Kendatire 2020

★Spokesperson
KENDA RUBBER IND.CO., LTD.

Name: Kuei-Chun Liu
Title: Assistant Vice President, Finance
Telephone: (04) 8345171
E-mail：chun@kenda.com.tw
★Deputy Spokesperson
Name: Ching-Hui Wu
Title: Finance Manager
Telephone: (04) 8345171
E-mail：bake@kenda.com.tw
★Addresses and telephone numbers of Headquarters and factory sites:

Headquarters: No. 146, Section 1, Chung Shan Road, Yuanlin City, Changhua County
Telephone: (04) 8345171-82　Fax: (04) 8331865
CHAIRMAN
Website: http://www.kendatire.com YANG, CHI-JEN
Main Factory: No. 146, Section 1, Zhongshan Road, Yuanlin City, Changhua County
Telephone: (04) 8345171-82　Fax: (04) 8331865
Yunlin Factory: No. 50, Yanping Road, Citong Village, Citong Township, Yunlin County
Telephone: (05) 5845271-2　Fax: (05) 5849325
Taipei Office: 11F, Rear Building, No. 201-24, Dunhua North Road, Taipei City
Telephone: (02) 27153125-7　Fax: (02) 27198900
★Stock transfer agent

Name: Transfer Agency Department, CTBC Bank
Address: 5F, No. 83, Section 1, Chongqing South Rd., Zhongzheng Dist., Taipei City
Telephone: (02) 6636-5566
Website: https://www.ctbcbank.com
★Financial statements auditors for the most recent year

Accounting firm: Deloitte & Touche Taiwan
Auditors: Wang, Yi-Wen and Tseng, Done-Yuin, CPA
Address: 20F, No. 100, Songren Road, Taipei City
Telephone: (02)2725-9988
Website: https:// www.deloitte.com.tw
Table of Contents
One. Letter to Shareholders ________________________________________________________ 1
I. The 2020 Business Report _______________________________________________ 2
II. Summary Of Business Plan for 2021 _______________________________________ 4
III. The Company's Future Development Strategy ________________________________ 6
IV. The Effect Of External Competition ________________________________________ 7
V. The Effect Of Legal Environment _________________________________________ 7
VI. The Effect Of the Overall Business Environment _____________________________ 8
Two. Introduction Of the Company _________________________________________________ 10
Three. Corporate Governance Report _______________________________________________ 17
I. Organization _________________________________________________________ 17
II. Directors, Supervisors, General Manager, Vice Presidents, Assistant Vice Presidents
and Branch Managers___________________________________________________ 20
III. Remuneration to Directors, Supervisors, General Manager, And Vice Presidents
In the Most Recent Year _________________________________________________ 25
IV. The Implementation Status of The Corporate Governance ______________________ 30
V. Information On CPA fees _______________________________________________ 69
VI. Information On Change in CPA __________________________________________ 71
VII. Chairman, President, Finance or Accounting Managers Who Have Worked In The
Accounting Firm Who Audit The Company’s Reports or Its Affiliates During The
Most Recent Year ______________________________________________________ 71
VIII. Share Transfers And Change In Pledges On Shares By Directors, Supervisors,
Managers And Shareholders With At Least 10% Stakes During The Most Recent
Year And As Of The Print Date of This Annual Report _________________________ 72
IX. Information on The Top 10 Shareholders Who Are Related To Each Other Under
SFAS No. 6 Or Are Related To Each Other As Spouses, Second Degree Of Kinship _ 74
X. Ownership Of Shares in Affiliated Companies _______________________________ 75
Four. Capitalization ____________________________________________________________ 76
I. Capitalization And Shares _______________________________________________ 76
II. Corporate Bonds ______________________________________________________ 83
III. Preferred Shares ______________________________________________________ 83
IV. Overseas Depositary Receipts ____________________________________________ 84
V. Employee Stock Options Plan (ESOP) _____________________________________ 84
VI. New Restricted Shares To Employees _____________________________________ 84
VII. Mergers & Acquisitions ________________________________________________ 84
VIII. Implementation of Capital Utilization Plan _________________________________ 84
Five. Operations ________________________________________________________________ 85
I. Content of Businesses __________________________________________________ 85
II. Market, Production and Sales Overview ____________________________________ 89
III. Employees ___________________________________________________________ 96
IV. Environmental Protection Expenses _______________________________________ 96
V. Labor Relations _______________________________________________________ 99
VI. Important Contracts ___________________________________________________ 104
Six. Financials ________________________________________________________________ 105
I. The Condensed Balance Sheet, Consolidated Income Statement Over The Past Five
Years, Names of The Certified Public Accountants And Their Audit Opinions ____ 105
II. Financial Analysis For The Most Recent Five Years _________________________ 109
III. Review Reports By Audit Committee On Financial Statements For The Most Recent
Years ______________________________________________________________ 113
IV. Consolidated Financial Statements Of The Latest Year Duly Audited By The
Certified Public Accountants____________________________________________ 114
V. Individual Consolidated Financial Statements Duly Audited By The Certified Public
Accountants In Recent Years ___________________________________________ 184
VI. Financial Difficulty Experienced By The Company Or Its Affiliates During The
Most Recent Year And As Of The Print Date Of This Annual Report ____________ 254
Seven. Review And Analysis Of Financials And Financial Performance And Risks __________ 254
I. Financial Status ______________________________________________________ 254
II. Financial Performance ________________________________________________ 255
III. Cash Flows _________________________________________________________ 256
IV. Impact Of Major Capital Expenditures On Finance And Business During Most
Recent Year _________________________________________________________ 256
V. Investment Policies, Main Causes For Profit Or Loss And Improvement Plans In
The Most Recent Year And Investment Plans For The Coming Year _____________ 257
VI. Risks ______________________________________________________________ 257
VII. Other Important Matters _______________________________________________ 262
Eight. Special Notes & Supplementary Information ___________________________________ 263
I. Data On Affiliated Companies __________________________________________ 263
II. Private Placement Of Marketable Securities During The Most Recent Year And As
Of The Print Date Of This Annual Report _________________________________ 267
III. Possession Or Disposal Of The Company’s Shares By Subsidiaries During The
Most Recent Year And As Of The Print Date Of This Annual Report ____________ 267
IV. Other Required Supplementary Information _______________________________ 267
One. Letter to Shareholders
In 2020, the COVID-19 pandemic changed the supply chain as well as the transition of
economy and trade in this world. In addition, the U.S. Department of Commerce imposed a high
anti-dumping duty on Taiwan tires sold to the U.S., which severely affected the competitiveness of
Taiwan’s tire manufacturers in the U.S. market. In response to market changes, the Company shifted
the tires for passenger cars and light trucks exported from the factory in Taiwan to the United States
to be produced in Vietnam and then sold to the United States, in order to avoid the risk of being
subject to high anti-dumping duties. As for the car and light truck tires produced by Taiwanese
manufacturers, we have switched the market focus on the "non-US markets", including Europe, the
Middle East and Asia to reduce such impacts. Despite a 5.8% decline in revenue in 2020 compared
to 2019, the newly developed car and SUV tires at the R&D center won the IDA International
Design Award and were well received after their launch into the market; thus, their market share was
among the top 10 in the US market and, together with higher selling prices, resulting in an increase
in profitability; thus, the Company's operating performance was better than its competitors in the
same industry.
Looking ahead to the coming year, given the impacts arising from the trade war between the US
and China, the COVID-19 pandemic, exchange rate fluctuations, raw material price increases and
industry supply chain restructuring, the Company continues to invest in expanding the production
scale in Phase III of Vietnam Plant 2 and expanding the production capacity of Indonesia Plant in
order to provide timely supply to meet the increasing orders from car and bicycle tire buyers when
container and shipping logistics gradually return to normal. We expect the Group's turnover will
grow rapidly. In response to the COVID-19 pandemic, we have strengthened the occupational safety
and health management to ensure workplace safety, and continued to promote the Productivity 4.0
smart manufacturing and MES production monitoring system to ensure the quality and increase the
production capacity. Our global R&D headquarters was opened in 2020; it will expand the Group's
R&D team, integrate the resources from the US and European R&D centers, and take advantage of
the industry-government-university cooperation to enhance the overall R&D capacity and launch
more tires with high cost performance. In addition, the Shenzhen plant's urbanization development
project has been successfully launched, the benefits of which will be highly beneficial to the
company's overall operating performance, thereby fulfilling the expectations of shareholders.
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I. The 2020 Business Report
(I) Results of the 2020 Business Plan Implementation
1. Production and Sales: In thousand units; %
Year Percentage of
Production in
Product Sales in 2020 Sales in 2019 increase/decrease
2020
(%)
Bicycle tires 44,519 43,153 41,750 3.36
Tires for motorcycles and
29,629 34,597 40,433 -14.43
other bias tires
Radial tires 7,411 5,878 6,387 -7.97
Inner tube 81,818 80,229 78,802 1.81
2. Operational Status:
Consolidated Unit: NTD Thousands; %
Year Percentage of
Item 2020 2019 increase/decrease
(%)
Net operating income 30,260,185 32,127,436 -5.81%
Operating cost 22,910,212 25,570,683 -10.40%
Operating expenses 4,876,452 5,302,222 -8.03%
Profit from operations 1,535,939 1,254,531 22.43%
Profit after tax 972,225 1,013,559 -4.08%
Individual Unit: NTD Thousands; %

Year Percentage of
Item 2020 2019 increase/decrease
(%)
Net operating income 5,946,286 5,947,113 -0.01%
Operating cost 3,993,110 4,360,674 -8.43%
Operating expenses 1,185,245 1,172,746 1.07%
Profit from operations 744,618 386,582 92.62%
Profit after tax 972,225 1,013,562 -4.08%
(II) Budget implementation

The Company's actual revenues for the year 2020 were NT$30.26 billion, representing an
achievement of 81.34% compared to the forecasted target of NT$37.2 billion for the year 2020.
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(III) Analysis of receipts, expenditures, and profitability
Consolidated Unit: NTD Thousands
Year Increase
2020 2019
Item (decrease) %
Receipts Operating income 30,260,185 32,127,436 -5.81%
and Gross profit 7,349,973 6,556,753 12.10%
expenditures
Profit after tax 972,225 1,013,559 -4.08%
Ratio of Return on Total Assets
2.69 2.98 -7.38%
Profitability (%)
Analysis Ratio of Return on Equity (%) 5.13 5.36 -4.29%
Ratio of income before tax to
14.20 14.35 -1.05%
paid-in capital (%)
Profit ratio (%) 3.21 3.15 1.90%
Earnings per share (NT$) 1.07 1.16 -7.76%
Individual Unit: NTD Thousands

Year Increase
2020 2019
Item (decrease) %
Receipts Operating income 5,946,286 5,947,113 -0.01%
and Gross profit 1,929,863 1,559,328 23.76%
expenditures
Profit after tax 972,225 1,013,562 -4.08%
Ratio of Return on Total Assets
3.19 3.37 -5.48%
Profitability (%)
Analysis Ratio of Return on Equity (%) 5.13 5.36 -4.26%
Ratio of income before tax to
12.92 12.36 4.53%
paid-in capital (%)
Profit ratio (%) 16.35 17.04 -4.05%
Earnings per share (NT$) 1.07 1.16 -7.76%
(IV) Examine the research and development work for the last two years
Due to the climate change and resource constraint around the world, nations are
becoming more aware of environmental protection, which has led to the increase of
eco-friendly, energy-saving and other environmental protection industries. Therefore,
people has been trying to reduce the material used in tires and use the eco-friendly materials
instead.
The global economy is affected by the unstable trade situation and increased
protectionism.The tire industry will change from a passive component to an active one,
which will provide all the performance parameters when driving the vehicle under the
influence of the automation, intelligence and digitization.
The only way to survive in this highly competitive environment is to change, so that
the business can remain stable. We can only create a new business opportunity by changing
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the traditional mindset and adopting an innovative one.Inflatable tires are no longer the only
design for tires; the smart tires are also feasible.
Kenda will continue to develop the energy-saving technology and the dynamic
simulation:
1. Research on the advance technology for smart tires to innovate new ideas in the tire
industry.
2. Study on the advance technology for a new type of non-inflatable tire.
3. Provide the high value-added products and introduce automatic equipment to ensure the
quality of our products.
4. Establish a tire laboratory to enhance the technology capability for dynamic tire
simulation.
5. Establish a VOC (odor) laboratory in response to the new international regulations to
reduce the tire odors and enhance the technical capability of the Company.
6. In 2020, the Company completed more than 800 new product developments and patents.
7. Kenda has won the 29th Taiwan Excellence Award, which is the 14th consecutive year
for Kenda's products to be awarded, including the AGC technology for off-road
downhill bicycle, ultra-thin lightweight inner tube for bicycle, NRF noise reduction
technology for automobile tire, the K6025 all-terrain motorbike tire, the K3211
all-terrain multi-purpose automobile tire, and the KR100 light truck tire.In order to
actively promote the intelligent property control plan, the implementation status of the
plan in the recent years is as follows:
In 2020, the Company developed a Kenda standard operating procedure for establishing
the R & D and patent licensing standards.
In 2020, the Company invited the Inspector from the Intellectual Property Office of the
Ministry of Economic Affairs to conduct patent knowledge education and training.
Future plan:
In 2021, the R&D BSC will set the number of patent applications and regularly review
the technology produced by the department.
In 2021, the Company will invite Taiwan Intellectual Property Office to conduct
educational training on patent search, patent specifications and claims.
II. Summary of Business Plan for 2021
(I) Business policy for 2021:

We focus on continuing to launch innovative products with high cost performance,
strengthening occupational safety and health, and expanding the marketing scale:
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1. Expand the product lines and production capacity in Vietnam and Indonesia factories to
avoid the US-China trade war and the US anti-dumping and countervailing duties, and
enhance our competitiveness to increase the global market share and business scale.
2. Reorganize the supply chain management in response to the COVID-19 to ensure that
the raw material procurement remains on track to meet our global customers' needs.
3. Maintain the occupational safety and health and environmental protection management
in order to respond to the impact from the post COVID-19 pandemic and to ensure the
workplace and production safety.
4. Build a digital marketing management system to promoteKENDA's brand awareness in
order to enrich theKENDA brand.
5. We will expand the management team and sales channels for subsidiaries in Europe,
STARCO and the European Research Center to increase the market share and marketing
scale in Europe and Eastern Europe markets.
6. Develop a trial run for the all-steel radial truck and complete the product line.
7. Develop high value-added products and optimize the existing one to expand into new
markets.
8. Innovate and develop high value-added products for specific markets, and build up the
channels to increase the market share.
9. Continue to research and develop the eco-friendly passenger car tire with EU A grade
low rolling resistance and good wet grip performance.
10. Expand the product lines including the car tires for SUV, UHP, new snow tires, and the
AT, RT, MT and MCR tires.
11. Extend the OEM business for PCR and LTR.
12. Refine human resources, enhance team discipline and improve the management
capability and operational performance.
(II) The sales volume forecast and its basis: The forecast is based on the Company's
annual operating targets and the market survey.
Consolidated
Year 2021
Sales Volume (in thousand
Product Type units)
Bicycle tires 56,615
Tires for motorcycles and 35,531
other bias tires
Radial tires 10,793
Inner tube 100,691
Total 203,630
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Individual
Year 2021
Sales Volume (in thousand
Product Type units)
Bicycle tires 3,868
Tires for motorcycles and 4,343
other bias tires
Radial tires 1,419
Inner tube 14,536
Total 24,166
III. The company's future development strategy

Our business strategy is to "Operate in Taiwan; Distribute globally; Deeply develop around
the world", to increase the production capacity, to innovate and develop new products with
high quality and low price, and to serve global customers with the KENDA brand.
1. The Company will continue to invest in Vietnam factory to expand the product line and
production capacity for passenger car tires, and expand the production capacity in Indonesia
factory for bicycle and motorbike tires, as well as to set up the local sales channels for both
domestic sales and sales in the nearby ASEAN countries in order to increase the market share
and increase the operating scale in the ASEAN region.
2. The Company will expand the management team and sales channels with STARCO and the
European subsidiary to increase the marketing scale and market share for bicycle and
motorbike tires, special tires for the agricultural industry and car tires in Europe and Eastern
Europe markets.
3. The Company will integrate R&D resources from the R&D headquarters, the US R&D center,
the China R&D center and the European R&D center to strengthen the R&D capability and
technology and to develop all kinds of tires with good cost performance to meet the market
demand in the new car and car repair market.
4. The Company will collaborate with OE car manufacturers to develop OE car tires in order to
increase the market share in the new car market for passenger car tires and spare tires.
5. The Company will introduce automation equipment and promote intelligent manufacturing to
stabilize the quality in production processes and improve the productivity based on the MES
production control management system.
6. Build a factory for all-steel truck radial tires to produce and sell all-steel truck radial tires in
order to expand the operation scale.
7. Continue to research and develop asymmetric radial tires for passenger cars, new snow tires
and progressively update the AT, MT, RT and MCR product lines.
8. Innovate and develop high value-added products for specific markets, and build up the
channels to increase the market share.
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9. Integrate human resources, reinforce team discipline and enhance the management capability
and operational performance.
IV. The effect of external competition

1. The EU continues to impose dumping duties on bicycles manufactured in China, which may
continue to affect the bicycle tires sales indirectly as the OE factory's sales are being
restricted.
2. Turkey imposes anti-dumping duties on bicycle and motorbike tires imported from Taiwan,
China and Vietnam which results in sale to Turkey being restricted.
3. Brazil imposes anti-dumping duties on bicycle and motorbike tires from China and Vietnam,
and anti-dumping duties on car tires from China and Taiwan which affects the sales in Brazil.
4. The US imposes anti-dumping and countervailing duties on passenger car tires and light truck
tires from China. The anti-dumping duty rate in our latest administrative review is 0 and the
countervailing duty rate is 15.56%, which is lower than other manufacturers in China. Once
the US terminates the 25% tariff imposed under Special 301 Act, our Kunshan factory will
regain the competitiveness in exporting these products to the US.
5. The Indian government had announced the ban on the tires imported from other countries in
June 2020, which would seriously affect our sales to the Indian market.
6. The Chinese tire manufacturers have invested and set up factories worldwide to intensify the
competition in tire manufacturing industry.
V. The effect of legal environment

1. The norms and standards for the tire product certification have continued to increase and
become more time-consuming and costly; for example, the E-mark and labelling act in EU,
DOT in US, CCC in China, SNI in Indonesia, GCC in the Middle East, INMETRO in Brazil,
TIS in Thailand, BIS in India and other requirements that cause the barriers in trading.
2. The United States imposed punitive trade tariffs on Chinese tires including the
countervailing and anti-dumping duties under the US-China trade war and the 301 Act,
which seriously affected the competitiveness of the Chinese tire manufacturers in the US
market.
3. The US imposes a high anti-dumping tariff on tires from Taiwan which affects the
competitiveness of Taiwanese tire manufacturers in the US market.
4. Due to the lack of progress for Taiwan's participation in regional economic organizations and
the signing the free trade agreements with the trade partner countries, it is not beneficial to
the competitiveness of Taiwan's tire industry in the global markets.
5. China's "Five social insurance and one housing fund", the industrial policy of the 13th
Five-Year Plan and the Taiwan government's " One fixed day off and one flexible rest day"
policies have increased the operating costs for the industry and are affecting the
competitiveness of the tire industry in the global market.
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VI. The effect of the overall business environment
1. Favorable factors:
(1) Due to the rapid growth in the China automotive market in the past few years and the
replacement of tires, the market for repairing tires has increased significantly as well as the
sales of vehicle tires by automobile manufacturers.
(2) The growth in automobiles, electric bicycles and electric motorbikes in China has
contributed greatly to the sales expansion of Kenda's high-priced products in China.
(3) Kenda has decentralized its production base for car tires in order to increase the
competitiveness of its products in response to the increase in regional trade protectionism
and the retaliatory measures taken by the US against the PRC under the 301 Act.
(4) Kenda has expanded its production network around the world to increase its supply
flexibility and the ability to respond to international trade protection measures and political
and economic changes.
(5) In response to the anti-dumping investigations conducted by various countries, KENDA's
Kunshan and Vietnam factories have obtained a favorable result of 0% anti-dumping tax
rate on the anti-dumping investigation of sedan and passenger car tires exported to the U.S.,
which has increased our competitiveness in exporting these products to the U.S.
(6) The Company has set up sales offices in Europe and the United States to develop local
markets, to localize the sales and to build up the motivation for future growth.
(7) The Company set up a Research and Development Center to strengthen its research and
development capability, speed up the launching of new products and achieve great profits.
(8) The global bicycle market was affected by the COVID-19 pandemic, resulting in a large
increase in demand; therefore, KI factory continues to expand the production.
2. Unfavorable factors:
Due to the impact of the COVID-19 pandemic, the cities in mainland China were locked down
from the beginning of spring 2020, despite the fact that the production resumed in
mid-February, turnover was declined in the first quarter. In addition, due to the influence of the
COVID-19 pandemic, the international oil price dropped drastically, which affected the raw
material price. In addition, after the production of mainland China's competitors resumed
production, they adopted price cuts in order to obtain orders. From March 2020, the COVID-19
gradually spread to Europe and the United States, which affected the sales since the second
quarter, but because of the major tire factories in Europe and the United States shut down due
to the pandemic, the production capacity of our mainland factory gradually resumed, and the
production capacity of our Vietnam factory gradually increased, which could make up for part
of the shortage in the European and American markets. Despite the environmental challenges
we faced, we were able to control the production schedule at each of our factories to minimize
the impact caused by the COVID-19 pandemic.
The local tire manufacturers in mainland China are rapidly expanding their production capacity
for passenger car tires while the US has taken the 301 Act retaliation measures against China;
therefor, the market price of passenger car tires outside the US will be influenced and the
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competition in the middle and low price passenger car tire market will become more intense in
the future. The Company will continue to develop high value-added tires and to differentiate
the market to cope with the increasing competition.
Due to the impact of the COVID-19 pandemic, the bicycle export declined significantly in the
first half of the year; in the second half of the year, the bicycle became the main commuting
and sporting vehicle for which the demand increased drastically; however, due to the limitation
of the production capacity among the bicycle parts suppliers, the materials supply was not
sufficient and the bicycle assembly plants hoarded a lot of materials to ensure the assembly of
bicycles smoothly; furthermore, as the containers could not be unpacked in time after exporting
to Europe and the United States which resulted in the shortage of containers and the drastic
increase of freight cost; therefore, the sales of bicycles in 2020 were 20.05% less than that in
2019. The average selling price will increase from USD631.03 in 2019 to USD646.24 in 2020.
The market for electronic assisted bicycles increased by 17.99% in 2020 compared to that in
2019. The average selling price declined from USD 1339.43 in 2019 to USD 1298.45 in 2020.
Kenda Rubber Ind. Co., Ltd.
Yang, Chi-Jen
Chairman
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Two. Introduction of the Company
I. Established and registered on: March 30, 1962
II. Organization and operations:

1962~1982 The company was established in March 1962 with a capital of $960,000 and 50
employees. At the beginning, the company was mainly producing bicycle inner and
outer tires. In 1980, the capital was increased to $126.1 million, which was used to
expand the factory, purchase machines and equipment, and improve the quality and
output of the products; therefore, the business turnover was increased every year. In
1978, the Yuanlin Factory was officially awarded with CNS Mark. In 1981, the
Company's capital was increased by $69.35 million from the retained earnings,
resulting in the total capital being $195.45 million. The Company acquired additional
land for the Yuanlin factory and a new factory site in Yunlin. The first phase
construction of the Yunlin factory included a raw material mixing plant, a public works
building and an air-raid shelter. In 1982, the company diversified its investment
portfolio by investing in Kenjou Ind. Co., Ltd.
1985~1991 In 1985, the capital was increased by the capitalization of $130.96 million from
retained earnings and an IPO. In 1986, the capital was increased to $430.86 million
after the capitalization of $104.45 million from retained earnings. The capital was used
to build a new factory in Yunlin and acquire equipment for manufacturing cover tires,
including a set of equipment for tire covering rubber, a set of equipment for mixing
rubber materials and other equipment. In 1988, the company's capital was increased to
$500,000,000 by the capitalization of $69,140,000 from the retained earnings; the
Yuanlin factory was also awarded the "JIS" Japanese Industrial Standard symbol. In
1989, the Yunlin factory was awarded the "JIS" Japanese Industrial Standard symbol
and the "CNS" mark. In 1990, the capital was increased to $800 million by the
capitalization of $199.6 million from the retained earnings and a cash capital increase
of $100.4 million. The Company was officially listed on the Taiwan Stock Exchange
on 20 December 1990. In 1991, the Company's capital was increased to $960 million
by the capitalization of $96 million from the retained earnings and $64 million from
the capital reserve; in April, the Company received the "E" mark from the European
Common Market.
1992~1996 The Company's capital increased to NT$1,132.8 million in 1992 by the capitalization
of NT$76.8 million from the retained earnings and NT$96 million from capital surplus.
Also, in 1992, Total Lubricants Taiwan Ltd. was established as a joint venture with
Total SE; a Hong Kong subsidiary was established as well. In 1993, the Company
increased the capital to NT$1,300 million by the capitalization of NT$92,538,000 from
the retained earnings and NT$74,662,000 from the capital surplus.The Company also
merged the Kenda Tire (Shenzhen) Limited via Kenda Industrial (Hong Kong) Limited
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for US$10 million and applied for an additional US$5 million to invest in Kenda Tire
(Shenzhen) Limited. The investment was approved by MOEAIC. The Company also
applied to MOEAIC for an investment of US$15 million to establish Kenda Rubber
(China) Limited, which was approved. Chou Chin Industrial (HK) Co., Ltd. was
established in Hong Kong and Shanghai Bomy Foodstuff Co., Ltd. was established as
the joint ventures with Chou-Chin Industrial C0., Ltd. In 1994, the Company
completed the capital increase of US$5 million for Kenda Tire (Shenzhen) Limited; in
September, both the Yuanlin and Yunlin factories were certified with ISO-9002 by the
Bureau of Standards, Metrology and Inspection of the Ministry of Economic Affairs. In
1995, the Company's capital was increased to $1,625 million by the capitalization of
$280.8 million from the retained earnings and $44.2 million from capital surplus. In
October, the Kenda Tire (Shenzhen) Limited was certified to the ISO-9002 standard
from the Shenzhen Quality Certification Centre and the British Vehicle Certification
Authority (VCA); in the same year, the Company also established a joint venture with
the Chinfon Group to build a tire factory in Vietnam. The Company's capital was
increased to $1,738,750,000 by the capitalization of $81,250,000 from the retained
earnings and $32,500,000 from the capital surplus in 1996; the shareholders' meeting
on May 29th resolved to authorize the Board of Directors to invest up to $10 millions
to set up a factory, and the contract was signed in December. In January of the same
year, our Yuanlin Factory was certified with ISO9001 by the Bureau of Standards,
Metrology and Inspection of the Ministry of Economic Affairs and the British BSI.
1997~2001 In 1997, the Company's capital was increased to NT$1,982,175,000 by the
capitalization of NT$208,650,000 from retained earnings and NT$34,775,000 from
capital surplus. On 23 May 1997, the Company's Board resolved to establish KENDA
GLOBAL HOLDING CO., LTD. In 1998, the Company's capital was increased to
$2,229,323,000 by the capitalization of $279,487,000 from the retained earnings and
$37,661,000 from the capital surplus; in June of the same year, the Yuanlin Factory and
the Yunlin Factory were certified with the ISO-14001 Environment Management
System. In 1999, The Company's capital was increased to $2,713,201,000 by the
capitalization of $390,885,000 from the retained earnings and $22,993,000 from the
capital surplus. In 2000, the Company’s capital was increased to $3,065,917,000 by the
capitalization of $339,150,000 from the retained earnings and $13,566,000 from
capital surplus. In 2001, the Company’s capital was increased to $3,203,884,000 by the
capitalization of $122,637,000 from the retained earnings and $15,330,000 from
capital surplus.
2002~2006 In 2002, the Company's capital was increased to $3,364.08 million by the
capitalization of $160,196,000 from the retained earnings. In 2003, the Company's
capital was increased to $3,600 million by
the capitalization of $235.92 million from the retained earnings. In December, the
Board of Directors resolved that Kenda Global Investment Corporation, a subsidiary
of the Company, and Cooper Tire & Rubber Company in the United States, would
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~ 11 ~
jointly establish a production and sales company for passenger car and truck ply tires
in Mainland China. The subsidiary, Kenda Global Investment Corporation, would
invest US$25 million and hold a 50% shareholding in this joint venture company. In
2004, the Company's capital was increased to $3,960 million by the capitalization of
$360 million from the retained earnings. In January of the same year, a capital increase
of US$15 million was made to Kenda Rubber (China) Co., Ltd. The Company also
increased the investment in Kenda Rubber (Vietnam) Co., Ltd. by US$6 million in
March. In August, the Board of Directors resolved that Kenda Global Investment
Corporation, a subsidiary, would invest US$1.3 million and hold a 13% shareholding
to establish a joint venture company in Mainland China with Kenjou Ind. Co., Ltd. and
Inoac International Co., Ltd. The new joint venture would be used to manufacture
automotive parts. In October, the Company increased the investment in its subsidiary,
AMERICAN KENDA RUBBER IND.CO., LTD. by US$4 million. In October of the
same year, the Company invested another US$40,000 to acquire 20% of the equity of
Cooper (Shanghai) Sales And Marketing Co., Ltd., a joint venture with Cooper Tire &
Rubber Company of the United States. The establishment of Cooper (Shanghai) Sales
And Marketing Co. is expected to serve both the domestic and export operations for
Cooper & Kenda Tire (Kunshan) Co. Ltd. in mainland China. In 2005, the Company's
capital was increased to $4,356 million by the capitalization of $396 million from the
retained earnings. In December of the same year, a capital increase of US$15 million
was made to Kenda Rubber (China) Co., Ltd. In 2006, the capital was increased to
$4,595,580,000 by the capitalization of $239,580,000 from the retained earnings, and
in March of the same year, the Board of Directors resolved to increase the capital of
Cooper and Kenda Tire (Kunshan) Co., Ltd., a joint venture subsidiary of the Company,
by $18 million.
2007 ~ 2011 In 2007, the Company's capital was increased to $4,895 million by the capitalization of
$299.42 million from the retained earnings. The Board of Directors' meeting in June
resolved to authorize the Chairman to have full authority to establish a factory in North
China. In August, the Board of Directors resolved to increase the investment in Cooper
and Kenda Tire (Kunshan) Co., Ltd., a joint venture subsidiary of the Company, by
US$12 million. In August of the same year, the board of directors of the Company
authorized the chairman of the Board to have full power to approve the investment of
US$3.6 million to Kenda Tire (Tianjin) Limited from the retained earnings allocated to
Kenda Tire (Shenzhen) Limited through the Company’s subsidiary, KENDA GLOBAL
HOLDING CO. Ltd.;and the investment of US$5.4 million in Kenda Tire (Tianjin)
Limited from the retained earnings allocated to Kenda Tire (Shenzhen) Co., Ltd.
through the Company's subsidiary, Kenda Industrial (Hong Kong) Limited. In 2008,
the Company's capital was increased to $5,262.5 million by the capitalization of
$367.5 million from the retained earnings. In March, the Board of Directors resolved to
increase the investment in Kenda Tire (Tianjin) Co., Ltd. by US$6.4 million; in August,
the Board of Directors resolved to increase the investment in Kenda Rubber (China)
12
~ 12 ~
Co., Ltd. by US$10 million. In October, the Board of Directors resolved to cancel the
investment in Cooper (Shanghai）Sales And Marketing Co.,Ltd. a joint venture
subsidiary of KENDA and COOPER. The Company received the 2008 Industrial
Sustainable Excellence Award from the Industrial Development Bureau of the Ministry
of Economic Affairs in December. In 2009, the Company's capital was increased to
$5,526 million by the capitalization of $263.5 million from the retained earnings. In
March, the Board of Directors resolved to increase investment in Dongguan Inoac
Kenjou Automotive Co., Ltd. by US$403,000. In August, the Board of Directors
resolved to increase the investment in Kenda Rubber (Tianjin) Limited by US$9.6
million. The Company received the 17th Industrial Technology Advancement Award
(Excellent Innovation Enterprise Award) from the Ministry of Economic Affairs in
November. In 2010, the Company's capital was increased to $6,206 million by the
capitalization of $680 million from the retained earnings. In February, the Board of
Directors resolved to increase the investment in Cooper and Kenda Tire (Kunshan) Co.,
Ltd., a joint venture subsidiary of the Company, by US$1.5 million. In February, the
Board of Directors resolved to increase the investment in Kenda Tire (Tianjin) Limited
by US$9 million. In 2011, the Company's capital was increased to $6,889 million by
the capitalization of $683 million from the retained earnings. The Board of Directors
resolved to approve the disposal of 50% of the shares of COOPER KENDA GLOBAL
HOLDING CO. LTD held by the KENDA GLOBAL INVESTMENT
CORPORATION through the KENDA INTERNATIONAL CORPORATION in
March. In April, the Board of Directors resolved to increase the investment in Kenda
Rubber (Tianjin) Limited by US$15 million. The Company was awarded the China
Well-known Trademark in June.
2012 ~ 2013 In 2012, the Company's capital was increased to $7,336.8 million by the capitalization
of $447.8 million from the retained earnings. In August, the Board of Directors
resolved to increase the investment in Kenda Rubber (Tianjin) Limited by US$30
million; in October, the Board of Directors resolved to increase the investment in
Kenda Tire (Tianjin) Limited by US$6 million; in September, the Company was
awarded the 2nd National Industry Innovation Award by the Ministry of Economic
Affairs; and the Company was ranked the 24th in Branding Taiwan. In 2013, the
Company's capital was increased to $7,630,300,000 by the capitalization of
$293,500,000 from the retained earnings. In January 2013, the Company was awarded
the JIPM (Japan Institute of Plant Maintenance) TPM Excellence Award; in February,
the Company was awarded the 1st Taiwan Outstanding Medium Enterprise Award by
the Ministry of Economic Affairs; in March, the Company was awarded the
Guangdong Outstanding Taiwanese Enterprise Award; in August, the Company was
awarded the 1st Outstanding Taiwanese Enterprise Award for Export Sales; in
September, the Company was awarded the Product Innovation Award by the Taiwan
Chemical Industry Association; and in November, the Company was awarded the
"Carbon Footprint Certification" by the Industrial Development Bureau. In March, the
13
~ 13 ~
Board of Directors resolved to establish Kenda Rubber (Huizhou) Limited; in May, the
Board of Directors resolved to establish Kenda Rubber Industries (Europe) Limited; in
November, the Board of Directors resolved to merge the U.S. Development Investment
Corporation with Kenda's U.S. subsidiary; to establish KF Trading Company Limited
and KENDA GLOBAL HOLDING (CHINA) CO., LTD.; and to increase the
investment in Kenda Rubber (China) Limited by USD 33 million.
2014 ~ 2015 In 2014, the Company's capital was increased to $8,164.5 million by the capitalization
of $534.2 million from the retained earnings. In April, Kenda Rubber (Tianjin) Co., Ltd.
was certified with ISO/TS 16949; in May, the Board of Directors resolved to expand
the R&D headquarters by establishing a R&D center; in June, Kenda joined the
European Imported Tyre Manufacturers Association (ITMA); in August, the Board of
Directors resolved to establish Kenda Rubber (Indonesia) with a total investment of
US$100 million; in December, the Yuanlin and Yunlin factories in Taiwan was certified
with ISO 50001. In February 2015, the Board of Directors resolved to change the name
of the subsidiary KF Trading Co., Ltd. to KF Industrial Co., Ltd. and to increase the
investment by $197 million in order to acquire a factory site in the Shihliuban
Industrial Park in Yunlin; in March, the Board of Directors resolved to lease land in
Dong Nai Province, Vietnam for the expansion of the passenger car tire factory in
Vietnam. For nine years in a row, the Company's products won the Taiwan Excellence
Award and from these, the Company was awarded the Taiwan Excellence Gold and
Silver Award again.
2015 ~2016 In 2015, the Company's capital was increased to $8,572.8 million by the capitalization
of $408.3 million from the retained earnings. The product K1127B won the 23rd
Taiwan Excellence Silver Award in April. In August, the Board of Directors resolved to
increase the investment in Kenda Rubber (Tianjin) Limited, the subsidiary of the
Company by US$35 million. The Company signed a land lease agreement for the
establishment of the passenger car tire factory in Vietnam in September. In November,
the U.S. Research and Development Center was officially established; the Company's
products KR50, K1174, K518 and KD1 won the 24th Taiwan Excellence Award again;
the Board of Directors resolved to increase the investment of US$8 million in the
subsidiary, Kenda Rubber (Vietnam) Co., Ltd. In February 2016, the Investment
Commission approved the cancellation of the subsidiary - Kenda Rubber (Shenzhen)
Company Limited; the Company was awarded as one of the Top Ten Brand Enterprises
in Kunshan, Jiangsu Province in China.
2016 ~2017 In 2016, the Company's capital was increased to $8,744.3 million by the capitalization
of $171.5 million from the retained earnings. In May, the construction of a new factory
in Douliu, Yunlin, was started. In June, the construction of the second factory in
Vietnam began. In August, the Board of Directors resolved to increase the investment
of US$15 million in the subsidiary, Kenda Rubber (Indonesia) Limited. In December,
the Company's products K1160X and K3201 won the 25th Taiwan Excellence Award.
In February 2017, the K1160X product was awarded the Taiwan Excellence Silver
14
~ 14 ~
Award again.
2017~2018 In September 2017, the Company's products K779, K1201, KR41 and K3203 won the
26th Taiwan Excellence Award. This is the 11th consecutive year that the Company's
products have been recognized by the Taiwan Excellence Awards. In October, the
Company acquired the Danish-based rim company STARCO EUROPE A/S; the
second factory in Vietnam started the trial runs for passenger car tire and light truck
tire. In November, the Board of Directors resolved to acquire land in the Tai Jiang
Industrial Park, where the Yunlin factory is located, to increase investment in the area.
2018~2019 In May, July and September 2018, the Tianjin, Yunlin and Shanghai factories were
certified with IATF 16949:2016 Quality Management System for Automotive Industry
respectively. In October, the Company was certified the "Talent Quality-management
System" by the Workforce Development Agency of the Ministry of Labor. In
November, the Company was awarded the Yunlin County Occupational Safety and
Health Excellence Award and certified as the D-U-N-S® Registered™ enterprise. In
November, the Company's products K1211/K1211E off-road mountain bike tires,
K678F/K678 all-terrain motorbike tires, K576A all-terrain multi-purpose car tire and
KR600 light truck tire won the 27th Taiwan Excellence Award.
In December, the Company was awarded the "Excellent Enterprise in Occupational
Safety and Health Performance" by the Ministry of Labor. In March 2019, the Board of
Directors resolved to increase the investment in the subsidiary - Kenda Rubber
(Vietnam) Limited by NT$1.5 billion.
2019~2020 In October 2019, we were awarded the 16th National Brand Yushan Award -
Outstanding Enterprise category by the Republic of China National Enterprise
Competitiveness Development Association and the National Brand Yushan Award
Selection Committee. In November, the Company's products K1227 XC off-road
bicycle tire, K590 all-terrain multi-purpose car tire, K6022 dual-purpose compound
motorbike tire, KR52 SUV asymmetrical RV tire and K3003/K3004 non-inflatable
tires won the 28th Taiwan Excellence Award. In December, the Company was awarded
the 2019 National Talent Development Award by the Ministry of Labor in the Large
Enterprise category. In January 2020, the Company was awarded the 2019 Excellent
Technology Award by Kwang Yang Motor Co., Ltd. In January, the Board of Directors
resolved to increase the investment of US$33 million in the subsidiary, Kenda Rubber
(Vietnam) Limited, and the investment of US$8 million in the subsidiary, Kenda
Rubber (Indonesia) Limited. In February, the company was awarded the Outstanding
Performance Award in Regular Evaluation by Sanyang Motor Co., Ltd. and the
Outstanding Contribution Award by China Motor Corporation Association.
2020~2021 In 2020, the Company's capital was increased to $9,094.1 million by the capitalization
from the retained earnings of $349.8 million. In November, the Company's products
AGC off-road downhill bicycle tire technology, ultra-thin lightweight bicycle inner
tube, NRF noise reduction foam technology in car tire, all-terrain motorbike tire -
K6025, all-terrain multi-purpose vehicle tire - K3211, light truck tire - KR100 won the
15
~ 15 ~
29th Taiwan Excellence Award, and in January 2021, won the 2020 Technology Award
from Kwang Yang Motor Co., Ltd. In January, the EMERA SUV607 UHP KR607 car
tire, the Noise Reduction Foam Technology (NRF) KR41 (silent foam) car tire and the
Advanced Gravity Casing (AGC) K1201/K1202/K1235/ K1241 bicycle downhill tires
won the 2020 Chicago Good Design Award. In February, the company was awarded
the Outstanding Performance Award in Regular Evaluation by Sanyang Motor Co.,
Ltd.
16
~ 16 ~
Sales Department I
Department
Sales Department II
Sales
Sales Department III
Sales Department V
Department
R&D Division I
R&D
R&D Division II
Office of the Board
Chairman’s Office
Remuneration
Committee
R&D Division III

Secretary
HR Department
The Headquarter
Administration
Department
Environmental & Safety Office
Material Department
Information Department
Department
Finance
Finance Department
Vice Chairman
Shareholders’
Vice President
Directors
Chairman
President
Board of
Meeting
Quality Assurance
Department
Department
Production
Engineering Department
Production Technology
Department
Yuanlin Factory
Yunlin Manufacturing
Factories in
Division I
Taiwan
Office of Internal
Audit Committee
Committees
Yunlin Manufacturing
Three. Corporate Governance Report
Functional
Division II
Audit
Yunlin Factory
Department
Douliu Factory
(I) Organizational structure
I. Organization
~ 17 ~
(II) Business for each segment:
Segment Job Description
Office of Internal Establishes the internal control system for the Group, reviews the rules and regulations, implements
Audit the audit and proposes the improvement measures.
Chairman’s Office 1. Plans and supervises the operations for the shareholders' meeting, the board of directors, the
remuneration committee, the audit committee and the CSR.
2. Plans the short-term, mid-term and long-term business operations, develops the annual business
policies and controls the performance for the Group.
3. Plans, implements and maintains the appropriateness and effectiveness of the internal control
system.
4. Plans, investigates and evaluates overseas investment projects including the application, filing and
approval of the said investment projects.
5. Supervises the businesses in all the subsidiaries and invested enterprises.
6. Plans and implements the Group's intellectual property rights (trademarks and patents), contract
review, legal affairs, product liability insurance and liability insurance for directors and
supervisors.
7. Plans and executes the activities for the Kenda Cultural and Education Foundation.
Kenda Rubber Be responsible for the market development and the product sales in North America.
( America)
Kenda Rubber Manufactures and sells the tubes and tires of bicycles, motorbikes and industrial vehicles.
(Vietnam)
Kenda Rubber Manufactures and sells the tubes and tires of bicycles, motorbikes, industrial vehicles and light trucks.
(Shenzhen)
Kenda Rubber Manufactures and sells the tubes and tires of bicycles, motorbikes, industrial vehicles and light trucks,
(China) and radial tires for cars.
Kenda Rubber Manufactures and sells the tubes and tires of bicycles, motorbikes, industrial vehicles and light trucks,
(Tianjin) and radial tires for cars, waterproof tape and other rubber products
Kenda Rubber Be in charge of the product marketing
(Europe)
KF Be in charge of the sale for all kinds of tire products in Taiwan.
Yunlin Manufactures the cover tires for motorbikes, cars and industrial vehicles.
Manufacturing
Division I
Yunlin Manufactures the radial tires for cars.
Manufacturing
Division II
Yunlin Factory 1. Develops and manages the engineering and quality control of tire manufacturing.
Department 2. Promotes the CSR related activities.
Yuanlin Factory Manufacturse the cover tires of bicycles, motorbikes and industrial vehicles, and all kinds of tubes.
Douliu Factory Be in charge of product shipping and other rubber products manufacturing.
Engineering 1. Develops and introduces the manufacturing equipment for the Group and improve the production
Department process.
2. Manages the facilities and equipment for the Group.
3. Promotes and manages the energy reduction and certification.
Quality Assurance Maintains the Group's quality assurance system, quality certification, after-sales service, and
Department continuously implements the quality improvements.
Production 1. Introduces new equipment, establishes the new process for production, assists in the development
18
~ 18 ~
Segment Job Description
Technology of new equipment and process testing, solves problems and establishes the production technology.
Department 2. Improves the manufacturing technology for the Group's existing equipment; evaluates, analyses
and develops the process improvement projects for each factory; accepts, reviews, changes the
design and validates and develops the results.
Finance 1. Processes accounts, calculates costs, plans budgets, and analyzes financial and operational results.
Department 2. Provides financial planning, consolidation and budgeting for the Group; handles the accounts and
taxation for the overseas holding companies.
Environmental & 1. Plans, executes, guides and audits the environmental protection and industrial safety management
Safety Office system.
2. Works on the environmental management system certification.
HR Department 1. Plans and integrates the Group's HR and general affairs, and manages the oversea staff deployment.
2. Promotes the CSR related activities.
Information Designs and manages the Group's information systems.
Department
Material Plans, manages and integrates the Group's procurement business.
Department
R&D Division I 1. Develops, designs and controls the raw materials and formulations for the Group's new products;
manages and tests the raw materials and formulations and conducts the evaluation.
2. Develops the raw material specifications for the Group.
3. Conducts the fundamental research on innovative rubber and tires; develops the polymer analysis
and test methods.
R&D Division II 1.Designs and controls the new product development for the Group (structure & mold), manages the
trial production and new product development business.
2. Develops the specifications for the Group’s products.
3. Develops the product design theory and the method for product validation.
4. Develops and analyzes the evaluation method and related technology.
R&D Division III 1. Implements the "R&D Project for Green Tire Design" by the Government.
2. Conducts the fundamental research on innovative rubber and tires, as well as polymer analysis and
testing.
3. Provides trial run, pilot production and mass production assistance for eco-friendly new material
applications and new formulation development.
4. Controls the design for new product development.
5. Collects and calibrates feedback on the market evaluation information.
6. Provides overseas staff assignment, training and support.
Sales Department Conducts the product planning, marketing planning, market development and sales activities.
I
II
III
V
19
~ 19 ~
II. Information on the Directors, Supervisors, President, Vice President, Assistant Vice President, the Chiefs of all the
Company's Divisions and Branches
(I) Information on Directors and Independent Directors
April 20, 2021
Other officers, directors or
Number of shares held by Number of shares held
Number of shares held Number of shares held supervisors who are spouses or
the spouses and children under other persons’
Position Date elected on date elected currently within the second degree of
Terms of minor age currently names Principal work experience and academic Position(s) held concurrently in the
Nationality Gender (initial elected kinship Remarks
of office qualifications Company and other companies
Name date) Percentage Percentage Percentage
Percentage of
Shares of Shares of Shares Shares of Position Name Relation
Ownership
Ownership Ownership Ownership
2nd
Yang, degree of
City University of New York Master Degree in
Chairman Republic 2018.06.11 American Kenda Rubber Ind. Co., Ltd. Director Ying Ming kinship
Male 3 years 88,188,695 10.09 91,622,924 10.07 9,801,904 1.08 0 0 Business Administration
Yang, Chi-Jen of China (1979.05.20) Chairman Director Hsiao, Ru 2nd
Vice Chairman, Kenda Rubber Ind., Co., Ltd.
Po degree of
kinship
Cornell University Doctoral Degree in
Vice Chairman Republic 2018.06.11 Kenda Rubber Ind., Co., Ltd.
Male 3 years 5,464,465 0.62 7,661,040 0.84 142,561 0.02 0 0 Mechanical Engineering None None None
Chang,Hong-Der of China (2003.06.20) Vice Chairman
President, Kenda Rubber Ind., Co., Ltd.
2nd
Syracuse University (New York) Master Degree Yang, Chi degree of
CEO, Kenda Rubber Ind., Co., Ltd.
Director Republic 2018.06.11 in Chemical Engineering Chairman Jen kinship
Male 3 years 66,005,282 7.55 65,555,015 7.21 17,320,649 1.90 0 0 Chairman of the Board, Kenjou Ind. Co.,
Yang, Ying-Ming of China (1974.01.01) Chairman of the Board, Kenda Rubber Ind., Co., Director Hsiao, Ru 2nd
Ltd.
Ltd. Po degree of
kinship
Ohio State University (America) Master Degree
Director Republic 2018.06.11
Male 3 years 13,900,789 1.59 7,228,842 0.79 2,165,085 0.24 7,268,753 0.80 in materials Engineering President, Kenda Rubber Ind., Co., Ltd. None None None
Chen, Chao-Jung of China (1990.05.23)
Vice President, Kenda Rubber Ind. Co. Ltd.
2nd
Yang, degree of
Director Republic 2018.06.11 B.A. in English, National Taiwan Normal Director Ying Ming kinship
Female 3 years 24,761,343 2.83 15,701,546 1.73 16,007,518 1.76 0 0 None
Hsiao, Ru-Po of China (1988.02.11) University Chairman Yang, Chi 2nd
~ 20 ~
Jen degree of
kinship
Director Republic 2018.06.11 BS in Pharmacy, China Medical University
Female 3 years 27,033,017 3.09 28,668,065 3.15 0 0 0 0 President, Kenlight Trading Corp. None None None
Yang, Chia-Ling of China (2015.06.23) President, Kenlight Trading Corp.
Master of Graduate Institute of Communication
Director Republic 2018.06.11 Engineering, National Taiwan University OBERLIN TECH. CO., LTD.
Male 3 years 10,012,857 1.15 10,413,403 1.15 521,463 0.06 0 0 None None None
Lin, Tsung-Yi of China (2018.06.11) Chairman of the Board, OBERLIN TECH. CO., Vice President
LTD.
Director 2018.06.11 Not Not Not
Taipei City - 63,464 0.01 66,002 0.01 0 0 0 0 Not applicable. Not applicable.
Kenjou Ind. (2012.06.13) applicable. applicable. applicable.
Co., Ltd. 3 years
Republic 2018.06.11 Department of Chemical Engineering, National Kenda Rubber Ind., Co., Ltd.
Representative: Male 0 0 0 0 0 0 0 0 None None None
of China (2012.06.13) Taipei Institute of Technology Vice President
Shen, Jui-Hsiung
Independent B.S in Department of Chemistry, National Cheng Convener of the Audit
Republic 2018.06.11
Director Male 3 years 0 0 0 0 0 0 0 0 Kung University Committee/Remuneration Committee, None None None
of China (2015.06.23)
Hsieh,Chun-Mou Vice President, Kenda Rubber Ind. Co. Ltd. Convener of Remuneration Committee
Independent Director, Rechi Precision
Co.,Ltd.
Independent B.S in Department of Mechanical Engineering,
Republic 2018.06.11 Independent director, Aerowin Technology
Director Male 3 years 0 0 0 0 0 0 0 0 National Cheng Kung University None None None
of China (2015.06.23) Corporation
Su, Ching-Yang President, China Motor Corporation
Director, Nature Wise Biotech & Medicals
Corporation
Master of Economics, National Taiwan
University SWANCOR HOLDING CO., LTD
Independent
Republic 2018.06.11 Political Deputy Minister and Administrative - Independent Director
Director Male 3 years 0 0 0 0 0 0 0 0 None None None
of China (2018.06.11) Deputy Minister, Ministry of Economic Affairs Formosa Taffeta Co., Ltd.-
Lin,Sheng-Chung
Chairman of the Board, CPC Corporation, Independent Director
Taiwan
Table 1: Major shareholders of corporate shareholders
Name of the corporate shareholder (Note 1) Major shareholders of corporate shareholders (Note 2)
Yang, Ying Ming (20%) Yang, Chi Jen (20%)
Kenjou Co., Ltd.
Hsiao, Ru Po (15%)
Note 1: If the director or supervisor is a representative of a corporate shareholder, the corporate shareholder's name
should be stated.
Note 2: Fill in the names of the major shareholders of the corporate shareholder (whose shareholding is among the top
ten shareholders) and their shareholding ratio. If the major shareholder is a corporate shareholder, the following
table 2 should be included.
Note 3: If a corporate shareholder is not a registered company, the name of the shareholder and the percentage of
shareholding disclosed in the preceding paragraph shall be the name of the contributor or donor and the
percentage of contribution or donation.
Information on Directors and Independent Directors (2)

