NTD10,290,000,000. The entire amount of funds raised will be used to repay bank loans, thereby suitably reducing the company's debt ratio. Based on the company's cash income and expense projections for 2016 and 2017, the company's non-financing income between December 2016 and April 2017 is projected to total NTD43,453,831,000. Add to that its cash balance as at December 2016 of NTD1,319,683,000 and deduct from that non-financing expenses of NTD34,406,371,000, and considering that its monthly minimum cash balance is NTD1,500,000,000 and the net amount of total bank loan is NTD29,593,919,000, the

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company will between December 2016 and April 2017 see a working capital shortfall of NTD20,726,776,000. If such shortfall is to be met by increase in bank loan the company's operating risk will correspondingly increase. Its profit will also be eroded. Thus to prevent interest rate from being a burden due to increased lending as well as reduce the company's reliance on banks and improve its competitiveness, it is necessary for the company's fundraising project to raise funds to repay bank loan. This also has the effect of using long-term funding to meet shortage in the company's working capital.

3. Reasonableness of projected progress and anticipated benefit of fund utilization plan

(1) Reasonableness of fund utilization plan and projected progress

Unit: NT$ 1,000

Project items	Expected date of completion	Total funding needed	Anticipated fund use progress
			2017
			Quarter 2 (Q2)
Repayment of bank loan	2017Q2	10,290,000	10,290,000
Total		10,290,000	10,290,000

The company expects to file with the Securities and Futures Bureau of the Financial Supervisory Commission in December 2016 its new share issuance for cash. It is then expected to complete fundraising during 2017Q1 following the aforesaid filing, whereupon it will apply the entire amount of fund raised for repayment of bank loan. For those bank loans to be repaid by the company, their loan contracts do not contain restrictions with respect to early repayment. Therefore the fund utilization plan and expected progress are considered reasonable.

(2) Reasonableness of anticipated benefit:

The following contains details of bank loans expected to be repaid following the fundraising project:

Unit: NT$ 1,000

Lending institution	Interest rate	Contract Period	Original loan purpose	Original loan amount	Proposed repayment amount in 2017Q2	Reduced interest expense
						2017 (Note)	2018
Standard Chartered Bank	0.91%	2016.08.01~2018.08.01	Working capital	3,290,000	3,290,000	22,454	29,939
DBS Bank	0.90%	2016.08.12~2019.08.11	Working capital	4,330,000	2,400,000	16,200	21,600
HSBC Bank	0.93%	2016.10.27~2018.10.26	Working capital	4,600,000	4,600,000	32,085	42,780
Total				12,220,000	10,290,000	70,739	94,319

Note: The company expects that following completion of fundraising in March 2017 it will utilize the funds to repay bank loans in April 2017, thus saving interest expense for April ~ December 2017.

The company expects to repay in 2017Q2 bank loans amounting to NTD10,290,000,000. The original bank loans were short-term loans for working capital.

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Based on the lending rate for the loans to be repaid, the company will in 2017 and annually in subsequent years save the following: NTD70,739,000 and NTD94,319,000. The savings in interest expense and reduction in financial burden is therefore reasonable.

4. Analysis of impact of various sources of fund deployment on the company's earnings per share during the current year and subsequent one year

(1) Analysis of comparison between various funding sources:

The main sources of funding for listed (OTC) companies are generally divided into equity-based and debt-based fundraising tools. The former consists of issuance of new shares for cash and overseas depository receipts, while the latter consists of foreign or local convertible corporate bonds, ordinary corporate bonds and bank loans etc. The following sets out favorable and unfavorable factors for various funding sources, along with their analysis:

Item		Favorable factors	Unfavorable factors
Equity	Cash capital increase Issuance of new shares	1. Improves financial structure, reduces financial risk, enhances market competitiveness.  2. A relatively common financial product in the capital market, with high level of acceptance by general investors.  3. Under the law employees will have priority in subscribing 10%~15% of the shares issued, thus raising employees' acceptance and sense of belonging.	1. Earnings per share are diluted as a result of expansion in share capital.  2. For companies whose shareholding is not concentrated, their operating status can be easily threatened.  3. If there is no reasonable disparity between underwriting price and market price, the fundraising may not be successful.
	Overseas Depository Receipts	1. Fundraising in overseas market gives an opportunity for the company to enhance its reputation.  2. Fundraising mainly targeted at foreign entities, thus preventing excessive accumulation of shareholding in local market and causing adverse impact of the share price.  3. Improves the ratio of proprietary funds as well as financial structure.	1. The company's reputation in overseas market and growth of its industry will affect the fundraising program's success.  2. Relatively high fixed issuing cost. To achieve economy of scale the issuance/offering should not be for a low amount.
Debt	Foreign and local convertible corporate bond	1. As it is accompanied with 'conversion' right its coupon rate is lower than long-term loan interest rate.  2. The conversion price for conversion into ordinary shares is generally higher than the current price of such shares during issuance of such convertible bonds. This means that the issuer is issuing shares at a relative premium.  3. Lower pressure of dilution of earnings per share.  4. Convertible bonds is changed from liabilities to assets upon creditors requesting conversion. In addition to save interest expense the company can also avoid being under pressure for funding once the bonds mature.	1. Lower liquidity than ordinary shares.  2. Insofar as the bonds are not converted the company will remain under pressure for capital in case of redemption.

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Item		Favorable factors	Unfavorable factors
	Ordinary corporate debt	1. No dilution of equity.  2. Creditors do not possess right of management of the company, thus no major impact.  3. Effective use of financial leverage, thus creating relatively high profit.	1. Interest burden erodes the company's profitability.  2. Easily cause deterioration in the company's financial structure, thus reducing its competitiveness.  3. The company will face enormous pressure to raise fund to meet redemption upon maturity of corporate debt.
	Bank loan  or Issuance of acceptance bill	1. No dilution of equity.  2. Creditors do not possess right of management of the company, thus no major impact.  3. Effective use of financial leverage, thus creating relatively high profit.	1. Interest burden erodes the company's profitability.  2. Deterioration of financial structure and lowering of competitiveness.  3. Possible requirement for collaterals.  4. Pressure of repayment on maturity.

(2) Analysis of impact of various funding sources on the issuer's earnings per share in the current year

The common sources of funding for listed (OTC) companies are borrowings (including bank loans, issuance of ordinary corporate bonds and issuance of convertible corporate bonds), issuance of overseas depository receipts and issuance of new shares for cash. As the cost of issuing overseas depository receipts is relatively high and does not conform to economic benefit, it will not be considered. Furthermore since bank loans and issuance of ordinary corporate bonds have the same effect, this analysis will deal with three means of fundraising namely bank loan, issuance of convertible corporate bonds and issuance of new shares for cash. As since the current plan involves using the funds raised to repay bank loans, this means of fundraising will therefore not be considered. If the current fundraising is by way of issuance of ordinary corporate bonds, the company would be required to pay issuance interest together with guarantee cost and other processing expenses etc. Such interest expense will pose fixed annual interest burden. And they must be repaid at their due date. If at such time the industry's outlook deteriorates, they will have an impact on the company's financial deployment. Thus adoption of purely debt-based financing tools will, in addition to increasing the company's debt ratio and hence lead to increase in financial risk, also reduce the company's profitability as well as place a burden on the company's finance each year. All these run counter to the principle of steady operation, not to mention the likelihood of them affecting the company's credit worthiness, future financing cost, profitability and financial structure. Comparison of impact on 2017 earnings per share between issuance of convertible corporate bonds and issuance of new shares for cash:

Unit: (NT$1,000) Share

Item	Cash capital increase	Convertible corporate bonds:  (fully convertible)	Convertible corporate bonds:  (partially convertible)
Amount of fund raised (NTD'000) (Note 1)	10,290,000	10,290,000	10,290,000
Fundraising tool interest (Note 2)	0%	0%	0%
Financing cost (NTD'000) (Note 3)	—	—	—
Outstanding shares before fundraising (shares) (B) (Note 4)	7,949,974,846	7,949,974,846	7,949,974,846
Projected number of shares issued (Note 5)	300,000,000	274,400,000	—

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Item	Cash capital increase	Convertible corporate bonds: (fully convertible)	Convertible corporate bonds: (partially convertible)
Outstanding shares after fundraising (shares)(C)	8,249,974,846	8,224,374,846	7,949,974,846
Maximum dilution of equity (Note 6)(D)	3.64%	3.34%	—
Maximum dilution of EPS (1-(1/1+D))	3.51%	3.23%	—

Note 1: The amount to be raised under the program is NTD10,290,000,000. 

Note 2: Without considering issuing cost the financing cost of the respective financing tools is: Share issuance for cash 0%; convertible corporate bond 0%. 

Note 3: If the full amount of NTD10,290,000,000 is raised by March 2017, the period for calculation of 2017 fundraising cost will be 9 months. 

Note 4: The number of outstanding shares (i.e. shares in circulation) before the fundraising project is 7,949,974,846. 

Note 5: The expected number of new shares to be issued is based on the assumption of issuance price of NTD34.30 per share. The conversion price for convertible corporate bonds during the conversion period is calculated based on NTD37.50 per share. 

Note 6: Maximum dilution of equity = 1-(number of outstanding shares before fundraising/number of outstanding shares after fundraising) based on the assumption that original shareholders do not participate in the subscription of new ordinary shares issued for cash or convertible corporate bond.

A. Effect of dilution of EPS

Examination of the aforesaid fundraising tools based on their respective financing cost and effect of share capital expansion, the maximum dilution of EPS for issuance of new shares for cash is slightly higher than that for issuance of convertible corporate bonds, although the difference is marginal. However issuance of new shares for cash is a long-term funding source with the lowest financing cost. It can also immediately reduce debt ratio as well as raise the company's competitiveness such to reduce operating risk. Thus by considering the dilution of EPS of the respective tools, the current issuance of new shares for cash ought to be considered reasonable.

B. Impact on the issuer's financial burden

Except for issuance of new shares which is a equity-based financing tool and thus does not incur interest and is not encumbered with repayment principal upon maturity, all other aforesaid fundraising tools are debt-based fundraising tools. In the case of convertible corporate bonds, the company not only have to make payment of interest based on prescribed rate, but would also be subject to financing pressure brought about by re-purchase from the creditor or redemption by creditors at maturity. Thus fundraising through issuance of new shares for cash has the benefit of obtaining long-term, stable, low-cost financing. It can also reduce interest burden and strengthen financial structure. Although in the short term it will dilute earnings per share, in the long term it has the benefit of strengthening the company's finance. Therefore issuance of new shares for cash should be a relative better fundraising means since it reduces the company's financial risk.

C. Dilution of equity and impact on shareholder's equity

In terms of potential impact of dilution of equity, issuance of new shares for cash will cause equity to be diluted. There is no dilution of equity before holders of convertible corporate bonds exercise the conversion rights. During the exercise

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period the holders can elect to exercise conversion at a relatively advantageous point in time. There is therefore a delay in the dilution of equity. With regard to the maximum dilution of equity for different fundraising tools (assuming that the original shareholders do not participate in subscription of new share issues or convertible corporate bonds), new share issue will have greater impact that convertible corporate bonds, although in such a case debt ratio will be lower than that if convertible corporate bonds are fully issued. Thus, new share issues can help improve financial structure, as well as avoid pressure on the company in relation to repayment of principal sum upon maturity of the corporate bonds. There are both reduced financial burden and financial risk. For the current issue, apart from being required by law to set aside 10% for employees' subscription as well as 10% for public subscription, the remaining shares are to be subscribed by shareholders on the shareholder's register on the benchmark date according to their shareholding percentage. As such dilution of equity is not as serious as in other cases. In the case of issuance of convertible corporate bonds, as they are usually sold to the public, any conversion by outside investors would result in greater dilution of equity. With regard to impact on shareholder equity, although the company's share capital will not increase immediately in the case of issuance of convertible corporate bonds, their financing cost is relatively high and can easily erode the company's profit. Moreover the fundraising exercise will only increase the company's liabilities and its net value will not immediately improved. There is therefore limited assistance to the company's sustainability. Conversely, share issue for cash will not only suitably improve the company's own capital and reduce its financial burden, but will even help it improve its competitiveness while reducing operating risk. Therefore in the long term existing shareholder equity has better protection.

5. For issuance of shares at below face value, explanation should be given with respect to the necessity and reasonableness of the company's issuance of new shares at discount, its reasons for not adopting other fundraising means and reasonableness thereof, and the amount of capital reserve or retained earnings that has been reduced: Not applicable.

(9) Describe the manner in which the issue price, conversion price, exchange price or subscription price is fixed: Please see Appendix 1: Calculation of Underwriting Price of Cash Subscription Shares

(10) Estimation of fund utilization and anticipated benefit

1. For acquisition of other companies, expansion or construction of immovable properties, plants and equipment, explanation should be given for projected increase in production and sale volume, value, cost structure (including total cost and unit cost), and changes in profitability, product quality improvement and other potential benefit after completion of share capital increase: Not applicable.

2. For re-investment in other companies, matters to be listed: Not applicable.

3. For complementing working capital, repayment of debts, matters to be listed:

(1) The amount due each year for the company's debts, repayment plan and projected reduction in financial burden, present status of working capital, amount of capital needed and projected utilization, with projected monthly cash income and expenses during the current and next one year:

A. The amount due each year for the company's debts, repayment plan and projected reduction in financial burden: Please refer to Sections 1 and 5 in the Prospectus, and Statement of Projected Cash Income and Expenses for 2016 and 2017.

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B. Present status of working capital, amount of capital needed and projected utilization

Unit: NTD 1,000

Item		January - November 2016 (Actual)	December 2016 ~ April 2017 (Estimated)
Opening cash balance (A)		8,533,346	1,319,683
Non-financing income (B)		112,861,699	43,453,831
Non-financing expenses (C)		128,799,788	34,406,371
Cash balance (minimum requirement) (D)		1,500,000	1,500,000
Repayment of corporate debts (E)		8,000,000	-
Repayment of bank loan (net amount) (F)		-	(29,593,919)
Cash balance (shortfall) (A)+(B) - (C) - (D) +(E) +(F)		(16,904,743)	(20,726,776)
Response.	Cash capital increase	--	10,290,000
	Issuance of ordinary corporate bonds	9,000,000	8,000,000(Note)
	Bank loan (net amount)	3,977,559	-
	Loan of borrowed funds to  Related enterprise (net amount)	3,746,866	3,367,000

Note: The company issued the first unsecured ordinary corporate bonds of 2016 in accordance with the resolution of the Board of Directors on December 8, 2016. The total amount of the issue was no more than NTD8 billion. The funds are planned to be used for paying back bank loans. The company’s cash balance forecasts for 2016 and 2017 show that the company plans to issue the bonds in the 2017Q1. The predicted effect is based on the fact that long-term corporate bond yields are still quite low, so long-term corporate bonds will help mitigate the risk of rebounding yields in the future, thus locking in long-term capital for adjustments to the company’s financial structure.

It can be seen from the Table above that between December 2016 and April 2017, the company will have a working capital shortfall of NTD20,726,776,000. This figure is arrived at by taking the total of cash balance and non-financing income as at December 2016 amounting to NTD44,773,514,000 and deducting from it non-financing expenses and minimum cash balance required totaling NTD35,906,371,000 and projected repayment of bank loans totaling NTD29,593,919,000. If such capital shortfall were to be dealt with using bank loan, the company's operating risk will rise while its profit will be eroded. Thus to prevent interest expense burden, reduce its reliance on banks and improve its competitiveness, the company proposes to raise, through share issue for cash, the amount of NTD10,290,000,000, thereby using long-term fund to meet working capital shortfall. As such it is necessary. Following appraisal of the amount and time at which the company's fundraising program is fully implemented, and the cash requirements and time of cash shortfall as set out in the statement of projected cash income and expenses, no major irregularities have been discovered.

C. The Statement of Projected Cash Income and Expenses during the year of filing and the following year on a month-by-month basis:

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Statement of Projected Cash Income and Expense in 2016

Unit: NT$ 1,000 

	January	February	March	April	May	June	July	August	September	October	November	December	Total
Opening cash balance	8,533,346	11,825,732	14,277,654	4,701,645	2,504,141	1,476,831	3,520,040	1,218,698	1,202,531	2,656,750	2,410,613	1,319,683	8,533,346
Add: Non-financing income
Cash receipt for accounts receivable	7,983,219	7,309,119	8,576,999	7,052,709	8,284,422	8,677,565	8,456,093	9,488,494	9,359,586	9,207,825	10,181,113	9,672,877	104,250,023
Other income						2,627,155	3,757,621	224,065					6,608,841
Others - sale of immovable property of Nantou Branch Company - Plant												51,707	51,707
Others - Handling of investment sum		789,684	4,437,639			3,776,451			2,537,959			1,104,600	12,646,333
Others - Disposal of equipment										133,980			133,980
Grand total 2	7,983,219	8,098,803	13,014,639	7,052,709	8,284,422	15,081,171	12,213,715	9,712,559	11,897,545	9,341,806	10,181,113	10,829,184	123,690,884
Subtract: Non-financing expenses
Accounts payable	3,449,093	4,064,437	4,553,145	4,269,720	5,477,866	4,836,583	5,369,717	5,502,645	6,428,692	5,409,674	5,652,003	4,477,668	59,491,245
Property, plant and equipment – Plant facilities	262,603	211,890	101,435	140,042	120,586	102,156	150,448	191,290	146,588	182,308	147,217	105,303	1,861,865
Property, plant and equipment – Machinery and equipment	866,314	731,323	773,422	1,055,471	1,737,160	1,010,484	794,276	2,188,593	885,584	1,183,530	723,011	527,591	12,476,760
Salary and remuneration in cash	2,193,290	1,397,153	1,471,624	1,383,322	1,512,418	1,776,392	1,513,800	1,675,839	3,604,908	1,679,394	1,755,273	1,645,789	21,609,202
Share dividend									12,539,568				12,539,568
Others - Investment	4,505,252		13,240,877	4,169,036			4,410,830		146,903	1,104,600			27,577,499
Grand total 3	11,276,553	6,404,804	20,140,503	11,017,591	8,848,030	7,725,615	12,239,070	9,558,367	23,752,244	9,559,506	8,277,504	6,756,351	135,556,139
Required minimum cash balance 4	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000
Total funding needed 5 = 3+4	12,776,553	7,904,804	21,640,503	12,517,591	10,348,030	9,225,615	13,739,070	11,058,367	25,252,244	11,059,506	9,777,504	8,256,351	137,056,139
Shortfall of available cash before fundraising 6 = 1+2 - 5	3,740,012	12,019,731	5,651,790	(763,237)	440,533	7,332,387	1,994,684	(127,110)	(12,152,168)	939,050	2,814,221	3,892,516	(4,831,909)
Net amount raised
Increase in loan	9,000,000												9,000,000
Repayment of loan								(8,000,000)					(8,000,000)
Issuance of corporate debt	2,436,470	1,887,639	3,262,029	8,439,248	3,478,594	8,695,736	8,119,046	13,546,227	18,938,535	10,247,984	13,748,853		92,800,361
Repayment of corporate debt	(4,850,750)	(1,049,717)	(9,336,610)	(1,936,210)	(4,627,211)	(20,543,083)	(8,895,032)	(3,337,562)	(9,337,616)	(8,803,021)	(16,105,992)	(7,174,917)	(95,997,719)
Loan of borrowed money to related enterprises - Bank repayment			7,033,687	4,839,000	5,935,930	10,355,000		8,565,750	6,655,840		23,584	3,467,000	46,875,790
Repayment of loans to related enterprises		(80,000)	(3,409,250)	(9,574,660)	(5,251,015)	(3,820,000)	(1,500,000)	(10,944,775)	(2,947,840)	(1,473,400)	(660,984)	(100,000)	(39,761,924)
Grand total 7	6,585,720	757,922	(2,450,145)	1,767,378	(463,701)	(5,312,347)	(2,275,986)	(170,359)	13,308,919	(28,437)	(2,994,539)	(3,807,917)	4,916,508
Closing cash balance 8 = 1 +2 - 3 + 7	11,825,732	14,277,654	4,701,645	2,504,141	1,476,831	3,520,040	1,218,698	1,202,531	2,656,750	2,410,613	1,319,683	1,584,599	1,584,599

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Statement of Projected Cash Income and Expense in 2017

Unit: NT$ 1,000

	January	February	March	April	May	June	July	August	September	October	November	December	Total
Opening cash balance	1,584,599	1,549,213	1,591,374	10,772,828	2,430,224	2,345,839	2,346,088	2,380,238	2,428,291	2,372,298	2,355,915	2,387,038	1,584,599
Add: Non-financing income
Cash receipt for accounts receivable	9,202,784	8,327,393	7,596,668	7,497,802	8,308,117	8,686,000	8,319,776	9,482,007	9,287,519	9,198,405	9,845,394	9,694,765	105,446,630
Other income								75,493					75,493
Grand total 2	9,202,784	8,327,393	7,596,668	7,497,802	8,308,117	8,686,000	8,319,776	9,557,500	9,287,519	9,198,405	9,845,394	9,694,765	105,522,122
Subtract: Non-financing expenses
Accounts payable	3,955,716	3,850,894	3,621,529	3,626,169	5,464,713	4,699,552	5,378,577	5,524,118	6,462,987	5,418,600	5,152,024	4,485,056	57,639,937
Property, plant and equipment – Plant facilities	221,071	53,028	178,110	37,470	5,095	20,814	7,507	5,252	4,470	4,762	5,829	5,066	548,475
Property, plant and equipment – Machinery facilities	3,122,204	441,038	972,304	337,329	127,540	111,244	151,986	98,534	113,595	139,993	91,722	99,454	5,806,943
Salary and remuneration in cash	2,295,789	1,645,789	1,645,789	1,645,789	1,794,156	1,527,542	1,528,938	1,692,597	3,640,957	1,696,188	1,662,247	1,662,247	22,438,030
Share dividend									12,539,568				12,539,568
Grand total 3	9,594,781	5,990,749	6,417,732	5,646,758	7,391,504	6,359,152	7,067,008	7,320,501	22,761,577	7,259,544	6,911,822	6,251,824	98,972,953
Required minimum cash balance 4	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000	1,500,000
Total funding needed 5 = 3+4	11,094,781	7,490,749	7,917,732	7,146,758	8,891,504	7,859,152	8,567,008	8,820,501	24,261,577	8,759,544	8,411,822	7,751,824	100,472,953
Shortfall of available cash before fundraising 6 = 1+2 - 5	(307,398)	2,385,857	1,270,310	10,283,873	1,006,836	2,332,687	1,258,856	2,277,236	(13,385,767)	1,971,159	2,949,487	3,489,978	6,633,768
Net amount raised
Issuance of new shares for cash capital increase			10,290,000										10,290,000
Ordinary corporate bond issue	8,000,000												8,000,000
Bank loan increases	3,230,000								13,418,065				16,648,065
Bank repayments	(10,873,389)	(2,294,482)	(2,287,482)	(10,193,649)	(1,000,997)	(2,326,599)	(1,218,618)	(2,188,946)		(1,955,244)	(2,902,449)	(3,398,940)	(40,640,795)
Loan of borrowed money to related enterprises - Bank repayment			3,563,124	4,576,200	7,164,120	8,791,800		8,521,200	7,984,640			3,467,000	44,068,084
Repayment of loans to related enterprises			(3,563,124)	(4,576,200)	(7,164,120)	(8,791,800)		(8,521,200)	(7,984,640)			(3,467,000)	(44,068,084)
Grand total 7	356,611	(2,294,482)	8,002,518	(10,193,649)	(1,000,997)	(2,326,599)	(1,218,618)	(2,188,946)	13,418,065	(1,955,244)	(2,902,449)	(3,398,940)	(5,702,730)
Closing cash balance 8 = 1 +2 - 3 + 7	1,549,213	1,591,375	10,772,828	2,430,224	2,345,839	2,346,088	2,380,238	2,428,291	2,372,298	2,355,915	2,387,038	2,431,038	2,431,038

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(2) With regard to the company's policy for collection of accounts receivable and payment of accounts payable, capital expenses plan, financial leverage and debt ratio (or ratio of own assets and risk assets) during the current year and the next one year, explanation should be give for reasons for repayment of debt or supplementing working capital.

A. Company's policy for collection of accounts receivable and payment of accounts payable

The company's main cash in-flow consists of cash receipts of accounts receivable. Its main expenses consist of purchase of raw materials and manufacturing cost. The company's policy for accounts receivable involves consideration of the customer's financial structure, credit status, operating scale, past dealings, economic situation of the respective sales regions and market competition, with appropriate credit limit and collection terms assigned to customers. For collection of money from sale of goods, in the company's financial reports for fiscal years 2014 and 2015 the term for accounts receivable is respectively 68 days and 73 days. There is no major deviation from credit term for the company's sale to general customers which is 30~90 days. Thus the number of days for cash receipts in the company's estimated accounts receivable for 2016 and 2017 should be reasonable, since they are compiled based on credit term for ordinary customers. With regard to purchases the company's policy for payment of accounts payable differs depending the vendor's scale, nature and raw materials market. According to the company's financial reports for fiscal years 2014 and 2015 the term for accounts payable is 42 days. There is no major deviation from credit term for the company's accounts payable which is 45 days. As such the estimate should be considered reasonable. Based on the aforesaid the company has, in keeping with its accounts receivable and payable policies and taking into consideration past and current trading terms, projected its cash receipts and payments for the respective months based on empirical principles for compilation of its cash receipt and payment table. The basis and assumption for its compilation are reasonable.

B. Capital expenses plan and long-term investment plan

In the Company's capital plan for 2016-2017, the expenses for the period January-November 2016 are based on its actual payments. The main items consist of purchase of operating machinery and equipment and related plant affairs. The capital expense plan from December 2016 to December 2017 consists mainly purchase of machinery and equipment, repair and maintenance of plants etc. Upon review it has been found that there have no major disparities in the Company's projected income and expenses for the respective months in 2016 and 2017. As such their compilation is considered reasonable.

Furthermore the Company's long-term investment in January to November 2016 consisted mainly of investment in currencies to obtain fixed return. The Company utilizes its own funds to obtain shareholding in Siliconware Precision Industries and that from its American depository receipts to increase its shareholding in Siliconware. In view of stable operation and performance of Siliconware, the Company expects to obtain long-term, steady investment return. The company also acquired special shares in Deca Technologies Inc. in order to strengthen its deployment in Fan-out WLP technology, thus strengthening the parternship relationship. There are no further plans for long-term investments between December 2016 and the end of December 2017.

C. Financial leverage and debt ratio

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Year Item	103.12.31 (Before fundraising)	104.12.31 (Before fundraising)	105.09.30  (Before fundraising)	2016 (Estimation) (Note)	2017 (Estimation) (Note)
Financial leverage (multiple)	1.06	1.09	1.11	1.10	1.14
Debt ratio (%)	42.60	48.71	51.66	49.23	41.13

Source: 2014–2015 financial reports inspected and certified by a CPA. 

Note: Projection based on individual 2016Q3 financial report

The higher a company's financial leverage, the greater the percentage of its interest expense in relation to its operating profit, and the greater its financial risk. Thus financial leverage operation requires one to consider the safety of one's financial structure as well as liquidity and convertibility of its assets. The company's issuance of new shares for cash to repay its bank loans means it can save on interest expense, thus preventing such expense from eroding its profit. The company’s degree of financial leverage for 2014-2015 and the first three quarters of 2016 are 1.06, 1.09, and 1.11 respectively. In 2015 due to the issuance of the fourth foreign unsecured convertible corporate bonds and additional bank loans to meet its need for working capital, financial leverage rose to 1.09; in the first three quarters of 2016 the financial leverage rose marginally to 1.11 due to the issuance of ordinary corporate bonds and increase in interest for long and short-term loans taken to fulfill the need for working capital. The company plans to issue the first unsecured ordinary corporate bonds for 2016 in January 2017, in consideration of the fact long-term corporate bond yields are still quite low, so long-term corporate bonds will help mitigate the risk of rebounding yields in the future, thus locking in long-term capital for adjustments to the company’s financial structure. Upon repayment of part of the company's bank loans following its fundraising plan, the company's financial leverage at year-end 2017 is at 1.14 times. It has been determined that if the company does not raise funds through issuance of new shares, and instead raises its working capital through loans from financial institutions, its interest burden will increase and its financial structure will deteriorate. The current issuance of new shares will enable the company to obtain long-term funds, reduce the impact of interest expense on its profit, as well as having a positive impact on the company's financial leverage.

Furthermore, the company's debt ratio for 2014~end 2015 and 2016Q3 is 42.60%, 48.71% and 51.66% respectively, demonstrating a rising trend. This is mainly because of the company's 2015 issuance of fourth foreign unsecured convertible corporate bonds and 2016Q1 issuance of unsecured ordinary corporate bonds as well as additional bank loans to meet its need for working capital. If the company then uses long and short-term loans to meet its needs, its financial structure consisting of high interest burden and relatively high debt ratio will directly affect its ability to flexibly use its working capital and its stability, thus increasing its financial risk. If the economic outlook turns worse or its operating environment deteriorates, the company will have even greater financial risk. For the above reasons the company has decided to undertake issue of new shares for cash in order to raise medium and long-term funding. It expects that after the fundraising its debt ratio as at the end of 2017 will drop to 41.10%, a significant improvement compared with 51.66% during the first three quarters of 2016. The company expects to improve its debt-repayment ability and reduce its financial risk.

(3) Explanation should be given to the use of the original loans and achievement of benefit if the fundraising plan is for repayment of debts

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For the current fund utilization plan, the company expects to use NTD10,290,000,000 to repay bank loans. The following sets out details of bank loans to be repaid:

Unit: NT$ 1,000

Lending institution	Interest rate	Contract Period	Original loan purpose	Original loan amount	Proposed repayment amount in 2017Q2	Reduced interest expense
						2017 (Note)	2018
Standard Chartered Bank	0.91%	2016.08.01~2018.08.01	Working capital	3,290,000	3,290,000	22,454	29,939
DBS Bank	0.90%	2016.08.12~2019.08.11	Working capital	4,330,000	2,400,000	16,200	21,600
HSBC Bank	0.93%	2016.10.27~2018.10.26	Working capital	4,600,000	4,600,000	32,085	42,780
Total				12,220,000	10,290,000	70,739	94,319

Note: The company expects that following completion of fundraising in March 2017 it will utilize the funds to repay bank loans in April 2017, thus saving interest expense for April ~ December 2017.

jNecessity and reasonableness of the endorsement or guarantee.

It can be seen from the above Table that the company's current fundraising plan is for proposed repayment of bank loans which have been used for its working capital. Owing to poor performance of the semiconductor assembly and testing industry in 2015 due to weak demand for terminal devices, as well as adjustment by upstream customers in their inventory and intensifying market competition the company's operating income in 2015 showed slight decline compared to that in 2014. Owing to weak seasonal demand during the first half of 2016 and lack of terminal devices for the semiconductor industry, the company’s operating income showed modest decline. With traditional peak season during the second half of 2016 and sustained demand for smart phones, the company’s income rose during the third quarter. To maintain its normal operation and continue expanding its business scale the company had to seek working capital from financial institutions. Therefore it was necessary and reasonable for the company to undertake the original loans.

kBenefit of original loans

The bank loans which the company proposes to repay following the current fundraising plan were necessary to meet its operating needs. Poor performance of the semicondutor assembly and testing industry in 2015 due to weak demand for terminal devices, as well as adjustment by upstream customers in their inventory and intensifying market competition meant that the company's operating income in 2015 suffered a slight decline compared to that in 2014. Owing to weak seasonal demand during the first half of 2016 and lack of terminal devices for the semiconductor industry, the company’s operating income showed modest decline. With traditional peak season during the second half of 2016 and sustained demand for smart phones, the company’s income rose on quarterly basis. To maintain its

192

normal operation and continue expanding its business it was necessary for the company to obtain working capital from financial institutions. Together with the company's prudent use of its funds, the company's net profit after tax during the first three quarters of 2016 has been steadily growing. Thus the company had benefited from such loans.

(4) If as shown in the Statement of Projected Cash Income and Expenses there are major capital expenses and long-term equity investment which together make up 60% of the fund raised, explanation should be given to their necessity, expected source of fund and benefit:

This fundraising program is projected at NTD10,290,000,000. The company's monthly statements of projected cash income and expenses from December 2016 to December 2017 show that there are no plans for long-term investments; future major capital expenses comprise primarily of general machinery equipment and the procurement, repair, and maintenance of relevant factory works which together make up 60% of the funds raised with NTD653.778 million in factory works, NTD6.334534 billion in machinery equipment for a total of NTD6.988312 billion. The fund sources, usages, and anticipated benefits of these expenses are described below.

From December 2016 to December 2017 in the Company’s cash balance forecast, capital outflow primarily comprises the procurement, repair, and maintenance of general machinery, factory operations, environmental equipment, and related ancillary facilities. This includes NTD653.778 million for factory operations and NTD6.334534 billion for machinery, for a total of NTD6.988312 billion. which are conducted in response to the demands of daily operations and optimization of existing production lines. These measures will in turn improve the product quality and production efficiency of the Company and furthermore reduce production costs and reinforce product competitiveness, and are deemed as indispensable. The necessary funds will be provided by the Company internally.

With regard to other anticipated benefits, general factory works primarily support the normal operations of respective plants and take form in factory facilities such as utilities piping and the procurement, replacement, and maintenance of engineering and ancillary equipment, which contribute toward the improvement of efficiency in daily operations but the benefits of which are intangible and therefore unable to exhibit benefits in the form of revenue or profit increase.

Additionally, in view of the Company’s continuous improvements in packaging and testing technical capacities and the ageing and expired durability of production machinery equipment on an annual basis, routine expenses in the form of repairs, replacements and equipment procurement are incurred annually to maintain the production efficiency and output yield of existing equipment. The benefits of these expenses are to sustain Company production capacity, thereby improving the Company’s technical capabilities and maintaining its industry competitiveness. Projected replacement and routine maintenance costs are approximately NTD1.353954 billion, do not contribute as newly increased production capacity, and as a result will not generate additional revenue or profit.

From December 2016 to December 2017 in the Company’s cash balance forecast includes regular maintenance, replacement, and procurement of environmental equipment and related ancillary facilities, for a total of NTD1.242715 billion. This is expected to continue to improve productivity and maintain existing policies towards environmental protection. It will also help reduce costs and improve the Company’s public image. The predicted reductions in

193

costs due to these environmental procurements will add NTD101.855 million annually to the Company’s net income.

In terms of newly added production equipment costing approximately NTD3.737865 billion, future anticipated benefits on an annual basis and basis of estimate are as described below.

jProduction volume and sales volume

The machinery equipment procured by the Company under this program will be installed and launched for operations on a progressive and ongoing basis and is scheduled to go into mass production in 2017 Q1. Production volume and sales volume are compositely projected by the Company according to past production process experiences, utilization rate, point in time machinery equipment go into mass production, and anticipated major client orders in the coming year in conjunction with future market demand forecasts provided by professional market research institutions. It is estimated that the Company will experience an increase of 192000000 units each in production and sales volumes from 2017 – 2020. In view of the above, the Company’s estimates in production and sales volumes are conducted by referencing the normal production capacities of similar type production equipment currently in use, mass production experiences, level of supplier cooperation and other relevant factors in conjunction with projected schedules for the procurement, installation, trial testing, inspection and acceptance of new machinery and their launch into mass production as well as factors such as future market supply and demand.

kOperation revenue

The estimated sales value of machinery equipment procured by the Company under this program are projected according to past production experiences, point in time in which equipment is scheduled to go into production, production utilization rate in conjunction with future market demand for the estimation of production and sales volumes. Unit price is estimated according to the average unit price of similar products currently manufactured by the Company in consideration of future product price fluctuations. It is estimated that from 2017 to 2020 the Company will experience an increase of NTD11.366078 billion in operating revenue.

ƒGross operating income and net operating income

In terms of gross operating income estimates, the Company adopts the average income ratio contributed by procured machinery equipment as the basis of calculation in conjunction with the impact of market price fluctuations. Based on these premises it is estimated that from 2017 to 2020 the Company will experience an increase of NTD3.973955 billion in gross operating income, which is deemed a reasonable projection. In terms of operating profit, the Company adopts the operating cost ratio of packaging and testing products of approximately 12% over the past year as the basis of calculation. Based on this premise from 2017 to 2020 the Company will experience an increase of NTD2.610026 billion in net operating income.

mFund recovery period

In the Company’s statements of projected cash income and expenses, with regard to the portion of newly added equipment in major capital expenses from December 2016 to December 2017, the projects amount is approximately

194

NTD3.737865 billion. If depreciation costs are added in accordance with operating profit, the estimated fund recovery period is 4 years.

4. With respect to purchase of land for construction, payment of construction cost or contractors' charges, details of such undertaking from the time of purchase to the completion of sale of construction project or contractors' work in terms of the total amount, source of funds covering any shortfall and funding of the respective stages and construction progress, with the time and amount involved for booking profit or loss and explanation on anticipated benefit: Not applicable.

5. In the case of purchase of incomplete works and assumption of contracts unfulfilled by the seller, details on the reasons for assignment by the seller, basis for determination of assignment price and impact of assignment on the contractual parties' rights and duties: Not applicable.

3. Assignment of new shares issued by other companies: Not applicable.

Matters that should be reported for the current issuance of new shares in connection with acquisition or merger: Not applicable.

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IV. Financial Summary

A. Financial information for the most recent 5 fiscal years (note)

(1) Condensed balance sheet and consolidated profit and loss statement

1. Condensed balance sheet - International Financial Reporting Standards (consolidated financial report)

Unit: NT$ 1,000

Year Item		Financial information for the most recent 5 fiscal years (note)					Financial information for current year until September 30, 2016
		2011	2012	2013	2014	2015 (after adjustment)
Current assets		N/A	97,495,577	132,176,482	159,955,190	156,732,840	143,369,196
Financial assets available for use - non-current			1,096,709	1,140,329	941,105	924,362	1,103,939
Investment accounted for using equity method			1,177,871	1,216,201	1,492,441	37,141,552	49,515,448
Property, plant and equipment			127,197,774	131,497,331	151,587,115	149,997,075	145,208,855
Intangible assets			12,361,269	11,953,644	11,913,286	11,888,612	12,217,117
Other assets			8,380,569	8,829,919	8,095,630	8,321,759	9,213,165
Total assets			247,709,769	286,813,906	333,984,767	365,006,200	360,627,720
Current liabilities	Pre-distribution		84,668,133	100,835,276	111,199,467	120,502,072	118,397,190
	Post-distribution		92,656,107	110,991,281	126,789,292	132,978,851	N/A
Non-current liabilities			52,089,877	58,813,671	64,347,296	76,365,603	81,013,087
Total liabilities	Pre-distribution		136,758,010	159,648,947	175,546,763	196,867,675	199,410,277
	Post-distribution		144,745,984	169,804,952	191,136,588	209,344,454	N/A
Equity attributable to the parent company's owner			107,430,340	123,020,621	150,218,907	156,634,647	150,158,984
Share capital			76,047,667	78,180,258	78,715,179	79,185,660	79,509,050
Capital reserve			5,262,129	7,908,870	16,013,058	23,757,099	22,461,952
Retained earnings	Pre-distribution		30,938,400	38,993,154	52,381,238	55,902,712	57,135,885
	Post-distribution		22,950,426	28,837,149	36,791,413	43,425,933	N/A
Other interests			(2,858,749)	(102,554)	5,068,539	5,081,689	(1,655,390)
Treasury stock			(1,959,107)	(1,959,107)	(1,959,107)	(7,292,513)	(7,292,513)
Non-controlling interests			3,521,419	4,144,338	8,219,097	11,503,878	11,058,459
Total equity	Pre-distribution		110,951,759	127,164,959	158,438,004	168,138,525	161,217,443
	Post-distribution		102,963,785	117,008,954	142,848,179	155,661,746	N/A

Source: Financial report inspected and certified by a CPA.

Note: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local financial standards should be separately provided.

196

2. Condensed balance sheet - International Financial Reporting Standards (individual financial report)

Unit: NT$ 1,000

Year Item		Financial information for the most recent 5 fiscal years (note)
		2011	2012	2013	2014	2015
Current assets		N/A	17,849,645	37,009,050	41,483,018	32,132,019
Financial assets available for use (Note 2) - non-current			521,999	592,557	542,147	473,107
Investment accounted for (Note 2) using equity method			109,255,920	117,942,583	139,053,527	189,994,170
Property, plant and equipment			58,271,665	63,122,172	77,640,995	80,375,695
Intangible assets			1,338,972	1,352,379	1,444,812	1,614,309
Other assets			1,629,169	1,327,293	1,562,646	1,353,638
Total assets (Note 2)			188,867,370	221,346,034	261,727,145	305,942,938
Current liabilities	Pre-distribution		42,827,937	49,159,136	68,567,745	91,305,117
	Post-distribution		50,815,911	59,315,141	84,157,570	103,781,896
Non-current liabilities			38,609,093	49,242,041	42,940,493	57,721,817
Total liabilities	Pre-distribution		81,437,030	98,401,177	111,508,238	149,026,934
	Post-distribution		89,425,004	108,557,182	127,098,063	161,503,713
Equity attributable to the company's owner			─	─	─	─
Share capital			76,047,667	78,180,258	78,715,179	79,185,660
Capital reserve			5,262,129	7,920,220	16,013,058	23,757,099
Retained earnings (Note 2)	Pre-distribution		30,938,400	38,906,102	52,381,238	56,184,069
	Post-distribution		22,950,426	28,750,097	36,791,413	43,707,290
Other interests			(2,858,749)	(102,616)	5,068,539	5,081,689
Treasury stock			(1,959,107)	(1,959,107)	(1,959,107)	(7,292,513)
Non-controlling interests			─	─	─	─
Total equity (Note 2)	Pre-distribution		107,430,340	122,944,857	150,218,907	156,916,004
	Post-distribution		99,442,366	102,788,852	134,629,082	144,439,225

Source: Financial report inspected and certified by a CPA.

Note 1: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local financial standards should be separately provided.

Note 2: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. After adjustments the company's investment accounted for using equity method is NTD189,712,813,000, total assets NTD305,661,581,000, retained earnings before distribution NTD55,902,712,000, retained earnings after distribution NTD43,425,933,000, total equity before distribution NTD156,634,647,000 and total equity after distribution NTD144,157,868,000.

197

3. Condensed balance sheet - Local Accounting Standards (consolidated)

Unit: NT$ 1,000

Year Item		Financial information for the most recent 5 fiscal years (note)
		2011	2012	2013	2014	2015
Current assets		90,131,690	98,042,323	N/A
Fund and investment		2,220,728	2,365,931
Fixed assets		111,779,036	126,150,296
Intangible assets		15,772,415	15,801,845
Other assets		3,974,226	4,143,720
Total assets		223,878,095	246,504,115
Current liabilities	Pre-distribution	66,761,885	84,703,409
	Post-distribution	71,087,169	92,691,383
Long-term liabilities		50,425,156	44,591,685
Other liabilities		4,408,560	4,749,953
Total liabilities	Pre-distribution	121,595,601	134,045,047
	Post-distribution	125,920,885	142,033,021
Share capital		67,571,325	76,047,667
Capital reserve		7,397,481	8,767,134
Retained earnings	Pre-distribution	27,809,126	26,969,183
	Post-distribution	23,483,842	18,981,209
Unrealized profit and loss for financial products		235,088	401,938
Cumulative conversion adjustments		3,353,938	119,987
Unrecognized pension fund Net loss for cost		(465,681)	(831,917)
Shareholder equity Total	Pre-distribution	101,169,536	109,514,885
	Post-distribution	96,844,252	101,526,911

Source: Financial report inspected and certified by a CPA.

Note: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

198

4. Condensed balance sheet - Local Accounting Standards (individual financial report)

Unit: NT$ 1,000

Year Item		Financial information for the most recent 5 fiscal years (note)
		2011	2012	2013	2014	2015
Current assets		17,147,117	18,147,566	N/A
Fund and investment		106,619,178	110,891,285
Fixed assets		44,897,565	57,233,865
Intangible assets		1,023,803	1,222,757
Other assets		1,390,944	1,505,088
Total assets		171,078,607	189,000,561
Current liabilities	Pre-distribution	31,159,171	42,712,691
	Post-distribution	35,484,455	50,700,665
Long-term liabilities		37,453,501	34,625,670
Other liabilities		1,296,399	2,147,315
Total liabilities	Pre-distribution	69,909,071	79,485,676
	Post-distribution	74,234,355	87,473,650
Share capital		67,571,325	76,047,667
Capital reserve		7,397,481	8,767,134
Retained earnings	Pre-distribution	27,809,126	26,969,183
	Post-distribution	14,167,847	18,981,209
Unrealized profit and loss for financial products		235,088	401,938
Cumulative conversion adjustments		3,353,938	119,987
Unrecognized pension fund Net loss for cost		(465,681)	(831,917)
Shareholder equity Total	Pre-distribution	109,514,885	101,169,536
	Post-distribution	101,526,911	96,844,252

Source: Financial report inspected and certified by a CPA.

Note: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

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5. Condensed profit and loss statement - International Financial Reporting Standards (consolidated)

Unit: Except for earnings per share which are denominated in NTD, all other figures are expressed in NTD'000. 

Year Item	Financial information for the most recent 5 fiscal years (note)					Financial information for current year until September 30, 2016
	2011	2012	2013	2014	2015
Operating revenue	N/A	193,972,392	219,862,446	256,591,447	283,302,536	197,755,474
Gross profit		36,619,812	42,813,744	53,588,529	50,135,228	37,817,099
Operating profits		17,687,085	22,044,323	29,645,869	24,884,622	18,575,572
Non-operating revenue and gains (Note 2)		(1,102,770)	(2,687,631)	(1,097,658)	403,631	(203,571)
Net profit before tax (Note 2)		16,584,315	19,356,692	28,548,211	25,288,253	18,372,001
Continuing operations Current period net profit (Note 2)		13,523,583	16,155,040	24,281,585	20,449,007	14,555,214
Loss on units which cease operations		─	─	─	─	─
Current period net profit (Note 2)		13,523,583	16,155,040	24,281,585	20,449,007	14,555,214
Other consolidated profit and loss during current period (Net after tax)		(3,823,690)	3,238,026	5,503,510	(147,547)	(7,331,544)
Total consolidated profit and loss during current period (Note 2)		9,699,893	19,393,066	29,785,095	20,301,460	7,223,670
Net profit attributable to Owner of the Company (Note 2)		13,066,075	15,689,074	23,636,522	19,478,873	13,715,836
Net profit attributable to Non-controlling interests		457,508	465,966	645,063	970,134	839,378
Total consolidated profit and loss attributable to Owner of the Company		9,301,863	18,798,923	28,802,296	19,405,806	6,978,757
Total consolidated profit and loss attributable to Non-controlling interests		398,030	594,143	982,799	895,654	244,913
Earnings per share (retroactive adjustment) (Note 2)		1.75	2.09	3.07	2.55	1.79

Source: Financial report inspected and certified by a CPA.

Note 1: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local financial standards should be separately provided.

Note 2: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. Following adjustments non-operating income and expenses are NTD122,274,000, net profit before tax NTD25,006,896,000, net profit during current period for continuing operations NTD20,167,650,000, net profit during current period NTD20,167,650,000, total consolidated profit and loss during current period NTD20,020,103,000, net profit attributable to owner of the Company NTD19,197,516,000, total consolidated profit and loss attributable to the Company NTD19,124,449,000 and earning per share (with retroactive adjustment) are NTD2.51.6. Condensed consolidated profit and loss statement - International Financial Reporting Standards(individual financial report)

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Unit: Except for earnings per share which are denominated in NTD, all other figures are expressed in NTD'000. 

Year Item	Financial information for the most recent 5 fiscal years (note)
	2011	2012	2013	2014	2015
Operating revenue	N/A	72,926,652	82,329,117	96,678,100	94,206,807
Gross profit		18,324,545	22,264,748	29,376,669	25,147,806
Operating profits		10,653,147	12,936,797	18,278,988	13,892,786
Non-operating revenue and gains (Note 2)		3,906,755	4,458,346	7,882,138	8,540,566
Net profit before tax (Note 2)		14,559,902	17,395,143	26,161,126	22,433,352
Continuing operations Current period net profit (Note 2)		13,066,075	15,689,074	23,636,522	19,478,873
Loss on units which cease operations		─	─	─	─
Current period net profit (Note 2)		13,066,075	15,689,074	23,636,522	19,478,873
Other consolidated profit and loss during current period (Net after tax)		(3,764,212)	3,109,849	5,165,774	(73,067)
Total consolidated profit and loss during current period (Note 2)		9,301,863	18,798,923	28,802,296	19,405,806
Net profit attributable to Owner of the Company		─	─	─	─
Net profit attributable to Non-controlling interests		─	─	─	─
Total consolidated profit and loss attributable to Owner of the Company		─	─	─	─
Total consolidated profit and loss attributable to Non-controlling interests		─	─	─	─
Earnings per share (retroactive adjustment) (Note 2)		1.75	2.09	3.07	2.554

Source: Financial report inspected and certified by a CPA.

Note 1: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local financial standards should be separately provided.

Note 2: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. Following adjustments non-operating income and expenses are NTD8,259,209,000, net profit before tax NTD22,151,995,000, net profit during current period for continuing operations NTD19,197,516,000, net profit during current period NTD19,197,516,000, total consolidated profit and loss during current period NTD19,124,449,000, and earning per share (with retroactive adjustment) are NTD2.51.

201

7. Condensed profit and loss statement - Local Accounting Standards (consolidated)

Unit: Except for earnings per share which are denominated in NTD, all other figures are expressed in NTD'000.

Year Item	Financial information for the most recent 5 fiscal years (note)
	2011	2012	2013	2014	2015
Operating revenue	185,347,206	193,972,392	N/A
Gross profit	35,008,803	36,623,770
Operating profits	16,821,251	17,761,382
Non-operating revenue and profit	3,058,708	2,435,229
Non-operating expenses and losses	2,882,798	3,606,075
Profit and loss before tax for units as continuing operations	16,997,161	16,590,536
Profit and loss for units as continuing operations	13,978,949	13,548,908
Profit and loss for units which cease operations	─	─
Non-operating profit and loss	─	─
Cumulative effect of changes in Accounting principles	─	─
Current period net profit	13,978,949	13,548,908
Earnings per share (retroactive adjustment) (NTD)	1.83	1.76

Source: Financial report inspected and certified by a CPA.

Note: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

6. Condensed profit and loss statement - Local Accounting Standards(individual financial report)

Unit: Except for earnings per share which are denominated in NTD, all other figures are expressed in NTD'000. 

Year Item	Financial information for the most recent 5 fiscal years (note)
	2011	2012	2013	2014	2015
Operating revenue	69,439,165	72,926,652	N/A
Gross profit	17,720,164	18,365,510
Operating profits	10,859,132	10,732,774
Non-operating revenue and profit	6,298,044	5,659,159
Non-operating expenses and losses	2,104,588	1,806,747
Profit and loss before tax for units as continuing operations	15,052,588	14,585,186
Profit and loss for units as continuing operations	13,725,958	13,091,359
Profit and loss for units which cease operations	─	─
Non-operating profit and loss	─	─
Cumulative effect of changes in Accounting principles	─	─
Current period net profit	13,725,958	13,091,359
Earnings per share (retroactive adjustment)	1.83	1.76

Source: Financial report inspected and certified by a CPA.

Note: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

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(2)Changes which affect the above condensed financial statements' consistency such as accounting changes, merger of companies or cessation of business units and their impact on the current year's financial reports: None.

(3) Names of auditors and audit opinions of the most recent 5 fiscal years

1. List the name of certified public accountants who have audited the company's accounts during the past 5 years and their audit opinion. Except for unqualified opinions, set out in details the contents of their opinions

Year	Audit firm name:	Accountant name:	Audit opinion
2011	KPMG Taiwan	Gong Jun-Ji, Qiu Hui-Yin	Unqualified opinion
2012	KPMG Taiwan	Chen Zhen-Li, Gong Jun-Ji	Unqualified opinion
2013	KPMG Taiwan	Chen Zhen-Li, Gong Jun-Ji	Unqualified opinion
2014	KPMG Taiwan	Chen Zhen-Li, Jiang Jia-Ling	Unqualified opinion
2015	KPMG Taiwan	Chen Zhen-Li, Jiang Jia-Ling	Revised unqualified opinion

2. If there is any replacement of auditor in the last 5 fiscal years, the reasons for the replacement of company, the former and successor auditors should be explained: Change of auditors due to internal re-organization of the auditor firm.

(4) Financial analysis

1. Financial Anlaysis - International Financial Reporting Standards (consolidated financial report)

Year/Anlaysis Item		Financial analysis of the most recent 5 years					Financial information as at September 30, 2016
		2011	2012	2013	2014	2015
Financial structure (%)	Debt-asset ratio (Note 3)	N/A	55.21	55.66	52.56	53.89	55.30
	Long-term fund/property, plants and equipment (Note 3)		128.18	141.43	146.97	163.19	166.82
Debt-Repayment  Ability	Current ratio %		115.15	131.08	143.85	130.07	121.09
	Quick ratio %		73.86	93.47	101.06	87.09	78.39
	Interest coverage ratio (Note 3)		9.27	9.58	13.28	12.15	11.76
Operating  Ability	Receivables turnover ratio (times)		5.70	5.45	5.34	5.79	5.44
	Average days of collection		64	67	68	63	67
	Inventory turnover ratio (times)		5.06	5.29	5.14	5.01	4.41
	Payables turnover ratio (times)		6.93	6.65	6.30	6.71	5.92
	Average days of sales		72	69	71	73	83
	Property, plant and equipment		1.62	1.70	1.81	1.88	1.79
	Total assets turnover ratio (times)		0.82	0.82	0.83	0.81	0.73
Profit  Ability	Return on assets (%)(Note 3)		6.42	6.75	8.44	6.39	5.87
	Return on shareholder's equity (%)(Note 3)		12.76	13.57	17.01	12.51	11.78

203

	Net profit before tax/Paid-up capital (%)(Note 3)	21.81	24.76	36.27	31.94	30.81
	Net profit margin (%)(Note 3)	6.97	7.35	9.46	7.22	7.36
	Earnings per share (NTD) (Note 3)	1.75	2.09	3.07	2.55	1.79
Cash Flow	Cash flow ratio (%)	39.02	40.95	41.25	47.76	41.34
	Cash flow adequacy ratio (%)	85.05	84.88	84.73	90.08	102.76
	Cash reinvestment ratio (%)	9.27	9.56	8.80	9.39	10.70
Leverage	Operating leverage	2.38	2.21	1.94	2.24	2.24
	Financial leverage	1.13	1.11	1.09	1.10	1.10
Please explain reasons for changes in financial ratios in the last two years: (If the increase, decrease or change is less than 20%, the analysis can be exempted.)  Decrease in return on assets, rate of return and net profit margin of the company and its subsidiaries: Gross operating margin and net operating profit in 2015 were affected by adjustments in product portfolio. As a result net profit after tax for 2015 declined resulting in the reduction of relevant financial ratios.

Source: Financial report inspected and certified by a CPA.

Note 1: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local financial standards should be separately provided.

Note 2: See Note 3 of Table below for formula for financial analysis.

Note 3: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. Folowing adjustments the financial analysis is as follows: Debt-asset ratio 53.94%, long-term fund to property, plant and equipment 163.01%, interest cover ratio 12.02, return on assets 6.31%, return on shareholders equity 12.35%, net profit before tax as a percentage of paid-up capital 31.58%, net profit margin 7.12% and earning per share (with retroactive adjustment) NTD2.51.

2. Financial anlaysis - International Financial Reporting Standards (individual financial report)

Year/Anlaysis Item		Financial analysis of the most recent 5 years
		2011	2012	2013	2014	2015
Financial structure (%)	Debt-asset ratio (Note 2)		43.12	44.44	42.60	48.71
	Long-term fund to fixed assets ratio (Note 2)		243.78	264.50	241.94	259.13
Debt-Repayment Ability	Current ratio %		41.68	75.28	60.50	35.19
	Quick ratio %		32.89	67.45	53.66	30.70
	Interest coverage ratio (Note2)		21.29	22.64	27.36	20.73
Operating Ability	Receivables turnover ratio (times)		7.05	6.48	5.37	4.98
	Average days of collection		52	56	68	73
	Inventory turnover ratio (times)		15.99	16.73	16.90	17.07
	Payables turnover ratio (times)		7.43	8.06	8.68	8.69
	Average days of sales		23	22	22	21
	Fixed assets turnover ratio (times)		1.25	1.30	1.25	1.17
	Total assets turnover ratio (times)		0.39	0.37	0.37	0.31
Profit Ability	Return on assets (%)(Note 2)		7.60	7.97	10.13	7.20

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	Return on shareholder's equity (%)(Note 2)	12.63	13.62	17.31	12.68
	Net profit before tax/Paid-up capital (%)(Note 2)	19.15	22.25	33.24	28.33
	Net profit margin (%)(Note 2)	17.92	19.06	24.45	20.68
	Earnings per share (NTD) (Note 2)	1.75	2.09	3.07	2.55
Cash  Flow	Cash flow ratio (%)	49.20	40.73	36.53	32.26
	Cash flow adequacy ratio (%)	108.02	100.88	89.77	89.33
	Cash reinvestment ratio (%)	8.20	5.06	5.54	5.80
Leverage	Operating leverage	1.85	1.86	1.73	2.11
	Financial leverage	1.07	1.07	1.06	1.09
Please explain reasons for changes in financial ratios in the last two years: (If the increase, decrease or change is less than 20%, the analysis can be exempted.)  1. Decrease in current ratio: Customer inventory closeout and the concurrence of major customer payment dates at the end of 2015 has caused accounts receivable to be lower than those at the end of 2014, thereby reducing current asset. Increase in current liabilitie is because of increase at the end of 2014 in others payable (related party) and corporate debt due within one year. Together with decrease in current asset, the increase in current liabilities has caused decrease in current ratio.  2. Decrease in quick ratio: Customer inventory closeout and the concurrence of major customer payment dates at the end of 2015 has caused accounts receivable to be lower than those at the end of 2014, thereby reducing quick asset. Increase in current liabilitie is because of increase at the end of 2014 in others payable (related party) and corporate debt due within one year. Together with decrease in current asset, the increase in current liabilities has caused decrease in quick ratio.  3. Decrease in interest coverage ratio: This is mainly because profit is affected by product portfolio adjustments in 2015.  4. Decrease in return on assets: This is because net profit after tax is affected by product portfolio adjustments in 2015.  5. Decrease in return on shareholder's equity This is because net profit after tax is affected by product portfolio adjustments in 2015.  6. Increase in operating leverage: This is because of higher operating income in 2015 than in 2014.

Source: Financial report inspected and certified by a CPA.

Note 1: Where the financial information prepared according to International Financial Reporting Standards is less than 5 years, financial statements prepared according to local accounting standards should be separately provided.

Note 2: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. Folowing adjustments the financial analysis is as follows: Debt-asset ratio 48.76%, long-term fund to property, plant and equipment 258.78%, interest cover ratio 20.49, return on assets 7.1%, return on shareholders equity 12.51%, net profit before tax as a percentage of paid-up capital 27.97%, net profit margin 20.38% and earning per share (with retroactive adjustment) NTD2.51.

Note 3: Calculation formula for financial analysis:

1. Financial structure

(1) Asset-debt ratio = Total assets/Total liabilities

(2) Long-term fund to property, plant and equipment = (Total equity + non-current liabilities)/Net property, plants and equipment

2. Solvency

(1) Current ratio = current assets / current liabilities.

(2) Quick ratio = (current assets – inventory – prepaid expense) / current liabilities.

(3) Times interest earned = net income before income tax and interest expense / current interest expense.

3. Operating ability

205

(1) Receivable (including accounts receivable and business-related notes receivable) turnover ratio = net operating revenue / average balance of receivable of the period (including accounts receivable and business-related notes receivable).

(2) Average days of collection = 365 / receivables turnover ratio.