The number
of other
listed
companies
Have at least 5 years working experience with
Requirem Eligible for independence (Note 2) that
the following professional qualifications
ents concurrently
serve as
independent
directors
An instructor A judge, public With work 1 2 3 4 5 6 7 8 9 10 11 12
or higher up in prosecutor, experience
a department attorney, certified in the area
of commerce, public accountant, of
law, finance, or other commerce,
accounting, or professional or law, finance
other academic technical or
department specialist who has accounting,
related to passed a national or
company examination and otherwise
business in a has been awarded necessary
Name public or a certificate in a for
(Note 1) private junior professional company
college, capacity that is business.
college, or necessary for
university. company
business.
Yang, Chi-Jen       -
Chang, Hong-Der         -
Yang, Ying-Ming        -
Chen, Chao-Jung         -
Hsiao, Ru-Po          -
Yang, Chia-Ling           -
Lin, Tsung-Yi            -
Kenjou Co., Ltd.
Representative:          -
Shen, Jui-Hsiung
Hsieh,Chun-Mou              -
Su, Ching-Yang              2
Lin,Sheng-Chung              2
21
~ 21 ~
Note 1: The number of columns is adjusted according to the actual number of entries.
Note 2: For director and supervisor who have fulfilled the following criteria in the two years prior to and during their term of office,
please tick the "" in the box below each criteria code.
(1) Not an employee of the Company or any of its affiliates.
(2) Not a director or supervisor of the Company or its associates (except for the case where the independent directors appointed in
accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the Company
and its parent or subsidiary or a subsidiary of the same parent).
(3) Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by
the person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company, or
ranking among the top 10 natural-person shareholders in holdings.
(4) Not a spouse, or relative within the second degree of kinship, or lineal relative within the third degree of kinship, of an
executive officer falling under (1), or of any of the persons in (2) and (3).
(5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number
of issued shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to
serve as a director or supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act (except for the case
where the independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and
concurrently serving as such at, the Company and its parent or subsidiary or a subsidiary of the same parent).
(6) A director, supervisor or employee of other companies who is not controlled by the same person as the majority of the
directorships or voting shares of the compan ( (except for the case where the independent directors appointed in accordance
with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the Company and its
parent or subsidiary or a subsidiary of the same parent).
(7) A director (officer), supervisor or employee of other company or institution who is not the same person or spouse as the
chairman, president or person holding an equivalent position in the company (except for the case where the independent
directors appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as
such at, the Company and its parent or subsidiary or a subsidiary of the same parent).
(8) A director, supervisor, managerial office or shareholder holding 5% or more of the shares of a specified company or
institution that does not have financial or business relationship with the Company (provided that if the specified company or
institution holds more than 20% of the total number of issued shares of the Company and does not exceed 50%, and where the
independent directors appointed in accordance with the Act or the laws and regulations of the local country by, and
concurrently serving as such at, the Company and its parent or subsidiary or a subsidiary of the same parent)
(9) Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership,
company, or institution that, provides auditing services to the company or any affiliate of the company, or that provides
commercial, legal, financial, accounting or related services to the company or any affiliate of the company for which the
provider in the past 2 years has received cumulative compensation exceeding NT$500,000, or a spouse thereof. This
restriction does not apply, however, to a member of the remuneration committee, public tender offer review committee, or
special committee for merger/consolidation and acquisition, who exercises powers pursuant to the Securities and Exchange
Act or to the Business Mergers and Acquisitions Act or related laws or regulations.
(10) Not having a marital relationship, or a relative within the second degree of kinship to any other director of the Company.
(11) Not been a person of any conditions defined in Article 30 of the Company Act.
(12) Not a governmental, juridical person or its representative as defined in Article 27 of the Company Act.
22
~ 22 ~
(II) Chief Executive Officer, President, Vice President, Assistant Vice President, the Chiefs of all the Company's Divisions and
Branches
Information on the Chief Executive Officer, President, Vice President, Assistant Vice President, the Chiefs of all the Company's Divisions and Branches
April 20, 2021
Number of shares held Number of shares held Managers who are related
Date on Principal work Position(s)
Shareholding by spouse and children under other persons’ to the spouse or the
which experience and held
of minor age names second degree of kinship Remarks
Position Nationality Name Gender current academic concurrently
Percentage Percentage Percentage (Note 3)
position was qualifications in other
Shares of Shares of Shares of Position Name Relation
assumed (Note 2) companies
Syracuse University
Chief chairman of
Republic (New York), USA
Executive Yang, Ying-Ming Male 2018.06.11 65,555,015 7.21 17,320,649 1.90 0 0 Kenjou Ind. None None None
of China Master of Chemical
Officer Co., Ltd.
Engineering
Ohio State
University, USA
Republic
President Chen, Chao-Jung Male 2018.08.09 7,228,842 0.79 2,165,085 0.24 7,268,753 0.80 Master of Science None None None None
of China
in Materials
Engineering
Department of
Chemical
~ 23 ~
Vice Republic Engineering,
Shen, Jui-Hsiung Male 2018.08.09 0 0 0 0 0 0 None None None None
President of China National Taipei
Institute of
Technology
Department of
Assistant Chemical
Republic
Vice Huang,Shi-Cheng Male 2005.11.01 13,390 0.00 39,560 0.00 0 0 Engineering, Chung None None None None
of China
President Yuan Christian
University
Department of
Chemical
Assistant
Republic Engineering,
Vice Lin, Chun-Ke Male 2006.04.01 6,972 0.00 0 0 0 0 None None None None
of China National Taipei
President
Institute of
Technology
Department of
Mechanical
Assistant
Republic Engineering,
Vice Chen, Chin-Fu Male 2006.04.01 0 0 0 0 0 0 None None None None
of China National Taipei
President
Institute of
Technology
Department of
Assistant
Republic Foreign Languages,
Vice Chang, Hui-Chu Female 2011.04.01 0 0 0 0 0 0 None None None None
of China National Chung
President
Hsing University
Department of
Assistant Chemical
Republic
Vice Wu, Wu-Long Male 2014.06.16 0 0 0 0 0 0 Engineering, None None None None
of China
President National Cheng
Kung University
Department of
Finance and
Assistant
Republic Taxation, Tamsui
Vice Liu, Kuei-Chun Male 2017.07.16 0 0 0 0 0 0 None None None None
of China Institute of
President
Business
Administration
Department of
Assistant
Republic Agricultural
Vice Hsiao,Wei-Lien Male 2019.05.14 0 0 0 0 0 0 None None None None
of China Extension, National
President
Taiwan University
Note 1: The information of the President, Vice President, Assistant Vice President, Department and Branch Heads shall be disclosed, as well as those whose position is
equivalent to President, Vice President for example: CEO, Director, and so on, shall also be disclosed no matter their titles.
Note 2: For those who have worked for a CPA firm or an affiliated company during the previous reporting period in relation to their current position, the title of the position
and the duties for which they were responsible should be disclosed: None.
~ 24 ~
Note 3: If the President or equivalent (the most senior manager) and the Chairman of the Board are the same person and are related to each other as spouses or first degree of
kin, the reasons, reasonableness, necessity and measures (e.g. increasing the number of independent directors and having a majority of directors who are not also
employees or managers) should be disclosed: None.
Note 4: Assistant Vice President Wu, Wu Long was resigned on May 13, 2019; Mr. Hsiao Wei Lien took the position on May 14, 2019.
(III) Where the Chairman of the Board of Directors and the President or person of an equivalent post (the highest level manager)
are the same person, spouses, or relatives within the first degree of kinship, an explanation shall be given of the reason for,
reasonableness, necessity thereof, and the measures adopted in response thereto: None.
III. The remuneration paid to Directors, Supervisors, President and Vice President in the most recent year
(I) Remuneration paid to Directors and Independent Directors (with the name(s) indicated for each remuneration range)
December 31, 2020 In New Taiwan Dollars
Remuneration paid to Directors Remuneration paid to part-time employees
(A+B+C+D+
Expenses from (A+B+C+D) as a E+F+G)
Severance Pay and Director’s Salary, Bonuses and Severance Pay Remuneration to employees as a %
Remuneration (A) professional practice % of Net Income Compensation
Pensions (B) remuneration (C) Allowances (E) and Pensions (F) (G) of Net Income
(D) Received from
Position Name Non-consolidated
From All Affiliates or
From the
Consolidated Parent Company
From All From All From All From All From All From All From All Company From All
From the From the From the From the From the From the From the Entities From the
Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated
Company Company Company Company Company Company Company Company
Entities Entities Entities Entities Entities Entities Entities Entities
Cash Stock Cash Stock
Yang, Chi-Jen
Chang, Hong-Der
Yang, Ying-Ming
Chen, Chao- Jung

Director 2,651,510 2,651,510 273,227 273,227 16,792,546 16,792,546 227,521 227,521 2.05 2.05 6,415,112 9,972,575 557,592 557,592 389,609 - 389,609 - 2.81 3.17 -
Hsiao, Ru-Po
~ 25 ~
Yang, Chia-Ling
Lin, Tsung-Yi
Kenjou Co., Ltd.
Representative:
Shen, Jui-Hsiung
Hsieh,Chun-Mou
Independent
Su, Ching-Yang 1,835,064 1,835,064 - - - - 218,000 218,000 0.21 0.21 - - - - - - - - 0.22 0.22 -
Director
Lin,Sheng-Chung
1. Please state the policy, system, standards and structure for the remuneration paid to independent directors and the linkage to the amount paid in respect of the responsibilities, risks, time and other factors that they are involved in.
The remuneration paid to the independent directors is a monthly fixed remuneration plus transportation costs to attend meetings. The monthly fixed remuneration is approved by the Remuneration Committee and discussed and resolved by the
Board of Directors.
2. Except as disclosed in the preceding table, the remuneration paid to the directors of the Company for services rendered to all companies consolidated in the Financial Report (e.g. as non-employee consultants) in the most recent year: None.
Remuneration Range Table
Directors’ Names
Remuneration paid to directors Total of the remunerations (A+B+C+D) Total of the remunerations (A+B+C+D+E+F +G)
From the Company From All Consolidated Entities (H) From the Company From All Consolidated Entities(I)
Shen, Jui-Hsiung, Hsieh, Chun-Mou Shen, Jui-Hsiung, Hsieh, Chun-Mou Hsieh, Chun-Mou, Su, Ching-Yang Hsieh, Chun-Mou, Su, Ching-Yang
$0 ~ $999,999
Su, Ching-Yang, Lin, Sheng-Chung Su, Ching-Yang, Lin, Sheng-Chung Lin, Sheng-Chung Lin, Sheng-Chung
Hsiao, Ru-Po, Yang, Chia-Ling Hsiao, Ru-Po, Yang, Chia-Ling Hsiao, Ru-Po, Yang, Chia-Ling Hsiao, Ru-Po, Yang, Chia-Ling
$1,000,000 ~ $1,999,999
Lin, Tsung-Yi Lin, Tsung-Yi Shen, Jui-Hsiung, Lin, Tsung-Yi Shen, Jui-Hsiung, Lin, Tsung-Yi
Yang, Ying -Ming, Chang, Hong-Der Yang, Ying -Ming, Chang, Hong-Der
$2,000,000 ~ $3,499,999 Chang, Hong-Der Chang, Hong-Der
Chen, Chao-Jung Chen, Chao-Jung
$3,500,000 ~ $4,999,999 Yang, Chi-Jen Yang, Chi-Jen Yang, Chi-Jen
Yang, Yin- Ming, Yang, Chi-Jen
$5,000,000 ~ $9,999,999 Yang, Ying-Ming, Chen, Chao-Jung
Chen, Chao-Jung
$10,000,000 ~ $14,999,999
$15,000,000 ~ $29,999,999
$30,000,000 ~ $49,999,999
~ 26 ~
$50,000,000 ~ $99,999,999
Over $100,000,000
Total 11 11 11 11
(II) Remuneration paid to supervisors: The Company has set up an Audit Committee; therefore, there is no supervisor.
(III) Remuneration paid to CEO, President and Vice President (with the name(s) indicated for each remuneration range)
December 31, 2019 In New Taiwan Dollars
Severance Pay and Pensions (A+B+C+D) as a % Compensation
Salary (A) Bonuses and Allowances (C) Remuneration to employees (D)
(B) of Net Income Received from
Position Name From All From All From All From All Consolidated From All Non-consolidated
From the From the From the From the Company From the
Consolidated Consolidated Consolidated Entities Consolidated Affiliates or Parent
Company Company Company Company
Entities Entities Entities Cash Stock Cash Stock Entities Company
Chief Executive
Yang, Ying Ming
Officer
4,528,336 4,528,336 557,592 557,592 1,886,776 1,886,776 251,050 0 251,050 0 0.74 0.74 None
President Chen, Chao Jung
Vice President Shen, Jui Hsiung
Remuneration Range Table

Names of the President and Vice President
Remuneration Paid to Presidents and Vice Presidents
From the Company From All Consolidated Entities(E)
$0 ~ $999,999
$1,000,000 ~ $1,999,999 Shen, Jui-Hsiung Shen, Jui-Hsiung
Chen, Chao-Jung Chen, Chao-Jung
$2,000,000 ~ $3,499,999
Yang, Ying-Ming Yang, Ying-Ming
~ 27 ~
$3,500,000 ~ $4,999,999
$5,000,000 ~ $9,999,999
$10,000,000 ~ $14,999,999
$15,000,000 ~ $29,999,999
$30,000,000 ~ $49,999,999
$50,000,000 ~ $99,999,999
Over $100,000,000
Total 3 3
*The remuneration disclosed in this table is for information purposes only and is not intended to be used for tax purposes as the definition of income
is different from that under the Income Tax Act.
Employees’ Profit Sharing Bonus Paid to Management Team
December 31, 2020
Proportion to
Stock Cash Amount Total Earnings After Tax
Position Name
(%)
Chief Executive Yang,
Officer Ying-Ming
Chen,
President
Chao-Jung
Shen,
Vice President
Jui-Hsiung
Assistant Vice
Lin, Chun-Ke
President
Assistant Vice
Managers Chen, Chin-Fu 0 487,072 487,072 0.0501
President
Assistant Vice Huang,
President Shi-Cheng
Assistant Vice Chang,
President Hui-Chu
Assistant Vice
Liu, Kuei-Chun
President
Assistant Vice
Hsiao,Wei-Lien
President
(IV) The analysis of the total remuneration, as a percentage of net income paid by the
Company and by each other company included in the consolidated financial
statements during the past 2 fiscal years to directors, supervisors, president, and
vice presidents, and the description of the remuneration policies, standards, and
packages, the procedure for determining remuneration, and its linkage to operating
performance and future risk exposure.
1. The total remuneration, as a percentage of net income paid by the Company and by each other
company included in the consolidated financial statements to directors, supervisors, president,
and vice presidents,
2019 2020
Remuneration paid to Directors, Supervisors,
President and Vice President
2.83% 3.02%
Proportion to Earnings After Tax
(Individual Financial Statement)
Remuneration paid to Directors, Supervisors,
President and Vice President
3.20% 3.39%
Proportion to Earnings After Tax
(Consolidated Financial Statement)
28
~ 28 ~
The Company's net income for 2019 was NT$1,013,562,000.
The consolidated net income for 2019 was NT$1,013,559,000.
The Company's net income for 2020 was NT$972,225,000.
The consolidated net income for 2020 was NT$972,225,000.
2. The description of the remuneration policies, standards, and packages, the procedure for
determining remuneration, and its linkage to operating performance and future risk exposure:
The Company's directors' remuneration shall be determined in accordance with Article 27-1
of the Company's Articles of Incorporation and shall be paid at a rate not exceeding 3% of the
Company's profit for the year, taking into account the Company's operating results and the extent
of the directors' contribution to the Company's operating objectives, and shall be evaluated in
accordance with the "Regulations Governing the Remuneration of Directors".The remuneration
paid to the President and Vice President is determined in accordance with the "Regulations
Governing the Remuneration of Managerial Officers", the average salary rate in the same industry,
the scope of authority and responsibility for that position and the contribution to the operational
objectives in the Company. In addition to the Company's overall operating performance (e.g. the
growth rate in profit before tax, the growth rate in operating revenue, and the over-consumption
rate in the Group), the risks associated with the business operation and future development in the
industry, the remuneration procedures also take into account the individual's performance
achievement rate and the extent of his or her contribution to the Company's performance (e.g.
Disabling Frequency Rate, the turnover rate, and the number of trial productions and trial runs).
The reasonableness regarding the performance evaluation and remuneration are reviewed by the
Remuneration Committee and the Board of Directors. In addition, the operational status and
relevant laws and regulations are reviewed in a timely manner in order to achieve the
sustainability and the risk management for the Company.
29
~ 29 ~
IV. The implementation status of the corporate governance:
(I) The state of operations of the board of directors
Information on the Operations of the Board
There were five meetings of the Board of Directors in the year 2020, the attendance of Directors and
Supervisors at these meetings was as follows:
Attendance in Attendance rate Remarks
Position Name Attendance by proxy
person in person (%)
Chairman Yang, Chi-Jen 5 0 100%
Vice Chairman Chang, Hong-Der 5 0 100%
Director Yang, Ying-Ming 5 0 100%
Director Hsiao, Ru-Po 5 0 100%