(3) Inventory turnover ratio = cost of goods sold / average amount of inventory.

(4) Payable (including accounts payable and business-related notes payable) turnover ratio = cost of goods sold / average balance of payable of the period (including accounts payable and business-related notes payable).

(5) Average days of sales = 365 / inventory turnover ratio.

(6) Property, plants and equipment turnover ratio = Net sales/Net average property, plants and equipment

(7) Total assets turnover ratio = net sales / total assets.

4. Profitability

(1) Return on assets ＝ [net income + interest expense (1– tax rate)] / average total assets.

(2) Return on shareholder’s equity＝ net profit and loss / net average shareholders’ equity.

(3) Net profit margin = net income / net sales.

(4) Earnings per share ＝ (Profit and loss attributable to owner of parent company - dividend to special stock) / weighted average of shares issued.

5. Cash flows

(1) Cash flow ratio = new cash flows from operating activities / current liabilities.

(2) Cash flow adequacy ratio = net cash flows from operating activities in the past five years / (capital expenditure + increase in inventory + cash dividend) in the past five years.

(3) Cash reinvestment ratio = (Net cash flows from operating activities – cash dividend) / (gross property, plants and equipment + long-term investment + other non-current assets + working capital).

6. Leverage

(1) Operating leverage = (Net operating income – variable operating cost and expenses) / operating income

(2) Financial leverage = operating income / (operating income – interest expense).

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3. Financial analysis - Local accounting standards (consolidated)

Year Item of analysis (Note2)			Financial analysis of the most recent 5 years
			2011	2012	2013 (Note 1)	2014 (Note 1)	2015  (Note 1)
Financial Structure	Debt-to-assets ratio (%)		54.31	54.38	N/A
	Long-term fund to fixed assets ratio (%)		136.62	124.49
Debt-Repayment Ability	Current ratio (%)		135.00	115.75
	Quick ratio (%)		84.53	73.46
	Interest coverage ratio		11.20	9.28
Operating Ability	Receivables turnover ratio (times)		5.81	5.73
	Average days of collection		63	64
	Inventory turnover ratio (times)		5.63	5.06
	Payables turnover ratio (times)		6.60	6.93
	Average days of sales		65	72
	Fixed assets turnover ratio (times)		1.66	1.54
	Total assets turnover ratio (times)		0.83	0.79
Profit Ability	Return on assets (%)		7.11	6.47
	Return on shareholder's equity (%)		14.40	12.62
	Percentage of paid-in capital (%)	Operating profits	24.89	23.36
		Net profit before tax	25.15	21.82
	Net profit margin		7.54	6.98
	Earnings per share (NTD)	Basic	1.83	1.76
		Diluted	1.78	1.71
Cash Flow (Note 3)	Cash flow ratio (%)		47.84	34.26
	Cash flow adequacy ratio (%)		93.95	82.60
	Cash reinvestment ratio (%)		10.07	8.53
Leverage	Operating leverage		2.42	2.37
	Financial leverage		1.11	1.13
Reasons for changes in the respective financial ratios during the past 2 years (If the increase, decrease is less than 20%, the analysis can be exempted.) Not applicable.

Source: Financial report inspected and certified by a CPA.

Note 1: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

Note 2: See Note 2 of Table below for formula for financial analysis.

207

4. Financial analysis - Local accounting standards (individual)

Year Item of analysis (Note2)			Financial analysis of the most recent 5 years
			2011	2012	2013 (Note 1)	2014 (Note 1)	2015  (Note 1)
Financial Structure	Debt-to-assets ratio (%)		40.86	42.06	N/A
	Long-term fund to fixed assets ratio (%)		308.75	251.84
Debt-Repayment Ability	Current ratio (%)		55.03	42.49
	Quick ratio (%)		41.72	32.72
	Interest coverage ratio		17.85	21.33
Operating Ability	Receivables turnover ratio (times)		7.13	7.10
	Average days of collection		51	51
	Inventory turnover ratio (times)		16.68	15.98
	Payables turnover ratio (times)		7.17	7.42
	Average days of sales		22	23
	Fixed assets turnover ratio (times)		1.55	1.27
	Total assets turnover ratio (times)		0.41	0.39
Profit Ability	Return on assets (%)		8.70	7.60
	Return on shareholder's equity (%)		14.47	12.43
	Percentage of paid-in capital (%)	Operating profits	16.07	14.11
		Net profit before tax	22.28	19.18
	Net profit margin		19.77	17.95
	Earnings per share (NTD)	Basic	1.83	1.76
		Diluted	1.78	1.71
Cash Flow (Note 2)	Cash flow ratio (%)		75.82	49.27
	Cash flow adequacy ratio (%)		134.49	121.40
	Cash reinvestment ratio (%)		10.17	8.24
Leverage	Operating leverage		3.10	3.34
	Financial leverage		1.09	1.07
Reasons for changes in the respective financial ratios during the past 2 years (If the increase, decrease is less than 20%, the analysis can be exempted.) Not applicable.

Source: Financial report inspected and certified by a CPA.

Note 1: For fiscal years 2013-2016 the company's financial reports are compiled in accordance with International Financial Reporting Standards (IFRS), therefore there are no financial reports that have been compiled in accordance with local accounting standards.

Note 2: Calculation formula for financial analysis:

1. Financial structure

(1) Debt-to-asset ratio = total liabilities / total assets.

(2) Long-term fund to fixed assets ratio＝(net shareholders’ equity + long-term debt) / net fixed assets.

2. Solvency

(1) Current ratio = current assets / current liabilities.

(2) Quick ratio = (current assets – inventory – prepaid expense) / current liabilities.

(3) Times interest earned = net income before income tax and interest expense / current interest expense.

3. Operating ability

(1) Receivable (including accounts receivable and business-related notes receivable) turnover ratio = net operating revenue / average balance of receivable of the period (including accounts receivable and business-related notes receivable).

208

(2) Average days of collection = 365 / receivables turnover ratio.

(3) Inventory turnover ratio = cost of goods sold / average amount of inventory.

(4) Accounts payable (including accounts payable and business-related notes payable) turnover ratio = Cost of goods sold / average balance of payable during the period (including accounts payable and business-related notes payable).

(5) Average days of sales = 365 / inventory turnover ratio.

(6) Fixed assets turnover ratio＝net sales / net fixed assets.

(7) Total assets turnover ratio = net sales / total assets.

4. Profitability

(1) Return on assets ＝ [net income + interest expense (1– tax rate)] / average total assets.

(2) Return on shareholder’s equity＝ net income / net average shareholders’ equity.

(3) Net profit margin = net income / net sales.

(4) Earnings per share ＝ (net income - dividend to preferred stock) / weighted average of shares issued.

5. Cash flows

(1) Cash flow ratio = new cash flows from operating activities / current liabilities.

(2) Cash flow adequacy ratio = net cash flows from operating activities in the past five years / (capital expenditure + increase in inventory + cash dividend) in the past five years.

(3) Cash reinvestment ratio = (net cash flows from operating activities – cash dividend) / (gross fixed assets + long-term investment + other assets + working capital).

6. Leverage

(1) Operating leverage = (net operating income – variable operating cost and expenses) / operating income

(2) Financial leverage = operating income / (operating income – interest expense).

209

(6) Description of material changes in accounts Compare the accounts of the balance sheet and income statement of the most recent two fiscal years. If the change in the amount is 10% or more and the amount is 1% of the total assets of the current fiscal year, the reasons for the change should be analyzed in details.

1. International Financial Reporting Standards (consolidated financial report)

Unit: (NT$1,000) %

Year Accounting Item	2014		2015		Changes:		Explanation
	Amount	%  (Note 1)	Amount	% (Note 1)	Amount	% (Note 2)
Net accounts receivable	52,920,810	15.85%	44,931,487	12.30%	(7,989,323)	(15.10%)	Net accounts receivable for year-end 2015 was lower than that in 2014 due to customers liquidating excess inventory coincidentally encountering the payment dates of key customers
Investment accounted for using equity method	1,492,441	0.45%	37,141,552	10.17%	35,649,111	2,388.64%	This is because of the company's additional adoption of equity method for its  investment in 24.99% of the equity of Siliconware Precision Industries
Short-term borrowing	41,176,033	12.33%	32,635,321	8.93%	(8,540,712)	(20.74%)	This is caused by repayment of short-term bank loans in 2015
Short-term bills payable	-	-	4,348,054	1.19%	4,348,054	100.00%	Addition of commercial bills payable for the company's operating needs in 2015
Corporate debts due within one year	-	-	14,685,866	4.02%	14,685,866	100.00%	This is because imminent expiration of the company's 2015 Third foreign unsecured convertible corporate bonds' redemption right, as a result of which the compny transfered them from corporate debts payable to payable within one year
Corporate debt payable	31,270,131	9.36%	23,740,384	6.50%	(7,529,747)	(24.08%)	This is because of the company's issuance of 2015 Fourth foreign unsecured convertible corporate bonds and  imminent expiration of the company's 2015 Third foreign unsecured convertible corporate bonds' redemption right, as a result of which the compny transfered them from corporate debts payable to payable within one year
Long-term borrowing	24,104,424	7.22%	42,493,668	11.64%	18,389,244	76.29%	Additional long-term loans to meet the company's operating needs
Capital reserve	16,013,059	4.79%	23,757,099	6.50%	7,744,040	48.36%	In 2015 the company disposed of part of its shareholding in Universal Scientific Industrial (Shanghai). Profit from the equity transaction is recognized under Capital Reserve
Treasury stock	(1,959,107)	(0.59%)	(7,292,513)	(2.00%)	(5,333,406)	272.24%	In 2015 the company bought back treasury stocks for conversion under its Fourth foreign unsecured corporate bonds
Operating revenue	256,591,447	100.00%	283,302,536	100.00%	26,711,089	10.41%	In 2015 the company continued to expand its production capacity. As a result operating income and cost were both higher than those in 2014
Operating cost	203,002,918	79.12%	233,167,308	82.30%	30,164,390	14.86%
Net operating profit	29,645,869	11.55%	24,884,622	8.78%	(4,761,247)	(16.06%)	The company's adjustments to its product portfolio affect its gross operating margin, thus reducing its net operating profit for 2015
Other profit	776,290	0.30%	1,437,036	0.51%	660,746	85.12%	Due to increase in the profit of financial tools whose profit and loss are measured using fair market value, and decrease in loss from currency conversion in 2015
Recognition of portion of profit and loss of related enterprises using equity method (Note 3)	(108,726)	(0.04%)	402,730	0.14%	511,456	(470.41%)	Recognition of investment return for reinvestment company in 2015 based on shareholding ratio
Conversion difference in the financial statements of overseas operating units	5,405,027	2.11%	(63,509)	(0.02%)	(5,468,536)	(101.17%)	Decline in the appreciation of USD caused reduction in conversion difference in the financial statement of overseas operating units
Other comprehensive income (net income after tax)	5,503,510	2.14%	(147,547)	(0.05%)	(5,651,057)	(102.68%)	Due to changes in the conversion difference in the financial statement of overseas operating units

210

Note 1: % refers to the same type of ratio of that item in the relevant statements.

Note 2: % refers to the calculated change of rate, assuming the previous year was 100%.

Note 3: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the net fair value of identifiable assets and liabilities of Siliconware Precision Industries Co., Ltd. following which it has made retrospective adjustments to its 2015 financial statement. The portion after adjustment of profit and loss of related enterprises recognized using equity method is NTD121,373,000.

211

2. International Financial Reporting Standards (individual financial report)

Unit: NT$ 1,000

Year Accounting Item	2014		2015		Changes:		Explanation
	Amount	% (Note 1)	Amount	% (Note 1)	Amount	% (Note 2)
Investment accounted for using equity method	139,053,527	53.13%	189,994,170	62.10%	50,940,643	36.63%	This is because of the company's additional adoption of equity method for its  investment in 24.99% of the equity of Siliconware Precision Industries
Short-term bills payable	0	0.00%	4,348,054	1.42%	4,348,054	100%	Addition of commercial bills payable for the company's operating needs
Others payable - Related parties	30,653,624	11.71%	40,191,954	13.14%	9,538,330	31.12%	Increase in loan of funds to related enterprises as a result of fund deployment within the Group
Corporate debts due within one year	0	0.00%	12,162,192	3.98%	12,162,192	100%	This is because imminent expiration of the company's 2015 Third foreign unsecured convertible corporate bonds' redemption right, as a result of which the compny transfered them from corporate debts payable to payable within one year
Corporate debt payable	19,270,613	7.36%	13,938,894	4.56%	(5,331,719)	(27.67%)	This is because of the company's issuance of 2015 Fourth foreign unsecured convertible corporate bonds and  imminent expiration of the company's 2015 Third foreign unsecured convertible corporate bonds' redemption right, as a result of which the compny transfered them from corporate debts payable to payable within one year
Long-term borrowing	18,355,554	7.01%	37,424,607	12.23%	19,069,053	103.89%	Additional long-term loans taken in response to the company's operating needs
Capital reserve	16,013,058	6.12%	23,757,099	7.77%	7,744,041	48.36%	In 2015 the company disposed of part of its shareholding in Universal Scientific Industrial (Shanghai). Profit from the equity transaction is recognized under Capital Reserve
Treasury stock	(1,959,107)	(0.75%)	(7,292,513)	(2.38%)	(5,333,406)	272.24%	In 2015 the company bought back treasury stocks for conversion under its Fourth foreign unsecured corporate bonds
Gross profit	29,376,669	30.39%	25,147,806	26.69%	(4,228,863)	(14.40%)	Gross profit margin affected in 2015 mainly because of adjustment in product portfolio
Other income	114,369	0.12%	451,354	0.48%	336,985	294.65%	Increase in share dividend of Ripley Cable Holdings I, L.P., a financial asset available or sale
Other profit	8,043	0.01%	722,437	0.77%	714,394	8882.18%	Due to increase in the profit of financial tools whose profit and loss are measured using fair market value, and decrease in loss from currency conversion in 2015
Share of other combined profit and loss of related enterprises and joint ventures recognized using equity method	5,168,779	5.35%	49,316	0.05%	(5,119,463)	(99.05%)	Decline in the appreciation of USD in 2015 caused reduction in conversion difference in the financial statement of overseas operating units

Note 1: % refers to the same type of ratio of that item in the relevant statements.

Note 2: % refers to the calculated change of rate, assuming the previous year was 100%.

II. Items that should be included in the financial report

(1) The financial statements and CPA audit reports for the two preceding fiscal years as of the time when the issuer registered the offering and issuance of securities, and the financial report for the most recent quarter publicly announced and reported shall also be included:

1. Please refer to Appendix 2 for the company's 2014 Consolidated Financial Reports and Auditor Report.

2. Please refer to Appendix 3 for the company's 2015 Consolidated Financial Reports and Auditor Report.

3. Please refer to Appendix 4 for the company's 2016 Consolidated Financial Reports and Auditor Report.

212

(2) The issuer's parent company financial reports for the two most recent fiscal years, audited and certified by a CPA but excluding statement of major accounting items:

1. 2014 Individual Financial Reports and Auditor Report: Please see Appendix 5.

2. 2015 Individual Financial Reports and Auditor Report: Please see Appendix 6.

(3) If there are CPA audited and certified, or reviewed financial reports and parent company financial reports for the most recent period during the time after the issuer has registered the offering and issuance of securities and up to the date of publication of the prospectus, disclose these reports: None.

III. The information that should be included in the financial summary and other important matters

(1) If the company and its affiliated enterprises have experienced any financial difficulties in the most recent two fiscal years, or in the current year up to the date of publication of the prospectus, indicate the impact on the company's financial position. None.

(2) The information shall be disclosed, in case of occurrence of the events under Article 185 of the Company Act in the most recent two years and up to the date of publication of the prospectus: None.

(3) Subsequent events: None.

(4) Others: None.

IV. Review and analysis of the company's financial condition and operating performance

(2) Financial status

Indicate the main reasons for, and impact of, any material changes to the company's assets, liabilities, or equity over the preceding two fiscal years. Where the impact is of material significance, describe plans for future response measures.

Unit: (NT$1,000) %

Year Item	2015 (after adjustment)	2014	Difference
			Amount	%
Current assets	156,732,840	159,955,190	(3,222,350)	(2.01)
Property, plant and equipment	149,997,075	151,587,115	(1,590,040)	(1.05)
Intangible assets	11,888,612	11,913,286	(24,674)	(0.21)
Other assets	46,387,673	10,529,176	35,858,497	340.56
Total assets	365,006,200	333,984,767	31,021,433	9.29
Current liabilities	120,502,072	111,199,467	9,302,605	8.37
Non-current liabilities	76,365,603	64,347,296	12,018,307	18.68
Total liabilities	196,867,675	175,546,763	21,320,912	12.15
Share capital	79,185,660	78,715,179	470,481	0.60
Capital reserve	23,757,099	16,013,058	7,744,041	48.36
Retained earnings	55,902,712	52,381,238	3,521,474	6.72
Other interests	5,081,689	5,068,539	13,150	0.26
Treasury stock	(7,292,513)	(1,959,107)	(5,333,406)	272.24
Non-controlling interests	11,503,878	8,219,097	3,284,781	39.97
Total equity	168,138,525	158,438,004	9,700,521	6.12
1. Reasons for changes and impact: (for changes of more than 20%, with the amount involved being NTD10 million) (1) Increase in other assets: This is because of the company's additional adoption of equity method for its investment. (2) Increase in Capital Reserve In 2015 the company disposed of part of its shareholding in Universal Scientific Industrial (Shanghai). Profit from the equity transaction is recognized under Capital Reserve. (3) Increase in treasury stock In 2015 the company bought back treasury stocks for conversion under its Fourth foreign unsecured corporate bonds. (4) Increase in non-controlling equity: Due to disposal of partial shareholding in subsidiary Universal Scientific Industrial (Shanghai). 2. Response plan: The above changes did not have major impact on the company.

(3) Financial Performance

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1. Analysis of comparison of financial performance

Unit: (NT$1,000) %

Year Item	2015	2014	Increased (reduced) amount	Change ratio (%)
Operating revenue	283,302,536	256,591,447	26,711,089	10.41
Operating cost	233,167,308	203,002,918	30,164,390	14.86
Gross profit	50,135,228	53,588,529	(3,453,301)	(6.44)
Operating expenses	25,250,606	23,942,660	1,307,946	5.46
Operating profits	24,884,622	29,645,869	(4,761,247)	(16.06)
Non-operating revenue and gains (Note)	403,631	(1,097,658)	1,501,289	136.77
Net profit before tax (Note)	25,288,253	28,548,211	(3,259,958)	(11.42)
Income tax expense	4,839,246	4,266,626	572,620	13.42
Current period net profit (Note)	20,449,007	24,281,585	(3,832,578)	(15.78)
Other comprehensive income (net income after tax)	(147,547)	5,509,748	(5,657,295)	(102.68)
Total comprehensive income (Note)	20,301,460	29,785,095	(9,483,635)	(31.84)
Note: As at September 30, 2016 the company has completed identification of the difference between its investment cost and the fair value of identifiable assets and liabilities of Siliconware Precision Industries Co. Ltd. attributable to the company, with appropriate retroactive adjustments to the company's 2015 financial statement. After the aforesaid adjustments non-operating income and expenses were NT$122,274,000; net profit before tax was NT$25,006,896,000; net profit during current period for units operating as going concern during current period was NT$20,167,650,000; net profit during current period was NT$20,167,650,000; total consolidated profit & loss during current period was NT$20,020,103,000. Explanation for major changes: (for changes of more than 20%, with the amount involved being NTD10 million) (1) Increase in non-operating income and expense: This is mainly because of increased profit in 2015 for financial tools whose profit and loss was measured using fair market value compared to those in the previous year. (2) Decrease in other comprehensive income (net income after tax) This is mainly because of decrease in 2015 of conversion difference in financial statements of overseas operating units. (3) Decrease in total comprehensive income: This is mainly because gross operation profit margin was affected by adjustments of product portfolio in 2015. There was therefore decrease in net operating profit and conversion difference in financial statements of overseas operating units in 2015.

2. The expected sales and its basis, and the possible impact on the company’s future financial operations and response plans:

Sales volume is based on market demand. Consideration is also given to projected customer order volume and production capacity of the company and its subsidiaries. The company expects growth in sales volume during the next one year.

(4) Cash flow

1. Analysis and explanation on the change in cash flow in the most recent fiscal year.

Unit: (NT$1,000) %

Item	2015	2014	Increased (reduced) amount	Increased (reduced) percentage (%)
Operating activities	57,548,305	45,864,749	11,683,556	25.47%
Investment activities	(63,351,429)	(38,817,889)	(24,533,540)	63.20%
Fundraising activities	8,636,339	(2,797,003)	11,433,342	(408.77%)
Explanation for major changes: (Where changes exceed 50%, with the amount being more than 5% of paid-up capital) (1) Cash out-flow from investment activities increased to NTD24,533,540,000: This is because of the company's additional adoption of equity method for its investment in 24.99% of the equity of Siliconware Precision Industries. (2) Cash in-flow from fundraising activities increased to NTD11,433,342,000: In 2015 the company issued its Fourth foreign unsecured corporate bonds to meet operating needs. It also increased long-term borrowings and short-term bills payable.

2. Plan to improve inadequate liquidity in recent years: None

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3. Analysis of cash flow in the next one year (2016) (individual)

Unit: NT$ 1,000 

Opening cash balance	Cash from operations during the year Net operating cash-flow	Cash during the year Cash out-flow	Cash balance (Shortfall) Amount	Remedial measures for cash shortfall
				Investment plan	Investment plan
8,533,346	110,858,863	(135,556,139)	(16,163,930)	─	Issuance of corporate bonds,  bank loan, or loans between parent company and subsidiaries
1. Analysis of liquidity changes during next year: (1) Net operating cash in-flow consists mainly of projected cash in-flow from the company's operations. (2) Cash out-flow is mainly in response to operating needs, purchase of machinery, and purchase of ancillary facilities. 2. Expected remedial action for cash shortfall and liquidity analysis: The company's projected cash out-flow during the next one year (2016) is mainly to meet operating needs. In addition to using operating cash in-flow, the company will undertake issuance of ordinary corporate bonds, bank loans, or loans between the parent company and subsidiaries and other methods to meet operating needs. The company additionally plans to implement cash capital increase via issuance of new shares to be wholly contributed toward repayment of bank loans.

(5) Impact of major capital spending on financial position and business operation in the previous year

1. Utilization of major capital expenses and source of fund

Unit: NT$ 1,000 

Project item	Actual or projected source of funds	Actual or projected completion date	Total funding needed	Actual or projected fund utilization
				2016
Expansion of plant by the Company or subsidiaries	Working capital and bank loan	December 2016	6,646,562	6,646,562
Purchase of machinery and equipment by the Company or subsidiaries	Working capital and bank loan	December 2016	21,763,122	21,763,122

As at present the Company and its subsidiaries are unable to make reasonable estimate of its capital expenses during the next 2 to 5 years and anticipated benefits.

2. Impact of major capital spending on financial position and business operation

Unit: thousands; NT$ 1,000 

Year	Item	Output Volume	Sales Volume	Sales revenue	Gross profit
2016	Semiconductor assembly and packaging	1,972,452	1,945,439	3,980,148	1,047,979
2016	Semiconductor assembly and testing	-(Note 1)	-(Note 1)	774,481	265,058

Note 1: Costs are based on test times, therefore the volumes are not disclosed.

Note 2: Estimates are solely for anticipated benefit in fiscal year 2016 for major capital expenses in 2016. Capital expenses on EMS comprise only small ratio. In addition it is difficult to project its industry characteristics. Thus it is not included.

(5) Reinvestment policy in the most recent year, the main reason for profit or loss, improvement plan, and investment plan for the coming year:

1. The company's reinvestment policy

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During the past year reinvestment policy of the company and its subsidiaries mainly involves investment in Mainland China, with key consideration given to their core competitiveness. As such each investment was made after careful study and evaluation.

2. Main reason for profit or loss from reinvestment during the past year, improvement plan, and investment plan for the coming year:

Unit: NT$ 1,000 

Reinvested company	Profit or loss in most recent year	Main reasons for profit or loss	Improvement plan	Other investment plan in the future
A.S.E. Holding Limited	480,474	Good operating status	-	Depends on its operating status
J & R Holding Limited	2,049,623	Good operating status	-	Depends on its operating status
ASE Marketing & Service Japan Co., Ltd.	2,082	Good operating status	-	Depends on its operating status
Omniquest Industrial Limited	198,948	Good operating status	-	Depends on its operating status
Innosource Limited	77,641	Good operating status	-	Depends on its operating status
Hung Ching Guang Company	(9,694)	Increase in competitors causing booth rental rate to decline	Continued solicitation of vendors and increase rental rate of exhibition booth	Depends on its operating status
Hung Ching  Development & Construction Co. Ltd.	64,151	Good operating status	-	Depends on its operating status
Universal Scientific Industrial (USI)	1,200,793	Good operating status	-	Depends on its operating status
ASE Test Inc.	2,883,511	Good operating status	-	Depends on its operating status
USI	1,239,134	Good operating status	-	Depends on its operating status
Lu Zhu Development Co., Ltd.	(1,527)	Real estate development operation current remains in planning and development stage.	Already signed partnership contract with Hong Ching Construction to jointly develop land	Depends on its operating status
Riyueyang Company	(4,274)	A new company, its plant is still under construction	N/A	Depends on its operating status
Siliconware Precision Industries Co., Ltd.	410,937	Good operating status	-	Depends on its operating status
Advanced Microelectronic Products, Inc.	(58,390)	Insufficient production capacity, thus incurring loss as it does not have economy of scale	Continue to launch high value-added products and maintain technological leadership in order to expand market share in the power semiconductor industry.	Depends on its operating status

3. Investment plan for the coming year: None

(6) Other material issues: None.

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V. Special Notes

1. Implementation of internal control system

(1) Recommendations of accountants during the past 3 years on internal control

Year	Recommendation by accountants	Current improvements
2013	No major defect	None
2014	No major defect	None
2015	No major defect	None

(2) The status of improvement of material defects discovered by internal auditors in the most recent three fiscal years: No major defect.

(3) Internal control statement: Please read Page 199 of this Prospectus.

(4) If accountants firm has been entrusted to conduct review of internal control system, the reasons for such appointment, the accountants firm review opinion, the company's improvement measures and status of improvement of defects shall be disclosed: Not applicable.

2. Those who have retained an FSC-approved or -recognized credit rating institution to conduct a credit rating/evaluation shall disclose the credit rating/evaluation report issued by the credit rating institution: Not applicable.

3. Summary opinion from the securities underwriter's assessment: Please read Page 200 of this Prospectus.

4. Attorney's legal opinion: Please read Page 201 of this Prospectus.

5. Summary opinion stated in the case checklist schedule written by the issuer and reviewed by a CPA: Not applicable.

6. The improvement status of the items notified to be corrected, if at the time the company registered (or applied for approval of) the previous offering and issuance of securities the FSC had notified it to make self-correction on certain items: None.

7. The items notified to be further disclosed, if at the time the company registered the current offering and issuance of securities the FSC had notified it to make supplemental disclosure on certain items: Not applicable.

8. The statement or promised items disclosed in the prospectus from the company's registration (application) for offering and issuance of securities for the first time, the preceding time, and within the most recent three fiscal years, and the current state of fulfillment of such: None.

9. The major content of any dissenting opinion of any director or supervisor regarding any material resolution passed by the board of directors, where there is a record or written statement of such opinion, for the most recent fiscal year and up to the date of publication of the prospectus. None.

10. Any legal sanctions against the company or its internal personnel, or any disciplinary action taken by the company against its own personnel for violation of internal controls, during the most recent fiscal year or during the current fiscal year up to the date of publication of the prospectus; and a description of the main shortcomings in the company's internal control system as well as an indication of measures for improvement: None.

11. The statement issued by the securities underwriter, the issuer, and the issuer's directors, supervisors, General Manager, financial or accounting officer, and the managerial officers involved in the current registration for public offering and issuance of securities, specifying that no underwriting related fees will be refunded or collected: Please refer to Appendix 7.

12. For a case that involves the issuer conducting a cash capital increase or an offering of corporate bonds with equity characteristics and adopting book building and public

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underwriting, the statement issued by the securities underwriter and issuer, specifying that allocation to related parties and insiders is prohibited. Not applicable.

13. Where depending on the nature of its operations, the issuer has engaged experts with professional knowledge and vast experience in technology, operations and finance etc. to conduct analysis and give opinions on the issuer's existing operating status and future development after current issuance of securities, the assessment opinions of such experts shall be disclosed: Not applicable.

14. Other necessary supplemental information: None.

XIV. Matters relating to the state of its implementation of corporate governance that should be recorded by a company listed on the stock exchange or traded on an OTC market:

(1) Operation of the Board of Directors

Between January 1, 2015 and December 8, 2016 the Board of Directors met 32 (A) times (6 times for the previous Board an 26 times for the new Board), with the directors' attendance as follows:

Title	Name	Attendance in person (or as observer)(B)	By proxy	Actual attendance rate (%)(B/A) (note)	Remarks
Director	Hong-Ben Chang (Vice Chairman)	16	13	50%	Re-elected on June 23, 2015
Director	Rutherford Chang	1	2	3%	Re-elected on June 23, 2015
Director	Representative, ASE Enterprises Ltd. Jason C.S. Chang (Chairman)	16	13	50%	Re-elected on June 23, 2015
Director	Tien Wu, Representative, ASE Enterprises Ltd.	25	2	78%	Re-elected on June 23, 2015
Director	Joseph Tung, Representative, ASE Enterprises Ltd.	31	1	97%	Re-elected on June 23, 2015
Director	Raymond Lo, Representative, ASE Enterprises Ltd.	22	2	85%	Newly elected on June 24, 2015
Director	Jeffery Chen, Representative, ASE Enterprises Ltd.	22	3	85%	Newly elected on June 24, 2015
Director	Chen Tien-chi, Representative, ASE Enterprises Ltd.	24	0	92%	Newly elected on June 24, 2015
Director	Representative, J&R Holding Ltd.: Raymond Lo	6	0	100%	Resigned during by-election June 23, 2015
Director	Representative, J&R Holding Ltd.: Jeffery Chen	4	1	67%	Resigned during by-election June 23, 2015
Independent Director	You Sheng-Fu	32	0	100%	Re-elected on June 23, 2015
Independent Director	Ta-lin Hsu	17	15	53%	Re-elected on June 23, 2015
Independent Director	Mei-yue Ho	25	1	96%	Newly elected on June 24, 2015
Note: Actual attendance rate (%) is calculated based on the number of Board meetings and actual attendance of the director. Other matters that require reporting: 1. The items included in Article 14-3 of the Securities and Exchange Act and other comments objected or retained by other Independent Directors in record or the resolutions of the Board of directors in a written statement should indicate the

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date, period, content of the motion, opinions of all Independent Directors and how the company handles the opinion of the Independent Directors: None.

2. The directors’ avoidance of interest motion should indicate the names of the directors, content of the motion and reasons of avoidance of interest as well as the involvement in voting: 

Date of Board meeting: Session No.	Motions	Results and resolutions	Company's follow-up on opinion of independent directors
September 8, 2015 12th Board meeting (2015)	To propose manager and employee bonus for the company's 2014 profit distribution plan. Abstention of directors on the ground of conflict of interest: Summary of speech by director Joseph Tung: Directors and ASE Enterprises Ltd. representatives Joseph Tung, Jason Chang, Hong-Ben Chang, Tien Wu, Raymond Lo and Chen Tien-chi are managers of the company and thus obviously are interested parties in the proposal on the company's 2014 profit-distribution proposal involving bonus for managers and employees. To avoid conflict of interest, directors Joseph Tung (including acting as proxy for chairman Jason Chang), Tien Wu, Raymond Lo (including acting as proxy for Hong-Ben Chang) and Chen Tien-chi will abstain from discussion and voting for the motion. The rest of the directors in attendance are requested to discuss the proposal.	The remaining 4 directors in attendance namely Jeffery Chen, You Sheng-Fu (including as proxy for Ta-Lin Hsu) and Mei-Yue Ho discussed and approved the motion.	Not applicable.
September 8, 2015 12th Board meeting (2015)	To propose director's remuneration for the company's 2014 profit distribution plan. Abstention of directors on the ground of conflict of interest: Summary of speech by director Joseph Tung: Directors and ASE Enterprises Ltd. representative Joseph Tung, Jason Chang, Tien Wu, Raymond Lo, Chen Tien-chi, Jeffery Chen, and director Hong-Ben Chang, are directors of the company and subject of remuneration for directors and supervisors, and thus obviously are interested parties in the proposal. To avoid conflict of interest, directors Joseph Tung (including acting as proxy for chairman Jason Chang), Tien Wu, Raymond Lo (including acting as proxy for Hong-Ben Chang), Chen Tien-chi and Jeffery Chen will abstain from discussion and voting for the motion. The rest of the directors in attendance are requested to discuss the proposal.	The remaining 3 directors in attendance namely You Sheng-Fu (including as proxy for Ta-Lin Hsu) and Mei-Yue Ho discussed and approved the motion.	Not applicable.
April 1, 2016 4th Board meeting (2016)	To discuss and revise remuneration of independent directors Abstention of directors on the ground of conflict of interest: Summary of speech by independent director You Sheng-Fu: Directors Yu Sheng-Fu, Ta-Lin Hsu and Mei-Yue Ho are all independent directors of the company. As such they have a patent conflict of interest in relation to the motion and will abstain from discussion and voting on the motion. The rest of the directors in attendance are requested to discuss the proposal.	Upon inquiry by the chairman all the directors in attendance except for independent directors Yu Sheng-Fu, Ta-Lin Hsu and Mei-Yue Ho approved the motion and passed the resolution.	Not applicable.
September 2, 2016 11th Board meeting	To propose distribution of remuneration for managers in 2015. Abstention of directors on the ground of conflict of interest:	The remaining directors in attendance namely You Sheng-Fu,	Not applicable.

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(2) The operation of the audit committee or the involvement of supervisors in the operation of the Board of Directors:

The company's Audit Committee has between June 24, 2015 and December 08, 2016 met 20 times (A), with attendance of independent directors as follows:

Title	Name	Actual attendance (B)	By proxy	Actual attendance rate (%)(B/A)	Remarks
Independent Directors	You Sheng-Fu	19	1	95%
Independent Directors	Ta-lin Hsu	13	7	65%
Independent Directors	Mei-yue Ho	19	1	95%

Other matters that require reporting:

I. Items listed in Article 14-5 of the Securities and Exchange Act and other items that have not passed the Audit Committee but approved by more than two-thirds of the entire Board of Directors (the Board of Directors meeting, session number, motion, resolutions of the Audit Committee and the company's follow-up action on the Audit Committee's opinion):

Date of Board meeting:  Session No.	Motions	Resolution of Audit Committee	The company's follow-up action on the Audit Committee's opinion
July 2, 2015	To appoint members of	All the independent directors	As more than half of the members of

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8th Board meeting (2015) the company's 3rd Compensation Committee expressed upon inquiry by the chairman, no objections to the approval of the motion for approval by the Board by way of resolution in accordance with Article 9 of the "Constitution of the Audit Committee". the Audit Committee are interested parties in the motion and have to abstain the Audit Committee is unable to pass a resolution. Thus, in accordance with Article 9 of the "Constitution of the Audit Committee" the Audit Committee agreed to report to the Board for its approval by way of resolution.

II. The directors’ avoidance of interest motion should indicate the names of the directors, content of the motion and reasons of avoidance of interest as well as the involvement in voting:

Session number	Motions	Name of Independent Director	Reasons for avoidance of interest	Participation in voting
1st meeting of the 1st Audit Committee	To appoint members of the company's 3rd Compensation Committee	You Sheng-Fu Ta-lin Hsu	Independent directors You Sheng-Fu and Ta-Lin Hsu are nominated for election to the Compensation Committee and are therefore interested parties.	Independent director You Sheng-Fu (including as proxy for Ta-Lin Hsu) abstain from discussion and voting.

III. Communication between independent directors and internal audit supervisor and auditors (e.g. about the company's financial status and operations, means and results etc.)

(1)  Before the end of each month the company's Internal Audit Department will submit consolidated report by way of e-mail to each independent director, such report containing results of its internal audit and defect responses. At the same time the supervisor of the Department will regular communicate on a quarterly basis with the independent directors. The supervisor also submits internal audit report during quarterly Board meetings. In addition the supervisor will promptly report to the independent directors on any special incidents. In 2015 and 2016 there are no such special incidents. As at to-date the company's independent directors and the supervisor of the Internal Audit Department have excellent communication.

(2)  The company's CPAs (external auditors) also report quarterly to independent directors, results of their audit or review of the current quarter's financial statements, as well as other matters requiring communication under the law. In addition the CPAs (external auditors) will promptly report to the independent directors on any special incidents. In 2015 and 2016 there are no such special incidents. As at to-date the company's independent directors and the CPAs (external auditors) have excellent communication. 

2. Attendance of supervisors in board meetings

Between January 1, 2015 and June 21, 2015 the Board of Directors has 6 meeting (A). The attendance of the supervisors are as follows:

Title	Name	Attendance in person	Actual attendance rate (%)	Remarks
Supervisors	Jerry Chang	1	17%	Resigned during by-election June 23, 2015
Supervisor	Representative, Hung Ching Development & Construction Co. Ltd.: Tseng Yuan-Yi	2	33%	Resigned during by-election June 23, 2015
Supervisor	Representative, Hung Ching Development & Construction Co. Ltd.: Pan Shih-hua	0	0%	Resigned during by-election June 23, 2015
Supervisor	Representative, Hung Ching Development & Construction Co. Ltd.: Chen Tien-chi	1	17%	Resigned during by-election June 23, 2015
Supervisor	Representative, Hung Ching Development & Construction Co. Ltd.: Chun-che Lee	2	33%	Resigned during by-election June 23, 2015
Other matters that require reporting: I. Composition and responsibility of supervisors:

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(1) Communication between supervisors and company employees and shareholders (e.g. communication channels, means etc.): The company's portal is equipped with spokesperson mail box. Employees and shareholders who wish to consult supervisors can make contact through this channel; In addition supervisors attend Shareholder's Meetings and can therefore be available for direct communication.

(2) Communication between supervisors and the Company's internal audit chief and CPA:

1. Before the end of each month the company's Internal Audit Department will submit consolidated internal audit report and defect response by way of e-mail to supervisors. After the end of each quarter the Department will consolidate all audit items and defects for discussion at the Board meeting, with the Internal Audit Department's supervisor or his proxy present the report in such meetings. After the Board meetings the company will send all relevant materials together with Board minutes by way of e-mail for review by all supervisors.

2. According to Article 219 of the Company Law the supervisor should verify all the forms and statements compiled by the Board of Directors for Shareholders Meeting. If a supervisor has any doubts on financial statements he should directly contact and communicate with the external auditors.

II. If a supervisor voices opinion in the Board of Directors meeting, describe the date of board meeting, term of the board, agenda items, resolutions adopted by the board, and actions taken by the company in response to the opinion of the supervisor: None. 

(3) Corporate governance implementation status and deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons

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Assessed areas:	Operation			Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Summary
I. Does the company establish and disclose its corporate governance principles in accordance with the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies?	V		In 2015 the company formulated in accordance with "Corporate Governance Best Practice Principles for TWSE/GTSM Listed Companies" its Code of Corporate Governance. The said Code was approved by the Board of Directors and disclosed on the company's portal. For details please see http://www.aseglobal.com。	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
II. Shareholding structure & shareholders' rights (1)    Does the company establish internal operating procedures for handling shareholder suggestions, questions, disputes or litigation and handled related matters accordingly? (2)    Does the company have a list of major shareholders that have actual control over the Company and a list of ultimate owners of those major shareholders? (3)    Has the company established and implemented risk management and firewall systems within its affiliated enterprises? (4)    Has the company established internal rules against insiders trading with undisclosed information?	V V V V		The company has set up departments to handle corporate relationship, public relations and legal affairs with full-time staff responsible for handle its stock affairs. The company maintains on a monthly basis, report on filing of changes in shareholder, with such report being held by its directors and major shareholders owning more than 10% of the company's equity, in order to have thorough knowledge of the company's main shareholders. Through close contact with major shareholders the company has understanding of a list of individuals/entities with ultimate control. The company implements control through its internal control system and promulgation of relevant rules and regulations. At the same time its audit unit is tasked with periodic supervision of the company's implementation. The company has formulated "Management Procedure Governing Prevention of Insider Trading" to prevent the company's insiders from carrying out insider trading due to negligence, inadvertence or intentional acts. This ensures fairness in the securities trading market, while also protecting the interest of investors.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
III. Composition and responsibilities of the Board of Directors (1)    Has the Board of Directors developed and implemented a diversified policy for the composition of its members? (2)    Does the company voluntarily establish other functional committees in addition to compensation committee and audit committee? (3)    Has the company established standards and method for evaluating the	V V V V		The company in its Code of Corporate Governance has set out a policy of diversity with respect to the composition of its Board of Directors. In this regard the Board of Directors comprises 11 directors including 3 independent directors, one of whom is a female director. Professional skills and knowledge of directors include: Industrial engineering, electronic engineering, mechanical engineering, computer science, physics, finance, economics, accounting, corporate management and psychology. It fully exemplifies the ideal of diversity of the members of the Board. The company has also duly established an Audit Committee, comprising members appointed by the Board. Its members are all independent directors who conform to the requirements of Sarbanes-Oxley Act as required under Rule 10A-3 of the U.S. Securities Exchange Act of 1934 and the Listing Rules of TWSE for possession of accounting or relevant financial management expertise. The company has also established a Compensation & Benefit Committee in compliance with the R.O.C. Securities and Exchange Act. According to the aforesaid law, there should be at least one member of the Compensation & Benefit Committee who meets the definition in the R.O.C. Securities and Exchange Act for independent directors. At present the Committee consists of three members, including 2 independent directors.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons

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Assessed areas:	Operation			Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Summary
performance of the board of directors, and implemented the performance evaluation annually? (4)    Has the company regularly evaluated the independence of CPAs?	V V V V		During annual disbursement of director's remuneration in connection of distribution of profit, the Compensation & Benefit Committee will conduct evaluation based on the directors' performance and propose disbursement accordingly. The company had in its Board of Directors meeting in 2015 passed its rules on directors' performance appraisal and method of appraisal pursuant to its Code of Corporate Governance. It expects to conduct regular performance appraisal beginning in 2016. The company's Audit Committee obtains yearly, statement of independence of the auditors and assess their independence, following which it presents its findings to the Board of Directors. (I) Assessment is as follows: (1) The company's auditors are not related parties of the company and its directors. (2) In accordance with the Sarbanes-Oxley Act, the company requires that the auditor firm obtain prior approval of its Audit Committee before being appointed as external auditors. (3) In accordance with the Sarbanes-Oxley Act, the company's auditors are required to report to its Audit Committee on a quarterly basis, its implementation of verification/audit and compliance with independence. (4) The company conforms to its Code of corporate Governance by rotating its certified accountants/auditors. (II) Appraisal results are as follows: (1) The independence of the company's certified accountants is in conformity with the requirements under the U.S. SEC, PCAOB, R.O.C. Accountants Act, and Code of Conduct for Accountants etc. (2) The company does not appoint the same certified accountant for more than 5 consecutive years.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
4. Does the company establish a communication channel and build a designated section on its website for stakeholders, and properly respond to corporate social responsibility issues of concern to the stakeholders?	V		The company empowers the persons-in-charge of relevant departments to handle communication with stakeholders such as creditors, customers and vendors. It also sets up labor union and general manager's mail-box to ensure a channel for communication with employees. The company's portal contains a special section for stakeholders. It provides them with a channel for expressing their opinions. It therefore facilitates the company's understanding of stakeholders' concerns and enables it to make appropriate response. The company also publicly discloses information on its communication with stakeholders through its annual corporate social responsibility report and official portal.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
5. Does the company designate a professional shareholder service agency to deal with shareholder affairs?	V		The Department of Stock Affairs at President Securities Corp. has been appointed the Company's stock affairs agent.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
VI. Information disclosure (1)    Has the company established a corporate website to disclose information regarding the company's financial, business and corporate governance status? (2)   Does the company have other	V V		The company has in place a web portal and empowers its relevant departments to undertake disclosure and updating of its financial operations and corporate governance. For details please see: http://www.aseglobal.com. The company has also developed its web portal in Chinese and English. It employs full-time staff to be in charge of collation and disclosure of information. It also has in place a spokesperson and acting spokesperson system in accordance with regulations, as well as a special liaison to give reply to shareholders on their views. For more information see: http://www.aseglobal.com.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons

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Assessed areas:	Operation			Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Summary
information disclosure channels (e.g., maintaining an English-language website, appointing responsible people to handle information collection and disclosure, creating a spokesperson system, webcasting investor conference on company website)?	V V		The company appoints full-time staff to be in charge of filing periodically and ad hoc, various financial and operating information on the Market Observation Post System, with publication of major information as required by regulations.
7. Is there any other important information to facilitate a better understanding of the company’s corporate governance practices (including but not limited to employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, continuing education of directors and supervisors, the implementation of risk management policies and risk evaluation standards, the implementation of customer relations policies, and purchasing insurance for directors and supervisors)?	V		A.Rights and interests of the employees and employee care: Please refer to the Annual Report's section on "Labor Relationship" and the company's Corporate Social Responsibility Report at http://www.aseglobal.com. B.Investor relationship, supplier relationships and the rights and interest of stakeholders: Please refer to the company's web portal on investor relationship and its section for stakeholders: http://www.aseglobal.com. C.Further studies by directors, supervisors and managers; Further studies undertaken by the company's directors, supervisors and managers in 2015 are set out in Attached Tables 1 and 2. D.Implementation of risk management policy and risk measurement standards: Please refer to the Annual Report under the section "Analysis and Assessment of Risk Items" and the company's Corporate Social Responsibility Report at: http://www.aseglobal.com。 E.(6) The implementation of client policies: Please refer to the Annual Report under the section "Summary of Market, Production and Sale". F.The Company has purchased liability insurance for directors and supervisors. The company has procured liability insurance for its directors and supervisors (in 2015 the sum insured was NTD820 million.) G.The company will sign with its suppliers, confidentiality agreements/supplier and contractor social responsibility undertaking. All procurement contracts have clear and legally-valid provisions for rights and duties. The company also has in place a supplier-selection system to ensure that suppliers conform to its quality and environmental policies. The said system is supplemented by supplier audit system to ensure its implementation. In this regard the company accepts the necessity of maintaining long-term dialog with its stakeholders. This will enable the company to have a better understanding of the society, thus allowing it to make the best decisions while preventing it from being in conflict with the public.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons
8. Does the company have corporate governance self-assessment report or have engaged any other professional organization to conduct such assessment? (If so, please describe the opinion of the board, the results of self or outside evaluation, major deficiencies found, suggestions, or improvement actions taken) (Note 2)	V		At present the company participates in corporate governance evaluation by TWSE, pursuant to which it has established "Corporate Governance Evaluation System" to conduct self-evaluation. The company has completed its second Corporate Governance Self-Evaluation Report. The report will be posted on TWSE portal for the public's perusal.	Deviations from Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and reasons

Attached Table 1: Continuing education for directors and supervisors during the past year

225

Title	Name	Date of further study		Organizer	Course	Study hours	Whether the study complies with requirements
		Start	End
Director (and manager)	Hong-Ben Chang	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Director	Rutherford Chang	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
Representative of legal entity director (and manager)	Jason C.S. Chang	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Representative of legal entity director (and manager)	Tien Wu	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Representative of legal entity director (and manager)	Joseph Tung	104/07/23	104/07/23	Taiwan Academy of Banking and Finance	Legal responsibility of directors and supervisor under corporate governance	3.0	Yes
		104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/09/22	105/09/22	Taiwan Institute of Directors	Corporate risk management and the challenges for family enterprises in Taiwan	3.0	Yes
Representative of legal entity director (and manager)	Raymond Lo	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Representative of	Jeffery Chen	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes

226

Title	Name	Date of further study		Organizer	Course	Study hours	Whether the study complies with requirements
		Start	End
legal entity director (and manager)
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
Representative of legal entity director (and manager)	Chen Tien-chi	104/12/17	104/12/17	Taiwan Corporate Governance Association	Corporate governance, enterprise risk management	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Independent Directors	You Sheng-Fu	104/01/22	104/01/22	Securities and Futures Institute	Corporate social responsibility report - Seminar on showcasing the value of sustainable operation	3.0	Yes
		104/07/15	104/07/15	Taiwan Corporate Governance Association	Corporate governance and evergreen enterprise; corporate decision-making and functions of board of directors	6.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/08/10	105/08/10	Securities and Futures Institute	Preventing fraud, protecting corporate secrets, and strengthening corporate management	3.0	Yes
		105/10/13	105/10/13	Securities and Futures Institute	2017 Economic and Industrial Trends	3.0	Yes
Independent Directors	Ta-lin Hsu	104/12/15	104/12/15	Taiwan Academy of Banking and Finance	Corporate governance forum - tax governance blueprint	3.0	Yes
		104/12/23	104/12/23	Securities and Futures Institute	Skills for directors and supervisors in understanding financial information	3.0	Yes
		105/07/13	105/07/13	Taiwan Corporate Governance Association	2016 Global Trends and Opportunities in the Green Economy and Corporate Low-Carbon Innovation	3.0	Yes
		105/10/19	105/10/19	Securities and Futures Institute	Corporate management and securities law	3.0	Yes
Independent Directors	Mei-yue Ho	104/08/10	104/08/10	Taiwan Corporate Governance Association	Enterprise risk management and prevention and detection of fraud risk	3.0	Yes
		104/08/18	104/08/18	Taiwan Corporate Governance Association	American anti-trust law and Taiwan enterprises - why you should care about and what you should know	3.0	Yes

227

Title	Name	Date of further study		Organizer	Course	Study hours	Whether the study complies with requirements
		Start	End
		104/11/13	104/11/13	Taiwan Corporate Governance Association	Global CEO Outlook 2015; Key auditing standards and legal updates	3.0	Yes
		105/07/20	105/07/20	Securities and Futures Institute	Legal responsibilities of directors and supervisors in mergers and acquisitions	3.0	Yes
		105/08/02	105/08/02	Securities and Futures Institute	Understanding and strategically using corporate financial data	3.0	Yes

Attached Table 2: Studies by managers during the past year

Title	Name	Date of further study		Organizer	Course	Study hours	Whether study is compliance with requirements
		Starting	Ending
Vice President and Chief of Accounting	Hong-Ming Kuo	2015/08/07	2015/08/11	Accounting Research and Development Foundation	Continuing education for accounting supervisors of issues, securities houses and Stock Exchange	12	Yes

228

(4) State of operations of the compensation committee:

1. Information on members of the Compensation Committee.

Note: If the committee member meets any of the following criteria in the two years before being appointed or during the term of office, please check "ü" the corresponding boxes:

(1) Not an employee of the Company or any of its affiliates.

(2) Not a director or supervisor of the Company or any of its affiliates. The same does not apply, however, in cases where the committee member is an independent director of the Company, its parent company, or any subsidiary in which the Company holds, directly or indirectly, more than 50 percent of the voting shares.

Not a natural-person shareholder whose shareholding, together with those of his/her spouse, minor children, and shares held under others' names, exceed 1% of the total number of outstanding shares of the Company, or ranks the person in the top ten shareholders of the Company.

(4) Not a spouse, relative within second degree of kinship, or lineal relative within third degree of kinship of any of the persons in the preceding three paragraphs.

Not a director, supervisor or employee of a juristic-person shareholder that holds directly 5% or more of the total number of outstanding shares of the Company or ranks in the top five shareholders.

Not a director, supervisor, manager or shareholder holding 5% or more of the shares of a specified company or institution that has a financial or business relationship with the Company.

Not a professional or an owner, partner, director, supervisor, manager or a spouse of the abovementioned who provides commercial, legal, financial, accounting services or consultation to the Company or an affiliate of the Company.

(8) Not having any of the situations set forth in Article 30 of the Company Act.

2. Current term of office: Between June 24, 2015 and June 23, 2108, and between January 1, 2015 and December 8, 2016 the Compensation Committee met 5 times, with the Committee members' attendance as follows:

Title	Name	Actual attendance (Note)	By proxy	Actual attendance rate (%)	Remarks
Convener	You Sheng-Fu	5	0	100%	-

229

Title	Name	Actual attendance (Note)	By proxy	Actual attendance rate (%)	Remarks
Committee member	Ta-lin Hsu	1	4	20%	-
Committee member	Gu Xiao-Ying	5	0	100%	-
Note: Actual attendance rate (%) is calculated based on the number of Board meetings and actual attendance of the Committee member. Other matters that require reporting: I. If the Board of Directors do not adopt or revise the recommendations of the Compensation Committee, explanation should be provided with respect to the date and session of the Board meeting, details on the motion, resolution of the Board and the company's follow-up action on the views of the Compensation Committee: None. II. If with respect to any resolution of the compensation committee, any member has a dissenting or qualified opinion that is on record or stated in a written statement, describe the date of committee meeting, term of the committee, agenda item, opinions of all members, and actions taken by the company in response to the opinion of members: None.

230

(5) Implementation of corporate social responsibility:

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
I. Corporate governance implementation (1)    Does the company establish corporate social responsibility policy or system and examine its implementation results? (2)    Does the company provide educational training on corporate social responsibility on a regular basis? (3)    Has the company established a dedicated or concurrent unit in charge of promoting CSR with senior management authorized by the board to take charge of proposing CSR policies and	V V V V		The company has adopted "ASE Group Policy for Sustainable Development and Corporate Citizen" and "Code of Corporate Social Responsibility". They are listed in the company's portal under corporate social responsibility and its corporate social responsibility (CSR) report. Pursuant to the said policies the company embarks on its CSR implementation plan. Details are set out in "2. Developing Sustainable Environment", "3. Maintaining Public Welfare", and "6. Other Important Information towards Understanding of CSR Operations" in this Table. The Board regularly conducts review of the company's CSR practice and achievements. Details on the company's CSR policy, regulations or management rules and results of specific implementation are all disclosed in ASE Group's CSR Report. Please refer to: http://www.aseglobal.com. The company formalizes annually CSR training program and provides in accordance with the program, training for new recruits and existing employees on their CSR. The program is designed to help employees understand the spirit of the company's CSR and means of achieving it. The company has established a "Group Sustainable Development Committee" consisting of senior management. The Committee is responsible for guiding and supervising ASE's growth with respect to its global economic, environmental and social policies. It regularly submits report to the Board, and puts in place a "Group Enterprise Sustainability Center", responsible for promoting the company's CSR. The Center is also responsible for assessing the Group's sustainability issues and performance, coordinating and promoting the formulation of the Group's targets and promoting the implementation of sustainable development plans. It reports directly to the Committee. The sustainable development program is divided into 6 major	There is no departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies.

231

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
reporting to the board? (4)    Has the company established a reasonable salary remuneration policy, and integrated the employee performance evaluation system with its CSR policy, and established an effective reward and disciplinary system?			themes, namely corporate governance, environmental sustainability, human resources, supply chain development, corporate citizen and social participation, consultation with stakeholders and information disclosure. Their implementation and results are as set out in "2. Developing Sustainable Environment", "3. Maintaining Public Welfare", and "6. Other Important Information towards Understanding of CSR Operations" in this Table. The company's CSR Report discloses the performance of its CSR unit. It also explains the unit's governance structure and implementation status. For information on the CSR unit's operation and implementation, please see: http://www.aseglobal.com. The company regularly adjusts its salary structure and welfare in accordance with local regulations and market status. In no way are salaries differentiated based on gender, race, nationality or age. The company complies with Gender Equality Act and will not consider gender as a criterion for appointment, performance appraisal or promotion of employees. To maintain the highest standards for employee's work discipline, the company has promulgated Guidelines on employee management, specifying unequivocal incentive and penalty rules. The Guidelines are the highest ethical standard and commitment to be complied with by employees.
II. Fostering a sustainable environment (1)    Has the company endeavored to improve the efficiency of resource utilization and used recycled materials which	V		The company has in place a management plan for use of electric power, water resources and consumable materials. It upgrades the efficiency of their supply facilities or makes optimal improvements on a sustained basis. The aim is to comply with "ASE Group Policy for Sustainable Development and Corporate Citizen" and "Code of Corporate Social Responsibility" and achieve their targets of reducing consumption of resources. They include: Energy-saving for air-conditioning,	There is no departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM

232

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
have a low impact on the environment? (2)    Has the company established a proper environmental management system based on the characteristics of the industry? (3)    Has the company monitored the impact of climate change on business operations, conducted greenhouse gas inventory and formulated strategies for energy conservation and carbon and greenhouse gas reduction?	V V		lighting and manufacturing processes etc. All the company's packaging materials are recyclable and compliant with EU regulations. Through internal management processes the company classifies waste materials and recycles resources, thereby reduces waste of natural resources and lowers impact on the environment. Pursuant to its "ASE Group Policy for Sustainable Development and Corporate Citizen" and "Code of Corporate Social Responsibility" the company has established a management system to implement in an orderly manner management of various types of resources. In this manner it is able to make best use and improve on a sustained basis, energy and water resources. With respect to environmental protection the company has in addition to compliance with laws and regulations, established ISO14001 environmental management system. In addition to regular checks on legal compliance the company formulates annually, pollution control and equipment improvement plans in order to effectively reduce pollution emission and discharge and make timely review of its environmental management system. The company monitors the impact of climate changes on its operating activities. As such it implements a ISO14064 greenhouse gas management system, based on which it checks its greenhouse gas discharge. It formulates emission-reduction targets in order to reduce its discharge of greenhouse gases. The company has passed ISO50001 certification. In response to expectations or customers and consumers around the world for low-carbon products the company introduces carbon footprint checks and has as its target, reduction of product carbon footprint.	listed companies.
III. Upholding public interests (1) Has the company	V		The company has introduced SA8000 social responsibility management system and	There is no departure from

233

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
formulated appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights? (2)    Has the company set up an employee hotline or grievance mechanism to handle complaints properly? (3)    Has the company provided a safe and healthy working environment and provided employees with regular safety and health training? (4)    Has the company set up a channel for communicating with employees on a regular basis, and reasonably inform employees of any significant changes in	V V V V V		EICC certification, and has promulgated "ASE Group Policy for Sustainable Development and Corporate Citizen" and "Code of Corporate Social Responsibility". It also respects basic human rights, complies with government labor laws and protects workers' rights with respect to their work environment, health and safety. The company devotes its attention to a harmonious employer-employee relationship. For this it has in pace a communication and complaint management policy. It provides employees with diversified communication channels including employer-employee meetings, general manager mailbox, employees' opinion box, seminars, correspondence, public notice board, internal communication, training, electronic notice board, employee-consultation staff and e-mail etc., all of which serve to enable the company to understand employees' views and suggestions, with reply and follow-up action whenever necessary. The company has implemented safety and health operations through the introduction of OHSAS 18001 and TOSHMS occupational safety and health management systems. Its objective is to provide employees with a work environment that is compliant with safety and health regulations. In this regard it regularly conducts risk identification and assessment, as well as adopt appropriate improvement measures to reduce work environment risk. The company also conducts employee work safety and health training and health-promotion activities. The company is equipped with employee clinic and regularly arranges employees to undergo health checks required by their respective units. The company regularly holds seminars or related meetings according to the category of employees including recruits, employees and labor representatives. Through periodic communication and exchanges the company is able to provide employees with an uncluttered communication channel. Whenever there are major work	Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies.