Director Chen, Chao-Jung 5 0 100%
Kenjou Co., Ltd.
Director Representative: 5 0 100%
Shen, Jui-Hsiung
Director Yang, Chia-Ling 5 0 100%
Director Lin, Tsung-Yi 4 0 80%
Independent
Hsieh,Chun-Mou 5 0 100%
Director
Independent
Su, Ching-Yang 5 0 100%
Director
Independent
Lin,Sheng-Chung 5 0 100%
Director
Other matters that require reporting:
I. The implementation of the Board shall state the date and session of the Board meeting, the resolution, the opinions of all independent directors
and the Company's response to such opinions, if any of the following circumstances apply:
(I) Items listed in paragraph 3 of Article 14 of the Securities and Exchange Act:
Independent Company’s
Director Had Response to
a Dissenting Independent
Board of
Opinion or Director’s
Directors Meeting Resolutions
Qualified Dissenting
Dates
Opinion Opinion or
Qualified
Opinion
2020.01.17 1. The proposal of the year-end bonus for the Company's managerial officers. None. None.
The 8th meeting 2. The proposal of the year-end bonus for the directors of the Company who execute
of the 19th of the the business operations.
Board of 3. A motion to review the salaries for the directors and the managerial officers of the
Directors Company who execute the business operations.
4. The proposal for increasing the investment in Kenda Rubber (Vietnam) Co., Ltd., the
subsidiary of the Company.
5. The proposal for increasing the investment in Kenda Rubber (Indonesia) Co., Ltd.,
the subsidiary of the Company.
6. The proposal for destruction of the Company's accounting books and documents
upon the expiration of their retention period.
7. The proposal of the endorsement and guarantee for the Company's subsidiaries.
8. The proposal of the loan amount application for the Company.
2020.03.26 1. The proposal of the employees' and directors' remuneration for the year 2019. None. None.
The 9th meeting 2. The adoption of the 2019 Business Report and Financial Statements.
of the 19th of the 3. The proposal of the 2019 earning distribution.
Board of 4. The proposal to distribute the cash dividends to shareholders from the 2019 earnings
Directors of the Company.
5. The proposal for new shares issue through the capitalization of earnings.
6. The amendments to the company’s “Articles of Incorporation”
30
~ 30 ~
Independent Company’s
Director Had Response to
a Dissenting Independent
Board of
Opinion or Director’s
Directors Resolutions
Qualified Dissenting
Date
Opinion Opinion or
Qualified
Opinion
2020.03.26 7. Matters related to the shareholders' proposal for the 2020 Annual Shareholders' None. None.
The 9th meeting Meeting being accepted by the Company.
of the 19th of the 8. The proposal to convene the 2020 Annual Shareholders’ Meeting of the Company.
Board of 9. The proposal to lease the land and factory from KF Co., Ltd.
Directors 10. The statement of the Internal Control System of the Company.
11. The amendment to the “Internal Control System” of the Company.
12. The amendment to the “Internal Audit Implementation Rules” of the Company.
2020.05.06 1. The proposal of the Company's financial statements for the first quarter of 2020. None. None.
The 10th meeting 2. The proposal to review the shareholders who hold more than one percent or more of
of the 19th of the the total number of issued shares of the Company.
Board of 3. The proposal to convene the 2020 Annual Shareholders’ Meeting of the Company.
Directors 4. The application for extending the endorsement and guarantee for the Company's
associates.
2020.08.12 1. The proposal of the Company's financial statements for the second quarter of 2020. None. None.
The 11th meeting 2. The proposals to issue new shares by the capitalization of the Company's 2019
of the 19th of the earnings and to determine the record date for cash dividends and other related
Board of matters.
Directors 3. The amendment to the Corporate Governance Best Practice Principles of the
Company.
2020.11.11 1. The preparation of the Company's audit plan for 2021. None. None.
The 12th meeting 2. The proposal of the Company's financial statements for the third quarter of 2020.
of the 19th of the 3. The distribution of remuneration to the directors of the Company.
Board of 4. The distribution of remuneration to the managerial officers and directors of the
Directors Company who execute the business operations.
5. A motion to review the salaries for the managerial officers and directors of the
Company who execute the business operations.
6. The amendment to the " Regulations on the Performance Evaluation of the Board of
Directors and Functional Committees" of the Company.
7. The amendment to the Company's "Rules of Procedure for Board of Directors
Meetings".
8. The amendment to the Company’s “Audit Committee Charter”.
9. The amendment to the Company’s “Rules Governing the Scope of Powers of
Independent Directors”.
10. The amendment to the Company’s “Remuneration Committee Charter”.
(II) Except for the preceding matters, other Board resolutions on which the independent directors express objections or reservations that
have been included in records or stated in writing:
None.
II. The implementation status of the directors' recusal from a resolution in which they may have interests shall include the directors' names, the
contents of the resolution, the reasons for the recusal and the participation in voting.
Date Directors’ Names Resolutions Reasons for the recusal Participation in voting
01.17 Directors presented - The proposal of the Resolved to distribute the Resolved by the rest of the
Yang, Ying Ming, year-end bonus for the year-end bonus for the Directors present without
Yang, Chi Jen directors who execute directors who execute objection.
Chang, Hong Der, the business operations. the business operations.
Chen, Chao Jung
Shen, Jui Hsiung
01.17 Directors presented - A motion to review the Resolved to pay the Resolved by the rest of the
Yang, Ying Ming, salaries for the directors salaries for the directors Directors present without
Yang, Chi Jen and the managerial and the managerial objection.
Chang, Hong Der, officers who execute the officers who execute the
Chen, Chao Jung business operations. business operations.
Shen, Jui Hsiung
31
~ 31 ~
11.11 Directors presented - The distribution of With the exception of Mr. When resolving on the
Yang, Ying Ming, remuneration to the Shen, Jui Hsiung, who is remuneration of each Director, the
Yang, Chi Jen directors of the Company. involved in the person being voted shall be recused
Chang, Hong Der, remuneration distribution and the rest of the Directors present
Chen, Chao Jung, to corporate directors, the shall pass the resolution without
Shen, Jui Hsiung, other directors are objection. When resolving on the
Hsiao, Ru Po involved in the remuneration of the corporate
Yang, Chia Ling, remuneration distribution director of Kenjou Co., Ltd, Mr.
Lin Tsung Yi to themselves. Shen Jui Hsiung, the representative
of the company, recused himself
and the rest of the directors present
passed the resolution without
objection.
11.11 Directors presented - The distribution of Resolved to distribute the When resolving on the
Yang, Ying Ming, remuneration to the remuneration to the remuneration of the managerial
Yang, Chi Jen managerial officers, managerial officers, officers and directors, the person
Chang, Hong Der, directors who execute the directors who execute the being voted shall be recused and
Chen, Chao Jung business operations and business operations and the rest of the Directors present
Shen, Jui Hsiung employees. the employees. shall pass the resolution without
objection.
11.11 Directors presented - A motion to review the Resolved to pay the Resolved by the rest of the
Yang, Ying Ming, salaries for the directors salaries for the directors Directors present without
Yang, Chi Jen who execute the business and the managerial objection.
Chang, Hong Der, operations and managerial officers who execute the
Chen, Chao Jung officers. business operations.
Shen, Jui Hsiung
III. Information on the evaluation cycle, period, scope, method and content of the self- (or peer) evaluation of the Board:
The implementation status of the Board's evaluation
Cycle Period Scope Method Content
Once a 2020.01.01 ~ Performance evaluations Internal evaluation of I. Board of Directors
year 2020.12.31 of the Board of Directors, the Board, Board 1. Participation in the operation of the
Board members, Audit member’s company.
Committee, and self-evaluation, 2. Improvement of the quality of the board of
Remuneration Committee Self-evaluation directors' decision making.
of the Audit 3. Composition and structure of the board of
Committee, directors.
Self-evaluation of the 4. Election and continuing education of the
remuneration directors.
committee 5. Internal Control.
II. Board members
1. Alignment of the goals and mission of the
company.
2. Awareness of the duties of a director.
3. Participation in the operation of the
company.
4. Management of internal relationship and
communication.
5. The director's professionalism and
continuing education.
6. Internal Control.
III. Audit Committee
company.
2. Awareness of the duties of the Audit
Committee
3. Improvement of quality of decisions made
by the Audit Committee
4. Composition of the Audit Committee, and
election and appointment of committee
members
5. Internal Control.
IV. Remuneration Committee
company.
2. Recognition of the duties of the
Remuneration Committee
3. Improvement in the quality of decision
making by the Remuneration Committee
4. Composition of the Remuneration
Committee, and election and appointment
32
~ 32 ~
of committee members
IV. An evaluation of the current and most recent year's goals for improving the Board's functions (e.g. establishing an audit committee, improving
information transparency and so on) and the implementation status:
(I) The Company adopted a candidate nomination system to elect 11 directors (including 3 independent directors) for the 19th term of the Board
of Directors in 2018. All independent directors served as members of the Audit Committee that was established to replace the Supervisors
in order to strengthen the independence and diversity of the Board of Directors; the basic qualifications and the values include: gender, age,
nationality and culture; and the professional knowledge and skills include:
Professional background, professional skills and experiences in the industry. The members of the Board of Directors undertake continuing
education each year during their term of office. The Company purchases liability insurance for all Directors in respect of the scope of
business they conduct. The Board of Directors is responsible to the shareholders of the Company and exercises its powers in accordance
with the laws and regulations, the Articles of Incorporation and the resolutions of the shareholders' meeting. To achieve the best company
interests, the members of the Board evaluate the Company's business strategies, risk management, investment plans and other major
projects with duties of loyalty and the due care of a good-faith administrator, as well as focus on corporate governance and the
implementation of internal control systems.
(II) The composition of the Company's Board of Directors includes overall consideration of operational judgment, management ability, financial
analysis ability, crisis management ability, industry knowledge, international market perspective, ability to lead, and ability to make policy
decisions.
(III) The Company amended the Procedures for Election of Directors, the Rules of Procedure for Board of Directors Meetings and the Corporate
Governance Practices in accordance with the laws and regulations, and disclosed them on the Company's website and the Market
Observation Post System.
(IV) The Company discloses the information on directors' continuing education, attendance at board meetings and directors' remuneration on the
Market Observation Post System.
(V) The Company's website discloses the major resolutions of the Board of Directors, the profiles of the Board members and the diversity policy
for the Board.
(VI) The Company has established an Audit Committee to supervise the fair expression of the Company's financial statements, the selection
(dismissal) and independence and performance of the certified public accountant, the effective implementation of the Company's internal
controls, the legal compliance of the Company with relevant orders and regulations, and the control of the Company's inherent or potential
risks.
33
~ 33 ~
(II) The implementation status of the Audit Committee:
There were five meetings of the Audit Committee in the year 2020, the attendance of independent
directors at these meetings was as follows:
Attendance in Attendance by Attendance rate in Remarks
Position Name
person proxy person (%)
Independent
Hsieh,Chun-Mou 5 0 100%
Director
Independent
Su, Ching Yang 5 0 100%
Director
Independent
Lin, Sheng-Chung 5 0 100%
Director
I. The implementation of the Audit Committee shall state the date and session of the Board meeting, the resolution, the results of all Audit
Committee meetings and the Company's response to such results, if any of the following circumstances apply
(I) Items listed in paragraph 5 of Article 14 of the Securities and Exchange Act.
Board of Results of the The Company’s handling of the

Directors Resolutions Audit Committee’s recommendation of the Audit
Meeting Dates resolution Committee
2020.01.17 1. Report on the independence evaluation of the CPA. RESOLVED by all Resolved by all Directors
The 8th meeting 2. The proposal of the endorsement and guarantee of the members present. present at the Board Meeting on
of the 19th of the Company. January 17, 2020.
Board of 3. The proposal for increasing the investment in Kenda Rubber
Directors (Vietnam) Co., Ltd., the subsidiary of the Company.
4. The proposal for increasing the investment in Kenda Rubber
(Indonesia) Co., Ltd., the subsidiary of the Company.
2020.03.26 1. The adoption of the 2019 Business Report and Financial RESOLVED by all Resolved by all Directors
The 9th meeting Statements. members present. present at the Board Meeting on
of the 19th of the 2. The proposal of the 2019 Earnings Distribution. March 26, 2020.
Board of 3. The proposal to distribute the cash dividends to shareholders
Directors from the 2019 earnings of the Company.
4. The proposal for the new shares issue through the
capitalization of earnings.
5. The amendments to the company’s “Articles of
Incorporation”
6. The proposal to lease the land and factory from KF Co., Ltd.
7. The statement of the Internal Control System of the
Company.
8. The amendment to the “Internal Control System” of the
Company.
9. The amendment to the “Internal Audit Implementation
Rules” of the Company.
10. The proposal of the endorsement and guarantee of the
Company.
2020.05.06 1. The proposal of the Company's consolidated financial RESOLVED by all Resolved by all Directors
The 10th statements for the first quarter of 2020. members present. present at the Board Meeting on
meeting of the 2. The application for extending the endorsement and guarantee May 6, 2020.
19th of the for the Company's associates.
Board of
Directors
2020.08.12 1. The proposal of the Company's financial statements for the RESOLVED by all Resolved by all Directors
The 11th second quarter of 2020. members present. present at the Board Meeting on
meeting of the 2. The proposals to issue new shares by the capitalization of the August 12, 2020.
19th of the Company's 2019 earnings and to determine the record date
Board of for cash dividends and other related matters.
Directors 3. The proposal of the endorsement and guarantee of the
Company.
2020.11.11 1. The preparation of the Company's audit plan for 2021. RESOLVED by all Resolved by all Directors
The 12th 2. The proposal of the Company's financial statements for the third members present. present at the Board Meeting on
meeting of the quarter of 2020. November 11, 2020.
19th of the 3. The proposal of the endorsement and guarantee of the
Board of Company.
Directors
(II) Other than the preceding matters, matter that has not been passed by the audit committee, but has been adopted with the approval of
two-thirds or more of all board directors without having been passed by the audit committee: None.
II. The implementation status of the independent directors' recusal from a resolution in which they may have interests shall include the independent
directors' names, the contents of the resolution, the reasons for the recusal and the participation in voting: None.
34
~ 34 ~
III. Communication between the independent directors and the internal auditors and the independent auditors (including the major issues, methods
and results of communication regarding the financial and operating positions of the Company).
(I) Summary of the communications between the independent directors and the internal auditors for the year 2020
Method of
Meeting Dates Content of Communication Result of Communication
Communication
2020.01.17 Report on the implementation of internal audits. Presentation Acknowledged, no further
in the meeting comments.
2020.03.26 1. Report on the implementation of internal audits. Acknowledged, no further
2. Discussion on the Statement of the Internal Control System. comments.
3. Discussion on the amendment to the “Internal Control System” of Presentation
the Company. in the meeting
4. Discussion on the amendment to the “Internal Audit Implementation
Rules” of the Company.
2020.11.11 1. Report on the implementation of internal audits. Presentation Acknowledged, no further
2. Discussion on the audit plan for 2021. in the meeting comments.
(II) Summary of the communications between the independent directors and the independent auditors for the year 2020
Method of
Meeting Dates Content of Communication Result of Communication
Communication
2020.03.26 Communicate with the corporate governance unit on the audit scope of Presentation Acknowledged, no further
the financial report and the audit opinion. in the meeting comments.
2020.11.11 Communicate with the corporate governance unit on the audit Presentation Acknowledged, no further
priorities and key audit items for the 2020 financial report. in the meeting comments.
IV. The Audit Committee's primary function is to assist the Board of Directors in overseeing the accounting, financial and auditing quality of the
Company. The Audit Committee is responsible to review the following major matters:
(I) Adoption or amendment of an internal control system in accordance with Article 14-1 of the Securities and Exchange Act
(II) Assessment of the effectiveness of the internal control system.
(III) Adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of handling procedures for financial or
operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans
to others, and endorsements or guarantees for others.
(IV) A matter bearing on the personal interest of a director or supervisor.
(V) A transaction involving material asset or derivatives trading.
(VI) A material monetary loan, endorsement, or provision of guarantee.
(VII) The offering, issuance, or private placement of any equity-type securities.
(VIII) The hiring, dismissal or remuneration of an attesting certified public accountant.
(IX) The appointment or dismissal of a financial, accounting, or internal auditing officer.
(X) The annual financial report and the semi-annual financial report.
(XI) The Business Report, earning distribution or loss make-up proposal.
(XII) Any other material matter so determined by the company or the competent authority.
V. The implementation status of Audit Committee for the year 2020:
(I) Convene the quarterly Audit Committee meeting to oversee the Company's financial performance and internal control system.
(II) Review the financial statements
(III) Evaluate the effectiveness of the internal control system.
(IV) Statement on Internal Control for 2020.
(V) Major endorsement and guarantee cases.
(VI) Capital increase proposal.
(VII) Evaluate the independence of the CPA.
35
~ 35 ~
(III) The state of the Company's implementation of corporate governance, any variance of such implementation from the Corporate
Governance Best Practice Principles for TWSE/TPEx Listed Companies, and the reason for any such variance
Implementation Status (Note 1) Non-implementation

Assessed Items
Yes No Summary and Explanation and its reasons
I. Does Company follow “Corporate Governance Best Practice  The Company has established a Corporate Governance Practice Principles in No material difference.
Principles for TWSE/TPEx Listed Companies” to establish accordance with Corporate Governance Best Practice Principles for TWSE/TPEx
and disclose its corporate governance practices? Listed Companies, which is disclosed on the Market Observation Post System and
the Company's website.
II. Shareholding Structure & Shareholders’ Rights No material difference.
(I) Does Company have Internal Operation Procedures for  The Company has established Rules of Procedure for Shareholders' Meetings and
handling shareholders’ suggestions, concerns, disputes and has a spokesperson and an acting spokesperson to handle the relevant issues.
litigation matters. If yes, has these procedures been
implemented accordingly?
(II) Does Company possess a list of major shareholders and  The Company maintains a shareholders roster through its shareholder service agent
~ 36 ~
beneficial owners of these major shareholders? and is controlled by an insider share reporting system.
(III) Has the Company built and executed a risk management  The Company has established and implemented the supervision and management of
system and “firewall” between the Company and its the subsidiaries in accordance with the regulations. The auditors also periodically
affiliates? visit each subsidiary to monitor and audit the subsidiaries in accordance with the
regulations.
(IV) Has the Company established internal rules prohibiting  The Company has established the " Regulations on Prevention of Insider Trading" to
insider trading on undisclosed information? control the trading of securities by insiders of the Company with information that is
not yet publicly announced in the market. The Company conducts annual training
and education courses on "Prevention of Insider Trading" for employees and
insiders.
III. Composition and Responsibilities of the Board of No material difference.
Directors
(I) Has the Company established a diversification policy for  The Company has established and implemented a diversification policy in
the composition of its Board of Directors and has it been accordance with Article 20 of the "Corporate Governance Principles of Kenda
Assessed Items
implemented accordingly? Industrial Co., Ltd.", including basic requirements and values, taking into account
gender, age, nationality and culture.In addition, the professional knowledge with
skills and expertise required to execute the duties include operational judgement,
accounting and financial analysis skills, business management, crisis management,
leadership and decision-making skills, as well as industry knowledge and
international market perspective.
There are total 11 members on the Board of Directors; of which 45% are employees
of the Company, 27% are independent directors (3 independent directors), 18% are
female directors (2 female directors), 1 independent director has served for less than
3 years, 2 independent directors have served for 4-6 years, 4 directors are over 70
years old, 3 directors are between the ages of 61 to 70, 2 directors are between the
ages of 51 to 60 and 2 are under the age of 50.
The Board of Directors of the Company consists a wide range of professional
~ 37 ~
backgrounds, and we have recruited a wide range of talents to achieve the diversity
in the Board. The composition of the Board included the chemical, mechanical and
marketing professionals who are related to the Company' s business. The Company
selects its Directors on the merit basis and without any discrimination.
1. Implement sound governance systems for the Board, and consider the diversity
and professionalism of Board members:
(1) Board diversity
Goal: The Company has specified in the Corporate Governance Principles that
 the composition of the Board of Directors should take into account the
 diversity of the Company's members, and that the Company should
develop an appropriate diversity policy with regard to its operations,
business model and development needs, and that the Board of Directors
should have the necessary knowledge, skills and qualities to perform its
duties in order to achieve the objectives of corporate governance.
Assessed Items
 Achievements: The Company's directors are all qualified and experienced in

conducting the Company's business; the professional background
of the Company's directors include: approximately 36% of the
directors with a background in the chemical engineering; 18% in
finance; 55% in business management; and 27% in both business
management and chemical engineering.
(2) Directors’ professional qualifications
Goal: The Board of Directors' overall abilities include ability to make
operational judgments; ability to perform accounting and financial
analysis; ability to conduct management administration; ability to
conduct crisis management; knowledge of the industry; an international
market perspective; ability to lead; ability to make policy decisions.
Furthermore, in order to strengthen the professionalism of the Board of
~ 38 ~
Directors, a minimum of 6 hours of training is required each year.
Achievement: The continuing education hours for the Company's directors in
2020 have all been accomplished.
2. For the purposes of developing supervisory functions, considering enhancing the
frequency of the Board's operations:
Goal: Convene at least once a quarter to review the operational performance and
discuss key strategic initiatives.
Achievement: The attendance rate is 98%.
3. For the purpose of strengthening management mechanisms, consider
strengthening the efficiency of the Board's operations:
Goal: In 2015, the Company established the "Self-Evaluation or Peer Evaluation
of the Board of Directors ", under which the annual performance
evaluation is conducted internally.In 2020, a performance evaluation
requirement for functional committees was added and performance
Assessed Items
evaluations are also conducted annually.

Achievement: The 2020 self-evaluation of the performance for the Board of
Directors (with a score of 93.7), the self-evaluation of the Board
members ( with a score of 96.4), the self-evaluation of the Audit
Committee ( with a score of 96.0) and the self-evaluation of the
Remuneration Committee ( with a score of 93.6)
(II) Other than the Remuneration Committee and the Audit  The Company has no other functional committees at present.
Committee which are required by law, does the Company
plan to set up other functional committees?
(III) Has the Company established methodology for evaluating  On 11 May 2015, the Company established the "Self-Evaluation or Peer Evaluation
the performance of its Board of Directors, on an annual of the Board of Directors " and conducted annual performance evaluation to
basis and on a regular basis, and reported the results of the implement corporate governance and enhance the functions of the Board of
performance evaluation to the Board of Directors and used Directors; on 11 November 2020, the performance evaluation of functional
~ 39 ~
them as the reference for individual directors' remuneration committees was added and the "Self-Evaluation or Peer Evaluation of the Board of
and nomination for re-election? Directors and Functional Committees" was established which was also announced on
the Company's website The performance evaluation for 2020 was completed by the
end of December of that year. The evaluation period is for the whole year of 2020.
The scope of the evaluation includes the performance evaluation of the Board of
Directors as a whole, individual Board members and functional committees; the
evaluation method is self-evaluation of the performance of the Board of Directors,
self-evaluation of the performance of the individual Board members, self-evaluation
of the performance of the Audit Committee and self-evaluation of the performance
of the Remuneration Committee. The results of the 2020 performance evaluation
were submitted to the Remuneration Committee and the Board of Directors on 3
February 2021 to use them as reference in determining compensation for individual
directors, their nomination and additional office term.
The results of the performance evaluation of the Board & Functional Committees are
Assessed Items
as follows:
1. Self-Evaluation of Performance of the Board
What is being evaluated Score
A. Participation in the operation of the company. 24
B. Improvement of the quality of the board of directors' decision 29.5
making.
C. Composition and structure of the board of directors. 14.4
D. Election and continuing education of the directors. 8.4
E. Internal Control. 17.4
Total 93.7
Evaluation results: Excellent
2. Self-Evaluation of Performance of Board Members
~ 40 ~
A. Alignment of the goals and mission of the company 11.78
B. Awareness of the duties of a director. 19.78
C. Participation in the operation of the company 30.33
D. Management of internal relationship and communication 11.42
E. The director's professionalism and continuing education 11.56
F. Internal control 11.56
Total 96.43
3. Self-Evaluation of Performance of the Audit Committee
A. Participation in the operation of the company. 20
B. Recognition of the duties of the Audit Committee 23

Assessed Items
C. Improvement in the quality of decision making by the Audit 30

Committee
D. Composition of the Audit Committee, and election and 10

appointment of committee members
E. Internal Control. 13
Total 96
4. Self-Evaluation of Performance of the Remuneration Committee
A. Participation in the operation of the company. 25.2
B. Recognition of the duties of the Remuneration Committee 16.8
~ 41 ~
C. Improvement in the quality of decision making by the 36
Remuneration Committee
D. Composition of the Remuneration Committee, and election 15.6
and appointment of committee members
Total 93.6
Evaluation results: Excellent.
(IV) Does the Company regularly evaluate its external auditors’  The appointment of the Company's independent auditor is approved by the Audit
independence? Committee and then proposed to the Board of Directors for resolution. The Company
has established the method for evaluating the independence of the certified public
accounts in 2015. The Company regularly checks the independence of the certified
public account and reports to the Audit Committee and the Board of Directors each
year to determine whether there is any violation of the Bulletin No. 10 of the Norm
of Professional Ethics for Certified Public Accountant of the Republic of China and
Article 47 of the Certified Public Accountant Act, to ensure that the CPAs have no
Assessed Items
other financial interest or business relationship with the Company other than
compensation for audit and taxation cases, and to review whether the CPAs are
directors or managers of the Company or are remunerated by the Company, and to
confirm that the CPAs are not a related parties before making the appointment.
Evaluation of the external CPAs’ Independence:
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.
3. Not a natural-person shareholder who holds shares, together with those held by
the person’s spouse, minor children, or held by the person under others’ names,
in an aggregate amount of one percent or more of the total number of issued
shares of the company or ranks as one of its top ten shareholders.
4. Not a spouse, relative within the second degree of kinship, or lineal relative
within the third degree of kinship, of any of the officer in the preceding 3
~ 42 ~
paragraphs.
5. Not a director, supervisor or employee of a corporate shareholder who directly
holds more than five percent or more of the total number of issued shares of the
Company, or a director, supervisor or employee of the top five corporate
shareholders of the Company.
6. Not a director, supervisor, officer, or shareholder holding five percent or more of
the shares of a specified company or institution that has a financial or business
relationship with the Company.
7. Not having a marital relationship, or a relative within the second degree of
kinship to any other director of the Company.
8. Not been a person of any conditions defined in Article 30 of the Company Act.
9. Not a governmental, juridical person or its representative as defined in Article
27 of the Company Act.
10. Whether the "Confirmation of independence" issued by the appointed
Assessed Items
independent auditors and audit team is available.