234

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
operations that may have an impact on them? (5)    Does the company set up effective career development and training programs for its employees? (6)    Has the company established any consumer protection mechanisms and complaint procedures regarding R&D, purchasing, production, operation and service? (7)    Has the company advertised and labeled its goods and services according to relevant regulations and international standards? (8)    Has the company evaluated the records of suppliers’ impact on the environment and society before doing business with the supplier? (9)    Do the contracts between the company and its major	V V V V V		changes (such as change in operating points) the company will communicate with employees in advance by giving them at least 2 weeks' notice. To-date the company has not been involved in any incidents involving coercion of its employees. The company undertakes annual training planning based on occupational training needs and career development requirements. Course programs include; Recruit training, general knowledge training, professional training, grass-root management, mid-level management and talent development etc. To ensure that customer's views can be effectively relayed and dealt with, as well as to promote timely interaction with customers, the company has in place management procedures for customer communication involving the establishment of professional customer service team, regular inspection of customer satisfaction, provision of relevant customer view response and communication services, and using the Internet as the basis, establishment of customer on-line service platform with integrated service network, thus providing customers with highly efficient services. The company complies with Taiwan trade laws including those on export and import of strategic hi-tech products. Its marketing, sale and labeling of services are all in accordance with customer needs and regulatory requirements. Before admitting new suppliers the company will examine and review their records in environmental and social impact in accordance with its vendor selection mechanism. Thereafter the suppliers are subject to the company's annual "sustainable development questionnaire". The company also conducts site check or documentary audit to ensure that suppliers are in conformity with its requirements. The company also stipulates in its contracts with key suppliers, the requirement for their compliance with local laws and the company's Code of Social Responsibility. Once a supplier is discovered to have conducted itself in contravention of such	There is no departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies.

235

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
suppliers include termination clauses which come into force once the suppliers breach the corporate social responsibility policy and cause significant impact on the environment and society?			requirements the company will conduct investigation. In serious cases it can even terminate its cooperation with such supplier.
IV. Enhancing information disclosure (1)    Has the company disclosed relevant and reliable information regarding its corporate social responsibility on its website and the M.O.P.S.?	V		To enable the public to understand the company's ideas and commitments with respect to its responses to sustainable development trends, as well as its efforts and adherence on related topics, the company makes public annually its Corporate Social Responsibility Report (in Chinese and English). It also provides PDF versions in its web portal (http://www.aseglobal.com). Key information on the company's corporate social responsibility is also disclosed in the Market Observation Post System.	There is no departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies.
V. If the Company has established the corporate social responsibility principles based on "Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies", please describe any discrepancy between the principles and their implementation: The company has in conformity with "Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies" formulated in 2015 its Code of Corporate Social Responsibility. The said Code was approved by its Board of Directors and posted on its web portal (http://www.aseglobal.com). Furthermore its practice does not deviate significantly from the said Code. VI. Other important information to facilitate a better understanding of the company’s corporate social responsibility practices: (1) For other information on the company's CSR operation please refer to the company's CSR Report (http://www.aseglobal.com). (2) The company has made long-standing effort to repay the society. It does so through the "Warmer Charity Foundation" and "ASE Cultural

236

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
Educational Foundation" and participation in social welfare activities. The company's employees generously contribute their time, funds and professional skills to help resolve urgent needs and children's educational needs. They provide the greatest support for our fulfillment of our social responsibility and our commitments. The company hopes that through long-term cooperation and communication with neighboring residents and members of the public, it will establish a trusting and harmonious relationship with them. Indeed the company spares no effort in creating a positive and socially-beneficial business environment. (3)   Active participation in environmental-protection public welfare activities: In December 20, 2013 the company made a commitment to invest at least NTD100 million annually for 30 years in environmental-protection work in Taiwan. This will be done through long-term planning and diverse angles. At present the company has planned and executed numerous environmental-protection public welfare activities through its "ASE Cultural and Educational Foundation". Important projects include: 1.Promotion of environmental education (construction of green classroom and plan for propagation of environmental-protection concepts/environmental education audio and video programs/South Region environmental education proposal/academic research and studies program for environmental technology/thesis subsidy for post-graduate and doctoral studies on environmental protection.) 2.Improvement of environmental quality (tree-planting program/Nantze Processing Zone landscaping fence.) 3.Reduction of environmental impact (campus LED proposal/Nantze Processing Zone's resource recycling model plant operation/proposal for promotion of green supply chain/dengue fever control.) 4.Promotion of environmental protection art and culture (Yayoi Kusama environmental art and cultural promotion/environmental theme opera - Adventures Under the Sea). (4)    Participation in charitable and care activities: In 2015 the company was able to rally employees in the Group and raised over NTD10 million. The fund was used through "ASE Cultural and Educational Foundation" towards under-privileged children and needy communities. The Foundation also provides emergency aid. Regional public welfare activities participated by the Foundation include: 1.Child care center for under-privileged families (after-school care for children/course tutoring/character education/family visits and counseling/parenthood talks etc.) 2.Subsidies for students from needy families (provision of lunch/study subsidies for primary, secondary and pre-university students in public schools near Kaohsiung and Chungli Plants.) 3.Emergency aid fund (provision of aid funds to families in need near Kaohsiung and Chungli Plants due to special emergencies or accidents.)

237

Assessed areas:	Operation			Departure from Corporate Social Responsibility Best Practice Principles for TWSE/GTSM listed companies and reasons
	Yes	No	Summary
4.Sponsorship of aid funds of public welfare units (sponsorship was extended to 20 public welfare organizations in 2015, including donations to medical fund for the under-privileged and assistance in organization of public welfare activities.) (5)    Promotion of collaboration between industry and academia: Collaboration with numerous universities (NTHU, Tungnan University, Chung Yuan, Yuan Ze, National Sun Yat Sen, National Cheng Kung, Kaohsiung Normal, Kaohsiung First Tech, Kaohsiung University of Applied Sciences, Kaohsiung Marine, Pingtung University of Science and Technology and Kao Yuan University, etc.) This does not only increase the channels for the company's recruitment but also foster job opportunities for local students as well as improve the company's partnership with universities, thereby enhancing academic research and industrial technology. The achievements were impressive. In 2015 the company will continue to expand its program such as to achieve benefit for all parties involved. (6)    A childcare center for employees was set up in the company's Chungli Plant. Qualified teachers were engaged to look after employees' children, relieving employees of the stress of looking after children while working. VII. If the corporate social responsibility reports have received assurance from external institutions, they should state so below: None From 2010 to 2014 the company has been publishing annually its corporate social responsibility report, the contents of which are compiled in accordance with the Guidelines of Global Reporting Initiative (GRI) and accountability principle standard (APS) under AA1000. The company also voluntarily obtained verification statement from third party (BSI) with respect to its compliance of G3.1 A+ application level. The company's 2015 Corporate Social Responsibility report was compiled using the core options in the Guidelines of Global Reporting Initiative (GRI). The company also obtained confirmation from Deloitte. The said confirmation was an independent 'limited assurance' under ISAE 3000.

238

(6) Ethical corporate management and measures adopted:

Assessed areas:	Operation			Departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" and reasons
	Yes	No	Summary
I.     Establishment of ethical corporate management policy and approaches (1)    Has the company declared its ethical corporate management policies and procedures in its rules and external documents, as well as the commitment of its Board of Directors and management to implementing the management policies? (2)    Has the company established policies to prevent unethical conduct with relevant procedures, guidelines of conduct, punishment for violation, rules of appeal clearly stated in the policies, and implemented the policies? (3)    Has the company	V V V		The company's Board of Directors has passed relevant operating rules, i.e. "ASE Group Code of Business Conduct and Ethics" and "Guidelines on Ethical Operation". They are disclosed in the company's web portal. Please see: http://www.aseglobal.com. The company intends to formulate operating procedure, code of behavior and complaint regulations in 2016 in accordance with the aforesaid Code. For work ethics the company has already in place its regulations on ethical behavior and penalties for infringement. All employees have been advised to comply with such regulations. The company expressly prohibits in its Code of Ethics, the following behavior by its directors, managers and employees. This prohibition is being supervised and monitored through its internal audit. The company's aim is to establish an honest business environment: 1.Giving and accepting bribes; 2.Giving illegal political contributions; 3.Improper charity donation or sponsorship; 4.Giving or accepting unreasonable gifts, entertainment or other benefits;	There was no departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies".

239

Assessed areas:	Operation			Departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" and reasons
	Yes	No	Summary
established appropriate precautionary measures for operating activities with higher risk of unethical conducts provided in Paragraph 2, Article 7 of the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies or within its scope of business?			5.Infringe business secrets, trademark, patent, copyright and other intellectual property rights; 6.Carrying out unfair competition.
II. Implementation of ethical corporate management (1)    Has the company evaluated the ethical records of parties it does business with and stipulated ethical conduct clauses in business contracts? (2)    Has the company established a dedicated (concurrent) unit under the board of directors to promote ethical corporate	V V V V		Before commencing business dealings the company will first conduct credit checks on potential business partners. It eliminates subjects with poor record of integrity. It also specify integrity as a requisite behavior in its business contracts. The company has also incorporated integrity and moral values in its operating policies. It conducts propagation of integrity for newly-recruited and existing employees. The company proposes to establish in 2016 a dedicated (concurrent) unit to promote ethical corporate management. It will be required to regularly report the status of implementation to the Board of Directors. The company exercises a high degree of discipline. For Board deliberations	There was no departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies".

240

Assessed areas:	Operation			Departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" and reasons
	Yes	No	Summary
management, and reported the status of implementation to the Board of Directors? (3)    Has the company established policies to prevent conflict of interests, provided appropriate channels for filing related complaints and implemented the policies accordingly? (4)    Has the company had effective accounting system and internal control systems set up to facilitate ethical corporate management, and have those systems been audited by either internal auditors or CPAs on a regular basis? (5)    Has the company held internal and external educational trainings on	V		involving conflict of interest members of the Board who are affected are required to abstain in such deliberations and voting. Board members are not disallowed to support each other's motions. The company regularly conducts audit to prevent insider trading. The company has in place a comprehensive accounting system and internal control regime. It does not allow outside or retain secret accounts. To ensure sustained effect of the systems' design and implementation the company's internal audit staff conduct ad hoc checks on their compliance. The company also conducts from time to time during each year training on integrity for its senior management. It also carries out propagation of ethical behavior by its suppliers.

241

Assessed areas:	Operation			Departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" and reasons
	Yes	No	Summary
operational integrity regularly?
III. Operation of whistleblowing system (1)    Has the company established concrete whistleblowing and reward system and had a convenient reporting channel in place, and assign an appropriate person to communicate with the accused? (2)    Has the company established standard operating procedures for investigating reported cases and related confidentiality mechanism? (3)    Has the company provided proper whistle blower protection?	V	V V	The company has in place a whistle blower channel (including general manager's mailbox and anti-fraud complaint mailbox). Its whistleblowing rules are set out in its Code of Ethics. The company proposes to establish in 2016, after its whistle blower regulations, standard operating procedure for lodgment of complaints and confidentiality rules. The company also intends to formulate and adopt in 2016 protection measures for whistle blowers.	There was no departure from "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies". The company is in the process of undertaking improvement. The company is in the process of undertaking improvement.

242

Assessed areas:	Operation			Departure from “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” and reasons
	Yes	No	Summary
IV. Enhancing information disclosure (1)    Has the company disclosed information regarding the company’s ethical corporate management principles and implementation status on its website and the M.O.P.S.?	V		The company has posted on its web portal relevant rules on ethical operations including “ASE Group Code of Business Conduct and Ethics” and “Guidelines on Ethical Operation”. It also discloses its ethical operations in its annual report. The company plans to set up in its web portal information on results of its implementation of the said rules.	There is no departure from “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”
V. If the company has established Ethical Corporate Management Principles in accordance with the "Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies", describe any discrepancy between the principles and their implementation: In keeping with the "Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies" the company had in 2015 formulated its ethical guidelines. The guidelines were passed by its Board of Directors and duly disclosed in its web portal (http://www.aseglobal.com). The company's actual operations have not deviated from the guidelines.
6. Other important information that is helpful in understanding the company's ethical operations (such as review and revision by the company of its ethical operation guidelines, etc.) None.

(7) If the company has established corporate governance principles and related guidelines, disclose the means of accessing this information: “Corporate Governance Best-Practice Principles”, “Corporate Social Responsibility Best Practice Principles” and “Ethical Corporate Management Best Practice Principles” of the company are disclosed in its web portal (http://www.aseglobal.com).

(8) Resignation and dismissal of managerial officers related to the financial report (including Chairperson of the Board, General Manager, chief accounting officer, chief financial officer, chief R&D officer and chief internal auditor) in the past year and up to the date of report: None.

(9) Other significant information which may improve the understanding of corporate governance and operation: None.

243

VI. Important Resolutions, Articles of Incorporation and Relevant Laws and Regulations

1. Key resolution records and text of resolution on the current issue:

Please refer to pages 202 to 203.

244

Advanced Semiconductor Engineering, Inc. 

Statement of Internal Control Regulations

Date:March 16, 2016

The Company hereby makes the following statement about its internal control system for the year 2015 based on its self-examination:

I. The Company acknowledges and understands that the establishment, enforcement and maintenance of the internal control system are the responsibility of the Board of Directors and management, and that the company has already established such a system.The purpose is to provide reasonable assurance to the effectiveness and efficiency of business operations (including profitability, performance and security of assets), reliability of reports and compliance with relevant regulatory requirements in reaching compliance targets.

II. There are inherent limitations to even the most well designed internal control system. As such, an effective internal control system can only reasonably ensure the achievement of the aforementioned goals. Moreover, the operating environment and situation may change and impact the effectiveness of the internal control system.The internal control system of the Company features a self-monitoring mechanism. Once identified, any deficiency will be rectified immediately.

III. The Company determines whether the design and implementation of its internal control system is effective by referring to the criteria stated in the "Regulations Governing Establishment of Internal Control Systems by Public Companies" (hereinafter, the "Regulations"). The Regulations provides measures for judging the effectiveness of the internal control system.There are five components of an internal control system as specified in the Regulations which are broken down based on the management control process, namely:1. Control environment, 2. Risk assessment, 3. Procedural control, 4. Information and communication, and 5. Supervision.Each of the components in turn contains certain audit items.Please refer to the Regulations for details.

IV. The Company has adopted the aforementioned measures for an evaluation of the effectiveness of the design and implementation of the internal control system.

V. Based on the findings of the aforementioned examination, the Company believes it can reasonably assure that the design and implementation of its internal control system as of December 31, 2015 (including supervision and management of subsidiaries), including the effectiveness and efficiency in operation, reliability, promptness and transparency of reports and compliance with relevant regulatory requirements, have achieved the aforementioned objectives.

VI. This statement shall be an integral part of the annual report and prospectus of the company and will be made public.If any fraudulent information, concealment or unlawful practices are discovered in the content of the aforementioned information, the Company shall be held liable under Article 20, Article 32, Article 171 and Article 174 of the Securities and Exchange Act.

VII. This statement was approved by the Board on March 16, 2016 in the presence of 10 Directors, who concurred unanimously.

Advanced Semiconductor Engineering, Inc.

Chairman:Jason C.S. Chang

General Manager:Richard H.P. Chang

245

Summary Opinion of Underwriter

Advanced Semiconductor Engineering, Inc. (hereinafter referred to as ASE or the Company) issues 300,000,000 shares in common stocks at a face value of NT$10 per share, amounting to NT$3,000,000,000 in total issuance value for the cash capital increase. It files an application with the Financial Supervisory Commission in accordance with regulations. Upon undertaking necessary counseling and evaluation by the Underwriter including understanding the company's operating status, interviews or meetings with the company's directors, managers and other relevant staff, collation, compilation, verification and comparison and analysis, the Underwriter has given the proposed issue and offering by the company careful evaluation.Pursuant to the Financial Supervisory Commission's "Regulations Governing the Offering and Issuance of Securities by Issuers", "Taiwan Securities Association Rules for Information to be Published in Securities Underwriter Evaluation Reports on Offering and Issuance of Securities by Securities Issuers" and "Taiwan Securities Association Rules for Information to be Published in Securities Underwriter Evaluation Reports on Offering and Issuance of Securities by Securities Issuers", the Underwriter hereby issues its Summary Opinion.

According to the opinion of the Underwriter, the offering and issuance of securities by Advanced Semiconductor Engineering, Inc. are consistent with the regulations in the "Regulations Governing the Offering and Issuance of Securities by Securities Issuers" and related regulations. The feasibility and necessity of the plan, the use and progress of funds, and the expected results are also considered to be reasonable.

KGI Securities Co., Ltd.

Legal Representative: Hsu Daw-yi

Supervisor of Underwriting Department:Lin Neng-Xian

Date:

246

Attorney's legal opinion

Advanced Semiconductor Engineering, Inc. accepts subscriptions and issues 30,000,000 registered shares in common stocks at a face value of NT$10 per share, amounting to NT$3,000,000,000 in total issuance value in the cash capital increase. It files an application with the Financial Supervisory Commission. The Attorney has undertaken necessary review procedures including company visits, interviews or meetings with the company's directors, managers and other relevant staff, collation, compilation, and verification of the company's meeting minutes, important contracts, and other related documents and material, as well as opinions of related experts.The Attorney's legal opinion is provided in accordance with regulations in the "Regulations Governing the Offering and Issuance of Securities by Securities Issuers."

According to the opinion of the Attorney, no violations of regulations have been discovered in the items in the legal item check list submitted by Advanced Semiconductor Engineering, Inc. to the Financial Supervisory Commission which would affect the offering and issuance of the securities.

To

Advanced Semiconductor Engineering, Inc.

Handsome Attorneys-at-Law

Qiu Ya-Wen

Date: (month) (date), 2016

247

Summary Opinion of Underwriter

248

Attorney's legal opinion

249

Advanced Semiconductor Engineering, Inc.

2016 14th Board of Directors Meeting Minutes (Excerpt)

I. Date and time: 4:00PM, December 8, 2016

II. Location: Conference room of the Company

III. Attending Directors: Jason C.S. Chang (Joseph Tung as proxy), Tien Wu (attending via video conference), Joseph Tung, Raymond Lo (Tien Wu as proxy), Tien-Szu Chen (attending via video conference), Jeffrey Chen (Tien-Szu Chen as proxy), Shen-Fu Yu, Ta-Lin Hsu, Mei-Yueh Ho, for a total of 9 in attendance. Richard H.P. Chang and Rutherford Chang are on leave and unable to attend

IV. In attendance:Li-Bin Guo (Auditing Chief Kun-Huang Wu is on a business trip, therefore in accordance with the relevant job authority and deputy regulations of the Company, deputy Li-Bin Guo is listed in attendance and is participating via video conference)

V. Presided by: Joseph Tung corded by: Mei-Hui Li

VI. Announcements: The Chairman of the Company Jason C.S. Chang is unable to attend and preside over this board director's meeting, and Vice Chairman Richard H.P. Chang is unable to attend for due reason, therefore Chairman Jason C.S. Chang has delegated I, Joseph Tung to act as proxy for the attendance of this board directors' meeting and to preside as chairman.

VII. Discussions:

Proposal 1:

Cause of action: The company plans to conduct issuance of ordinary shares for increasing domestic cash capital by means of public subscription and placement, and hereby submits the proposal for review and approval.

Explanation: 1. To accommodate future production capacity expansion plans, substantiate operating funds, repay bank loans or other capital needs that facilitate the long term developments of the Company, the Company has by resolution of the shareholders' meeting on June 28, 2016 authorized the Board of Directors to conduct one or more of the following financing methods individually or concurrently as deemed appropriate: cash capital increase via issuance of ordinary shares for participation in issuance of global depository receipts, domestic cash capital increase via issuance of ordinary shares, overseas discretionary convertible corporate bonds. New shares issued for domestic cash capital increases shall amount to no more than 500,000,000 ordinary shares and shall be conducted in either one of the following two manners: public subscription and placement, or book building subscription.

2. To repay bank loans and reduce interest expenditures, the company proposes to, in accordance with authorization granted to the Board of Directors by the shareholders' meeting on June 28, 2016, conduct domestic cash capital increase via issuance of 300,000,000 ordinary shares for public subscription and placement.

3. This issuance of ordinary shares for increasing domestic cash capital shall be conducted in the following manner:

(1) The issue price of this cash capital increase is established in accordance with the regulations of the "Taiwan Securities Association Self-Disciplinary Regulations on Underwriter Members for Subscription and Issuance of Securities by Issuing Company," and shall be no lower than 70 percent of the simple arithmetic mean of the closing ordinary share price five business days prior to registering with the FSC for a public offering and ex-rights date after factoring out ex-rights trading in connection with issuance of stock dividends and ex-dividend trading.The Company has tentatively fixed the share issue price at NT$31.50 per share at the time of registering with the FSC, actual issue price as authorized by the Chairman shall become effective with the competent authority's approval and jointly determined by the underwriter according to actual market conditions within the above stated range in compliance with laws and regulations.(2) If the funds raised are insufficient due to adjustment in the offer price of the new ordinary shares as a result of market changes and in compliance with laws and regulations, the difference will be supplemented by proprietary funds; in the event of an excess in funds raised, excess funds shall contribute toward the repayment of bank loans.

(2) Pursuant to the requirements under Article 267 of the Company Act, 10% of new shares issued will be set aside for subscription by the company's employees. Furthermore

250

pursuant to Article 28-1 of the Securities Exchange Act, 10% of new shares issued will be set aside for public offering through underwriter by way of open subscription. The remaining 80% will be subscribed by original shareholders with their respective shareholding ratios on the shareholders’ roster at subscription record date. For fractional part of a share subscribed by shareholders, such shareholders shall proceed to the company's registrar within 5 days of the cessation of transfer registration to process subscription through aggregation of fractional entitlement. For shares for which the original shareholders or employees have relinquished their subscription rights or fractional parts of shares, the Chairman is authorized to negotiate with specific individuals to subscribe such shares or fractional parts at the issue price.

(3) The issuance of new shares for cash capital increase shall be conducted in book-entry form, are entitled to the same rights and obligations as those of the ordinary shares originally issued, and shall be listed with the Taiwan Stock Exchange.

4. The sources of capital, project items, expected fund utilization and anticipated benefits of this program are as specified in Appendix 1.

5. Due to potential rapid fund raising changes in the capital market, in order to obtain full control of the formulation of issuance conditions and achieve timeliness in actual issuance operations, in the event the competent authority conducts modifications or modifications and adjustments are necessary due to subjective and objective concerns, it is hereby proposed that the Chairman of the Company or his delegate be granted full authority to modify or adjust all matters with regard to the preceding cash capital increase financing program, including issue amount, number of issued shares, issuance conditions, project items, issuance schedule, anticipated potential benefits, and other relevant matters.

6. Matters not addressed in the preceding paragraphs shall be subject to the discretion of the Chairman in accordance with the law.

7. The proposal has been approved by resolution of the Auditing Committee, and is hereby submitted for review and approval.

Resolution: The proposal is approved unanimously by attending Directors following proposition by the presiding Chairman.

VIII. Extempore motion: None.

IX. Meeting dismissed

Presided by: Joseph Tung

Recorded by: Mei-Hui Li

251

Appendix 1

Advanced Semiconductor Engineering, Inc.

Calculation of Underwriting Price of Cash Subscription Shares

Advanced Semiconductor Engineering, Inc.

Calculation of Underwriting Price of Cash Subscription Shares

I Description

(I) Th paid-up capital of Advanced Semiconductor Engineering, Inc. ("ASE") at present is NT$79,499,748,460 with 7,949,974,846 ordinary shares issued, each with a face value of NT$10.The current issuance of new shares for cash to increase the company's capital has been approved by resolution of the Board of Directors' meeting held on December 8, 2016, under which 300,000,000 new ordinary shares each with a face value of NT$10 will be issued. After the share capital increase the company's paid-up capital will be NT$82,499,748,460.

(II) Pursuant to the requirements under Article 267 of the Company Act, 10% of the new shares issued, i.e. 30,000,000 shares will be set aside for subscription by the company's employees. Furthermore pursuant to Article 28-1 of the Securities Exchange Act, 10% of new shares issued, i.e. 30,000,000 shares will be set aside for public offering through underwriter by way of open subscription. The remaining 80%, i.e. 240,000,000 shares will be subscribed by original shareholders with their respective shareholding ratios on the shareholders’ roster at subscription record date. For fractional part of a share subscribed by shareholders, such shareholders shall proceed to the company's registrar within 5 days of the cessation of transfer registration to process subscription through aggregation of fractional entitlement. For shares for which the original shareholders or employees have relinquished their subscription rights or fractional parts of shares, the Board of Directors authorizes the Chairman to negotiate with specific individuals to subscribe such shares or fractional parts at the issue price.

(III) The new shares issued by this cash capital increase shall have the same rights and obligations as those of the ordinary shares originally issued.

(IV) For this share issue the shares to be subscribed by original shareholders, employees and underwriter and those offered for public subscription shall have the same subscription price.

II The company's financial status during the past 3 years

(I) Net earnings per share and share dividend per share during the most recent period and the last 3 years are as set out in the Table below:

1

Unit:NT$/share

	Net earnings per share (Note 1)	Dividend distribution
		Cash dividend	Stock dividend		Total
			Earnings	Capital reserve
2013	2.09	1.30	─	─	1.30
2014	3.07	2.00	─	─	2.00
2015	2.55 (Note 2)	1.60	─	─	1.60
2016Q3	1.79	─	─	─	─

Source: The company's audited financial reports during the respective periods

Note 1:     Earnings per share are calculated based on weighted average shares in circulation during the current year

Note 2:     As of September 30, 2016, said company completed all identification of invested capital and the difference in net fair value between identifiable assets and liabilities of Silicon Precision Industries Co., Ltd. to which the company is entitled. Retroactive adjustments were made to the 2015 financial report, and earnings per share was retroactively adjusted to NT$2.51

(II) Shareholder's Equity per share as at September 30, 2016 calculated based on shares in circulation.

Description	Amount
Shareholder's Equity attributable to the parent company	NT$150,158,984,000
Total shares issued as at September 30, 2016 (note)	7,816,690,000
Net book value per share as at September 30, 2016	19.21 (NT$/share)

Source: The company's audited financial reports for 2016Q3 

Note: Includes advance receipts for capital stock after deducting treasury shares

2

(III) Audited financial reports for the last 3 years

1. Summary Balance Sheet

Unit:NT$ 1,000

		Financial information for the most recent 5 fiscal years (note)			Financial Information as at September 30, 2016
		2013	2014	2015
Current assets		132,176,482	159,955,190	156,732,840	143,369,196
Financial assets for sale - Non-current		1,140,329	941,105	924,362	1,103,939
Investment accounted for using equity method		1,216,201	1,492,441	37,141,552	49,515,448
Property, plant and equipment		131,497,331	151,587,115	149,997,075	145,208,855
Intangible assets		11,953,644	11,913,286	11,888,612	12,217,117
Other assets		8,829,919	8,095,630	8,321,759	9,213,165
Total assets		286,813,906	333,984,767	365,006,200	360,627,720
Current liabilities	Pre-distribution	100,835,276	111,199,467	120,502,072	118,397,190
	Post-distribution	110,991,281	126,789,292	132,978,851	N/A
Non-current liabilities		58,813,671	64,347,296	76,365,603	81,013,087
Total liabilities	Pre-distribution	159,648,947	175,546,763	196,867,675	199,410,277
	Post-distribution	169,804,952	191,136,588	209,344,454	N/A
Shareholder's Equity attributable to the parent company		123,020,621	150,218,907	156,634,647	150,158,984
Share capital		78,180,258	78,715,179	79,185,660	79,509,050
Capital reserve		7,908,870	16,013,058	23,757,099	22,461,952
Retained earnings	Pre-distribution	38,993,154	52,381,238	55,902,712	57,135,885
	Post-distribution	28,837,149	36,791,413	43,425,933	N/A
Other interests		(102,554)	5,068,539	5,081,689	(1,655,390)
Treasury stock		(1,959,107)	(1,959,107)	(7,292,513)	(7,292,513)
Non-controlling interests		4,144,338	8,219,097	11,503,878	11,058,459
Total equity	Pre-distribution	127,164,959	158,438,004	168,138,525	161,217,443
	Post-distribution	117,008,954	142,848,179	155,661,746	N/A

Source:The company's audited financial reports during the respective periods

3

2. Summary Consolidated Profit & Loss Statement

Unit:Except for earnings per share which are expressed in NT$, all other figures are NT$1,000.

	Financial information for the last 5 fiscal years			Financial Information as at September 30, 2016
	2013	2014	2015
Operating revenue	219,862,446	256,591,447	283,302,536	197,755,474
Gross profit	42,813,744	53,588,529	50,135,228	37,817,099
Net operating profit	22,044,323	29,645,869	24,884,622	18,575,572
Non-operating revenue and gains (Note 2)	(2,687,631)	(1,097,658)	403,631	(203,571)
Net income (loss) before tax (Note 2)	19,356,692	28,548,211	25,288,253	18,372,001
Net profit during current period for units operating as going concern (Note 2)	16,155,040	24,281,585	20,449,007	14,555,214
Loss for units which have ceased operations	-	-	-	-
Current period net profit (Note 2)	16,155,040	24,281,585	20,449,007	14,555,214
Other consolidated profit & loss (Net income after tax)	3,238,026	5,503,510	(147,547)	(7,331,544)
Total consolidated profit & loss (Note 2)	19,393,066	29,785,095	20,301,460	7,223,670
Net profit attributable to shareholders of the parent company (Note 2)	15,689,074	23,636,522	19,478,873	13,715,836
Net profit attributable to non-controlling interest	465,966	645,063	970,134	839,378
Consolidated profit & loss attributable toowners of the parent company (Note 2)	18,798,923	28,802,296	19,405,806	6,978,757

4

Consolidated profit & loss attributable tonon-controlling interest	594,143	982,799	895,654	244,913
Earnings per share (retroactive adjustment) (Note 2)	2.09	3.07	2.55	1.79

Source:The company's audited financial reports during the respective periods

Note:As at September 30, 2016 said company has completed identification of the difference between its investment cost and the fair value of identifiable assets and liabilities of Siliconware Precision Industries Co. Ltd. attributable to the company, with appropriate retroactive adjustments to the company's 2015 financial statements. After the aforesaid adjustments non-operating income and expenses were NT$122,274,000; net profit before tax was NT$25,006,896,000; net profit during current period for units operating as going concern during current period was NT$20,167,650,000; net profit during current period was NT$20,167,650,000; total consolidated profit & loss during current period was NT$20,020,103,000; net profit attributable to shareholders of the parent company was NT$19,197,516,000; consolidated profit & loss attributable to owners of the parent company was NT$19,124,449,000 and earnings per share were retroactively adjusted to NT$2.51.