The Company's Independent Auditor's independence requirement was evaluated and
fulfilled for the year and, the results were reported to the Audit Committee and the
Board of Directors on 3 February 2021. The Conformation of Independence for
Accountants and Audit Team and the Accountants' Independence Evaluation Report
are published on the Company's website.
IV. Does the TWSE/TPEx listed company have an adequate  The Company's Board of Directors resolved on 6 May 2021 to appoint a Chief of No material difference.
number of corporate governance personnel with appropriate Corporate Governance, Mr. Lin, Chun-Ke, who is also the Assistant Vice President
qualifications and appoint a chief corporate governance of the Board of Directors. Mr. Lin has served as the head of shareholding and
officer to be in charge of corporate governance affairs corporate governance related affairs in a listed company for at least three years. The
(including but not limited to furnishing information required Company also has a corporate governance personnel to assist him. The Chief of
for business execution by directors and supervisors, assisting Corporate Governance is responsible for matters relating to board meetings and
directors and supervisors with legal compliance, handling shareholders meetings, producing minutes of board meetings and shareholders
~ 43 ~
matters relating to board meetings and shareholders meetings meetings, furnishing information required for business execution by directors,
according to laws and producing minutes of board meetings assisting in onboarding and continuous development of directors and legal
and shareholders meetings)? compliance in accordance with the law.
The implementation status for the year 2019 and 2020 are as follow:
1. Handling matters relating to the board meetings and shareholder meetings in
compliance with the law.
2. Arranging continuous development of directors.
3. Furnishing information required for business execution by directors.
4. Reviewing the amendments to the rules and regulations relating to corporate
governance.
The matters relating to the registration and changes to the registration of the
Company are performed by the Finance Department of the Company.
Assessed Items
V. Has the Company established a means of communicating  The Company not only adopts a spokesperson system, but also provides a No material difference.
with its Stakeholders (including but not limited to communication channel for employees, suppliers, customers and other stakeholders
shareholders, employees, customers, suppliers, etc.) or to ensure that communication is smooth and that the spokesperson has full control
created a Stakeholders Section on its Company website? over these communications. We have also set up an investor relationship and a
Does the Company respond to stakeholders’ questions on stakeholder information on the company's website to disclose the related rules of
corporate responsibilities? corporate social responsibility and to provide feedback on related issues (A
designated officer is assigned to assist with suppliers, customers, investors, and
employees, and the contact information is posted on the Company's website).
VI. Has the Company appointed a professional shareholder  The Stock Agency of the Company: The Stock Agency Department of Chinatrust No material difference.
service agent for its Shareholders’ Meetings? Commercial Bank was appointed by the Company to conduct the Annual
Shareholders' Meeting.
VII. Information Disclosure No material difference.
(I) Has the Company established a corporate website to  The Company has disclosed the financial information and corporate governance
~ 44 ~
disclose information regarding its financials,business and information on the Company's website in compliance with the law.
corporate governance status? The Company has a spokesperson responsible for collecting and disclosing the
(II) Does the Company use other information disclosure  Company's information and immediately uploading the information to the
channels (e.g. maintaining an English-language website, Company's website for public access, and the Company has set up a spokesperson
designating staff to handle information collection and and implemented a spokesperson system in accordance with the regulations.
disclosure, appointing spokespersons, webcasting Information on the past investor conferences is available on the Company's website
investors conference etc.)? for investors' reference.
(III) Does the Company announce and report the annual  The Company's financial statements and monthly operating results are publicly
financial statements within two months after the end of the announced within the prescribed timeframe.
fiscal year, and announce and report the first, second, and
third quarter financial statements as well as the operating
status of each month before the prescribed deadline?
VIII. Has the Company disclosed other information to facilitate a  1. Employee rights: The Company is committed to protecting the rights of our No material difference.
better understanding of its corporate governance practices employees with integrity and in compliance with the Labor Standards Act. The
Assessed Items
(e.g. including but not limited to employee rights, employee Union has been set up to ensure employees' rights and benefits, in addition to
wellness, investor relations, supplier relations, rights of basic benefits such as labor insurance, national health insurance and pension
stakeholders, directors’ and supervisors’ training records, the fund allocation, the Company also provides regular health checks and group
implementation of risk management policies and risk insurance for our employees.
evaluation measures, the implementation of customer 2. Employee care: The company considers employees as assets of the Company and
relations policies, and purchasing insurance for directors and cares for them based on the Labor Standards Act. The Company has established a
supervisors)? labor union to hold regular labor-management meetings to communicate with the
employees, and has set up an Employee Welfare Committee to allocate funds on
a monthly basis and organize regular employee welfare activities. There are 3
on-site visits per month by occupational medicine doctors.
3. Investor relations: We provide investors, analysts and domestic and international
investors with the best possible service by making the information available
through the Market Observation Post System, the Spokesperson System and the
~ 45 ~
Investor Relations section on the Company's website, so that investors can fully
understand the Company's operating results and performance and the direction of
its long-term business strategy in real time.
4. Supplier relations: We promote "green procurement" to strengthen the positive
impact on society and the environment from our suppliers. We maintain good
partnerships with our suppliers based on the principle of equality and reciprocity.
We have established a stable supply chain and conduct audits from time to time
to ensure the quality of products supplied.
5. Stakeholders' rights: Stakeholders may communicate and make suggestions to the
Company in order to protect their legitimate rights and interests. The Company
has also established rules governing the activities that employees may engage in
with the stakeholders of the Company.
6. Continuing education for directors, financial officers and internal auditors: The
continuing education hours of the Company's directors, financial officers and
Assessed Items
internal auditors are all in compliance with the requirements for continuing
education (please refer to Table 1).
7. The implementation of risk management policies and risk evaluation measures:
The Company has established various internal rules and regulations to manage
and evaluate all kinds of risks in accordance with the law. The Company
identifies the risks through the implementation and auditing processes in the
accounting and management system, prevents the risks from occurring through
the risk assessment of each department, and ensures that the risks are effectively
controlled and the objectives are achieved through the internal audit system,
annual audit plan, and control of all meetings.
Please refer to pages 14-15 of the 2020 CSR Report.
8. The implementation of customer relations policies:The Company maintains a
steady and good relationship with all the customers to create win-win
~ 46 ~
relationships.
9. The implementation of purchasing insurance for directors:The Company has
purchased liability insurance for the directors, the coverage of which is up to
June 2021, and has reported to the Board of Directors.
IX. The improvement status for the result of Corporate Governance Evaluation announced by Taiwan Stock Exchange. (this information is not required for those companies not listed in
the assessment)
We will make English-language information available to the public; we will establish a Chief of Corporate Governance in May 2021; and we will prepare the 2020 Annual Report and
2021 Shareholders' Meeting Handbook in English.
X. The succession plans of the Board of Directors and key management personnel of the Company are as follows:
In 2016, the Company organized a succession seminar, inviting outstanding business leaders to share their experiences and the strategies of success in entrepreneurship, innovation and
business management, in order to provide opportunities for the middle and senior executives in the next generation to develop their business management skills, to innovate and
change, and to seek for sustainability. The annual strategy meeting is held in the first quarter of each year. The managers from each department share their action plans to achieve the
short, medium and long term strategy and management objectives of the Company in order to consolidate and focus the Company's business objectives through discussion and
consensus at the meeting.
Assessed Items
Group Chairman Yang Ying Ming spoke in the session of the Global Views 17th Chinese Leaders Summit 2019, he said "Passing on a son is one of the options, but not the only one,
family spirit and a professional management team is the way to run a sustainable business. The founder of the company was aware of the importance of succession long ago. When I
was a student in the Department of Mechanical Engineering at National Taiwan University, I was asked to transfer to the Department of Chemical Engineering in sophomore year
because he advised me to do so, thinking that my family was in the tire and rubber businesses. After I graduated from NTU, I went to the United States to pursue a master's degree and
I also got a scholarship for PhD. He was worried that if I had a PhD degree, I would pursue an academic or teaching career, so he advised me not to study for a PhD but to work for a
bicycle company in the United States instead. It was only after working for a year that I returned to Taiwan. When I joined Kenda, he was still in charge of most of the operations. I
began my career in Kenda as a salesman; subsequently, the Company continued to expand the overseas business until the founder handed over the Chairman position to me at the age
of 70. After 24 years as Chairman of the Board, I also handed over the position to my younger brother, Mr. Yang, Chi Jen in 2018, and my two nephews were promoted to Vice
Chairman and President respectively to take on more responsibilities. Perhaps in five or six years, the third generation will take over and, together with professional executives, we
will build a stronger succession team to lead the Company into a new era towards the established business strategy.
~ 47 ~
Schedule 1: The progress of continuing education of directors, supervisors, financial supervisors and
internal auditors in 2020
Date of Continuing
Position Name Continuing Organizer Course Name Education
Education Hours
Accounting Research and Corporate Crisis Management - with a focus on Risk
Chairman Yang, Chi-Jen 2020.05.20 6
Development Foundation Management and Crisis Communication
How to analyze the key financial information and
Vice Accounting Research and
Chang, Hong-Der 2020.07.13 strengthen the crisis warning capability for the 6
Chairman Development Foundation
company
Strategies for Business Growth and Innovation
Director Yang, Ying-Ming 2020.02.20 Taiwan Institute of Directors 3
Breakthroughs
UBS and Taiwan Academy of
Director Yang, Ying-Ming 2020.07.24 Corporate Governance and Sustainability Workshop 3
Banking and Finance
Director Yang, Ying-Ming 2020.08.16 Taiwan Institute of Directors Review for Corporate Sustainability 3
International Artificial Intelligence
Director Yang, Ying-Ming 2020.11.22 The Legal Impact on Intellectual Manufacturing 6
and Law Research Foundation
Director Hsiao, Ru-Po 2020.07.22 Corporate Governance and Sustainability Workshop 3
Banking and Finance
Taiwan Stock Exchange (TWSE) The 2020 Insider Trading Prevention and Insider
Director Hsiao, Ru-Po 2020.10.14 3
Corporation Share Transaction Seminar
International Artificial Intelligence
Director Chen, Chao-Jung 2020.11.22 The Legal Impact on Intellectual Manufacturing 6
and Law Research Foundation
Director Shen, Jui-Hsiung 2020.07.24 Corporate Governance and Sustainability Workshop 3
Banking and Finance
Taiwan Stock Exchange (TWSE) The 2020 Insider Trading Prevention and Insider
Director Shen, Jui-Hsiung 2020.09.04 3
Corporation Share Transaction Seminar
Director Yang, Chi-Ling 2020.07.22 Corporate Governance and Sustainability Workshop 3
Banking and Finance
The 2020 Annual Workshop for Understanding the
Director Yang, Chia-Ling 2020.08.19 Securities and Futures Institute Futures Derivative Trading for Hedging and 3
Conducting a Sound Corporate Sustainability
Taiwan Development & Research
Director Lin, Tsung-Yi 2020.09.09 Academia of Economic and Interpreting and analyzing the financial statements 6
Technology
Independent UBS and Taiwan Academy of
Hsieh,Chun-Mou 2020.07.24 Corporate Governance and Sustainability Workshop 3
Director Banking and Finance
Independent Taiwan Stock Exchange (TWSE) The 2020 Insider Trading Prevention and Insider
Hsieh,Chun-Mou 2020.09.04 3
Director Corporation Share Transaction Seminar
Advanced Seminar on Directors and Supervisors
Independent
Su, Ching-Yang 2020.05.28 Securities and Futures Institute (including Independent Directors & Supervisors) and 3
Director
the Chief of Corporate Governance
Independent Taiwan Stock Exchange (TWSE) The 2020 Conference for Directors and Supervisors
Su, Ching-Yang 2020.10.16 3
Director Corporation on Corporate Governance and Corporate Integrity
Independent Chinese National Association of Risk Management and Legal Responsibility for
Lin,Sheng-Chung 2020.05.26 3
Director Industry and Commerce, Taiwan Independent Directors
Independent Chinese National Association of Norms and practices for directors and supervisors in
Lin,Sheng-Chung 2020.07.28 3
Director Industry and Commerce, Taiwan relation to related party transactions
Issuers, Securities Dealers, and Stock Exchanges
Financial 2020.08.20 Accounting Research and Continuing Education for Accounting Supervisors
Liu, Kuei-Chun 12
Officer 2020.08.21 Development Foundation (Accounting, Corporate Governance, Ethics & Legal
Responsibility)
Auditing The Institute of Internal Auditors -
Hsieh, Yu-Huang 2020.04.16 Practical Exercise on the Labor Incident Act 6
Supervisor Chinese Taiwan
Policy Analysis on Improving the Ability to
Auditing The Institute of Internal Auditors -
Hsieh, Yu-Huang 2020.06.12 Self-Prepare Financial Reports and Key Discussions 6
Supervisor Chinese Taiwan
on the Internal Audit and Control Practices
Internal The Institute of Internal Auditors - Labor Law Knowledge for Auditors - From
Chen, Yu-Jui 2020.07.03 6
Auditor Chinese Taiwan Recruitment to Termination
Internal The Institute of Internal Auditors -
Chen, Yu-Jui 2020.10.13 How to Detect Hidden Fraud and Case Studies 6
Auditor Chinese Taiwan
48
~ 48 ~
(IV) The composition, duties and operation of the Remuneration Committee:
1. The Company's Remuneration Committee is responsible for periodically reviewing the

Company's directors' and managers' performance assessment standards, the annual and long-term
performance goals, and the policies, systems, standards and structure of remuneration. Also,
periodically assessing the degree to which performance goals for the directors and managerial
officers of the Company have been achieved, setting the types and amounts of their individual
compensation based on the results of the reviews conducted in accordance with the performance
assessment standards.
The performance assessments and compensation levels of directors and managerial officers shall
take into account the general pay levels in the industry, the time spent by the individual and their
responsibilities, the extent of goal achievement, their performance in other positions, and the
compensation paid to employees holding equivalent positions in recent years. Also to be
evaluated are the reasonableness of the correlation between the individual's performance and the
Company's operational performance and future risk exposure, with respect to the achievement of
short-term and long-term business goals and the financial position of the Company.
2. Information on the members of the Remuneration Committee:

Have at least 5 years working experience with Eligible for independence
Requirements the following professional qualifications (Note 2)
An instructor or A judge, public prosecutor, Having work
higher up in a attorney, certified public experience in the Number of other
department of accountant, or other area of commerce, listed companies
commerce, law, professional or technical law, finance or concurrently
Status
finance, accounting, specialist who has passed a accounting, or serving as Remarks
(Note 1)
or other academic national examination and otherwise members of
1 2 3 4 5 6 7 8 9 10
department related to has been awarded a necessary for remuneration
company business in certificate in a professional company business. committees
a public capacity that is necessary
Name
or private junior for company business.
college, college, or
university.
Independent
Hsieh,Chun-Mou   0
Director
Independent
Su, Ching-Yang   2
Director
Others Chen, Ming-Chang    0
Others Liu, Shih-Tsung   0
Note 1: Please state whether the status is Director, Independent Director or Other.
Note 2: For members who have fulfilled the following criteria in the two years prior to and during their term of office, please tick the "v" in the
box below each criteria code.
(1) Not an employee of the Company or any of its affiliates.
(2) Not a director or supervisor of the Company or its associates (except for the case where the independent directors appointed in
accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the Company and its
parent or subsidiary or a subsidiary of the same parent).
(3) Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by the
person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company, or ranking
among the top 10 natural-person shareholders in holdings.
(4) Not a spouse, or relative within the second degree of kinship, or lineal relative within the third degree of kinship, of an executive officer
falling under (1), or of any of the persons in (2) and (3).
(5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of issued
shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to serve as a director or
supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act (except for the case where the independent directors
appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the
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Company and its parent or subsidiary or a subsidiary of the same parent).
(6) A director, supervisor or employee of other companies who is not controlled by the same person as the majority of the directorships or
voting shares of the company (except for the case where the independent directors appointed in accordance with the Act or the laws and
regulations of the local country by, and concurrently serving as such at, the Company and its parent or subsidiary or a subsidiary of the
same parent).
(7) A director (officer), supervisor or employee of other company or institution who is not the same person or spouse as the chairman,
president or person holding an equivalent position in the company (except for the case where the independent directors appointed in
accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the Company and its
parent or subsidiary or a subsidiary of the same parent). .
(8) A director, supervisor, managerial office or shareholder holding 5% or more of the shares of a specified company or institution that
does not have financial or business relationship with the Company (provided that if the specified company or institution holds more
than 20% of the total number of issued shares of the Company and does not exceed 50%, and where the independent directors
appointed in accordance with the Act or the laws and regulations of the local country by, and concurrently serving as such at, the
Company and its parent or subsidiary or a subsidiary of the same parent)
(9) Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company,
or institution that, provides auditing services to the company or any affiliate of the company, or that provides commercial, legal,
financial, accounting or related services to the company or any affiliate of the company for which the provider in the past 2 years has
received cumulative compensation exceeding NT$500,000, or a spouse thereof. This restriction does not apply to a member of the
remuneration committee, public tender offer review committee, or special committee for merger/consolidation and acquisition, who
exercises powers pursuant to the Securities and Exchange Act or to the Business Mergers and Acquisitions Act or related laws or
regulations. .
(10) Not been a person of any conditions defined in Article 30 of the Company Act.
3. Information on the meeting status of the Remuneration Committee