5

III Calculation of Underwriting Price and Explanation

(I) Reference factors for calculation of underwriting prices

1. The company's capital increase through share issuance proposal has been approved by way of resolution of its Board of Directors meeting held on December 8, 2016. The resolution also stipulates that the issue price of the new shares shall be in accordance with market changes and can be adjusted in accordance with Article 6 Paragraph 1 of the "Taiwan Securities Association Self-Disciplinary Regulations on Underwriter Members for Subscription and Issuance of Securities by Issuing Company". Furthermore the Chairman is authorized to make necessary adjustments to the relevant conditions based on objective conditions at the time of share issuance.

2. For the current issue the company plans to issue 300,000,000 new ordinary shares with a face value of NT$10 each. The issue price has been tentatively fixed at NT$34.30, and the total capital raised is fixed at NT$10,290,000,000.Pursuant to the requirements under Article 267 of the Company Act, 10% of the new shares issued, i.e. 30,000,000 shares will be set aside for subscription by the company's employees. Furthermore pursuant to Article 28-1 of the Securities Exchange Act, 10% of new shares issued, i.e. 30,000,000 shares will be set aside for public offering through underwriter by way of open subscription.The remaining 80%, i.e. 240,000,000 shares will be subscribed by original shareholders with their respective shareholding ratios on the shareholders’ roster at subscription record date. For fractional part of a share subscribed by shareholders, such shareholders shall proceed to said company's registrar within 5 days of the cessation of transfer registration to process subscription through aggregation of fractional entitlement.For shares for which the original shareholders or employees have relinquished their subscription rights or fractional parts of shares, the Board of Directors authorizes the Chairman to negotiate with specific individuals to subscribe such shares or fractional parts at the issue price.

3. The new shares issued by this cash capital increase shall have the same rights and obligations as those of the ordinary shares originally issued.

(II) Explanation on price calculation

1. Based on the benchmark date of February 2, 2017 the average closing prices for the company's shares on the preceding trading day, preceding 3 trading days and preceding 5 trading days are NT$34.30, NT$33.78 and NT$34.00. The average closing price of NT$34.30 for the preceding 1 trading day shall be the reference price for the purpose of calculation.

2. With respect to the issuance of new shares for additional share capital, the underwriter KGI Securities Co., Ltd. has considered the market's overall situation, the company's

6

share price trend, ASE's operating performance and future prospects. KGI has, following joint consultation with ASE, fixed the share issue price at NT$34.30 per share. As such the underwriting price is in conformity with Article 6 of the "Taiwan Securities Association Self-Disciplinary Regulations on Underwriter Members for Subscription and Issuance of Securities by Issuing Company".

7

Issuing company: Advanced Semiconductor Engineering, Inc.

Legal Representative: Chian-Sheng Chang

(This seal endorsement page is solely for Calculation of Underwriting Price of Cash Subscription Shares for 2017 Capital Increase Share Issuance by Advanced Semiconductor Engineering, Inc.)

Date:

8

Main Underwriter: KGI Securities Co., Ltd.

Legal Representative: Hsu Daw-yi

(This seal endorsement page is solely for Calculation of Underwriting Price of Cash Subscription Shares for 2017 Capital Increase Share Issuance by Advanced Semiconductor Engineering, Inc.)

Date:

9

Appendix 2

Advanced Semiconductor Engineering, Inc.

2014 Consolidated Financial statements and Auditor Report

Advanced Semiconductor Engineering, Inc. and Subsidiaries 

Consolidated Financial Statements for the  

Years Ended December 31, 2014 and 2013 and 

Independent Auditors’ Report

REPRESENTATION LETTER

The entities that are required to be included in the combined financial statements of Advanced Semiconductor Engineering, Inc. as of and for the year ended December 31, 2014, under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with the International Accounting Standards No. 27, “Consolidated and Separate Financial Statements.” In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, Advanced Semiconductor Engineering, Inc. and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

Advanced Semiconductor Engineering, Inc.

By

________________________

JASON C.S. CHANG

Chairman

February 26, 2015

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders

Advanced Semiconductor Engineering, Inc.

We have audited the accompanying consolidated balance sheets of Advanced Semiconductor Engineering, Inc. and its subsidiaries (collectively, the “Group”) as of December 31, 2014 and 2013, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2014 and 2013. These consolidated financial statements are the responsibility of the Group’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the Rules Governing the Audit of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Those rules and standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2014 and 2013, and the consolidated results of operations and the consolidated cash flows for the years ended December 31, 2014 and 2013, in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed by the Financial Supervisory Commission of the Republic of China.

We have also audited the parent company only financial statements of Advanced Semiconductor Engineering, Inc. as of and for the years ended December 31, 2014 and 2013 on which we have issued an unqualified opinion.

February 26, 2015

Notice to Readers

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

For the convenience of readers, the independent auditors’ report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and consolidated financial statements shall prevail.

-3-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

	December 31, 2014				December 31, 2013
ASSETS	NT$		%		NT$		%
CURRENT ASSETS
Cash and cash equivalents (Notes 4 and 6)	$	51,694,410		16	$	45,026,371		16
Financial assets at fair value through profit or loss - current  (Notes 4, 5 and 7)		4,988,843		2		2,764,269		1
Available-for-sale financial assets - current (Notes 4 and 8)		1,533,265		-		2,376,970		1
Trade receivables, net (Notes 4 and 10)		52,920,810		16		43,235,573		15
Other receivables (Note 4)		537,122		-		422,345		-
Current tax assets (Note 4 and 24)		65,312		-		150,596		-
Inventories (Notes 4, 5 and 11)		20,163,093		6		16,281,236		6
Inventories related to real estate business
(Notes 4, 5, 12, 23 and 34)		23,986,478		7		18,589,255		6
Other financial assets - current (Notes 4 and 34)		638,592		-		278,375		-
Other current assets		3,427,265		1		3,051,492		1
Total current assets		159,955,190		48		132,176,482		46
NON-CURRENT ASSETS
Available-for-sale financial assets –
non-current (Notes 4 and 8)		941,105		-		1,140,329		-
Investments accounted for using the
equity method (Notes 4 and 13)		1,492,441		1		1,216,201		1
Property, plant and equipment
(Notes 4, 5, 14, 23, 34 and 35)		151,587,115		45		131,497,331		46
Goodwill (Notes 4, 5 and 15)		10,445,415		3		10,347,820		4
Other intangible assets (Notes 4, 5, 16 and 23)		1,467,871		1		1,605,824		1
Deferred tax assets (Notes 4 , 5 and 24)		4,493,664		1		3,765,482		1
Other financial assets - non-current (Notes 4 and 34)		367,345		-		354,993		-
Long-term prepayments for lease (Note 17)		2,585,964		1		4,072,281		1
Other non-current assets		635,350		-		637,163		-
Total non-current assets		174,016,270		52		154,637,424		54
TOTAL	$	333,971,460		100	$	286,813,906		100

(Continued)

-4-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands of New Taiwan Dollars)

	December 31, 2014						December 31, 2013
LIABILITIES AND EQUITY	NT$			%			NT$			%
CURRENT LIABILITIES
Short-term borrowings (Note 18)	$	41,176,033			12		$	44,618,195			16
Financial liabilities at fair value through
profit or loss - current (Notes 4, 5 and 7)		2,651,352			1			1,853,304			1
Derivative financial liabilities for hedging
- current (Notes 4, 5 and 9)		-			-			3,310			-
Trade payables		35,411,281			11			28,988,976			10
Other payables (Note 20)		22,364,516			7			14,758,553			5
Current tax liabilities (Note 4 and 24)		4,150,036			1			3,000,869			1
Advance real estate receipts (Note 4)		480,325			-			19,248			-
Current portion of bonds payable
(Notes 4 and 19)		-			-			731,438			-
Current portion of long-term borrowings
(Notes 18 and 34)		2,831,007			1			5,276,206			2
Other current liabilities		2,134,917			1			1,585,177			-
Total current liabilities		111,199,467			34			100,835,276			35
NON-CURRENT LIABILITIES
Bonds payable (Notes 4 and 19)		31,270,131			10			20,582,567			7
Long-term borrowings (Notes 18 and 34)		24,104,424			7			29,580,659			11
Deferred tax liabilities (Notes 4, 5 and 24)		3,932,819			1			2,663,767			1
Long-term payables (Note 20)		-			-			894,150			-
Accrued pension cost (Notes 4, 5 and 21)		4,371,136			1			4,441,357			2
Other non-current liabilities		657,392			-			651,171			-
Total non-current liabilities		64,335,902			19			58,813,671			21
Total liabilities		175,535,369			53			159,648,947			56
EQUITY ATTRIBUTABLE TO OWNERS OF
THE COMPANY (Notes 4 and 22)
Share capital
Ordinary shares		78,525,378			24			77,560,040			27
Shares subscribed in advance		189,801			-			620,218			-
Total share capital		78,715,179			24			78,180,258			27
Capital surplus		15,995,671			5			7,908,870			3
Retained earnings
Legal reserve		10,289,878			3			8,720,971			3
Special reserve		3,353,938			1			3,663,930			2
Unappropriated earnings		38,753,462			12			26,608,253			9
Total retained earnings		52,397,278			16			38,993,154			14
Other Equity		5,067,931			1			(102,554	)		-
Treasury shares		(1,959,107	)		(1	)		(1,959,107	)		(1	)
Equity attributable to owners of
the Company		150,216,952			45			123,020,621			43
NON-CONTROLLING INTERESTS
(Notes 4 and 22)		8,219,139			2			4,144,338			1
Total equity		158,436,091			47			127,164,959			44
TOTAL	$	333,971,460			100		$	286,813,906			100

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

-5-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Thousands of New Taiwan Dollars Except Earnings Per Share)

	For the Years Ended December 31
	2014						2013
	NT$			%			NT$			%
OPERATING REVENUES (Note 4)	$	256,591,447			100		$	219,862,446			100
OPERATING COSTS (Notes 11, 21 and 23)		203,051,691			79			177,048,702			81
GROSS PROFIT		53,539,756			21			42,813,744			19
OPERATING EXPENSES (Notes 21 and 23)
Selling and marketing expenses		3,439,258			2			2,983,874			1
General and administrative expenses		10,233,878			4			8,716,529			4
Research and development expenses		10,295,363			4			9,069,018			4
Total operating expenses		23,968,499			10			20,769,421			9
PROFIT FROM OPERATIONS		29,571,257			11			22,044,323			10
NON-OPERATING INCOME AND
EXPENSES
Other income (Note 23)		588,875			-			557,014			-
Other gains (losses), net (Note 23)		776,290			1			(963,490	)		-
Finance costs (Note 23)		(2,354,097	)		(1	)		(2,307,455	)		(1	)
Share of the profit (loss) of associates
and joint ventures (Note 4)		(108,726	)		-			26,300			-
Total non-operating income and
expenses		(1,097,658	)		-			(2,687,631	)		(1	)
PROFIT BEFORE INCOME TAX EXPENSE		28,473,599			11			19,356,692			9
INCOME TAX EXPENSE (Notes 4, 5
and 24)		4,251,513			1			3,201,652			2
NET PROFIT FOR THE YEAR		24,222,086			10			16,155,040			7

(Continued)

-6-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Thousands of New Taiwan Dollars Except Earnings Per Share)

	For the Years Ended December 31
	2014					2013
	NT$			%		NT$			%
OTHER COMPREHENSIVE INCOME
(LOSS)
Exchange differences on translating
foreign operations	$	5,404,358			2	$	2,817,268			2
Unrealized gain (loss) on available-for-sale
financial assets		(133,714	)		-		14,839			-
Cash flow hedges		3,279			-		1,245			-
Remeasurement of defined benefit
obligation		(45,884	)		-		418,843			-
Share of other comprehensive income
of associates and joint ventures		234,125			-		55,183			-
Income tax relating to items that will not
be reclassified subsequently		13,039			-		(69,352	)		-
Other comprehensive income for
the year, net of income tax		5,475,203			2		3,238,026			2
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR	$	29,697,289			12	$	19,393,066			9
NET PROFIT ATTRIBUTABLE TO:
Owners of the Company	$	23,592,667			10	$	15,689,074			7
Non-controlling interests		629,419			-		465,966			-
	$	24,222,086			10	$	16,155,040			7
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO:
Owners of the Company	$	28,730,614			11	$	18,798,923			9
Non-controlling interests		966,675			1		594,143			-
	$	29,697,289			12	$	19,393,066			9
EARNINGS PER SHARE (Note 25)
Basic	$	3.07				$	2.09
Diluted	$	2.95				$	2.03

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

-7-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In Thousands of New Taiwan Dollars)

	Equity Attributable to Owners of the Company
																			Other Equity
	Share Capital							Retained Earnings
	Shares (In Thousands)		Amounts		Capital Surplus			Legal Reserve		Special Reserve			Unappropriated Earnings			Total			Exchange Differences on Translating Foreign Operations			Unrealized Gain on Available for-sale Financial Assets		Cash Flow Hedges			Total			Treasury Shares			Total			Non-controlling Interests			Total Equity
BALANCE AT JANUARY 1, 2013		7,602,292	$	76,047,667	$	5,262,129			7,411,835		—		$	23,526,565		$	30,938,400			(3,210,248	)	$	355,254	$	(3,755	)	$	(2,858,749	)	$	(1,959,107	)	$	107,430,340		$	3,521,419		$	110,951,759
Special reserve under Rule No. 1010012865 issued by the Financial Supervisory Commission (Note 22)		—		—		—			—		3,353,938			(3,353,938	)		—			—			—		—			—			—			—			—			—
Profit for the year ended December 31, 2013		—		—		—			—		—			15,689,074			15,689,074			—			—		—			—			—			15,689,074			465,966			16,155,040
Other comprehensive income for the year ended December 31, 2013, net of income tax		—		—		—			—		—			353,654			353,654			2,684,727			70,992		476			2,756,195						3,109,849			128,177			3,238,026
Total comprehensive income for the year ended December 31, 2013		—		—		—			—		—			16,042,728			16,042,728			2,684,727			70,992		476			2,756,195						18,798,923			594,143			19,393,066
Issue of ordinary shares for cash (Note 22)		130,000		1,300,000		2,093,000			—		—			—			—			—			—		—									3,393,000			—			3,393,000
Appropriation of 2012 earnings
Legal reserve		—		—		—			1,309,136		—			(1,309,136	)		—			—			—		—									—			—			—
Special reserve		—		—		—			—		309,992			(309,992	)		—			—			—		—									—			—			—
Cash dividends distributed by the Company		—		—		—					—			(7,987,974	)		(7,987,974	)		—			—		—									(7,987,974	)		—			(7,987,974	)
				—		—			1,309,136		309,992			(9,607,102	)		(7,987,974	)		—			—		—									(7,987,974	)		—			(7,987,974	)
Issue of dividends received by subsidiaries from the Company		—		—		153,097			—		—			—			—			—			—		—									153,097			—			153,097
Partial disposal of interest in subsidiaries and additional  acquisition  of partially-owned subsidiaries (Notes 22 and 28)		—		—		(330	)		—		—			—			—			—			—		—									(330	)		27,826			27,496
Changes in capital surplus from investments in associates accounted for using the equity method		—		—		1,457			—		—			—			—			—			—		—									1,457			—			1,457
Issue of ordinary shares under employee share options		55,535		832,591		399,517			—		—			—			—			—			—		—									1,232,108						1,232,108
Cash dividends distributed by subsidiaries		—		—		—			—		—			—			—			—			—		—									—			(99,597	)		(99,597	)
Additional non-controlling  interest arising on issue of employee share options by subsidiaries		—		—		—			—		—			—			—			—			—		—									—			100,547			100,547
BALANCE AT DECEMBER 31, 2013		7,787,827		78,180,258		7,908,870			8,720,971		3,663,930			26,608,253			38,993,154			(525,521	)		426,246		(3,279	)		(102,554	)		(1,959,107	)		123,020,621			4,144,338			127,164,959
Profit for the year ended December 31,2014		—		—		—			—		—			23,592,667			23,592,667			—			—		—			—			—			23,592,667			629,419			24,222,086
Other comprehensive income (loss) for the year ended December 31, 2014, net of income tax		—		—		—			—		—			(32,538	)		(32,538	)		5,066,674			100,532		3,279			5,170,485			—			5,137,947			337,256			5,475,203
Total comprehensive income for the year ended December 31, 2014		—		—		—			—		—			23,560,129			23,560,129			5,066,674			100,532		3,279			5,170,485			—			28,730,614			966,675			29,697,289
Appropriation of 2013 earnings
Legal reserve		—		—		—			1,568,907		—			(1,568,907	)		—			—			—		—			—			—			—			—			—
Special reserve		—		—		—			—		(309,992	)		309,992			—			—			—		—			—			—			—			—			—
Cash dividends distributed by the Company		—		—		—			—		—			(10,156,005	)		(10,156,005	)		—			—		—			—			—			—			—			(10,156,005	)
		—		—		—			1,568,907		(309,992	)		(11,414,920	)		(10,156,005	)		—			—		—			—			—			(10,156,005	)		—			(10,156,005	)
Issue of dividends received by subsidiaries from the Company		—		—		188,790			—		—			—			—			—			—		—			—			—			188,790			—			188,790
Partial disposal of interest in subsidiaries and additional  acquisition  of partially-owned subsidiaries (Notes 22 and 28)		—		—		6,871,062			—		—			—			—			—			—		—			—			—			6,871,062			3,073,516			9,944,578
Change in capital surplus from investments in associates accounted for using the equity method		—		—		26,884			—		—			—			—			—			—		—			—			—			26,884			—			26,884

                                                                                                                                                                        (Continued)

-8-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In Thousands of New Taiwan Dollars)

	Equity Attributable to Owners of the Company
															Other Equity
															Exchange
															Differences on		Unrealized Gain
	Share Capital						Retained Earnings								Translating		on Available-
	Shares										Unappropriated				Foreign		for-sale		Cash Flow									Non-controlling
	(In Thousands)		Amounts		Capital Surplus		Legal Reserve		Special Reserve		Earnings		Total		Operations		Financial Assets		Hedges		Total		Treasury Shares			Total		Interests					Total Equity
Issue of ordinary shares under employee share options		73,898	$	534,921	$	1,000,065	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—		$	1,534,986		$				$1,534,986
Cash dividends distributed by subsidiaries		—		—		—		—		—		—		—		—		—		—		—		—			—				(85,766	)	(85,766
Additional non-controlling interest arising on issue of
employee share options by subsidiaries		—		—		—		—		—		—		—		—		—		—		—		—			—				120,376		120,376
BALANCE AT DECEMBER 31, 2014		7,861,725	$	78,715,179	$	15,995,671	$	10,289,878	$	3,353,938	$	38,753,462	$	52,397,278	$	4,541,153	$	526,778	$	—	$	5,067,931	$	(1,959,107	)	$	150,216,952			$	8,219,139		$158,436,091

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

 

-9-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands of New Taiwan Dollars)

	For the Years Ended December 31
	2014			2013
	NT$			NT$
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before income tax	$	28,473,599		$	19,356,692
Adjustments for:
Depreciation expense		25,805,042			24,696,607
Amortization expense		545,734			774,304
Net gain on fair value change of financial assets
and liabilities at fair value through profit or loss		(1,838,840	)		(795,359	)
Interest expense		2,324,426			2,257,144
Interest income		(243,474	)		(212,801	)
Dividend income		(101,252	)		(131,449	)
Compensation cost of employee share options		110,157			260,801
Share of the loss (profit) of associates and joint
ventures		108,726			(26,300	)
Impairment loss recognized on financial assets		28,421			196,325
Impairment loss recognized on non-financial assets		899,480			949,015
Others		1,717,372			1,345,390
Changes in operating assets and liabilities
Financial assets held for trading		823,313			1,122,280
Trade receivables		(9,703,070	)		(5,767,254	)
Other receivables		(8,625	)		(6,540	)
Inventories		(8,208,824	)		(3,241,115	)
Other current assets		102,353			(108,425	)
Financial liabilities held for trading		(835,779	)		(1,011,975	)
Trade payables		6,422,305			4,722,462
Other payables		3,045,452			1,068,223
Other current liabilities		703,764			2,796
Other operating activities items		(111,843	)		(174,306	)
		50,058,437			45,276,515
Interest received		233,457			182,164
Dividend received		101,252			176,058
Interest paid		(2,065,244	)		(2,200,143	)
Income tax paid		(2,463,153	)		(2,138,639	)
Net cash generated from operating activities		45,864,749			41,295,955
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of financial assets designated as at fair
value through profit or loss		(108,958,658	)		(53,135,894	)
Proceeds on sale of financial assets designated as at
fair value through profit or loss		109,825,159			55,032,536
Purchase of available-for-sale financial assets		(3,565,428	)		(3,474,152	)
Proceeds on sale of available-for-sale financial assets		4,388,130			1,093,408

(Continued)

-10-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands of New Taiwan Dollars)

	For the Years Ended December 31
	2014			2013
	NT$			NT$
Cash received from return of capital by
available-for-sale financial assets	$	20,411		$	27,368
Purchase of held-to-maturity financial assets		-			(88,169	)
Proceeds on sale of held-to-maturity financial assets		-			73,716
Acquisition of associates and joint ventures		(100,000	)		-
Net cash outflow on acquisition of subsidiaries		-			(250,387	)
Payments for property, plant and equipment		(39,598,964	)		(29,142,719	)
Proceeds from disposal of property, plant and
equipment		421,207			351,546
Payments for intangible assets		(396,466	)		(313,110	)
Decrease (increase) in other financial assets		(372,569	)		4,513
Increase in other non-current assets		(480,711	)		(104,499	)
Net cash used in investing activities		(38,817,889	)		(29,925,843	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeding from (repayment of) short-term
borrowings		(3,442,162	)		7,051,874
Proceeds from issue of bonds		8,888,562			11,900,051
Repayment of bonds payable		(729,790	)		-
Proceeds from long-term borrowings		32,030,868			28,715,694
Repayment of long-term borrowings		(40,978,403	)		(31,382,333	)
Dividends paid		(9,967,215	)		(7,834,877	)
Proceeds from issue of ordinary shares		-			3,393,000
Proceeds from exercise of employee share options		1,498,343			1,071,854
Decrease (Increase) in non-controlling interests		9,905,673			(72,101	)
Other financing activities items		(2,879	)		(48,291	)
Net cash generated from (used in) financing
activities		(2,797,003	)		12,794,871
EFFECTS OF EXCHANGE RATE CHANGES ON
THE BALANCE OF CASH AND CASH
EQUIVALENTS		2,418,182			867,872
NET INCREASE IN CASH AND CASH
EQUIVALENTS		6,668,039			25,032,855
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE YEAR		45,026,371			19,993,516
CASH AND CASH EQUIVALENTS AT THE END
OF THE YEAR	$	51,694,410		$	45,026,371

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

-11-

ADVANCED SEMICONDUCTOR ENGINEERING, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

(Amounts in Thousands, Unless Stated Otherwise)

1. GENERAL INFORMATION

Advanced Semiconductor Engineering, Inc. (the “Company”), a corporation incorporated in Nantze Export Processing Zone under the laws of Republic of China (the “ROC”). In August 2004, the Company merged its subsidiaries, ASE (Chung Li) Inc. and ASE Material Inc., and established Chung-Li Branch. In August 2006, the Company spun-off and assigned its substrate production business to ASE Electronics Inc. In January 2011, the Company established Nan-Tou Branch. In May 2012, the Company merged its subsidiary, PowerASE Technology, Inc. In August 2013, the Company merged its subsidiary, Yang Ting Tech Co., Ltd. The Company and its subsidiaries (collectively referred to as the “Group”) offer a comprehensive range of semiconductors packaging, testing, and electronic manufacturing services (“EMS”).

Since July 1989, the Company’s ordinary shares have been listed on the Taiwan Stock Exchange (the “TSE”) under the symbol “2311”. Since September 2000, the Company’s ordinary shares of the Company have been traded on the New York Stock Exchange (the “NYSE”) under the symbol “ASX” in the form of American Depositary Shares (“ADS”). The ordinary shares of its subsidiary, Universal Scientific Industrial (Shanghai) Co., Ltd. (the “USISH”), have been listed on the Shanghai Stock Exchange (the “SSE”) under the symbol “601231” since February 2012.

The consolidated financial statements are presented in the Company’s functional currency, New Taiwan dollar (NT$).

2. APPROVAL OF FINANCIAL STATEMENTS

The consolidated financial statements were approved for issue by board of directors on February 26, 2015.

3. APPLICATION OF NEW AND REVISED STANDARDS, AMENDMENTS AND INTERPRETATIONS

a. The amendment to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the 2013 version of the International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), Interpretations of IFRS (IFRIC), and Interpretations of IAS (SIC) endorsed by the Financial Supervisory Commission of the ROC (“FSC”) not yet effective

Rule No. 1030029342 and Rule No. 1030010325 issued by the FSC on April 3, 2014, stipulated that the Group should apply the 2013 version of IFRS, IAS, IFRIC and SIC (collectively, the “IFRSs”) endorsed by the FSC and the related amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers starting January 1, 2015.

New, Amended and Revised Standards and Interpretations   (the “New IFRSs”)	Effective Date  Announced by International Accounting Standard Board (“IASB”) (Note)
Improvements to IFRSs (2009) - amendment to IAS 39	January 1, 2009 or January 1, 2010
Amendment to IAS 39 “Embedded Derivatives”	Effective in fiscal year ended on or after June 30, 2009

(Continued)

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New, Amended and Revised Standards and Interpretations   (the “New IFRSs”)	Effective Date  Announced by International Accounting Standard Board (“IASB”) (Note)
Improvements to IFRSs (2010)	July 1, 2010 or January 1,2011
Annual Improvements to IFRSs 2009 - 2011 Cycle	January 1, 2013
Amendments to IFRS 1 “Limited Exemption from Comparative IFRS 7 Disclosures for First- time Adopters”	July 1, 2010
Amendment to IFRS 1 “Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters”	July 1, 2011
Amendment to IFRS 1 “Government Loans”	January 1, 2013
Amendment to IFRS 7 “Disclosures - Offsetting Financial Assets and Financial Liabilities”	January 1, 2013
Amendment to IFRS 7 “Disclosures - Transfers of Financial Assets”	July 1, 2011
IFRS 10 “Consolidated Financial Statements”	January 1, 2013
IFRS 11 “Joint Arrangements”	January 1, 2013
IFRS 12 “Disclosure of Interests in Other Entities”	January 1, 2013
Amendments to IFRS 10, IFRS 11 and IFRS 12 “Consolidated financial Statements, Joint Arrangements, and Disclosure of Interests in Other Entities:  Transition Guidance”	January 1, 2013
Amendments to IFRS 10, IFRS 12 and IAS 27 “Investment Entities”	January 1, 2014
IFRS 13 “Fair Value Measurement”	January 1, 2013
Amendment to IAS 1 “Presentation of Items of Other Comprehensive Income”	July 1, 2012
Amendment to IAS 12 “Deferred Tax:  Recovery of Underlying Assets”	January 1, 2012
IAS 19 (Revised 2011) “Employee Benefits”	January 1, 2013
IAS 27 (Revised 2011) “Separate Financial Statements”	January 1, 2013
IAS 28 (Revised 2011) “Investments in Associates and Joint Ventures”	January 1, 2013
Amendment to IAS 32 “Offsetting of Financial Assets and Financial Liabilities”	January 1, 2014
IFRIC 20 “Stripping Costs in the Production Phase of a Surface Mine”	January 1, 2013

(Concluded)

Note : Unless stated otherwise, the above New IFRSs are effective for annual periods beginning on or after the respective effective dates.

Except for the following, whenever applied, the initial application of the above 2013 IFRSs version and the related amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers would not have any material impact on the Group’s accounting policies:

1) IFRS 12 “Disclosure of Interests in Other Entities”

IFRS 12 is a new disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or unconsolidated structured entities. In general, the disclosure requirements in IFRS 12 are more extensive than in the current standards.

2) IFRS 13 “Fair Value Measurement”

IFRS 13 establishes a single source of guidance for fair value measurements. It defines fair value,

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establishes a framework for measuring fair value, and requires disclosures about fair value measurements. The disclosure requirements in IFRS 13 are more extensive than those required in the current standards, for example, quantitative and qualitative disclosures based on the three-level fair value hierarchy currently required for financial instruments only will be extended by IFRS 13 to cover all assets and liabilities within its scope.

The fair value measurements under IFRS 13 will be applied prospectively from January 1, 2015.

3) Amendment to IAS 1 “Presentation of Items of Other Comprehensive Income”

The amendments to IAS 1 requires items of other comprehensive income to be grouped into those items that (1) will not be reclassified subsequently to profit or loss; and (2) may be reclassified subsequently to profit or loss. Income taxes on related items of other comprehensive income are grouped on the same basis. Under current IAS 1, there were no such requirements.

The Group retrospectively will apply the above amendments starting in 2015. Items that will not be reclassified subsequently to profit or loss are remeasurements of the defined benefit plans and share of remeasurements of the defined benefit plans of associates accounted for using the equity method. Items that may be reclassified to profit or loss are the exchange differences on translating foreign operations, unrealized gain (loss) on available-for-sale financial assets, cash flow hedges, and share of other comprehensive income (except the share of the remeasurements of the defined benefit plans) of associates accounted for using the equity method. However, the application of the above amendments will not have any impact on the net profit, other comprehensive income (net of income tax), and total comprehensive income for the period.

4) Revision to IAS 19 “Employee Benefits”

Revised IAS 19 requires the recognition of changes in defined benefit obligations and in the fair value of plan assets when they occur, and hence eliminates the “corridor approach” permitted under current IAS 19 and accelerate the recognition of past service costs. The revision requires all remeasurements of the defined benefit plans to be recognized immediately through other comprehensive income in order for the net pension asset or liability to reflect the full value of the plan deficit or surplus. Remeasurement of the defined benefit plans is presented separately as other equity. The Group has not determinated the presentation of the changes in defined benefit obligations.

Furthermore, the interest cost and expected return on plan assets used in current IAS 19 are replaced with a “net interest” amount, which is calculated by applying the discount rate to the net defined benefit liability or asset. In addition, the revised IAS 19 introduces certain changes in the presentation of the defined benefit cost, and also includes more extensive disclosures.

On initial application of the revised IAS 19 in 2015, the changes in cumulative employee benefit costs as of January 1, 2013 resulting from the retrospective application are adjusted to accrued pension cost, deferred tax assets, capital surplus, retained earnings and non-controlling interests; however, the carrying amount of inventory is not adjusted. In addition, in preparing the consolidated financial statements for the year ended December 31, 2015, the Group would elect not to present 2014 comparative information about the sensitivity analysis of the defined benefit obligation. The anticipated impact of the initial application is set out below:

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	Carrying Amount			Adjustments Arising from Retrospective Application			Adjusted
	NT$			NT$			NT$
Impact on Assets, Liabilities and Equity
December 31, 2014
Deferred tax assets	$	4,493,664		$	13,307		$	4,506,971
Accrued pension cost		4,371,136			11,393			4,382,529
Capital surplus		15,995,671			17,387			16,013,058
Retained earnings		52,397,278			(16,040	)		52,381,238
Exchange differences on translating foreign operations		4,541,153			608			4,541,761
Non-controlling interests		8,219,139			(41	)		8,219,098
January 1, 2014
Deferred tax assets		3,765,482			17,783			3,783,265
Accrued pension cost		4,441,357			104,603			4,545,960
Capital surplus		7,908,870			11,576			7,920,446
Retained earnings		38,993,154			(87,050	)		38,906,104
Non-controlling interests		4,144,338			(11,346	)		4,132,992
Impact on Total Comprehensive Income For the Year Ended December 31, 2014
Operating cost		203,051,691			(48,773	)		203,002,918
Operating expense		23,968,499			(25,839	)		23,942,660
Income tax expense		4,251,513			15,113			4,266,626
Net profit for the year		24,222,086			59,499			24,281,585
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit obligation		(45,884	)		17,739			(28,145	)
Income tax relating to items that will not be reclassified subsequently		13,039			9,897			22,936
Impact on comprehensive income for the year, net of income tax		5,475,203			28,244			5,503,447
Total comprehensive income for the year		29,697,289			87,743			29,785,032
Net profit attributable to:
Owners of the Company	$	23,592,667		$	43,855		$	23,636,522
Non-controlling interests		629,419			15,644			645,063
	$	24,222,086		$	59,499		$	24,281,585
Total comprehensive income attributable to:
Owners of the Company	$	28,730,614		$	71,618		$	28,802,232
Non-controlling interests		966,675			16,125			982,800
	$	29,697,289		$	87,743		$	29,785,032

-15-

5) Amendment to IFRS 7 “Disclosures - Offsetting Financial Assets and Financial Liabilities”

The amendments to IFRS 7 require disclosure of information about rights of offset and related arrangements (such as collateral posting requirements) for financial instruments under enforceable master netting arrangements and similar arrangements.

6) Amendment to IAS 32 “Offsetting Financial Assets and Financial Liabilities”

The amendments to IAS 32 clarify the requirements relating to the offset of financial assets and financial liabilities. Specifically, the amendments clarify the meaning of “currently has a legally enforceable right of set-off” and “simultaneous realization and settlement”.

7) Annual Improvements to IFRSs: 2009-2011 Cycle

Several standards including IFRS 1 “First-time Adoption of International Financial Reporting Standards”, IAS 1 “Presentation of Financial Statements”, IAS 16 “Property, Plant and Equipment”, IAS 32 “Financial Instruments: Presentation” and IAS 34 “Interim Financial Reporting” were amended in this annual improvement.

The amendments to IAS 1 clarify that an entity is required to present a balance sheet as at the beginning of the preceding period when a) it applies an accounting policy retrospectively, or makes a retrospective restatement or reclassifies items in its financial statements, and b) the retrospective application, restatement or reclassification has a material effect on the information in the balance sheet at the beginning of the preceding period. The amendments also clarify that related notes are not required to accompany the balance sheet at the beginning of the preceding period.

The initial application of the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the 2013 IFRSs version in 2015 is expected to have material effect on the consolidated balance sheet as of January 1, 2014. In preparing the consolidated financial statements for the year ended December 31, 2015, the Group would present the consolidated balance sheet as of January 1, 2014 in accordance of the above amendments to IAS 1 and disclose related information in accordance with IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors”, but not required to make disclosures about the line items of the balance sheet as of January 1, 2014.

b. New IFRSs in issue but not yet endorsed by the FSC

The Group has not applied the following New IFRSs issued by the IASB but not yet endorsed by the FSC. As of the date the consolidated financial statements were approved for issue, the FSC has not announced their effective dates.

New IFRSs	Effective Date  Announced by IASB (Note 1)
Annual Improvements to IFRSs 2010-2012 Cycle	July 1, 2014 or transactions on or after July 1, 2014
Annual Improvements to IFRSs 2011-2013 Cycle	July 1, 2014
Annual Improvements to IFRSs 2012-2014 Cycle	January 1, 2016 (Note 2)
IFRS 9 “Financial Instruments”	January 1, 2018
Amendments to IFRS 9 and IFRS 7 “Mandatory Effective Date of IFRS 9 and Transition Disclosures”	January 1, 2018

(Continued)

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New IFRSs	Effective Date Announced by IASB (Note 1)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”	January 1, 2016 (Note 3)
Amendments to IFRS 10, IFRS 12 and IAS 28 “Investment Entities:  Applying the Consolidation Exception”	January 1, 2016
Amendment to IFRS 11 “Accounting for Acquisitions of Interests in Joint Operations”	January 1, 2016
IFRS 14 “Regulatory Deferral Accounts”	January 1, 2016
IFRS 15 “Revenue from Contracts with Customers”	January 1, 2017
Amendment to IAS 1 “Disclosure Initiative”	January 1, 2016
Amendments to IAS 16 and IAS 38 “Clarification of Acceptable Methods of Depreciation and Amortization”	January 1, 2016
Amendments to IAS 16 and IAS 41 “Agriculture:  Bearer Plants”	January 1, 2016
Amendment to IAS 19 “Defined Benefit Plans:  Employee Contributions”	July 1, 2014
Amendment to IAS 27 Equity Method in Separate Financial Statements	January 1, 2016
Amendment to IAS 36 “Impairment of Assets:  Recoverable Amount Disclosures for Non-financial Assets”	January 1, 2014
Amendment to IAS 39 “Novation of Derivatives and Continuation of Hedge Accounting”	January 1, 2014
IFRIC 21 “Levies”	January 1, 2014

(Concluded)

Note 1: Unless stated otherwise, the above New IFRSs are effective for annual periods beginning on or after their respective effective dates.

Note 2: The amendment to IFRS 5 is applied prospectively to changes in a method of disposal that occur in annual periods beginning on or after January 1, 2016; the remaining amendments are effective for annual periods beginning on or after January 1, 2016.

Note 3: Prospectively applicable to transactions occurring in annual periods beginning on or after January 1, 2016.

The initial application of the above New IFRSs, whenever applied, would not have any material impact on the Group’s accounting policies, except for the following:

1) IFRS 9 “Financial Instruments”

Recognition and measurement of financial assets

With regards to financial assets, all recognized financial assets that are within the scope of IAS 39 “Financial Instruments: Recognition and Measurement” are subsequently measured at amortized cost or fair value. Under IFRS 9, the requirement for the classification of financial assets is stated below:

For the Group’s debt instruments that have contractual cash flows that are solely payments of principal and interest on the principal amount outstanding, their classification and measurement are as follows:

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a) For debt instruments, if they are held within a business model whose objective is to collect the contractual cash flows, the financial assets are measured at amortized cost and are assessed for impairment continuously with impairment loss recognized in profit or loss, if any. Interest revenue is recognized in profit or loss by using the effective interest method;

b) For debt instruments, if they are held within a business model whose objective is achieved by both the collecting of contractual cash flows and the selling of financial assets, the financial assets are measured at fair value through other comprehensive income (FVTOCI) and are assessed for impairment. Interest revenue is recognized in profit or loss by using the effective interest method, and other gain or loss shall be recognized in other comprehensive income, except for impairment gains or losses and foreign exchange gains and losses. When the debt instruments are derecognized or reclassified, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.

Except for above, all other financial assets are measured at fair value through profit or loss. However, the Group may make an irrevocable election to present subsequent changes in the fair value of an equity investment (that is not held for trading) in other comprehensive income, with only dividend income generally recognized in profit or loss. No subsequent impairment assessment is required, and the cumulative gain or loss previously recognized in other comprehensive income cannot be reclassified from equity to profit or loss.

The impairment of financial assets

IFRS 9 requires that impairment loss on financial assets is recognized by using the “Expected Credit Losses Model”. The credit loss allowance is required for financial assets measured at amortized cost, financial assets mandatorily measured at FVTOCI, lease receivables, contract assets arising from IFRS 15 “Revenue from Contracts with Customers”, certain written loan commitments and financial guarantee contracts. A loss allowance for the 12-month expected credit losses is required for a financial asset if its credit risk has not increased significantly since initial recognition. A loss allowance for full lifetime expected credit losses is required for a financial asset if its credit risk has increased significantly since initial recognition and is not low. However, a loss allowance for full lifetime expected credit losses is required for trade receivables that do not constitute a financing transaction.

For purchased or originated credit-impaired financial assets, the Group takes into account the expected credit losses on initial recognition in calculating the credit-adjusted effective interest rate. Subsequently, any changes in expected losses are recognized as a loss allowance with a corresponding gain or loss recognized in profit or loss.

Hedge accounting

The main changes in hedge accounting amended the application requirements for hedge accounting to better reflect the entity’s risk management activities. Compared with IAS 39, the main changes include: (1) enhancing types of transactions eligible for hedge accounting, specifically broadening the risk eligible for hedge accounting of non-financial items; (2) changing the way hedging derivative instruments are accounted for to reduce profit or loss volatility; and (3) replacing retrospective effectiveness assessment with the principle of economic relationship between the hedging instrument and the hedged item.

2) Amendment to IAS 36 “Recoverable Amount Disclosures for Non-financial Assets”

In issuing IFRS 13 “Fair Value Measurement”, the IASB made consequential amendment to the disclosure requirements in IAS 36 “Impairment of Assets”, introducing a requirement to disclose in every reporting period the recoverable amount of an asset or each cash-generating unit. The amendment clarifies that such disclosure of recoverable amounts is required only when an

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impairment loss has been recognized or reversed during the period. Furthermore, the Group is required to disclose the discount rate used in measurements of the recoverable amount based on fair value less costs of disposal measured using a present value technique.

3) IFRS 15 “Revenue from Contracts with Customers”

IFRS 15 establishes principles for recognizing revenue that apply to all contracts with customers, and will supersedes IAS 18 “Revenue”, IAS 11 “Construction Contracts” and a number of revenue-related interpretations from January 1, 2017.

When applying IFRS 15, an entity shall recognize revenue by applying the following steps:

— Identify the contract with the customer;

— Identify the performance obligations in the contract;

— Determine the transaction price;

— Allocate the transaction price to the performance obligations in the contracts; and

— Recognize revenue when the entity satisfies a performance obligation.

When IFRS 15 is effective, the Group may elect to apply this Standard either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this Standard recognized at the date of initial application.

4) Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”

The amendments stipulated that, when the Group sells or contributes assets that constitute a business (as defined in IFRS 3) to an associate or joint venture, the gain or loss resulting from the transaction is recognized in full. Also, when the Group loses control of a subsidiary that contains a business but retains significant influence or joint control, the gain or loss resulting from the transaction is recognized in full.

Conversely, when the Group sells or contributes assets that do not constitute a business to an associate or joint venture, the gain or loss resulting from the transaction is recognized only to the extent of the unrelated investors’ interest in the associate or joint venture, i.e. the entity’s share of the gain or loss is eliminated. Also, when the Group loses control of a subsidiary that does not contain a business but retains significant influence or joint control in an associate or a joint venture, the gain or loss resulting from the transaction is recognized only to the extent of the unrelated investors’ interest in the associate or joint venture, i.e. the entity’s share of the gain or loss is eliminated.

5) Amendment to IAS 1 Disclosure Initiative

The amendment clarifies that the consolidated financial statements should be prepared for the purpose of disclosing material information. To improve the understandability of its consolidated financial statements, the Group should disaggregate the disclosure of material items into their different natures or functions, and disaggregate material information from immaterial information.

The amendment further clarifies that the Group should consider the understandability and comparability of its consolidated financial statements to determine a systematic order in presenting its footnotes.

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Except for the above impact, as of the date the consolidated financial statements were approved for issue, the Group is continuously assessing the possible impact that the application of other standards and interpretations will have on the Group’s financial position and results of operations, and will disclose the relevant impact when the assessment is completed.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Statement of Compliance

The consolidated financial statements have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs as endorsed by the FSC.

b. Basis of Preparation

The consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments that are measured at fair value. Historical cost is generally based on the fair value of the consideration given in exchange for the assets.

c. Classification of Current and Non-current Assets and Liabilities

Current assets include cash and cash equivalents and those assets held primarily for trading purposes or to be realized within twelve months after the balance sheet date, unless the asset is to be used for an exchange or to settle a liability, or otherwise remains restricted, at more than twelve months after the balance sheet date. Current liabilities are obligations incurred for trading purposes or to be settled within twelve months after the balance sheet date and liabilities that do not have an unconditional right to defer settlement for at least twelve months after the balance sheet date. Assets and liabilities that are not classified as current are classified as non-current.

The Group engages in the construction business which has an operating cycle of over one year. The normal operating cycle applies when considering the classification of the Group’s construction-related assets and liabilities.

d. Basis of Consolidation

1) Principles for preparing consolidated financial statements

The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the Company (i.e. its subsidiaries).

Income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Company.

All intra-group transactions, balances, income and expenses are eliminated in full upon consolidation.

Attribution of total comprehensive income to non-controlling interests

Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

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Changes in the Group’s ownership interests in existing subsidiaries

Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners of the Company.

2) Subsidiaries included in consolidated financial statements were as follows:

		Establishment and	Percentage of   Ownership (%) December 31
Name of Investee	Main Businesses	Operating Location	2014	2013
A.S.E. Holding Limited	Holding company	Bermuda	100.0	100.0
J & R Holding Limited (“J&R Holding”)	Holding company	Bermuda	100.0	100.0
Innosource Limited	Holding company	British Virgin Islands	100.0	100.0
Omniquest Industrial Limited	Holding company	British Virgin Islands	100.0	100.0
ASE Marketing & Service Japan Co., Ltd.	Engaged in marketing and sales services	Japan	100.0	100.0
ASE Test, Inc.	Engaged in the testing of semiconductors	Kaohsiung, ROC	100.0	100.0
Universal Scientific Industrial Co., Ltd. (“USI”)	Engaged in the manufacturing, processing and sale of computers, computer peripherals and related accessories	Nantou, ROC	99.2	99.2
Luchu Development Corporation (“Luchu”)	Engaged in the development of real estate properties	Taipei, ROC	86.1	86.1
Alto Enterprises Limited	Holding company	British Virgin Islands	100.0	100.0
Super Zone Holdings Limited	Holding company	Hong Kong	100.0	100.0
ASE (Kun Shan) Inc.	Engaged in the packaging and testing of semiconductors	Kun Shan, China	100.0	100.0
ASE Investment (Kun Shan) Limited	Holding company	Kun Shan, China	100.0	100.0
Advanced Semiconductor Engineering (China) Ltd.	Will engage in the packaging and testing of semiconductors	Shanghai, China	100.0	100.0
ASE Investment (Labuan) Inc.	Holding company	Malaysia	100.0	100.0
ASE Test Limited (“ASE Test”)	Holding company	Singapore	100.0	100.0
ASE (Korea) Inc.	Engaged in the packaging and testing of semiconductors	Korea	100.0	100.0
J&R Industrial Inc.	Engaged in leasing equipment and investing activity	Kaohsiung, ROC	100.0	100.0

(Continued)

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		Establishment and	Percentage of Ownership (%) December 31
Name of Investee	Main Businesses	Operating Location	2014	2013
ASE Japan Co., Ltd.	Engaged in the packaging and testing of semiconductors	Japan	100.0	100.0
ASE (U.S.) Inc. (“ASE US”)	After-sales service and sales support	U.S.A.	100.0	100.0
Global Advanced Packaging Technology Limited, Cayman Islands	Holding company	British Cayman Islands	100.0	100.0
ASE WeiHai Inc.	Engaged in the packaging and testing of semiconductors	Shandong, China	100.0	100.0
Suzhou ASEN Semiconductors Co., Ltd.	Engaged in the packaging and testing of semiconductors	Suzhou, China	60.0	60.0
Anstock Limited	Engaged in financing activity	British Cayman Islands	100.0	100.0
Anstock II Limited	Engaged in financing activity	British Cayman Islands	100.0	-
ASE Module (Shanghai) Inc.	Will engage in the production and sale of electronic components and printed circuit boards	Shanghai, China	100.0	100.0
ASE (Shanghai) Inc.	Engaged in the production of substrates	Shanghai, China	100.0	100.0
ASE Corporation	Holding company	British Cayman Islands	100.0	100.0
ASE Mauritius Inc.	Holding company	Mauritius	100.0	100.0
ASE Labuan Inc.	Holding company	Malaysia	100.0	100.0
ASE Module (Kun Shan) Inc.	Merged into ASE (Kun Shan) Inc. in September 2014	Kun Shan, China	-	100.0
Shanghai Ding Hui Real Estate Development Co., Ltd.	Engaged in the development, construction and sale of real estate properties	Shanghai, China	100.0	100.0
Advanced Semiconductor Engineering (HK) Limited	Engaged in the trading of substrates	Hong Kong	100.0	100.0
Shanghai Ding Wei Real Estate Development Co., Ltd.	Engaged in the development, construction and leasing of real estate properties	Shanghai, China	100.0	100.0
Shanghai Ding Yu Real Estate Development Co., Ltd.	Engaged in the development, construction and leasing of real estate properties	Shanghai, China	100.0	100.0
Kun Shan Ding Yue Real Estate Development Co., Ltd.	Engaged in the development, construction and leasing of real estate properties	Kun Shan, China	100.0	100.0

(Continued)

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		Establishment and	Percentage of Ownership (%) December 31
Name of Investee	Main Businesses	Operating Location	2014	2013
Kun Shan Ding Hong Real Estate Development Co., Ltd.	Engaged in the development, construction and leasing of real estate properties	Kun Shan, China	100.0	100.0
ASE Electronics Inc.	Engaged in the production of substrates	Kaohsiung, ROC	100.0	100.0
ASE Test Holdings, Ltd.	Holding company	British Cayman Islands	100.0	100.0
ASE Holdings (Singapore) Pte. Ltd.	Holding company	Singapore	100.0	100.0
ASE Test Finance Limited	Engaged in financing activity	Mauritius	100.0	100.0
ASE Singapore Pte. Ltd.	Engaged in the packaging and testing of semiconductors	Singapore	100.0	100.0
ISE Labs, Inc.	Engaged in the testing of semiconductors	U.S.A.	100.0	100.0
ASE Electronics (M) Sdn. Bhd.	Engaged in the packaging and testing of semiconductors	Malaysia	100.0	100.0
ASE Assembly & Test (Shanghai) Limited	Engaged in the packaging and testing of semiconductors	Shanghai, China	100.0	100.0
Wuxi Tongzhi Microelectronics Co., Ltd.	Engaged in the packaging and testing of semiconductors	Wuxi, China	100.0	100.0
Huntington Holdings International Co., Ltd.	Holding company	British Virgin Islands	99.2	99.2
Senetex Investment Co., Ltd.	In the process of liquidation	Nantou, ROC	99.2	99.2
Unitech Holdings International Co., Ltd.	Holding company	British Virgin Islands	99.2	99.2
Real Tech Holdings Limited	Holding company	British Virgin Islands	99.2	99.2
Universal ABIT Holding Co., Ltd.	Holding company	British Cayman Islands	99.2	99.2
Rising Capital Investment Limited	Holding company	British Virgin Islands	99.2	99.2
Rise Accord Limited	Holding company	British Virgin Islands	99.2	99.2
Cubuy Corporation	Will engaged in the trading of computer systems	Shanghai, China	99.2	99.2
Universal Scientific Industrial (Kunshan) Co., Ltd.	Engaged in the manufacturing and sale of computer assistance system and related peripherals	Kun Shan, China	99.2	99.2
USI Enterprise Limited (“USIE”)	Engaged in the services of investment advisory and warehousing management	Hong Kong	98.7	99.1
Universal Scientific Industrial (Shanghai) Co., Ltd. (“USISH”)	Engaged in the designing, manufacturing and sale of electronic components	Shanghai, China	82.1	88.6

(Continued)

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		Establishment and	Percentage of Ownership (%) December 31
Name of Investee	Main Businesses	Operating Location	2014	2013
Universal Global Technology Co., Limited	Holding company	Hong Kong	82.1	88.6
Universal Global Technology (Kun Shan) Co., Ltd.	Engaged in the designing and manufacturing of electronic components	Kun Shan, China	82.1	88.6
Universal Global Technology (Shanghai) Co., Ltd.	Engaged in the processing and sales of computer and communication peripherals as well as business in import and export of goods and technology	Shanghai, China	82.1	88.6
Universal Global Electronics (Shanghai) Co., Ltd.	Engaged in the sale of electronic components and telecommunications equipment and established in May 2014	Shanghai, China	82.1	-
Universal Global Electronics (Shenzhen) Co., Ltd.	Liquidated in March 2014	Shenzhen, China	-	88.6
Universal Global Industrial Co., Limited	Engaged in manufacturing, trading and investing activity	Hong Kong	82.1	88.6
Universal Global Scientific Industrial Co., Ltd.	Engaged in the manufacturing of components of telecomm and cars and provision of related R&D services	Nantou, ROC	82.1	88.6
USI Manufacturing Service Inc.	Engaged in the manufacturing and processing of motherboards and wireless network communication and provision of related technical service.	U.S.A.	82.1	88.6
Universal Scientific Industrial De Mexico S.A. De C.V.	Engaged in the assembling of motherboards and computer components	Mexico	82.1	88.6
USI Japan Co., Ltd.	Engaged in the manufacturing and sale of computer peripherals, integrated chip and other related accessories	Japan	82.1	88.6
USI@Work, Inc.	After-sale service	U.S.A.	82.1	88.6
USI Electronics (Shenzhen) Co., Ltd.	Engaged in the design, manufacturing and sale of motherboards and computer peripherals	Shenzhen, China	82.1	88.6

(Concluded)

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e. Business Combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognized in profit or loss as incurred.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after re-assessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is recognized immediately in profit or loss as a bargain purchase gain.

When a business combination is achieved in stages, the Group’s previously held equity interest in the acquiree is remeasured to its acquisition-date fair value and the resulting gain or loss, if any, is recognized in profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognized in other comprehensive income are recognized on the same basis as would be required if that interest were directly disposed of by the Group.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.

The Group does not apply the acquisition method to account for business combinations involving entities under common control.

f. Foreign Currencies

In preparing the financial statements of each individual group entity, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At each balance sheet date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences on monetary items arising from settlement or translation are recognized in profit or loss in the period in which they arise.

Exchange differences arising on the retranslation of non-monetary assets (such as equity instruments) or liabilities measured at fair value are included in profit or loss for the period at the rates prevailing at the balance sheet date except for exchange differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income, in which case, the exchange differences are also recognized directly in other comprehensive income.

For the purposes of presenting the consolidated financial statements, the assets and liabilities of the Group’s foreign operations are translated into New Taiwan dollars using exchange rates prevailing at each balance sheet date. Income and expense items are translated at the average exchange rates for the

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period. Exchange differences arising are recognized in other comprehensive income and accumulated in equity attributed to the owners of the Company and non-controlling interests as appropriate.

On the disposal of the Group’s foreign operation that result in the Group losing control , joint control or significant influence over the foreign operation, all of the equity in respect of that operation attributable to the owners of the Company are reclassified to profit or loss.

g. Cash Equivalents

Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

h. Inventories and Inventories Related to Real Estate Business

Inventories, including raw materials (materials received from customers for processing, mainly semiconductor wafers, are excluded from inventories as title and risk of loss remain with the customers), supplies, work in process, finished goods, and materials and supplies in transit are stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except for those that may be appropriate to group items of similar or related inventories. Net realizable value is the estimated selling prices of inventories less all estimated costs of completion and estimated costs necessary to make the sale. Raw materials and supplies are recorded at moving average cost while work in process and finished goods are recorded at standard cost.

Inventories related to real estate business include land and buildings held for sale, land held for construction, construction in progress and prepayment for land use rights. Land held for development is recorded as land held for construction upon obtaining the title of ownership. The prepayment is recorded as prepayments for land use right before obtaining the title of ownership. Prior to the completion, the borrowing costs directly attributable to construction in progress are capitalized as part of the cost of the asset. Construction in progress is transferred to land and buildings held for sale upon completion. Land and buildings held for sale, construction in progress and land held for construction are stated at the lower of cost or net realizable value and related write-downs are made by item. The amounts received in advance for real estate properties are first recorded as advance receipts and then recognized as revenue when the construction is completed and the title and significant risk of the real estate properties are transferred to customers. Cost of sales of land and buildings held for sale are recognized based on the ratio of property sold to the total property developed.

i. Investments Accounted for Using the Equity Method

Investments accounted for using the equity method include investments in associates. An associate is an entity over which the Group has significant influence and that is not a subsidiary. Significant influence is the power to participate in the financial and operating policy decisions of the investee without having control over those policies.

The operating results as well as assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of accounting. Under the equity method, an investment in an associate is initially recognized at cost and adjusted thereafter to recognize the Group’s share of the profit or loss and other comprehensive income of the associate. The Group also recognizes the changes in the Group’s share of equity of associates.

Any excess of the cost of acquisition over the Group's share of the net fair value of the identifiable assets and liabilities of an associate at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized.

When a group entity transacts with its associate, unrealized profits and losses resulting from the transactions with the associate are eliminated.

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j. Property, Plant and Equipment

Except for land which is stated at cost, property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment.

Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognized impairment loss. Cost includes professional fees and borrowing costs eligible for capitalization. Such properties are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.

Freehold land is not depreciated.

Depreciation is recognized using the straight-line method. Each significant part is depreciated separately. The estimated useful lives, residual values and depreciation method are reviewed at each balance sheet date. The effect of any changes in estimate accounted for on a prospective basis.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets. If the lease term is shorter than the useful lives, assets are depreciated over the lease term.

Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

k. Goodwill

Goodwill arising from an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment loss.

For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units or groups of cash-generating units that is expected to benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired, by comparing its carrying amount, including the attributed goodwill, with its recoverable amount. However, if the goodwill allocated to a cash-generating unit was acquired in a business combination during the current annual period, that unit shall be tested for impairment before the end of the current annual period. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss is recognized directly in profit or loss. An impairment loss recognized for goodwill is not reversed in subsequent periods.

l. Other Intangible Assets

Other intangible assets with finite useful lives acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization and accumulated impairment. Other intangible assets are amortized based on the pattern in which the economic benefits are consumed or using the straight-line method over their estimated useful lives. The estimated useful lives, residual value and amortization methods are reviewed at each balance sheet date. The residual value of an intangible asset with a finite useful life shall be assumed to be zero unless the Group expects to dispose of the intangible asset before the end of its economic life. The effect of any changes in estimate being accounted for on a prospective basis.

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Other intangible assets acquired in a business combination and recognized separately from goodwill are initially recognized at their fair value at the acquisition date which is regarded as their cost. Subsequent to initial recognition, they are measured on the same basis as intangible assets that are acquired separately.

On derecognition of an intangible asset, the difference between the net disposal proceeds and the carrying amount of the asset are recognized in profit or loss.

m. Impairment of Tangible and Intangible Assets Other than Goodwill

At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets, excluding goodwill (see above), to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount.

When an impairment loss is subsequently reversed, the carrying amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent of the carrying amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized immediately in profit or loss.

n. Financial Instruments

Financial assets and financial liabilities are recognized when a group entity becomes a party to the contractual provisions of the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

1) Financial assets

All regular way purchases or sales of financial assets are recognized or derecognized on a settlement date basis.

a) Measurement category

The classification of financial assets held by the Group depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

i Financial assets at fair value through profit or loss (“FVTPL”)

Financial assets are classified as at FVTPL when the financial assets are either held for trading or they are designated as at FVTPL.

A financial asset other than a financial asset held for trading may be designated as at FVTPL upon initial recognition if:

• Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or

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• The financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Group’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

• It forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the entire combined contract to be designated as at FVTPL.

Financial assets at FVTPL are stated at fair value with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss incorporates any dividend or interest earned on the financial asset.

ii Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated as available-for-sale or are not classified as (a) loans and receivables, (b) held-to-maturity investments or (c) financial assets at fair value through profit or loss.

Available-for-sale financial assets are stated at fair value at each balance sheet date. Changes in the carrying amount of available-for-sale monetary financial assets relating to changes in foreign currency rates, interest income calculated using the effective interest method and dividends on available-for-sale equity investments are recognized in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognized in other comprehensive income and accumulated under the heading of unrealized gain (loss) on available-for-sale financial assets. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the unrealized gain (loss) on available-for-sale financial assets is reclassified to profit or loss.

Dividends on available-for-sale equity instruments are recognized in profit or loss when the Group’s right to receive the dividends is established.

iii Loans and receivables

Loans and receivables including cash and cash equivalents, trade receivables, other receivables, other financial assets and debt investments with no active market are measured at amortized cost using the effective interest method, less any impairment. Interest income is recognized by applying the effective interest rate, except for short-term receivables when the effect of discounting is immaterial.

b) Impairment of financial assets

Financial assets, other than those at FVTPL, are assessed for indicators of impairment at each balance sheet date. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial assets, the estimated future cash flows of the investments have been affected.