(1) There are three members in the Remuneration Committee of the Company.
(2) The term of office: From 9 August 2018 to 10 June 2021.
There were three meetings held for the Remuneration Committee in 2020, with the following attendance:
Attendance Rate in Person
Position Name Attendance in Person Attendance by proxy Remarks
(%)
Convener Hsieh,Chun-Mou 3 100%
Independent
Su, Ching-Yang 3 100%
Director
Committee
Liu, Shih-Tsung 3 100%
member
I. If the Board of Directors does not adopt or amend the recommendation of the Remuneration Committee, it shall state the date and period, the content of the
resolution, the result of the resolution and the Company's handling of the recommendation of the Remuneration Committee (if the remuneration approved by the
Board of Directors is better than the recommendation of the Remuneration Committee, it shall state the difference and the reasons for the difference): None
II. Matters resolved by the Remuneration Committee in 2020, where the members expressed objections or reservations on the committee’s resolutions, the date of
the meeting, session, content of the motion, all members’ opinions and the response to members’ opinion should be specified: None.
Meeting dates The Company’s handling of the
of the Result of the recommendation of the
Resolutions
Remuneration resolutions Remuneration Committee
Committee
2020.01.17 1. The proposal of the year-end bonus for the Company's managerial RESOLVED by all On January 17, 2020, the Directors
The 4th session officers. members present. recused themselves from the
The 4th meeting 2. The proposal of the year-end bonus for the directors of the resolution in relation to the motion
Company who execute the business operations. and the other Directors who were
3. A motion to review the salaries for the directors and the managerial present at the meeting approved the
officers of the Company who execute the business operations. resolution.
2020.03.26 RESOLVED by all Resolved by all Directors present at
The proposal of the employees' and directors' remuneration for the
The 4th session members present. the Board Meeting on March 26,
year 2019.
The 5th meeting 2020.
2020.10.29 1. The distribution of remuneration to the directors of the Company. RESOLVED by all On November 11, 2020, the
The 4th session 2. The distribution of remuneration to the managerial officers and members present. Directors recused themselves from
The 6th meeting directors of the Company who execute the business operations. the resolution in relation to the
3. A motion to review the salaries for the directors and the managerial motion and the other Directors who
officers of the Company who execute the business operations. were present at the meeting
4. The amendment to the " Regulations on the Performance approved the resolution.
Evaluation of the Board of Directors and Functional Committees"
of the Company.
III. Matters resolved by the Remuneration Committee in 2021, where the members expressed objections or reservations on the committee’s resolutions, the date
of the meeting, session, content of the motion, all members’ opinions and the response to members’ opinion should be specified: None.
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Meeting dates The Company’s handling of the
of the Result of the recommendation of the
Resolutions
Remuneration resolutions Remuneration Committee
Committee
2021.02.03 1. Report on matters resolved by the last Remuneration Committee RESOLVED by On February 3, 2021, the Directors
The 4th session meeting. all members recused themselves from the
The 7th meeting 2. The results of the performance evaluation of the Board & present. resolution in relation to the motion
Functional Committees. and the other Directors who were
3. Discuss the payment of the year-end bonus for the Company's present at the meeting approved the
managerial officers. resolution.
4. Discuss the payment of the year-end bonus for the Company’s
directors who execute the business operations.
5. Review the salaries for the directors and the managerial officers of
the Company who execute the business operations.
6. Review the amendment to the Company's Articles of Incorporation.
2021.03.25 1. Report on matters resolved by the last Remuneration Committee RESOLVED by Resolved by all Directors present at
The 4th session meeting. all members the Board Meeting on March 25,
The 8th meeting 2. Discuss the distribution of the remuneration to employees and present. 2021.
directors of the Company for the year 2020.
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(V) The state of the Company's performance of social responsibilities, any variance from the Corporate Social Responsibility Best Practice
Principles for TWSE/TPEx Listed Companies, and the reason for any such variance.
Implementation Status (Note 1) Non-implementation and
Assessed Items its reasons
Yes No Summary and Explanation (Note 2)
I. Does the company conduct risk  The Company manages the business risks by improving the internal control system, ensuring No material difference.
assessments of environmental, social the effective implementation of the internal control system through an audit system, tracking
and corporate governance issues and correcting internal audit irregularities, and reporting to the Audit Committee and the
pertaining to company operations and Board of Directors to avoid the risks and damages caused by the failure of the internal control
establish the relevant risk management system. The annual budget is prepared in accordance with the regulations on the annual
policy or strategy in accordance with budget system in order to manage the operating funds required. The Company manages the
the materiality principle? (Note 3) financial risks, such as market risk (exchange rate risk, interest rate risk and price risk), credit
risk and liquidity risk on a daily basis to maintain a stable financial position and to prevent
from market uncertainty. In addition, the Company identifies the environmental, social and
economic issues that have a significant influence on the Company's investors and other
stakeholders and establishes the relevant management policies and management objectives,
which are managed by the relevant management units and the highest authority.
The risks arising from those significant issues are evaluated as follows:
Environmental issues: The risks to the environment and safety and health, and the risks to
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climate change. In response to the risk of 'climate change', the
Company has proposed a contingency plan for suppliers, promoted
greenhouse gas reduction and maintained a safety stock for products.
Social issues: Including the product risk, the raw material risk and the employee risk. The
main focus is on product quality and staff competitiveness. The strategy is to
improve the yield rate of our products and to provide a good working
environment for the employees.
Corporate governance issues: regulation compliance risk, financial risk, information security
risk and market risk. The main strategies are to ensure the legal
compliance and the information security control.
Please refer to pages 14-15 of the Company's 2020 CSR Report and pages 260-262 of the
Annual Report for the risk management strategy and policy.
II. Does the Company have a dedicated  A cross-departmental committee is formed by all assistant vice presidents of the Company to No material difference.
(or ad-hoc) CSR organization with promote CSR, and the Chairman's Office and the Administration Department are responsible
Board of Directors authorization for for promoting these CSR activities.
senior management, which reports to The implementation status of the CSR Committee is as follows:
the Board of Directors? 1.An annual meeting is held, and each department's assistant vice president and above will
participate in the meeting, and the relevant departments will explain the implementation
status of CSR and the communication with the stakeholders; if necessary, meetings will be
held from on an irregular basis.
2. Composition:
(1) CSR Committee: Coordinate CSR-related indicators and performance results.
(2) Sales Department: Maintain the relationship with customers and the liaison of the product
liability.
(3) Research and Development Department: Research to develop eco-friendly products.
(4) The Administration Department: Build a sustainable environment and a friendly
workplace as well as manage the supply chain.
(5) Finance Department: Control and manage the operational performance and financial risks.
(6) Production Department: Manage eco-friendly production and product liability.
3. The Company will review the CSR performance indicators and examine the annual CSR
report every year. The Company's CSR reports for 2020 and 2019 were submitted to the
Board of Directors on 2021.05.06 and 2020.05.06 respectively.
Please refer to pages 8 and 9 of the 2020 CSR Report.
III. Environmental Issues No material difference.
(I) Has the company established an  We are an ISO 14001:2015, ISO 45001:2018, CNS 45001:2018, and ISO 50001:2018
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appropriate environmental certified company.
management system based on the 1. The validity period of ISO 14001:2015 is from 2020.01.17 to 2023.01.16.
industry characteristics? 2. The validity period of ISO 45001:2018 is from 2020.11.02 to 2023.11.01.
3. The validity period of CNS 45001:2018 is from 2020.11.02 to 2023.11.01.
4. The validity period of ISO 50001:2018 is from 2020.12.05 to 2023.12.04.
The environmental safety and health management system is implemented through a
combination of daily management and total production management (TPM) activities. The
Company integrates the environmental safety and health management plan with the actual
operation in the factory and implements the system according to the Plan, Do, Check and
Action modes. The environmental and health risks associated with the company's operations
are systematically evaluated in order to determine the potential impacts on the environment
and employees from the use of the raw materials to the waste output processes. The Company
will evaluate, replace and reduce the amount of raw materials, control and reduce the amount
of process contamination and effectively deal with end-of-pipe contamination for items that
may cause significant environmental impact.In terms of the safety and health aspect, risk
management is implemented with the intrinsic safety of the equipment, chemical safety and
operational safety as the starting point, in order to protect the safety and physical and mental
health for all employees. In order to achieve the goal of sustainability, we have established the
"Environmental Safety and Health Policy" to continuously improve our environmental safety
and health performance, with "Zero Disaster, Zero Pollution" as the ultimate goal for
environmental protection and safety and health efforts. The Company has set annual targets
for its environmental health and safety management system, and is committed to continuously
improving environmental protection and health and safety management to reduce
environmental impacts and improve environmental health and safety in the Company.
(II) Is the company committed to  The Company is equipped with pollution prevention equipment for various types of pollution
improving the resources utilization such as waste water, waste gas and waste materials in accordance with environmental
and the use of renewable materials that protection regulations. The Company also provides waste separation and recycling and
have low impact on the environment? continues to improve the energy efficiency, mainly focusing on improving the source and
increasing the utilization efficiency for all resources in order to reduce the raw materials or
waste materials and to minimize the impact on the environment.
We actively use eco-friendly packaging materials, set up recycling, use energy-saving lighting
equipment, install energy-saving equipment with scheduled power disconnection, use
water-saving equipment in toilets, and use energy-saving lights to reduce the impact on the
environment in order to achieve the sustainability.
In addition, the Company has disclosed its environmental protection strategies such as energy
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saving, carbon reduction and greenhouse gas reduction on the website, and announced the
tracking results periodically.
(III) Does the Company evaluate current  The Company manages the climate change risk through procurement meetings, business
and future climate change potential meetings, occupational safety and health and environmental committees; in additional, the
risks and opportunities and take Company has developed a supplier response plan, promoted greenhouse gas reduction, and
measures related to climate related maintained a safe inventory of products.
topics?
(IV) Does the Company collect data for  1. Information on the carbon dioxide emissions for the last two years:
greenhouse gas emissions, water usage (1) Yuanlin Factory: 2020: 18,259 tons, 2019: 17,491 tons. This represents an increase of 4.39
and waste quantity in the past two % in 2020 compared to 2019.
years, and set energy conservation, (2) Yunlin Factory: 2020: 40,676 tons, 2019: 39,849 tons. This represents an increase of 2.08
greenhouse gas emissions reduction, % in 2020 compared to 2019.
water usage reduction and other waste 2. Information on the water consumption for the last two years:
management policies? (1) Yuanlin Factory: 2020: 132,884 tons, 2019: 136,023 tons. This represents a decrease of
2.3% in 2020 compared to 2019.
(2) Yunlin Factory: 2020: 143,660 tons, 2019: 139,249 tons. This represents an increase of
3.17% in 2020 compared to 2019.
3. Information on the wast generation for the last two years:
(1) Yuanlin Factory: 2020: 53.45 tons, 2019: 59.6 tons. This represents a decrease of 10.32%
in 2020 compared to 2019.
(2) Yunlin Factory: 2020: 159 tons, 2019: 184.4 tons. This represents a decrease of 13.77% in
2020 compared to 2019.
4. The energy saving results:
(1) Energy savings: 2,156,851 kWh/year.
(2) Electricity cost savings: $5,467,134/year.
(3) CO2 reduction: 1,315.5 tons/year.
In line with the greenhouse gas inventory, the Company has been working on the energy
management system of ISO 50001, carbon reduction, product carbon footprint disclosure and
waste reduction to reduce the greenhouse gas emissions, increase the water recycling
efficiency, save water resources, reduce waste from the process source and improve the
recycling of waste in order to make efforts to sustainable environment. Please refer to pages
45 and 46 of the 2020 CSR Report for more information.
Future quantitative targets for energy saving plans:
1. The Company plans to build a solar power facility on the roof of the R&D headquarters,
which is estimated to reduce CO2 emissions by 311 tons per year.
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2.The 2021 energy saving objectives:
(1) Electricity: Yuanlin Factory: 0.809 kg/kwh; Yunlin Factory: 1.000 kg/kwh.
(2) Fuel: Yuanlin Factory: 0.353 kg/kcal; Yunlin Factory: 0.538 kg/kcal.
3. Reduce the mixing sections and shorten the mixing time, the Company aims to reduce the
annual power consumption to below 150 kWh in the future.
4. The water recycling and reuse goal for 2021 is 10%.
5. Replace heavy oil boilers with natural gas boilers and reduce CO2 emission by 5% in 2021.
Climate change risk:
Risks to the safe inventory in the supply chain, product transportation, unavailability of
supplies and energy shortages.
In response to climate change:
1. Build solar power facilities.
2. Promote carbon reduction activities.
3. Purchase eco-friendly raw materials.
4. Recycle and reuse the water resources.
5. Maintain a safe inventory at each sales office; for those location without a sales office to
keep a safe inventory, we will ensure that our customers have a safe inventory.
IV. Social Issues No material difference.
(I) Does the Company set policies and  The Company is committed in protecting the workers' rights and complying with the Labor
procedures in compliance with Standards Act and the government's human rights policy. We not only implement the policy,
regulations and internationally but also set up a variety of communication channels and management mechanisms to ensure
recognized human rights principles? that all employees are well protected so that we can create a respectful, caring and human
rights-protective working environment. The Company provides a safe and healthy working
environment and establishes precautions to avoid accidents or health hazards at work. The
Company does not discriminate in hiring, remuneration, promotion, training, retirement or
termination of employment on the basis of race, nationality, religion, gender, age, social class,
physical disability, family and marital status, union membership, and political preference. In
addition, the Company does not interfere with the workers' religion, political party, marriage
and the right to worship all kinds of traditions and customs. The Company had no incidents
that violated the human rights, discrimination and rights of disadvantaged and vulnerable
people in 2020, and there were no cases that were subject to human rights review or impact
assessment.
(II) Has the Company established  We believe that our employees are the most valuable asset for the Company and we are
appropriately managed employee committed to share the profits with all our employees; we are also dedicated to provide a
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welfare measures (include salary and perfect working environment and system by setting rules for calculating the salary, special
compensation, leave and others), and leave and other benefits, please refer to pages 83 to 87 of this year's Annual Report and pages
link operational performance or 71 to 74 of the 2020 CSR Report. The monthly performance bonuses are paid based on the
achievements with employee salary performance achievement rate as evaluated.
and compensation? The Company has made annual salary adjustments for the employees based on the
profitability. The average annual salaries for full-time employees who are not in a managerial
position were $622,178 and $535,730 in 2020 and 2019, representing an increase of 16.14%;
the median annual salaries for full-time employees who are not in a managerial position were
$575,552 and $499,599 in 2020 and 2019, which represents an increase of 15.20%.
(III) Does the Company provide employees  The Company is ISO 45001:2018 certified, and follows the ISO 45001 occupational safety
with a safe and healthy working and health management system to promote the on-site implementation for occupational safety
environment, with regular safety and and health management, to conduct regular inspections on workplaces, to implement contract
health training? management, to introduce a false alarm reporting system, to conduct activities for safety, to
manage toxic chemical substances, and to hold regular training on safety and health. It is our
responsibility to provide a working environment that satisfies the legal and client
requirements through a continuous improvement based on the PDCA management cycle for
our employees and their families.
The Company regularly holds seminars on employee safety and conducts safety inspections
for the working environment, prepares a manual on safety and hygiene practices.The safety
and health work rules have been prepared for all employees, and management staff have been
required to attend work safety related courses; the Company has also allocated funds to
improve the safety and environmental facilities in the factory.
Our safety and health education includes
1. In compliance with the occupational safety and health education and training requirements:
(1) For new employees: three-hour courses.
(2) For the supervisors: two-hour courses per year.
(3) On-site special operators: 3-hour course every 3 years on safety, hygiene, health and fire
education.
(4) For on-site staff:
(a) Before the new employee starts work on the first day, he/she will be given a one-hour
course on equipment safety, hazard identification and safety awareness according to the
job description.
(b) The employees will be given one hour seminar on equipment safety, hazard identification
and safety awareness every year according to the job description.
(5) Occupational Safety and Health Staff: They must attend 12 hours of occupational safety
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and health courses organized by external institutes every 2 years.
2. According to the Fire Services Act, the General Affairs Section shall invite firefighters to
conduct factory-wide fire drills for all employees in the Company for four hours every six
months.
The total number of training hours for occupational safety and health, environmental
protection and fire education in 2020 is 23,533 hours with 20,368 participants.
(IV) Has the Company established effective  A series of education and training is planned for new recruits from the very beginning, and the
career development training plans? training is conducted according to different levels and units with incentives and subsidies to
encourage employees to actively study in languages or other areas. We provide a wide range
of training courses that are used as criteria to promote our staff, including Training for New
Recruits, Training for Core Functions, Training for Management Functions, Training for
Projects, and Training for Self-development every year. Please refer to pages 55 - 58 of the
2020 CSR Report for more information.
(V) Does the Company’s product and  All of our motorbike tires are produced using eco-friendly oils without the use of polycyclic
service comply with related aromatic hydrocarbons (PAHs) in order to ensure the safety of both consumers and
regulations and international rules for employees.
customers’ health and safety, privacy, Our products and services are marketed and labelled in accordance with the relevant
sales,labelling and set polices to regulations and are certified with ISO 9001:2015 and IATF 16949:2016.
protect consumers’ rights and Our products are certified worldwide with BIS (India), CCC (China), Colombia, DOT (USA),
consumer appeal procedures? E-MART (Europe), GSO (GCC), SASO (Saudi Arabia), I-MART (Brazil), KATECH (Korea),
SNI (Indonesia) and TIS (Thailand).
Our products are also certified in Taiwan with the BSMI, the CNS Mark, the Vehicle Safety
Component Certification (VSCC) and the Taiwan Tire Energy Efficiency Label.
We have set up a stakeholder information on our website ( http://csr.kenda.com.tw), and have
established rules for managing customer complaints and after-sales service. The Quality
Assurance Department is assigned to handle the consumer protection and the customer
complaints, and to conduct the customer satisfaction survey.
(VI) Does the Company set supplier  When the Company evaluates the suppliers, in addition to information on management,
management policy and request technical capability and production capacity, new suppliers must provide the "Basic Supplier
suppliers to comply with related Information Survey Form" with the "Declaration of Non-Use of Environmental Hazardous
standards on the topics of Substances and Conflict Minerals", the "CSR Statement for Suppliers" and samples
environmental, occupational safety (including the SDS Safety Information Sheet) for the Company's responsible department to
and health or labor right, and their investigate and evaluate before they can be classified as qualified suppliers. The Company
implementation status? also considers that suppliers should have a sound quality system available. Major raw
material suppliers must also be certified with ISO 9001 quality system. The selection of new
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suppliers is based on the criteria such as quality, delivery time, supply status, operational
performance, service capability and so on, in addition to environmental protection, labor
practices, human rights and anti-corruption. In 2016, the Company started to conduct CSR
evaluation and communication with 996 domestic and overseas suppliers, including the
sending CSR declaration to suppliers, asking them to fill in the declaration and return it, and
conducting CSR surveys to new suppliers and existing suppliers. As a result, 91% of the
suppliers have qualified, and those who fail to meet the standard must be required to make
improvements by a certain date, otherwise they will not be classified as qualified suppliers.
V. Does the Company refer to  The Company prepares the CSR report in accordance with the GRI Standards published by No material difference.
international reporting rules or the Global Reporting Initiative. The Company has not yet acquired 3rd certification party
guidelines to publish CSR Report to verification or statement of assurance. In the future, the Company expects to disclose CSR
disclose non-financial information of reports with the goal of acquiring 3rd certification party verification or statement of
the Company? Has the said Report assurance.
acquire 3rd certification party
verification or statement of assurance?
VI. If the company has established its corporate social responsibility code of practice according to “Corporate Social Responsibility Best Practice Principles for TWSE/GTSM
Listed Companies” please describe the operational status and differences.
The Company has formulated the "Code of Practice on Corporate Social Responsibility" in accordance with the relevant provisions of the "Corporate Social Responsibility Best
Practice Principles for TWSE/GTSM Listed Companies" and has followed the relevant regulations. There is no difference between the operation and the regulations.
VII. Other important information to facilitate better understanding of the company’s implementation of corporate social responsibility:
(I) Implementation status for CSR:
1. Established the Kenda Cultural and Educational Foundation:
(1) Encourage students to continue their studies by awarding them with the Kenda Outstanding Scholarship and Underprivileged Scholarship for Freshmen Students.
(2) Promote education, culture and arts activities: The Company regularly organizes annual summer camps for children, Newton Science Camp and concerts, and Golden Jade
Lectures.
(3) Support for students who have suffered from family problems, donations to schools in rural areas, and bicycles for economically disadvantaged students.
2. Social concerns:
(1) The US subsidiary donated personal protective supplies to health care workers in Europe and the US.
(2) The Company donated residential fire alarms to the Fire Departments of Cihtong Township and the West District of Yuanlin City.
(3) The Company maintains and cleans the roads around the community area.
(4) The Company sponsored the Bicycle Festival organized by Giant Manufacturing Co. Ltd.
(5) The Company supports various sports events in Taiwan and has been sponsoring a number of potential golfers for a long time.
Please refer to pages 75 - 81 of the 2020 CSR Report for more information.
(II) For other information on the Company's CSR implementation, please refer to the 2020 CSR Report.
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(http://csr.kenda.com.tw/default.aspx?lang=0&menuid=4&editable=1)
Note 1: If "Yes" is selected for the implementation status, please state the important policies, strategies and measures adopted and their implementation status. If "No" is selected for
the implementation status, please explain the reasons and state the plans for the future policies, strategies and measures to be implemented.
Note 2: If the Company has prepared a CSR report, the implementation status should indicate how to view the CSR report and the index page instead.
Note 3: The materiality principle refers to environmental, social and corporate governance issues that have a significant impact on the Company's investors and other stakeholders.
(VI) The state of the Company's Code of Conduct on integrity, any variance from the Ethical Corporate Management Best Practice Principles
for TWSE/GTSM Listed Companies, and the reasons for such variances.
Implementation Status (Note 1)
Non-implementation
Assessed Items
I. Establishment of Corporate Conduct and No material
Ethics Policy and Implementation The Company has established the "Ethical Corporate Management Best Practices Principles", difference.
Measures "Codes of Ethical Conduct and Regulations on the Public Recusal of Interested Parties" as
(I) Does the company have a clear ethical  resolved by the Board of Directors. The Company requires the Board of Directors, senior
corporate management policy approved executives and all employees to implement these regulations. These policies and regulations
by its Board of Directors, and bylaws and provide that the Company and its subsidiaries shall establish policies based on integrity,
publicly available documents addressing transparency and accountability, and establish good corporate governance and risk control
its corporate conduct and ethics policy mechanisms to create a business environment for the sustainability of the Company. In
and measures, and commitment regarding addition to complying with the relevant laws and regulations, the Company Act, the Securities
implementation of such policy from the and Exchange Act, the Business Entity Accounting Act, the Political Donations Act, the
Board of Directors and the top Anti-Corruption Act, the Government Procurement Act, Act on Recusal of Public Servants Due
management team? to Conflicts of Interest, the regulations relating to the listed companies or other business conduct
related laws and regulations are also applicable. Offering and acceptance of bribes, illegal
political donations, improper charitable donations or sponsorships, offering or acceptance of
unreasonable presents, hospitality or other improper benefits, misappropriation of trade secrets
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and infringement of trademark rights, patent rights, copyrights, and other intellectual property
rights, and engaging in unfair competitive practices are strictly prohibited. The Company's
directors and senior executives shall exercise a high degree of self-discipline. If a director or a
juristic person represented by the director is an interested party with respect to any proposal for a
board meeting, the director shall state the important aspects of the interested party relationship at
the meeting. When the relationship is likely to prejudice the interests of the Company, the
director may not participate in discussion or voting on that proposal and shall enter recusal
during the discussion and voting. The director also may not act as another director's proxy to
exercise voting rights on that matter.
In 2020, the Company conducted internal and external training related to ethical management
(including ethical management regulations, internal control systems, accounting systems, tire
quality regulations and policies, safety and health and management) for a total of 23,204
participants and 26.500 hours.
(II) Whether the company has established an  For business activities with a higher risk of unethical conduct, the Company shall follow the
assessment mechanism for the risk of accounting system and internal control system established by the Company. The Company does
unethical conduct; regularly analyzes and not allow external accounts or secret accounts, and constantly reviews to ensure the
evaluates within a business context, the appropriateness of the system design and the continuous effectiveness of its implementation. The
Non-implementation
Assessed Items
business activities with a higher risk of Company's Audit Office shall conduct audits on the compliance of the preceding system from
unethical conduct; has formulated a time to time and shall prepare an audit report to the Board and may appoint an accountant to
program to prevent unethical conduct perform such audits and, if necessary, an independent auditor or professional to perform such
with a scope no less than the activities audits.
prescribed in paragraph 2, Article 7 of the In order to improve the mechanism, we have set up a clear and effective reward and punishment
Ethical Corporate Management Best system by integrating the ethical management policy with employee performance evaluation and
Practice Principles for TWSE/GTSM human resources policy through education, training and evaluation. There is also a system for
Listed Companies? whistleblowing, punishment and grievance. New suppliers of the Company are required to sign a
"Letter of Compliance with Corporate Social Responsibility Requirements for Suppliers" as a
guarantee.
(III) Special Assistance: Whether the company  The Company has established a code of conduct for the relationship of interested parties and
has established relevant policies that are ethics guidelines, as well as a non-disclosure policy for its employees, which provide clear
duly enforced to prevent unethical conduct, directions for directors, managerial personnel, employees and persons having substantial control
provided implementation procedures, over the Company. In addition, the management and operation of each business is governed by a
guidelines, consequences of violation and internal control system that clearly reveals the disciplinary methods and provides appropriate
complaint procedures, and periodically remedies for grievances.
reviews and revises such policies?
II. Ethic Management Practice No material
~ 61 ~
(I) Whether the company has assessed the  The suppliers and customers of the Company have signed the Letter of Undertaking of Integrity difference.
ethics records of whom it has business in compliance with theAct on Recusal of Public Servants Due to Conflicts of Interest and the
relationship with and include business Ethics Guidelines for Civil Servants.
conduct and ethics related clauses in the
business contracts?
(II) Whether the company has set up a unit  The Company does not set up an ethical management unit.
which is dedicated to promoting the The implementation status for ethical management
company’s ethical standards and regularly 1. In order to implement the ethical management policy and prevent unethical conduct, the
(at least once a year) reports directly to the Company holds annual training courses on relevant laws and regulations. The courses cover
Board of Directors on its ethical corporate ethical management, procedures for investigation and public handling of material
management policy and relevant matters, information, prevention of insider trading, the Company Act, the Securities and Exchange
and program to prevent unethical conduct Act and other laws and regulations.
and monitor its implementation? 2. 2020.12.30 The Company's legal advisor, Mr. Chen, Chong Yi, was invited to the morning
meeting to explain to all the directors and officers above the team leader level and the fourth
grade staff about the regulations related to "insider trading". 116 people participated in the
meeting and the relevant information was posted on the Company's internal website and sent
to the directors for all employees to download and study.
Non-implementation
Assessed Items
3. The Company has established a specific whistleblowing system and announced the internal
independent whistleblowing mailbox and hotline on the Company's website in the
Stakeholders' section and the CSR Report. The Company has designated a responsible
person or unit to handle reports that involve directors or senior executives. The report should
be submitted to the independent directors or the Audit Committee, and the types of matters to
be reported and the standard operating procedures for the investigation should be established.
Investigation cases, investigation processes, results and related documents shall be recorded
and maintained. Keep the identity of the whistleblower and the contents of the
whistleblowing report confidential. Protect the whistleblower from improper treatment due to
his/her whistleblowing.
(III) Whether the company has established  The Company has a "Code of Ethical Conduct and Regulations on Conflict of Interest in Public
policies to prevent conflict of interests, Recusal" to prevent conflict of interest related business; the employee who has a conflict of
provide appropriate communication and interest in the business should inform the supervisor and recuse himself/herself; the Board
complaint channels and implement such members will not participate in the discussion and vote on the motion if a conflict of interest is
policies properly? involved.
(IV) To implement relevant policies on ethical  The Company has an effective accounting system and internal control system, which is audited
conducts, has the company established by an audit unit under the Board of Directors and by professional independent auditors.
effective accounting and internal control
~ 62 ~
systems, audit plans based on the
assessment of unethical conduct, and
have its ethical conduct program audited
by internal auditors or CPA periodically?
(V) Does the company provide internal and  In 2020, the Company conducted internal and external training related to ethical management
external ethical conduct training (including ethical management regulations, internal control systems, accounting systems, tire
programs on a regular basis? quality regulations and policies, safety and health and management) for a total of 23,204
participants and 26.500 hours.
III. Implementation status of whistleblowing No material
procedures difference.
(I) Does the company establish specific  The Company has established a specific whistleblowing system and announced the internal
whistleblowing and reward procedures, independent whistleblowing mailbox, hotline, responsible personnel or unit on the Company's
set up conveniently accessible reporting website in the Stakeholders' section and the CSR Report.
channels, and designate responsible For related information, please go to the Company’s website:
personnel to handle the reports received? (http://csr.kenda.com.tw/default.aspx?lang=0&menuid=5)
(II) Whether the company has established  The Company has designated a responsible person or unit to handle reports that involve directors
standard operation procedures for or senior executives. The report should be submitted to the independent directors or the Audit
Non-implementation
Assessed Items
investigating the complaints received, Committee, and the types of matters to be reported and the standard operating procedures for the
follow-up measures after investigation investigation should be established. For the investigation cases, investigation processes, results
are completed, and ensuring such and related documents are properly recorded and maintained. The Company keeps the identity
complaints are handled in a confidential of the whistleblower and the contents of the whistleblowing report confidential.
manner?
(III) Does the company adopt proper measures  The Company shall keep the identity of the whistleblower and the contents of the whistleblowing
to prevent improper treatment from report confidential, and shall protect the whistleblower from improper treatment due to his/her
retaliation for whistleblower? whistleblowing.
IV. Information Disclosure No material
(I) Does the company disclose its guidelines  The Company has established a Code of Conduct on Integrity, which is disclosed on the difference.
on business ethics as well as information Company's website and the Market Observation Post System.
about implementation of such guidelines
on its website and Market Observation
Post System (“MOPS”)?
V. If the company has established corporate governance policies based on Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies, please
describe any discrepancy between the policies and their implementation.
The Company has established the "Ethical Corporate Management Best Practice Principles" in accordance with the "Ethical Corporate Management Best Practice Principles
for TWSE/GTSM Listed Companies" and has followed the relevant regulations. There is no difference between the operation and the regulations.
~ 63 ~
VI. Other important information to facilitate better understanding of the company’s corporate conduct and ethics compliance practices (e.g., review the company’s corporate
conduct and ethics policy)
The Company will review and amend the Ethical Corporate Management Best Practice Principles y based on the implementation status each year and the relevant law and
regulations.
Note: 1. Suppliers: http://csr.kenda.com.tw/default.aspx?lang=0&menuid=5,37,71
2. Customers: http://csr.kenda.com.tw/default.aspx?lang=0&menuid=5,38,73
3. Employees:http://csr.kenda.com.tw/default.aspx?lang=0&menuid=5,36,59
4. Shareholders: http://csr.kenda.com.tw/default.aspx?lang=0&menuid=3,23&editable=1
(VII) If the company has adopted corporate governance best-practice principles or
related bylaws, disclose how these are to be searched.
The Company's Corporate Governance Principles, Corporate Social Responsibility
Principles, Code of Ethical Conduct and Regulations on Recusal of Stakeholders, and
Ethical Corporate Management Best Practice Principles are all clearly defined and
available on the Company's website (http://csr.kenda.com.tw/) and on the Market
Observation Post System.
(VIII) Other significant information that will provide a better understanding of the
state of the company's implementation of corporate governance may also be
disclosed.
1. The Company's corporate governance practices are disclosed on the website
( http://csr.kenda.com.tw/ ) and on the Market Observation Post System.
2. We will comply with the internal control system, ensure its on-going and effective
operation, implement internal control self-examination, strengthen the audit and report to
the Board of Directors.
3. The Company implements a spokesperson system to make information transparent and
fully disclose material information so that our shareholders have the right to receive
information on an equal basis.
4. Directors of the Company attend continuing education courses to fulfil the corporate
governance practices of the Company.
(IX) The implementation status of the company's internal control system