For financial assets carried at amortized cost, such as trade receivables and other receivables, assets that are assessed not to be impaired individually are, further, assessed for impairment on a collective basis. The Group assesses the collectability of receivables based on the Group’s past experience of collecting payments and observable changes that correlate with default on receivables.

For financial assets carried at amortized cost, the amount of the impairment loss recognized is the difference between the assets’ carrying amounts and the present value of estimated future cash flows, discounted at the financial assets’ original effective interest rates. If, in a

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subsequent period, the amount of the impairment loss decreases and the decreases can be objectively related to an event occurring after the impairment loss recognized, the previously recognized impairment loss is reversed either directly or by adjusting an allowance account through profit or loss. The reversal shall not result in carrying amounts of financial assets that exceed what the amortized cost would have been at the date the impairment is reversed.

When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified to profit or loss in the period. In respect of available-for-sale equity securities, impairment loss previously recognized in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognized in other comprehensive income and accumulated under the heading of unrealized gain (loss) on available-for-sale financial assets.

c) Derecognition of financial assets

The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss.

2) Equity instruments

Debt and equity instruments issued by the Group are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. Equity instruments issued by a group entity are recognized at the proceeds received, net of direct issue costs.

Repurchase of the Company’s own equity instruments is recognized in and deducted directly from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments.

3) Financial liabilities

Financial liabilities are measured either at amortized cost using the effective interest method or at FVTPL. Financial liabilities measured at FVTPL are held for trading.

Financial liabilities at FVTPL are stated at fair value, with any gain or loss arising on remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss incorporates any interest or dividend paid on the financial liability.

The Group derecognizes financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

4) Derivative financial instruments

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at each balance sheet date. When the fair value of derivative financial instruments is positive, the derivative is recognized as a financial asset; when the fair value of derivative financial instruments is negative, the derivative is recognized as financial liabilities.

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Derivatives embedded in non-derivative host contracts are treated as separate derivatives when they meet the definition of a derivative, their risks and characteristics are not closely related to those of the host contracts and the contracts are not measured at FVTPL.

5) Convertible bonds

Convertible bonds issued by the Company that contain liability, conversion option, redemption option and put option (collectively the “Bonds Options”) components are classified separately into respective items on initial recognition. The conversion option that will be settled other than by the exchange of a fixed amount of cash or other financial asset for a fixed number of the Company’s own equity instruments is classified as a conversion option derivative. At the date of offering, both the liability and the Bonds Options components are recognized at fair value.

In subsequent periods, the liability component of the convertible bonds is measured at amortized cost using the effective interest method. The Bonds Options are measured at fair value and the changes in fair value are recognized in profit or loss.

Transaction costs that relate to the offering of the convertible bonds are allocated to the liability and the Bonds Options components in proportion to their relative fair values. Transaction costs relating to the Bonds Options are recognized immediately in profit or loss. Transaction costs relating to the liability component are included in the carrying amount of the liability component and amortized using the effective interest method.

o. Hedge Accounting

The Group designates certain hedging instruments as cash flow hedges. At the inception of the hedge relationship, the Group documents the relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents whether the hedging instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item attributable to the hedged risk.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income and accumulated under the heading of cash flow hedges. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss.

Hedge accounting is discontinued prospectively when the Group revokes the designated hedging relationship, or when the hedging instrument expires or is sold, terminated, or exercised, or when it no longer meets the criteria for hedge accounting. The cumulative gain or loss on the hedging instruments that has been previously recognized in other comprehensive income from the period when the hedge was effective remains separately in equity until the forecast transaction occurs. When a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognized immediately in profit or loss.

p. Revenue Recognition

Revenue is measured at the fair value of the consideration received or receivable take into account of estimated customer returns, rebates and other similar allowances.

1) Sale of goods and real estate properties

Revenue from the sale of goods and real estate properties is recognized when the goods and real estate properties are delivered and titles have passed, at the time all the following conditions are satisfied:

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— The Group has transferred to the buyer the significant risks and rewards of ownership of the goods and real estate properties;

— The Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods and real estate properties sold;

— The amount of revenue can be reliably measured;

— It is probable that the economic benefits associated with the transaction will flow to the Group; and

— The costs incurred or to be incurred in respect of the transaction can be reliably measured.

2) Rendering of services

Service income is recognized when services are rendered.

3) Dividend and interest income

Dividend income from investments and interest income from financial assets are recognized when they are probable that the economic benefits will flow to the Group and the amount of income can be reliably measured. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable.

q. Leasing

The Group as lessor

Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease.

The Group as lessee

Assets held under finance leases are initially recognized as assets of the Group at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the consolidated balance sheets as a finance lease obligation.

Operating lease payments are recognized as expenses on a straight-line basis over the lease term.

r. Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognized in profit or loss in the period in which they are incurred.

s. Government grants

Government grants are not recognized until there is reasonable assurance that the Group will comply with the conditions attaching to them and that the grants will be received.

Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct

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or otherwise acquire non-current assets are recognized as deferred revenue in the consolidated financial statements and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Group with no future related costs are recognized in profit or loss in the period in which they become receivable.

t. Retirement Benefit Costs

Payments to defined contribution retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method. All actuarial gains and losses on the defined benefit obligation are recognized immediately in other comprehensive income.

u. Share-based Payment Arrangements

Equity-settled share-based payments to employees are measured at the fair value of the equity instruments at the grant date. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group's best estimate of equity instruments that will eventually vest, with a corresponding increase in capital surplus - employee share options.

At each balance sheet date, the Group reviews its estimate of the number of employee share options expected to vest. The impact of the revision of the original estimates is recognized in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the capital surplus - employee share options.

v. Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

1) Current tax

Income tax on unappropriated earnings (excluding earnings from foreign consolidated subsidiaries) at a rate of 10% is expensed in the year the earnings arise and adjusted to the extent that distributions are approved by the shareholders in the following year.

Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

2) Deferred tax

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, unused loss carry-forward and unused tax credits for purchases of machinery and equipment to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries except where the Group is able to control the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future.

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The carrying amounts of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of deferred tax assets to be utilized. A previously unrecognized deferred tax asset is also reviewed at each balance sheet date and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which assets are realized or the liabilities are settled. The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which the Group expects, at the balance sheet date, to recover or settle the carrying amounts of its assets and liabilities.

3) Current and deferred tax for the year

Current and deferred tax are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.

Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group’s accounting policies, which are described in Note 4, management is required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Impairment of Goodwill

Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires management to estimate the future cash flows expected to arise from cash-generating units and suitable discount rates in order to calculate its present value. When the actual future cash flows are less than expected, a material impairment loss may arise.

Impairment of Tangible and Intangible Assets Other than Goodwill

In evaluating the impairment of tangible and intangible assets other than goodwill, the Group is required to make subjective judgments in determining the independent cash flows, useful lives, expected future revenue and expenses related to the specific asset groups with the consideration of its usage patterns and the nature of semiconductor industry. Any changes in these estimates based on changed economic conditions or business strategies could result in significant impairment charges in future periods.

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Valuation of Inventory

Inventories are stated at the lower of cost or net realizable value and the net realizable value of inventory at balance sheet date is determined based on Group’s judgments and estimates.

Due to the rapid technology changes, the Group estimates the net realizable value of inventory for obsolescent and unmarketable items at balance sheet date and then writes down the cost of inventories to net realizable value. There may be significant changes in the net realizable value of inventories due to assumptions of future demand within a specific time period.

Income Taxes

The reliability of deferred tax assets mainly depends on whether sufficient future profits or taxable temporary differences will be available. In cases where the actual future profits generated are less than expected, a material reversal of deferred tax assets may arise, which would be recognized in profit or loss for the period in which such a reversal takes place.

Recognition and Measurement of Defined Benefit Plans

Accrued pension liabilities and the resulting pension expenses under defined benefit pension plans are calculated using the Projected Unit Credit Method. Actuarial assumptions comprise discount rates and expected rates of salary increase. Changes in economic circumstances and market conditions will affect these assumptions and may have a material impact on the amount of the expense and the liability.

Fair value measurements and valuation processes of Derivatives and Other Financial Instruments

As disclosed in Note 32, the Group’s management uses its judgments applying appropriate valuation techniques commonly applied by market practitioners. The assumptions applied are based on observable quoted market prices, foreign exchange rates and interest rates to the extent it is available. The fair value of unquoted equity instruments is estimated based on the assumptions supported by unobservable market prices and interest rates which are disclosed in Note 32. The Group’s management believes that the valuation techniques and the assumptions applied are appropriate in determining the fair value of financial instruments.

6. CASH AND CASH EQUIVALENTS

	December 31
	2014		2013
	NT$		NT$
Cash on hand	$	9,953	$	40,392
Checking accounts and demand deposits		43,059,911		38,090,014
Cash equivalents		8,624,546		6,895,965
	$	51,694,410	$	45,026,371

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7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

	December 31
	2014		2013
	NT$		NT$
Financial assets designated as at FVTPL
Structured time deposits	$	2,376,050	$	2,228,643
Private-placement convertible bonds		100,500		100,500
		2,476,550		2,329,143
Financial assets held for trading
Swap contracts		1,907,705		219,324
Open-end mutual funds		533,425		172,000
Quoted shares		43,352		33,624
Forward exchange contracts		27,811		10,178
		2,512,293		435,126
	$	4,988,843	$	2,764,269
Financial liabilities held for trading
Conversion option, redemption option and put option of convertible bonds (Note 19)	$	2,520,606	$	1,742,996
Swap contracts		99,165		74,170
Forward exchange contracts		31,581		31,315
Cross currency swap contracts		-		4,180
Foreign currency option contracts		-		643
	$	2,651,352	$	1,853,304

The Group invested in structured time deposits and in private-placement convertible bonds, and all included embedded derivative instruments which are not closely related to the host contracts. The Group designated the entire contracts as financial assets at FVTPL on initial recognition.

At each balance sheet date, the outstanding swap contracts not accounted for hedge accounting were as follows:

		Notional Amount
Currency	Maturity Period	(In Thousands)
December 31, 2014
Sell NT$/Buy US$	2015.01-2015.12	NT$36,199,735/US$1,209,000
Sell US$/Buy NT$	2015.01-2015.02	US$132,100/NT$4,149,958
Sell US$/Buy JPY	2015.01	US$72,248/JPY8,450,000
Sell US$/Buy CNY	2015.01-2015.06	US$80,000/CNY503,452
Sell CNY/Buy US$	2015.03	CNY217,288/US$35,000

(Continued)

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		Notional Amount
Currency	Maturity Period	(In Thousands)
December 31, 2013
Sell NT$/Buy US$	2014.01-2014.12	NT$31,707,176/US$1,075,000
Sell US$/Buy NT$	2014.01-2014.02	US$46,500/NT$1,377,874
Sell US$/Buy JPY	2014.02	US$53,965/JPY5,550,000
Sell US$/Buy CNY	2014.01-2014.06	US$60,000/CNY368,148

(Concluded)

At each balance sheet date, the outstanding forward exchange contracts not accounted for hedge accounting were as follow:

		Notional Amount
Currency	Maturity Period	(In Thousands)
December 31, 2014
Sell US$/Buy NT$	2015.01	US$14,000/NT$438,434
Sell US$/Buy CNY	2015.01-2015.03	US$127,000/CNY785,683
Sell US$/Buy MYR	2015.01-2015.02	US$6,000/MYR20,860
Sell US$/Buy SGD	2015.01-2015.02	US$11,700/SGD15,211
Sell US$/Buy JPY	2015.01-2015.04	US$18,385/JPY2,177,800
December 31, 2013
Sell US$/Buy NT$	2014.01-2014.02	US$51,000/NT$1,521,484
Sell US$/Buy CNY	2014.01-2014.04	US$88,220/CNY537,100
Sell US$/Buy MYR	2014.01-2014.02	US$8,500/MYR27,508
Sell US$/Buy KRW	2014.01	US$4,000/KRW4,253,000
Sell US$/Buy SGD	2014.01-2014.02	US$9,500/SGD11,870
Sell US$/Buy JPY	2014.01-2014.03	US$28,950/JPY3,003,944
Sell NT$/Buy US$	2014.03	NT$294,370/US$10,000

At each balance sheet date, the outstanding cross currency swap contracts not accounted for hedge accounting were as follows:

Notional Amount  (In Thousands)	Maturity Period	Range of Interest Rates Paid	Range of Interest Rates Received
December 31, 2013
NT$598,600/US$20,000	2014.07	(0.19)	0.16

At each balance sheet date, the outstanding foreign currency option contracts not accounted for hedge accounting were as follows:

		Notional Amount
Currency	Maturity Period	(In Thousands)
December 31, 2013
Sell US$ Put/NT$ Call	2016.03 (Note)	US$4,000/NT$113,400
Buy US$ Call/NT$ Put	2016.03 (Note)	US$2,000/NT$56,700

-37-

Note: The contracts will be settled once a month and the counterparty has the right to early terminate the contracts. All of the aforementioned outstanding contracts as of December 31, 2013 were early terminated.

8. AVAILABLE-FOR-SALE FINANCIAL ASSETS

	December 31
	2014		2013
	NT$		NT$
Open-end mutual funds	$	1,500,434	$	2,321,826
Limited partnership		555,361		583,441
Unquoted ordinary shares		211,726		199,051
Quoted ordinary shares		195,070		328,656
Unquoted preferred shares		11,779		14,670
Private-placement ordinary shares		-		69,655
		2,474,370		3,517,299
Current		1,533,265		2,376,970
Non-current	$	941,105	$	1,140,329

In 2014 and 2013, the Group assessed its investees’ financial conditions as well as future operating performance and charged an impairment loss of NT$10,390 thousand and NT$106,916 thousand, respectively, to the carrying amounts of a portion of the aforementioned investments and debt investments with no active market.

9. DERIVATIVE FINANCIAL INSTRUMENTS FOR HEDGING

The Group entered into interest rate swap contracts as cash flow hedge to mitigate exposures to future cash flow fluctuations resulting from interest rate changes from the Group’s borrowings.

At each balance sheet date, the outstanding interest rate swap contracts of the Group were as follows:

Maturity Period	Notional Amount  (In Thousands)	Interest Rates Paid (%)	Interest Rates Received (%)	Expected Period for  Future Cash  Flow	Expected Period for the Recognition of Gains or Losses from  Hedging
December 31, 2013
2014.04	CNY 240,000	2.00	1.05-2.80	2014	2014

ll interest rate swap contracts exchanging floating interest rates for fixed interest rates were designated as cash flow hedges in order to reduce the Group's cash flow exposure to loating interest rates on borrowings. The interest rate swaps and the interest payments on the borrowings occur simultaneously and the amounts accumulated in equity are reclassified to profit or loss over the period that the floating rate interest payments on the borrowings affect profit or loss. (Note 22e)

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10. TRADE RECEIVABLES, NET

	December 31
	2014		2013
	NT$		NT$
Trade receivables	$	53,004,955	$	43,303,693
Less:  Allowance for doubtful debts		84,145		68,120
Trade receivables, net	$	52,920,810	$	43,235,573

a. Trade receivables

The Group’s average credit terms were 30 to 90 days. Allowance for doubtful debts is assessed by reference to the collectability of receivables by evaluating the account aging, historical experience and current financial condition of customers.

As of December 31, 2014 and 2013, except that the Group’s five largest customers accounted for 30% and 21% of accounts receivable, respectively, the concentration of credit risk is insignificant for the remaining accounts receivable.

Age of receivables that are past due but not impaired

	December 31
	2014		2013
	NT$		NT$
Less than 30 days	$	5,191,521	$	4,090,787
31 to 90 days		131,247		195,741
More than 91 days		1,407		1,585
Total	$	5,324,175	$	4,288,113

The above aging schedule was based on the past due date.

Except for those impaired, the Group had not provided an allowance for doubtful debts on trade receivables at each balance sheet date since there has not been a significant change in credit quality and the amounts were still considered collectible. The Group did not hold any collateral or other credit enhancements over these balances nor did it have a legal right to offset against any amounts owed by the Group to counterparties.

Movement of the allowance for doubtful trade receivables

	Impaired Individually			Impaired  Collectively			Total
		NT$			NT$			NT$
Balance at January 1, 2014	$	26,885		$	41,235		$	68,120
Impairment losses recognized		2,875			15,156			18,031
Amount written off during the period as uncollectible		(891	)		(917	)		(1,808	)
Effect of foreign currency exchange		(564	)		366			(198	)
Balance at December 31, 2014	$	28,305		$	55,840		$	84,145

(Continued)

-39-

	Impaired Individually			Impaired  Collectively			Total
		NT$			NT$			NT$
Balance at January 1, 2013	$	34,225		$	45,912		$	80,137
Impairment losses reversed		(5,860	)		(4,033	)		(9,893	)
Amount written off during the period as uncollectible		-			(757	)		(757	)
Effect of foreign currency exchange		(1,480	)		113			(1,367	)
Balance at December 31, 2013	$	26,885		$	41,235		$	68,120

(Concluded)

Age of impaired trade receivables

	December 31
	2014		2013
	NT$		NT$
Not past due	$	2,701	$	-
Less than 30 days		31,422		11,501
31 to 90 days		174,805		109,376
More than 91 days		86,665		115,203
Total	$	295,593	$	236,080

The above aging schedule was based on the past due date.

b. Transfers of financial assets

Factored trade receivables of the Company were as follows:

Counterparties	Receivables Sold  (In Thousands)	Amounts  Collected  (In Thousands)	Advances  Received  At Year-end  (In Thousands)		Interest Rates  on Advances  Received  (%)		Credit Line  (In Thousands)
Year ended December 31, 2014
Citi bank	US$ 103,744	US$ 103,744		-		-	US$ 92,000
Year ended December 31, 2013
Citi bank	US$ 258,660	US$ 202,532		US$ 56,128		1.06	US$ 92,000

Pursuant to the factoring agreement, losses from commercial disputes (such as sales returns and discounts) should be borne by the Company, while losses from credit risk should be borne by the banks. The Company also issued promissory notes to the banks for commercial disputes which remained undrawn since. The promissory notes amounted to US$5,000 thousand and US$27,000 thousand as of December 31, 2014 and 2013, respectively. As of December 31, 2014, there was no significant losses from commercial disputes in the past and the Company does not expect any significant commercial dispute losses in the foreseeable future.

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11. INVENTORIES

	December 31
	2014		2013
	NT$		NT$
Finished goods	$	6,568,459	$	4,863,676
Work in process		2,064,377		1,701,257
Raw materials		10,155,006		8,766,638
Supplies		797,353		573,588
Raw materials and supplies in transit		577,898		376,077
	$	20,163,093	$	16,281,236

The cost of inventories recognized as operating costs for the years ended December 31, 2014 and 2013 were NT$203,009,201 thousand and NT$176,637,295 thousand, respectively, which included write-downs of inventories at NT$601,726 thousand and NT$453,468 thousand, respectively.

12. INVENTORIES RELATED TO REAL ESTATE BUSINESS

	December 31
	2014		2013
	NT$		NT$
Land and buildings held for sale	$	5,558	$	16,764
Construction in progress		22,242,065		13,676,668
Land held for construction		1,738,855		1,682,735
Prepayments for land use rights		-		3,213,088
	$	23,986,478	$	18,589,255

Land and buildings held for sale located in Shanghai Zhangjiang was completed and subsequently sold. Construction in progress is mainly located on Caobao Road and Hutai Road in Shanghai, China and Lidu Road and Xinhong Road in Kun Shan, China. The capitalized borrowing costs for the years ended December 31, 2014 and 2013 is disclosed in Note 23.

As of December 31, 2014 and 2013, inventories related to real estate business of NT$23,697,339 thousand and NT$18,572,491 thousand, respectively, are expected to be recovered longer than twelve months.

Refer to Note 34 for the carrying amount of inventories related to real estate business that had been pledged by the Group to secure bank borrowings.

13. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments in associates accounted for using the equity method consisted of the following:

-41-

			Carrying Amount as of  December 31
Name of Associate	Main Business	Operating Location	2014		2013
			NT$		NT$
Listed company
Hung Ching Development & Construction Co. (“HC”)	Engaged in the development, construction and leasing of real estate properties	ROC	$	1,351,400	$	1,163,196
Advanced Microelectronic Products Inc. (“AMPI”)	Engaged in integrated circuit	ROC		99,052		-
Unlisted companies
Hung Ching Kwan Co. (“HCK”)	Engaged in the leasing of real estate properties	ROC		342,138		353,154
StarChips Technology Inc. (“SCT”)	Engaged in design, manufacturing and sale of LED driver IC	ROC		-		47,856
				1,792,590		1,564,206
	Less:  Deferred gain on transfer of land			300,149		300,149
	Accumulated impairment - SCT			-		47,856
			$	1,492,441	$	1,216,201

a. At each balance sheet date, the percentages of ownership held by the Group were as follows:

	December 31
Name of Associate	2014	2013
HC	26.2%	26.2%
AMPI	18.2%	-
HCK	27.3%	27.3%
SCT	-	33.3%

b. In January 2014, the Company subscribed for 20,000 thousand private-placement ordinary shares of AMPI in NT$100,000 thousand. The Company obtained significant influence over AMPI since the percentage of ownership was increased to 27.4% after taking into account the shares previously held which were recognized as available-for-sale financial assets. The private-placement ordinary shares were restricted for disposal during a 3-year lock-up period. In addition, the Company did not join AMPI’s cash capital increase in February and April 2014 and, as the result, the percentage of ownership decreased from 27.4% to 18.2%. After the consideration of potential voting rights that are currently convertible, the Company still has significant influence over AMPI.

c. The Company did not subscribe for SCT’s cash capital increase in May 2014 and, therefore, the percentage of ownership decreased from 33.3% to 5.6%. As the result, the Company had no significant influence over SCT and the investment in SCT was reclassified to available-for-sale financial assets.

d. Fair values of investments in associates with available published price quotation as of the balance sheet date are summarized as follows

-42-

	December 31
Name of Associate	2014		2013
	NT$		NT$
HC	$	1,427,499	$	1,242,199
AMPI	$	184,862	$	-

e. Aggregate information of associates that are not individually material

	December 31
	2014		2013
	NT$		NT$
Total assets	$	16,992,101	$	16,020,314
Total liabilities	$	8,679,614	$	9,802,624

	For the Year Ended December 31
	2014		2013
	NT$		NT$
Operating revenue for the year	$	5,718,922	$	2,403,386
Net profit for the year	$	508,376	$	311,835
Other comprehensive income for the year	$	9,087	$	215,427

The investment accounted for using the equity method and the share of net profit and other comprehensive income were recorded based on the audited financial statements for the years ended December 31, 2014 and 2013.

14. PROPERTY, PLANT AND EQUIPMENT

The carrying amounts of each class of property, plant and equipment were as follows:

	December 31
	2014		2013
	NT$		NT$
Land	$	3,348,018	$	3,295,758
Buildings and improvements		56,395,710		44,766,601
Machinery and equipment		84,171,647		75,085,182
Transportation equipment		88,119		82,228
Furniture and fixtures		1,310,703		1,243,556
Leased assets and leasehold improvement		417,865		14,304
Construction in progress and machinery in transit		5,855,053		7,009,702
	$	151,587,115	$	131,497,331

-43-

For the year ended December 31, 2014

	Land		Buildings and improvements			Machinery and equipment			Transportation equipment			Furniture and fixtures			Leased assets and leasehold improvement			Construction in progress and machinery  in transit			Total
	NT$		NT$			NT$			NT$			NT$			NT$			NT$			NT$
Cost
Balance at January 1,2014	$	3,295,758	$	70,593,537		$	208,351,905		$	288,571		$	5,973,301		$	122,717		$	7,009,702		$	295,635,491
Additions		-		1,246,123			1,140,822			8,603			87,903			476,260			40,488,876			43,448,587
Disposals		-		(299,515	)		(8,188,532	)		(26,982	)		(312,774	)		(107,291	)		(56,209	)		(8,991,303	)
Reclassification		-		12,683,476			27,935,525			26,832			378,928			(10,645	)		(41,044,364	)		(30,248	)
Effect of foreign currency exchange differences		52,260		2,501,633			4,429,907			11,103			263,949			2,099			(535,788	)		6,725,163
Balance at December 31,2014	$	3,348,018	$	86,725,254		$	233,669,627		$	308,127		$	6,391,307		$	483,140		$	5,862,217		$	336,787,690
Accumulated depreciation and impairment
Balance at January 1,2014	$	-	$	25,826,936		$	133,266,723		$	206,343		$	4,729,745		$	108,413		$	-		$	164,138,160
Depreciation expense		-		3,980,337			21,180,214			30,152			550,126			64,213			-			25,805,042
Impairment losses recognized		-		79,124			211,466			-			-			-			7,164			297,754
Disposals		-		(248,477	)		(7,786,216	)		(24,199	)		(302,373	)		(107,291	)		-			(8,468,556	)
Reclassification		-		7,459			(7,122	)		-			(6,133	)		(1,774	)		-			(7,570	)
Effect of foreign currency exchange differences		-		684,165			2,632,915			7,712			109,239			1,714			-			3,435,745
Balance at December 31,2014	$	-	$	30,329,544		$	149,497,980		$	220,008		$	5,080,604		$	65,275		$	7,164		$	185,200,575

For the year ended December 31, 2013

	Land		Buildings and improvements			Machinery and equipment			Transportation equipment			Furniture and fixtures			Leased assets and leasehold improvement			Construction in progress and machinery   in transit			Total
	NT$		NT$			NT$			NT$			NT$			NT$			NT$			NT$
Cost
Balance at January 1,2013	$	3,274,086	$	63,482,739		$	193,973,968		$	294,377		$	5,435,713		$	211,477		$	8,178,827		$	274,851,187
Additions		-		5,447,913			14,484,611			22,920			285,276			10,645			6,792,707			27,044,072
Disposals		-		(412,648	)		(9,479,630	)		(42,581	)		(154,622	)		-			(38,565	)		(10,128,046	)
Reclassification		-		758,850			7,661,570			4,935			241,193			(103,337	)		(8,638,840	)		(75,629	)
Acquisitions through business combinations		-		5,106			278,862			114			121,994			-			-			406,076
Effect of foreign currency exchange differences		21,672		1,311,577			1,432,524			8,806			43,747			3,932			715,573			3,537,831
Balance at December 31,2013	$	3,295,758	$	70,593,537		$	208,351,905		$	288,571		$	5,973,301		$	122,717		$	7,009,702		$	295,635,491
Accumulated depreciation and impairment
Balance at January 1,2013	$	-	$	22,307,146		$	120,775,451		$	207,017		$	4,235,613		$	128,186		$	-		$	147,653,413
Depreciation expense		-		3,555,865			20,486,896			26,766			566,575			60,505			-			24,696,607
Impairment losses recognized (reversed)		-		(15,754	)		508,894			-			2,407			-			-			495,547
Disposals		-		(368,707	)		(9,285,927	)		(34,810	)		(131,561	)		-			-			(9,821,005	)
Reclassification		-		(24,797	)		58,448			2,016			35,491			(83,242	)		-			(12,084	)
Acquisitions through business combinations		-		2,473			108,365			4			36,814			-			-			147,656
Effect of foreign currency exchange differences		-		370,710			614,596			5,350			(15,594	)		2,964			-			978,026
Balance at December 31,2013	$	-	$	25,826,936		$	133,266,723		$	206,343		$	4,729,745		$	108,413		$	-		$	164,138,160

A portion of property, plant and equipment used in packaging segment, testing segment, EMS segment and other segment was unable to be used for the Group’s production due to operation plans and production demands. After carrying out individual assessment or cash flow analysis, the Group recognized an impairment loss of NT$297,754 thousand and NT$495,547 thousand under the line item of other income and expenses in the consolidated statements of comprehensive income for the years ended December 31, 2014 and 2013, respectively.

Each class of property, plant and equipment was depreciated on a straight-line basis over the following useful lives:

Buildings and improvements
Main plant buildings	10-40 years
Cleanrooms	10-20 years
Others	3-20 years
Machinery and equipment	2-10 years
Transportation equipment	2-7 years
Furniture and fixtures	2-20 years
Leased assets and leasehold improvements	2-10 years

-44-

The capitalized borrowing costs for the years ended December 31, 2014 and 2013 are disclosed in Note 23.

Refer to Note 34 for the carrying amount of property, plant and equipment that had been pledged by the Group to secure bank borrowings.

15. GOODWILL

	December 31
	2014			2013
	NT$			NT$
Cost
Balance at January 1	$	12,336,816		$	12,295,819
Effect of foreign currency exchange differences		97,595			40,997
Balance at December 31	$	12,434,411		$	12,336,816
Accumulated impairment
Balance at January 1 and December 31	$	(1,988,996	)	$	(1,988,996	)

a. Allocating goodwill to cash-generating units

Goodwill had been allocated to the following cash-generating units for impairment testing purposes: packaging segment, testing segment, EMS segment and other segment. The carrying amount of goodwill allocated to cash-generating units was as follows:

	December 31
	2014		2013
Cash-generating units	NT$		NT$
Testing segment	$	7,846,460	$	7,777,268
Others		2,598,955		2,570,552
	$	10,445,415	$	10,347,820

b. Impairment assessment

At the end of each year, the Group performs impairment assessment by reviewing the recoverable amounts based on value in use. In assessing value in use, the estimated 5-year future cash flows are discounted to their present value using annual discount rates of 9.70%-11.50% and 9.56%-11.80% as of December 31, 2014 and 2013, respectively, that reflect the risks specific to each cash-generating unit.

Cash flow projection is based on the expected operating revenue, gross profit, capital expenditure and the growth of other operating costs. The Group’s capital expenditure is based on the forecast of market demands, capacity strategy and improvement of manufacturing process.

For the years ended December 31, 2014 and 2013, the Group did not recognize impairment loss on goodwill.

-45-

16. OTHER INTANGIBLE ASSETS

The carrying amounts of each class of other intangible assets were as follows:

	December 31
	2014		2013
	NT$		NT$
Patents	$	15,768	$	35,751
Acquired specific technology		5,116		88,674
Customer relationships		501,501		654,821
Computer software and others		945,486		826,578
	$	1,467,871	$	1,605,824

For the year ended December 31, 2014

&nb