1. Statement on Internal Control
64
~ 64 ~
The statement of the Internal Control System of the Company.
Date: March 25, 2021
Based on the findings of a self-assessment, the Company states the following with regard to its internal control system during
the year 2020:
I. The Company’s Board of Directors and management are responsible for establishing, implementing, and maintaining an
adequate internal control system. Our internal control is a process designed to provide reasonable assurance over the
effectiveness and efficiency of our operations (including profitability, performance and safeguarding of assets), reliability
of the financial reporting, and compliance with laws and regulations.
II. An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control
system can provide only reasonable assurance of accomplishing its stated objectives. Moreover, the effectiveness of an
internal control system may be subject to changes due to extenuating circumstances beyond our control. Nevertheless,
our internal control system contains self-monitoring mechanisms, and the Company takes immediate remedial actions in
response to any identified deficiencies.
III. The Company evaluates the design and operating effectiveness of its internal control system based on the criteria
provided in the Regulations Governing Establishment of Internal Control Systems by Public Companies (herein below,
the “Regulations”). The criteria adopted by the Regulations identify five key components of managerial internal control:
(1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and (5)
monitoring activities. There are several items in each key components. Please refer to the Regulations for the preceding
items.
IV. The Company has evaluated the design and operating effectiveness of its internal control system according to the
aforesaid Regulations.
V. Based on the findings of such evaluation, the Company believes that, on December 31, 2019, it has maintained, in all
material respects, an effective internal control system (that includes the supervision and management of our subsidiaries),
to provide reasonable assurance over our operational effectiveness and efficiency, reliability of the financial reporting,
and compliance with laws and regulations.
VI. This Statement is an integral part of the Company’s annual report and prospectus, and will be made public. Any
falsehood,concealment, or other illegality in the content made public will entail legal liability under Articles 20, 32, 171,
and 174 of the Securities and Exchange Act.
VII. This Statement was passed by the Board of Directors in their meeting held on March 25, 2021, all the 11 directors
present hereby affirm the content of this Statement.
Chairman：Yang, Chi-Jen
President：Chen, Chao-Jung
2. If CPA was engaged to conduct a special audit of internal control system, provide its audit report: None.
65
~ 65 ~
(X) If there has been any legal penalty against the Company or its internal personnel, or any
disciplinary penalty by the Company against its internal personnel for violation of the
internal control system, during the most recent fiscal year or during the current fiscal year
up to the publication date of the annual report, where the result of such penalty could have
a material effect on shareholder equity or securities prices, the annual report shall disclose
the penalty, the main shortcomings, and condition of improvement: None.
(XI) Material resolutions of a shareholders meeting or a board of directors meeting during the
most recent fiscal year or during the current fiscal year up to the date of publication of the
annual report: None.
1. The result and implementation status of the Annual Shareholders Meeting: The Annual Shareholders
Meeting was convened on June 16, 2020.
Resolutions and voting results
Percentage of
the total votes
Proposals represented by Implementation
Result of the votes the attending status
shareholders at
the time of
voting
1. Adoption of the Approval votes: 692,223,667 (including 150,688,410 electronic votes) 98.94% Publicly
2019 Business announced
Disapproval votes: 57,301 (including 57,301 electronic votes) 0.00%
Report and according to the
Financial Invalid votes: 0 (including 0 electronic vote) 0.00% resolution.
Statements. Abstention votes/no votes: 7,323,409 (including 7,233,689 electronic
1.04%
votes)
This proposal was adopted as proposed.
2. Adoption of the Approval votes: 650,981,167 (including 109,445,910 electronic votes) 93.04% Cash dividend
2019 Earnings Disapproval votes: 42,024,454 (including 42,024,454 electronic votes) paid on October
Distribution. 6.00% 7, 2020 at
Invalid votes: 0 (including 0 electronic vote) 0.00% NT$0.4 per
Abstention votes/no votes: 6,598,756 (including 6,509,036 electronic share; the record
0.94% date for the stock
votes)
dividend
distribution is
This proposal was adopted as proposed. September 8,
2020.
3. Amendment to Approval votes: 692,925,467 (including 151,390,210 electronic votes) 99.04% The amendment
the Company's Disapproval votes: 71,669 (including 71,669 electronic votes) was made in
Articles of 0.01% accordance with
Incorporation. Invalid votes: 0 (including 0 electronic vote) 0.00% the resolution,
Abstention votes/no votes: 6,607,241 (including 6,517,521 electronic publicly
0.94% announced and
votes)
approved by the
Ministry of
This proposal was approved as proposed. Economic Affairs
on July 20, 2020.
4. Proposal for new Approval votes: 92,917,520 (including 151,382,263 electronic votes) 99.04% The new shares
shares issue Disapproval votes: 86,402 (including 86,402 electronic votes) were issued in
through the 0.01% accordance with
capitalization of Invalid votes: 0 (including 0 electronic vote) 0.00% the resolution.
earnings. Abstention votes/no votes: 6,600,455 (including 6,510,735 electronic The change of
0.94% registration was
votes)
approved by the
Ministry of
This proposal was approved as proposed. Economic Affairs
on 22 September
2020.
66
~ 66 ~
2. Major decisions of Board Meetings
Date Major Proposals
2020.01.17 1. The proposal of the year-end bonus for the Company's managerial officers.
2. The proposal of the year-end bonus for the directors of the Company who execute the business
operations.
3. A motion to review the salaries for the directors and the managerial officers of the Company who
execute the business operations.
4. The proposal for increasing the investment in Kenda Rubber (Vietnam) Co., Ltd., the subsidiary of the
Company.
5. The proposal for increasing the investment in Kenda Rubber (Indonesia) Co., Ltd., the subsidiary of
he Company.
6. The proposal for destruction of the Company's accounting books and documents upon the expiration
of their retention period.
2020.03.26 1. The proposal of the employees' and directors' remuneration for the year 2019.
2. The adoption of the 2019 Business Report and Financial Statements.
3. The proposal of the 2019 earning distribution.
4. The proposal to distribute the cash dividends to shareholders from the 2019 earnings of the Company.
5. The proposal for new shares issue through the capitalization of earnings.
7. Matters related to the shareholders' proposal for the 2020 Annual Shareholders' Meeting being
accepted by the Company.
8. The proposal to convene the 2020 Annual Shareholders’ Meeting of the Company.
9. The proposal to lease the land and factory from KF Co., Ltd.
10. The statement of the Internal Control System of the Company.
11. The amendment to the “Internal Control System” of the Company.
12. The amendment to the “Internal Audit Implementation Rules” of the Company.
2020.05.06 1. The proposal of the Company's financial statements for the first quarter of 2020.
2. The proposal to review the shareholders who hold more than one percent or more of the total number
of issued shares of the Company.
4. The application for extending the endorsement and guarantee for the Company's associates.
67
~ 67 ~
2020.08.12 1. The proposal of the Company's financial statements for the second quarter of 2020.
2. The proposals to issue new shares by the capitalization of the Company's 2019 earnings and to
determine the record date for cash dividends and other related matters.
3. The amendment to the Corporate Governance Best Practice Principles of the Company.
2020.11.11 1. The preparation of the Company's audit plan for 2021.
2. The proposal of the Company's financial statements for the third quarter of 2020.
3. The distribution of remuneration to the directors of the Company.
4. The distribution of remuneration to the managerial officers and directors of the Company who execute
the business operations.
5. A motion to review the salaries for the managerial officers and directors of the Company who execute
the business operations.
6. The amendment to the " Regulations on the Performance Evaluation of the Board of Directors and
Functional Committees" of the Company.
7. The amendment to the Company's "Rules of Procedure for Board of Directors Meetings".
8. The amendment to the Company’s “Audit Committee Charter”.
9. The amendment to the Company’s “Rules Governing the Scope of Powers of Independent Directors”.
10. The amendment to the Company’s “Remuneration Committee Charter”.
2021.02.03 1. The proposal of the year-end bonus for the Company's managerial officers.
2. The proposal of the year-end bonus for the directors of the Company who execute the business
operations.
3. A motion to review the salaries for the directors and the managerial officers of the Company who
execute the business operations.
2021.03.25 1. The proposal of the employees' and directors' remuneration for the year 2020.
2. The adoption of the 2020 Business Report and Financial Statements.
3. The proposal of the 2020 earning distribution.
4. The proposal to distribute the cash dividends to shareholders from the 2020 earnings of the Company.
5. Amendment to the Company's Articles of Incorporation.
6. Amendment to the Company’s Rules of Procedures for Shareholders Meetings.
7. The re-election of directors (including independent directors) of the Company.
9. The Company accepted the shareholders' motions for the 2021 Annual Shareholders' Meeting and
matters relating to the acceptance of nominations of Directors and Independent Director candidates.
68
~ 68 ~
2021.03.25 10. The proposal to nominate candidates for directors (including independent directors) by the Board of
Directors of the Company and to review the qualifications of the nominees.
11. Release the prohibition on directors from participation in competitive business.
12. The statement of the Internal Control System of the Company.
2021.05.06 1. The proposal of the Company's financial statements for the first quarter of 2021.
2. The proposal to appoint a chief corporate governance officer.
3. The application for extending the endorsement and guarantee for the Company's associates.
(XII) Where, during the most recent fiscal year or during the current fiscal year up to the date
of publication of the annual report, a director or supervisor has expressed a dissenting
opinion with respect to a material resolution passed by the board of directors, and said
dissenting opinion has been recorded or prepared as a written declaration, disclose the
principal content thereof: None.
(XIII) A summary of resignations and dismissals, during the most recent fiscal year or during the
current fiscal year up to the date of publication of the annual report, of the company's
chairman, president, chief accounting officer, chief financial officer, chief internal auditor,
chief corporate governance officer, and chief research and development officer: None.
V. Information on CPA fees:

(I) When non-audit fees paid to the certified public accountant, to the accounting firm of the
certified public accountant, and/or to any affiliated enterprise of such accounting firm are
one quarter or more of the audit fees paid thereto, the amounts of both audit and non-audit
fees as well as details of non-audit services shall be disclosed: Not applicable.
Accounting firm Name of CPA Audit period Remark

Wang, Yi-Wen,
Deloitte & Touche Taiwan 2020
Tseng, Done-Yuin
CPA professional fees range table

Unit: In Thousand New Taiwan Dollars
Professional Fees
Fee Range Audit Fees Non-Audit Fees Total
1 $0 ~ $1,999,999 
2 $2,000,000 to $3,999,999
3 $4,000,000 to $5,999,999 
4 $6,000,000 to $7,999,999 
5 $8,000,000 to $9,999,999
6 More than $10,000,000
Note: Non-audit fees include transfer pricing
69
~ 69 ~
Unit: In Thousand New Taiwan Dolalrs
Non-Audit Fees
CPA’s
Accounting Audit
Name of CPA System Audit Remark
firm Fees (policy)
Business Human Others
Subtotal Period
Registration resource (Note 2)
design
Transfer Pricing Report,
Deloitte
Information on Salaries of
& Wang, Yi-Wen,
5,132 1,781 1,781 2020 Full-time Employees in
Touche Tseng,Done-Yuin
Non-Management
Taiwan
Positions Checklist
Note 1: If the Company has replaced its CPA or accounting firm during the year, please indicate the period of audit and
the reasons for the change in the remarks column, and disclose information on the audit and non-audit fees paid
respectively.
Note 2: Non-audit fees should be listed separately by service item. If the "Other" non-audit fees amount exceed 25% of
the total non-audit fees, the description of the service should be listed in the Remarks column.
(II) When the Company changes its accounting firm and the audit fees paid for the financial
year in which the change took place are lower than those paid for the financial year
immediately preceding the change, the amount of the audit fees before and after the
change and the reason shall be disclosed: Not applicable.
(III) When the audit fees paid for the current financial year are lower than those paid for the
immediately preceding financial year by 15 percent or more, the amount and percentage
of and reason for the reduction in audit fees shall be disclosed: None.
70
~ 70 ~
VI. Information on change in CPA:
(I) Regarding the former CPA:
Date of Change in CPA January 29, 2019
Reason and description for The Company changed its accounting firm and certified public accountants to
the change in CPA meet the operational needs of the Company
Client
Certified Public
Status Consignor
Description of whether the Accountant
CPA or the Company
Appointment terminated Lin, Ming-Shou and Kenda Rubber Ind. Co., Ltd.
terminated or discontinued
automatically Yang, Chen-Yu
the engagement.
Appointment rejected
(discontinued)
The Opinions other than None
Unmodified Opinion Issued
in the Last Two Years and
the Reasons for the Said
Opinions
Accounting principles or practices
Disclosure of Financial Statements
Yes
Audit scope or steps
Differences with the
Others
Company
None 
Explanation
Supplementary Disclosures None
(Disclosures Specified in
Article 10.6.1.4~7 of the
Standards)
(II) Regarding the successor CPA:

Accounting firm Deloitte & Touche Taiwan
Wang, Yi-Wen
Name of CPA
Tseng,Done-Yuin
Date of engagement January 29, 2019
Prior to the Formal Engagement, Any Inquiry or
Consultation on the Accounting Treatment or
Accounting Principles for Specific None
Transactions, and the Type of Audit Opinion
that Might be Rendered on the Financial Report
Written Opinions from the Successor CPAs that
None
are Different from the Former CPA’s Opinions
(III) The Reply of Former CPAs on Article 10.6.1 and Article 10.6.2.3 of the Standards: None.
VII. Chairman, President, finance or accounting managers who have worked

in the accounting firm who audit the Company’s reports or its affiliates
during the most recent year:None
71
~ 71 ~
VIII. Share transfers and change in pledges on shares by directors,
supervisors, managers and shareholders with at least 10% stakes during
the most recent year and as of the print date of this annual report:
(I) Information on changes in the shareholdings of directors, supervisors, managerial officers and
major shareholders (holding more than 10% of the shares):
Unit: shares
As of April 20 of the
2020
current year
Position Increase Increase
Name Increase (decrease) Increase (decrease)
(Note 1) (decrease) in (decrease) in t
in the number of in the number of
the number of he number of
shares held shares pledged
shares held shares pledged
Chairman
Yang, Chi-Jen 3,434,229 0 0 (1,800,000)
(Major Shareholders)
Vice Chairman Chang, Hong-Der 2,196,575 0 0 0
Director Yang, Ying-Ming 1,437,540 0 0 0
Director Hsiao, Ru-Po (240,797) 0 (7,000,000) 0

Director Chen, Chao-Jung (6,671,947) 0 0 0
Director Yang, Chia-Ling 1,443,048 0 (9,000) 2,000,000
Director Lin, Tsung-Yi 400,546 0 0 0
Director Kenjou. Co., Ltd. 2,538
Independent
Hsieh,Chun-Mou 0 0 0 0
Director
Independent
Su, Ching-Yang 0 0 0 0
Director
Independent
Lin,Sheng-Chung 0 0 0 0
Director
Vice President Shen, Jui-Hsiung 0 0 0 0
Assistant
Huang, Shi-Cheng 515 0 0 0
Vice President
Assistant
Lin, Chun-Ke 268 0 0 0
Vice President
Assistant
Chen, Chin-Fu 0 0 0 0
Vice President
Assistant
Chang, Hui-Chu 3,320 0 (3,320) 0
Vice President
Assistant Wu, Wu-Long
0 0 0 0
Vice President (Note 2)
Assistant
Liu, Kuei-Chun 0 0 0 0
Vice President
Assistant Hsiao,Wei-Lien 0 0 0 0
Vice President (Note 2)
Note 1: The shareholders holding more than 10% of the total shares of the Company should be indicated as major shareholders and
listed separately.
Note 2: Assistant Vice President Wu, Wu-Long was resigned on May 13, 2019; Mr. Hsiao Wei-Lien took the position on May 14, 2019.
72
~ 72 ~
(II) Information on the share transfer:
Relationship between the
Reason for trading counterpart and the
Name transferring Transaction Trading company, the directors, Transaction
Shares
(Note 1) the share Date Counterpart managers and shareholders price
(Note 2) holding more than 10 per cent
of the shares
Chang, Chang Yang ,
acquired 2020.02.04 mother and son 190,374 47.50
Hong-Der Hui-Mei
Chang, Chang Yang ,
acquired 2020.02.18 mother and son 1,709,036 47.50
Hong-Der Hui-Mei
Chang, Chang Yang ,
acquired 2020.11.16 mother and son 99 0.00
Hong-Der Hui-Mei
Chang, Chang Yang ,
acquired 2020.11.16 mother and son 2,488 47.50
Hong-Der Hui-Mei
Chen, Chiang,
disposed 2020.05.27 Husband and wife 50,000 24.60
Chao-Jung Tsai-Feng
Stretch
Chen, Number of shares held under
disposed 2020.08.19 Investment 6,900,000 27.90
Chao-Jung other persons’ names
Co., Ltd.
Yang, Huang,
acquired 2020.08.13 mother and daughter 340,000 24.40
Chia-Ling Yu-Hwa
Yang, Yang,
disposed 2020.05.13 father and son 90,000 24.40
Chi-Jen Sheng-Jie
Yang, Ying Yang,
disposed 2020.06.03 father and daughter 1,084,000 24.40
Ming Su-Ting
Hsiao, Yang,
disposed 2020.08.06 mother and daughter-in-law 1,114,000 24.40
Ru-Po Jin-Yi
Hsiao, Yang,
disposed 2021.03.25 Husband and wife 7,000,000 34.20
Ru-Po Shin-Nan
Note 1: These names include the names of directors, supervisors, managers and shareholders holding more than 10% of the shares
of the Company.
Note 2: This represents either acquisition or disposal.
(III) Information on the share pledge:

The counterparty of the share pledge of the Company is a related party: None.
73
~ 73 ~
IX. Information on the top 10 shareholders who are related to each other
under SFAS No. 6 or are related to each other as spouses, second degree
of kinship:
Relationship information among the top ten shareholders
Unit: Shares; %
The names and
Total number of relationships
Number of shares held of the top ten shareholders
Number of shares shares held under
by spouse and children who are related parties or Remarks
held in person other persons’ are related to each other
of minor age
Name names as a spouse or second
degree of kinship.
Percentage Percentage Percentage
Shares of Shares of Shares of Name Relation
Yang, Yang, Ying-Ming 2nd degree
91,622,924 10.07% 9,801,904 1.08% 0 0
Chi-Jen Yang, Hsiu-Ya of kinship
Yang,
Yang, Chi-Jen 2nd degree
Ying-Ming 65,555,015 7.21% 17,320,649 1.90% 0 0
Yang, Su-Ting of kinship
Fubon Life
Insurance 53,079,761 5.84% 0 0 0 0 None None
Co., Ltd.
Representative:
Tsai, 0 0 0 0 0 0 None None
Ming-Hsing
Yang, Yang, Shu-Yuan 2nd degree
39,783,360 4.37% 0 0 0 0
Jin-Yi Yang,Ying-Yuan of kinship
Yang, 2nd degree
28,668,065 3.15% 0 0 0 0 Yang, Chia-Yu
Chia-Ling of kinship
Yang, 2nd degree
26,416,551 2.90% 0 0 0 0 Yang, Chi-Jen
Hsiu-Ya of kinship
Yang, Yang,Jin-Yi 2nd degree
25,119,924 2.76% 0 0 0 0
Shu-Yuan Yang, Ying-Yuan of kinship
Yang, Yang,Jin-Yi 2nd degree
25,119,924 2.76% 0 0 0 0
Ying-Yuan Yang, Shu-Yuan of kinship
Yang, 2nd degree
21,679,793 2.38% 0 0 0 0 Yang, Ying-Ming
Su-Ting of kinship
Yang, 2nd degree
20,164,793 2.22% 2,398,969 0.26% 0 0 Yang, Chia-Ling
Chia-Yu of kinship
Note 1: The top ten shareholders should all be listed, and the names of corporate shareholders and the names of their
representatives should be listed separately.
Note 2: The calculation of the percentage of ownership refers to the calculation of the percentage of shareholding in the
name of oneself, one's spouse, one's minor children or the name of another person respectively.
Note 3: The shareholders listed in the preceding paragraph shall include both juristic and natural persons and the
relationship between them shall be disclosed as well.
74
~ 74 ~
X. Ownership of Shares in Affiliated Companies:
Unit: Thousand Shares; %
Investment made by directors,
Invested by the supervisors, managers and companies Consolidated
Company directly or indirectly controlled by Investments
Investment Business
them
Shares Shares
Shares Shares Shares Ratio Shares
Ratio Ratio
KA subsidiary - 100.00 - - - 100.00
KHK Subsidiary - 100.00 - - - 100.00
KV Subsidiary - 100.00 - - - 100.00
KE Subsidiary - 100.00 - - - 100.00
Kenda International
- 100.00 - - - 100.00
Corporation, Subsidiary
KF, Subsidiary - 100.00 - - - 100.00
KI Subsidiary - 99.99 - 0.01 - 100.00
Note: Long-term investments accounted for using the equity method.
75
~ 75 ~
Four. Capitalization
I. Capitalization and shares
(I) Source of share capital
Authorized capital Paid-in capital Remarks
Year/ Issuance Contribution to
month price Shares Amount Shares Amount Source of share capital share capital with Others
non-cash assets
1962.03 100 9,600 960,000 9,600 960,000 Founding share capital None None
Issuance of common stock
1966.03 100 30,000 3,000,000 30,000 3,000,000 None None
for cash 2,040,000
1967.03 100 48,000 4,800,000 48,000 4,800,000 None None
for cash 1,800,000
1968.01 100 60,000 6,000,000 60,000 6,000,000 None None
for cash 1,200,000
1970.04 100 80,000 8,000,000 80,000 8,000,000 None None
for cash 2,000,000
1973.09 100 160,000 16,000,000 160,000 16,000,000 None None
for cash 8,000,000
1974.12 100 240,000 24,000,000 240,000 24,000,000 None None
for cash 8,000,000
for cash 1,776,000
1975.12 100 360,000 36,000,000 360,000 36,000,000 Issuance of shares for None None
capitalization of capital
surplus 10,224,000
for cash 7,320,000
capitalization of earnings
4,680,000
for cash 8,400,000
3,600,000
for cash 11,000,000
15,000,000
for cash 10,000,000
1980.06 10 12,610,000 126,100,000 12,610,000 126,100,000 Issuance of shares for None None
30,100,000
Issuance of shares for
1981.07 10 19,545,500 195,455,000 19,545,500 195,455,000 capitalization of earnings None None
69,355,000
Issuance of shares for Public issuance status in 1985
1985.05 10 32,640,985 326,409,850 32,640,985 326,409,850 capitalization of earnings None Official Letter Taiwan-Finance-Securities (I)
130,954,850 No. 00682 on May 27, 1985
Official Letter Taiwan-Finance-Securities (I)
1986.08 10 43,086,100 430,861,000 43,086,100 430,861,000 capitalization of earnings None
No.00812 on August 6, 1986
104,451,150
No. 09055 on September 16, 1988
69,139,000
No. 02601 on December 29, 1989
100,000,000
for cash 100,400,000
1990.11 10 80,000,000 800,000,000 80,000,000 800,000,000 Issuance of shares for None
No. 35820 on October 17, 1990
99,600,000
96,000,000 Official Letter Taiwan-Finance-Securities (I)
1991.08 10 96,000,000 960,000,000 96,000,000 960,000,000 None
Issuance of shares for No. 01562 on July 17, 1991
surplus 64,000,000
76
~ 76 ~
non-cash assets
1992.08 10 120,000,000 1,200,000,000 113,280,000 1,132,800,000 None
surplus 96,000,000
1993.08 10 160,000,000 1,600,000,000 130,000,000 1,300,000,000 None
surplus 74,662,000
1995.07 10 162,500,000 1,625,000,000 162,500,000 1,625,000,000 None
Issuance of shares for No. 37684 on June 27, 1995
surplus 44,200,000
1996.07 10 173,875,000 1,738,750,000 173,875,000 1,738,750,000 None
surplus 32,500,000
1997.07 10 198,217,500 1,982,175,000 198,217,500 1,982,175,000 None
surplus 34,775,000
1998.07 10 300,000,000 3,000,000,000 229,932,300 2,299,323,000 None
surplus 37,661,325
1999.07 10 300,000,000 3,000,000,000 271,320,114 2,713,201,140 None
surplus 22,993,230
2000.07 10 320,000,000 3,200,000,000 306,591,728 3,065,917,280 None
surplus 13,566,000
2001.07 10 320,388,400 3,203,884,000 320,388,400 3,203,884,000 None
surplus 15,330,030
Official Letter Taiwan-Finance-Securities
2002.07 10 336,408,000 3,364,080,000 336,408,000 3,364,080,000 capitalization of earnings None
No. 0910134107 on June 24, 2002
160,196,000
Official Letter Taiwan-Finance-Securities
(1) No. 0920129322 on July 2, 2003
235,920,000
Official Letter Securities-Futures (1) No.
0930129968 on July 7, 2004
360,000,000
Official Letter FSC(1) No. 0940126863 on
July 5, 2005
396,000,000
Official Letter FSC(1) No. 0950126935 on
June 28, 2006
239,580,000
Official Letter FSC (1) No. 0960033561 on
July 3, 2007
299,420,000
June 26, 2008
367,500,000
July 2, 2009
263,500,000
77
~ 77 ~
non-cash assets
July 1, 2010
680,000,000
July 1, 2011
683,000,000
July 2, 2012
447,800,000
July 23, 2013
293,500,000
July 29, 2014
534,420,000
July 27, 2015
408,300,000
Issuance of shares for Official Letter
2016.09 10 880,000,000 8,800,000,000 874,430,000 8,744,300,000 capitalization of earnings None MOEA-Authorization-Business No.
171,500,000 10501227020 on September 22, 2016
Issuance of shares for Official Letter
2020.09 10 910,000,000 9,100,000,000 909,410,000 9,094,100,000 capitalization of earnings None MOEA-Authorization-Business No.
349,800,000 10901177170 on September 22, 2020
April 20, 2021

Authorized capital
Type of No. of
No. of shares Remarks
shares shares Total
outstanding (note)
unissued
Common 910,000,000 Note: The shares are listed without
909,410,000 shares 590,000
share shares restrictions on trading.
(II) Shareholder structure

April 20, 2021
Shareholder Foreign
Government Financial Other legal
structure institutions Individual Total
agencies institutions persons
Number and foreigners
Number of 4 13 103 197 28,999 29,316
shareholders
Number of
292 81,081,440 68,798,117 76,128,532 683,401,619 909,410,000
shares held
Shareholding % 0.00 8.92 7.57 8.37 75.14 100
78
~ 78 ~
(III) Dispersion of ownership
April 20, 2021
Shareholder bracket Number of shareholders Number of shares held Shares Ratio
1 ~ 999 13,643 3,058,873 0.34%
1,000 ~ 5,000 10,654 22,275,106 2.45%
5,001 ~ 10,000 2,273 15,785,625 1.74%
10,001 ~ 15,000 939 11,157,446 1.23%
15,001 ~ 20,000 430 7,603,345 0.84%
20,001 ~ 30,000 447 10,664,447 1.17%
30,001 ~ 40,000 218 7,502,421 0.82%
40,001 ~ 50,000 139 6,290,296 0.69%
50,001 ~ 100,000 238 16,665,385 1.83%
100,001~ 200,000 138 18,596,651 2.04%
200,001 ~ 400,000 73 20,156,273 2.22%
400,001 ~ 600,000 24 12,105,118 1.33%
600,001~ 800,000 12 8,387,164 0.92%
800,001~ 1,000,000 13 11,916,847 1.31%
1,000,001 or above 75 737,245,003 81.07%
Total 29,316 909,410,000 100.00%
(IV) Major shareholders: with 5% or more stakes or top ten shareholders
Shareholdings Number of
Shareholding %
Name of major shareholder shares held
Yang, Chi-Jen 91,622,924 10.07%
Yang, Ying-Ming 65,555,015 7.21%
Fubon Life Insurance Co., Ltd. 53,079,761 5.84%
representative: Tsai Ming-Hsing
Yang, Jin-Yi 39,783,360 4.37%
Yang, Chia-Ling 28,668,065 3.15%
Yang, Hsiu-Ya 26,416,551 2.90%
79
~ 79 ~
Shareholdings Number of
Shareholding %
Name of major shareholder shares held
Yang, Shu-Yuan 25,119,924 2.76%
Yang, Ying-Yuan 25,119,924 2.76%
Yang, Su-Ting 21,679,793 2.38%
Yang, Chia-Yu 20,164,793 2.22%
(V) Market price, net value, earnings and dividends per share and relevant data
during the most recent two years
Market Price, Book value, Earnings and Dividends per share
Year As of March
2019 2020
Item 31, 2021
Market price Highest 33.40 38.15 44.45
per share Lowest 27.75 24.10 31.10
Average 30.15 29.99 35.37
Net value Before distribution 21.48 21.01 -
per share After distribution 19.88 20.01 -
Earnings 874,430,000 909,410,000 909,410,000
Weighted average number of shares
per share shares shares shares
(EPS) Earnings per Before adjustment 1.16 1.07 -
share (EPS) After adjustment 1.11 1.07 -
Dividends Cash dividends 0.4 1.0 -
per share Stock dividends via
0.4 0.0 -
Bonus shares
Stock dividends via
- - -
capitalization of capital surplus
Cumulative unpaid dividends - - -
Return on Price earnings ratios 25.99 28.03 -
investment Price earnings ratio 75.38 29.99 -
Cash dividend yield (%) 1.33 3.33 -
Note 1: The earnings distribution has yet to be ratified by the general shareholders’ meeting.
Note 2: Price earnings ratio based on pre-adjusted earnings
(VI) Dividend policy and implementation status
1. Dividend policy
If there is any retained earnings at the year-end, the Company shall first pay tax and make up
for the accumulated deficits, and then set aside 10% of such earnings as a legal reserve,
unless the legal reserve has reached the Company's total capital. If necessary, the special
reserve shall be set aside or reversed as required by law or by the competent authority.
80
~ 80 ~
The Company takes into consideration its business environment and growth stage in its
capital requirements and long-term financial planning as well as cash inflows required by
shareholders.
The Board of Directors will propose, together with the accumulated undistributed earnings
from the previous year, to set aside 10% to 80% of the available earnings for distribution.
When new shares are issued for dividends, a resolution by the shareholders’ meeting shall be
required. However, the ratio of new shares to be issued for the earnings distribution may be
adjusted by a resolution of the shareholders' meeting, depending on the actual profitability
and capital position of the year; of which the cash dividends shall not be less than 10% of
the total dividends. The Company authorizes the Board of Directors, with the presence of at
least two-thirds of the Directors and a resolution by a majority of the Directors present, to
distribute all or part of the dividends from earnings, legal reserve and capital surplus in the
form of cash and report the same to the shareholders' meeting.
2. Percentage of profits to be distributed as remuneration to employees and directors

The Company shall distribute remuneration to its employees at a rate of 0.5% to 1% of the
profit for the year.
The Company shall distribute the Directors' remuneration not exceeding 3% of the profit for
the year.
Where the Company has accumulated losses as provided in the preceding two paragraphs, an
amount to cover the losses shall first be set aside.
Employees' remuneration may be paid in shares or in cash to employees of the Company and
to employees of controlled or associated companies who meet certain requirements as
determined by the Board of Directors.
The earnings for the year referred to in paragraphs 1 and 2 are the earnings before taxation
for the year excluding the remuneration to employees and directors.
The distribution of remuneration to employees and directors shall be resolved by a majority
vote at a meeting of board of directors attended by two-thirds of the total number of
directors, and in addition thereto a report of such distribution shall be submitted to the
shareholders’ meeting.
81
~ 81 ~
3. Proposal to the 2020 general shareholders’ meeting the distribution of dividends:

Earnings Distribution Table for the Year 2020 Unit: NT$
Unappropriated retained earnings at the beginning of the period $ 6,125,575,016

Net profit after tax for the period 972,224,651
The remeasurement of defined benefit plans recognized in
retained earnings (24,546,008)
Net profit after tax and items excluded from net profit after tax
for the period to be added into unappropriated earnings of the
year 947,678,643
Less: Legal reserve (10%) ( 94,767,864)
Less: Special reserve (Note) (270,947,315)
Distributable net profit for the period 6,707,538,480
Distributable items:
Cash Dividend for shareholders’ bonus (at 1.0 per share) 909,410,000
Stock Dividend for shareholders’ bonus 0
Unappropriated retained earnings $ 5,798,128,480
Note: Special reserve is recognized in accordance with Jin-Guan-Zheng-Fa-Zi No. 1010012865.
(VII) Impact of the issuance of bonus shares proposed to this shareholders’ meeting
on the Company’s operating performance and earnings per share:
There is no issuance of bonus shares proposed to this shareholders’ meeting.
(VIII) Remuneration to employees and directors

1. Percentage or scope of remunerations to employees and directors stated in the Articles
of Incorporation: Please refer to (VI) for the dividend policy.
2. Basis of estimates for remunerations to employees and director for the period,
calculation for the number of shares to be distributed as employees’ remunerations, and
accounting treatment of any discrepancy between the actual distributed amount and the
estimated amount: To be recognized as adjustment to profit or losses for the following
year.
3. Remuneration distribution approved by the Board of Directors
82
~ 82 ~
(1) Amount of remunerations to employees and directors issued in cash or shares
Difference in amounts, reasons and treatment of any discrepancy between estimated
amount and recognized expenses for the year:
The special resolution by the Board of Directors in 2020 decided to issue the
following:
The percentage of profits to be distributed to employees is 0.93% or
NT$11,188,489 in total; the percentage of profits to be distributed to directors is
1.40% or NT$16,792,546 in total. All distributions are in cash.
There is no difference between the recognized amount and the amount intended to
be distributed.
(2) The amount of employees’ remunerations issued with stocks and such amount as a
percentage of net incomes in the parent company’s or the individual financial report
during the period and as a percentage of the total amount of employees’
remunerations:
There is no issuance of stock dividends to employees.
4. Actual distribution of remunerations to employees, directors and supervisors during the
previous year (including the number of shares issued, the amount, and share prices)
Difference in amounts, reasons and treatment of any discrepancy from the recognized
expenses for remunerations to employees, directors and supervisors
Recognized Proposed Reason for the

Item Difference Treatment
amount amount difference
Remuneration to
11,040,000 11,040,000 0
employees
Remuneration to Not applicable. Not applicable.
directors and 16,570,000 16,570,000 0
supervisors
(IX) Share repurchases: none
II. Corporate bonds: none
III. Preferred shares: none
83
~ 83 ~
IV. Overseas depositary receipts: none
V. Employee Stock Options Plan (ESOP): none
VI. New restricted shares to employees: none
VII. Mergers & acquisitions: none
VIII. Implementation of capital utilization plan: None.
84
~ 84 ~
Five. Operations
I. Content of Businesses
(I) Scope of businesses
1. Content of businesses
(1) C804010 Tyres Manufacturing
(2) CD01050 Bicycles and Parts Manufacturing
(3) C805070 Reinforced Plastic Products Manufacturing
(4) CB01010 Mechanical Equipment Manufacturing
(5) F401010 International Trade
(6) F114030 Wholesale of Motor Vehicle Parts and Motorcycle Parts, Accessories
(7) F114040 Wholesale of Bicycle and Component Parts Thereof
(8) F114050 Wholesale of Tires
(9) F214030 Retail Sale of Motor Vehicle Parts and Motorcycle Parts, Accessories
(10) F214040 Retail Sale of Bicycle and Component Parts Thereof
(11) F214050 Retail Sale of Tires
(12) ZZ99999 All business items that are not prohibited or restricted by law, except those that
are subject to special approval.
2. Revenue proportion
Revenue
Content of businesses
proportion
(1) Manufacturing, processing, wholesale and retail of a variety of
rubber and plastic products 85.79 %
(2) Manufacturing, wholesale and retail of a variety of bicycles,
motorcycles and components 0%
(3) Manufacturing, wholesale and retail of a variety of carbon fibers
and composite materials 0%
(4) Manufacturing, wholesale and retail of a variety of carbon fiber
products 0%
(5) Manufacturing, wholesale and retail of a variety of 0%
(6) Imports, exports and trading of the abovementioned products 14.21 %
3. The Company’s current product portfolios:

Inner tubes and cover tires of bicycles, motorbikes, industrial vehicles and light trucks; and
radial tires
4. New products under development: airless tires; all steel STR trailer tires; ultra
high-performance tires for sports utility vehicles
85
~ 85 ~
(II) Industry
1. Current status and development
(1) The bicycle industry in Taiwan posted a 20.05% decline in shipments in 2020, down to
1.699 million units from 2.125 million in 2019. The export value dropped 18.14% in 2020,
down to US$1.091 billion from US$1.341 billion in 2019. The average selling price
increased 2.41% from US$631.03 in 2019 to US$646.24 in 2020. Taiwan’s export of
electrically assisted bicycles increased 17.99% in 2020 to 760,000 million units from
644,000 units in 2019. The export value went up by 14.38% in 2020 to US$987 million from
US$863 million in 2019.
The average selling price dropped by 3.06% in 2020 to US$1.298.45 from US$1,339.43 in
2019.
(2) Taiwan produced a total of 1.297 million motorcycles (including all-terrain vehicle and
motorbikes) in 2020, up by 10.48% from 1.1174 million units in 2019. Exports totaled 1.036
million units in 2020, up by 14.86% from 0.902 million units in 2019. Due to competition
from China, ts the ATVs and motorbikes from Taiwan are increasingly for overseas and
high-end markets. As a result, tires are increasingly moving toward high unit prices.
(3) Taiwan produced 245,600 cars in 2020, down 2.26% from 251,300 cars in 2019. Domestic
sales reached 241,700 cars in 2020, up 5.17% from 229,800 cars in 2019. The number of
new cars sold in 2020 exceeded 400,000 again and reached 457,435 units, up by 4% from
439,836 in 2019.
2. Upstream, midstream, and downstream of the industry

In China, a total of 25.311 million cars (including commercial vehicles and passenger
vehicles) were sold in 2020, down 1.9% year-over-year.
3. Product development trends and competition

(1) The car market in China began stable growth in 2021 and is expected to reach 30 million
units in 2025. Despite COVID-19,over 25 million cars were sold in China in 2020, only
2% deviated from the original target.
(2) In 2020, the demand to combat COVID-19 and for infrastructure and logistics and the
multiplication effect by policies & regulations and economic stimulus measures, medium
and heavy trucks (particularly tow trucks) are growing at a high speed and with a heavier
duty. The demand for commercial vehicles in 2021 will be about 4.4 million units.
(3) The market share of sport utility vehicles (SUVs) will continue to rise. The year 2020 saw
for the first time the share of SUVs exceeded that of passenger vehicles. The SUVs to
passenger cars ratio may reach 55:45 in 2025.
(4) The 2020 was the fast-growing year for the sales of new energy vehicles. All the OEMs
around the world are working hard on the roadmap, R&D and distribution of new energy
vehicles. In 2020, 1.36 million new energy vehicles were sold in China and more than 3
86
~ 86 ~
million in the world. The global market is expected to exceed 4 million units in 2021, with
over 1.7 million sold in China, and 15 million in 2025, with about 5 million sold in China.
(III) Technology and R&D status

1. From 2020 to March 31, 2021, the Company spent a total of NT$1,707,339,000 in R&D
expenses.
2. Technologies or products successfully developed from 2020 to March 31, 2021

(1) Development of low heat build-up and high-reinforcing side reinforced rubber,
introduction of new butadiene rubber with a modified recipe for run-flat tires
(2) Development of inner rubes with significantly higher gas barrier properties by using a new
liquid material and a breakthrough manufacturing process
(3) Development of tread rubber with low VOC (volatile organic compounds) residuals to
meet with the environmental protection requirements
(4) Development of color tread rubber for bicycle tires with high color fastness by introducing
weathering resistant rubber and using the recipe technology to maintain original
functionality
(5) Development of low heat build-up rubber for tread rubber of passenger cars, in order to
extend the service life of tires and reduce the likelihood of inner liner peel-off
(6) Development of tread rubber for high LTR (land transport rules) commercial vehicles with
high rigidity to enhance abrasion resistance of tires
(7) Establishment of a yaw angle testing method for bicycle tires
(8) Establishment of a pull-off test method for adhesion of non-pneumatic (NPT) tires
(9) Establishment of a tire tread testing method
(10) Establishment of a testing method for air going though tire cord yards
(11) Development of light and low rolling resistant MTB XC products
(12) Development of cyclocross gravel tires
(13) Development of electric bike cargo tires
(14) Development of high grip performance MTB DH car tires for downward slops
(15) Development of highly safe and low noise tires for mobility scooters
(16) Development of tires with low rolling resistance and high grip performance for all terrain
vehicles
(17) Development of KM1 radial tires for heavy vehicles
(18) Development of wire tires for scooters
(19) Development of comfortable, energy efficient and advanced tires for passenger cars
(20) Development of SUV snow tires in adherence to EU regulatory requirements
(21) Development of all season passenger car tires in adherence to EU regulatory requirements
87
~ 87 ~
3. R&D plan for the following year
(1) Development of Grade A environmental friendly tires with low rolling resistance and high
wet grip performance and in adherence to the new EU standards
(2) Development of new, recyclable and environmental friendly materials and recipes
(3) Development of new and environmental friendly tire technologies
(4) Continued development of VTDS (virtual tire development system)
(5) Development of all steel STR trailer tires
(6) Development of puncture-resistant tires for motorcycles
(7) Development of light and energy efficient tires
(8) Development of light radial tires for all terrain cross-country vehicles
(9) Development of half-wire radial tires for industrial vehicles
(10) Development of new of non-pneumatic (NPT) tires
(11) Development of a composite structure for tread rubber of bicycle tires
(12) Development of hook-less TLR (tubeless ready) bicycle tires
(13) Development of tires specially designed for electric vehicles
(14) Development of analytics technology for smart tires
(15) Development of special technology for wire cushioning materials
(IV) Short-term and long-term business development plan

1. Short-term plan
(1) Market development for high valued added B/C tires, such as tires for E-bikes, E-Cargo
bikes and TLR tires
(2) Continued business development for M/C tires in the global OEMs and aftermarkets;
business development of tires for large capacity vehicles and MCR (motorcycle radial)
tires
(3) Development of the SUV tire business
(4) Development of the UHP (ultra high performance) tire business
(5) Increase of sales of radial tires in the global market
(6) Development of the snow tire business
(7) Development of the AT (all terrain) tire business
(8) Development of the MT (mud terrain) tire business
(9) Development of the RT (rugged terrain) tire business
(10) Development of the road tire business
(11) Development of contracted manufacturing business for PCR (passenger car radial) and
LTR (land transport rules) tires
(12) Development of the all season tire business
88
~ 88 ~
(13) Development of the radial tire business in the golf cart market
(14) Promotion of of non-pneumatic (NPT) tires tires for golf carts
2. Long-term plan
(1) Development of the MCR (motorcycle radial) tire business
(2) Development of the slick tire business (Performance tires for motorcycles and PCR drift
tires)
(3) Development of the TBR (truck and bus radial) tire business
(4) Increase in the snow tire product range
(5) Higher percentage of sales of radial tires in all market segments
(6) Development of the tire business for large agricultural and industrial vehicles
(7) Development of the business for high-performance/speed motorcycle tires and
cross-road motorcycle tires
(8) Continued development of high-performance and high value added B/C tire business in
the mid-priced premier segment
(9) Development of the ATV (all-terrain vehicle) radial tire business
(10) Development of the dual-compound tire business
II. Market, Production and Sales Overview

(I) Market analysis
1. Overseas markets
(1) Markets for the Company’s main products
North America, Europe, Central and South America, Middle East and Africa, Asia, New
Zealand and Australia
(2) Market shares
According to the 2020 Global Tire Company Rankings, we were the top 26th player based
on 2019 sales.
(3) Supply, demand and market growth in the future
We will continue to enhance the brand image KENDA, develop high value added products
for the market and strive to increase customers’ satisfaction and recognition. The
performance of multiple PCR products launched in 2020 received great ratings in the market
and are expected to generate strong sales. Our factory in Indonesia ramped up in the second
quarter of 2017, expanded capacity in 2018 and 2019 and again in 2020. To meet the
demand for car tires and spare tires, we have installed new equipment for additional
capacities in Kunshan and Tianjin in China and Yunlin in Taiwan. The new facility in
Vietnam for passenger car tires ramped up in 2018.
(4) The U.S. government conducted an anti-dumping investigation on passenger car tires and
light truck tires from Taiwan, South Korea and Thailand and an anti-dumping and
89
~ 89 ~
countervailing-duty investigation on Vietnam. The preliminary expectation for our factory in
Vietnam is 0% anti-dumping duty and 6.77% countervailing duty. This is lower than the
duties on manufacturers in other regions and protective of our competitiveness of products
exported to the U.S.
(5) Competitive niches
(5.1)We proactively participate in and sponsor tradeshows in relation to our products and
famous racing teams, racers and competitions around the world such as the follows:
Columbus Blue Jacket for NHL (National Hockey League); Cleveland Indians for
MLB (Major League Baseball); Phoenix Suns, New Orleans Pelicans, San Antonio
Spurs, Boston Celtics and Miami Heat for NBA (National Basketball
Association);Ohio State University for NCAA (National Collegiate Athletic
Association) basketball; Ohio State University for NCCA soccer; female golfers
Candie Kung and Hsinning Yeh; UHC Rally Road, Norco Factory Bicycle Team,
PolygonDH Team;Chinese Taipei Cycling Team; Kenda Global Cycling Team in the
US; Norco Factory Team in the US; Incycle Enduro Team; Team KHS; riders such
as Mike Steidley, Kyle Strait, Eric Porter, Andrew Taylor, Nic Beechan, Austin
Warren, Rachel Strait, Laura Slavin, and Rebecca Gross;Speed EVO＆JNRT Team
in Taiwan; ELITE Fly Team in Taiwan; 2019 SongShan Cup International
Tournament (basketball); Unilions for Chinese Professional Baseball League in
Taiwan; Formula Drift Japan; and TSR & KCC Challenge for motorcyclers in
Taiwan. The KENDA brand is well-exposed around the world.
Tradeshows
Bicycle tradeshows around the world, such as EUROBIKE and TAIPEI CYCLE;
auto tradeshows such as SEMA Show in the U.S., MIMS Automechanika Moscow,
TIRE COLOGNE and Bologna Motor Show; motorcycle tradeshows such as
AIMExpo in the U.S., EICMA and INTERMOT in Europe. KENDA booths and
services are present at all these tradeshows.
(5.2) Wheel fitment in Europe and the U.S. is an additional distribution channel and
source of profits.
(5.3) The gradual reduction of tariffs and the increase of motorcycle sales in the Southeast
Asian market have greatly benefited the Company’s business expansion in Southeast
Asia for factories in Vietnam and Indonesia.
(5.4) In addition to stepping up sports marketing around the world, we are also
significantly increasing advertising spending on billboards, in-store promotion,
product presentations, digital marketing and social media so that the KENDA brand
continues to increase exposure.
(5.5) The Company continues with the advertisements on trolleys at Shenzhen Bao'an
International Airport and signboards along Shanghai-Nanjing Highway in China.
(5.6) Expansion of online marketing to quickly boost the brand exposure and shorten the
distance with customers
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(6) Positive and negative factors for development, and responding strategies
(6.1) Positive factors
(a) Policy support from the Chinese government such as the lifting of purchase restrictions
and “Cars Going to the Countryside” campaign are stimulating the new car market and
boosting the penetration of cars. Despite the pandemic in 2020, the demand for
automobiles still increased.
(b) New cars come with large-sized tires. Some mid-range models have changed from
R14/15 to R16/17/18. This benefits the sale of large-diameter tires. Meanwhile,
there is a demographic shift among car buyers. The number of car owners is on the rise.
This supports the demand for SUVs and luxury cars. With the launch of a few
high-performance SUV tires over recent years, the Company is seeing rapid growth in
this segment.
(c) The electric vehicle market in China is growing fast. Foreign brands have entered the
competition and the new energy vehicle market is increasingly mature. The Company’s
R&D and sales department have launched market surveys and developed requirements.
A development special project has been established. A quick launch of electric vehicle
tires can boost the sales for both OEMs and aftermarkets.
(d) In Taiwan, the subsidy program for old vehicle replacement is extended for another
five years. However, a subsidy reduction for electric motorcycles has direct influence
on the sales volumes. The previously replaced motorcycles will soon need to replace
tires and this will boost the demand in the aftermarket.
(e) The U.S. government conducted an anti-dumping investigation on passenger car tires
and light truck tires from Taiwan, South Korea and Thailand and an anti-dumping and
countervailing-duty investigation on Vietnam. The preliminary expectation for our
factory in Vietnam is 0% anti-dumping duty and 6.77% countervailing duty. This is
lower than the duties on manufacturers in other regions and protective of our
competitiveness of products exported to the U.S.
(f) After years of efforts, Kenda North American Technical Center (KATC), the
Company’s R&D center in the U.S., has developed multiple competitive PCR
(passenger car radial) tires and LTR (land transport rules ) tires and gradually gained
traction among U.S. consumers and market shares in North America. Through
KATC’s continued R&D, marketing and advertising efforts, better sales and services,
Kenda expects to soon achieve its 5% market share target in North America for PCR
(passenger car radial) tires and LTR (land transport rules) tires.
(6.2) Negative factors and responding strategies
Chinese tire manufacturers are rapidly expanding capacities for passenger car tires
but the US has taken Section 301 actions against China. This will lead to intensified
competition in the low-and-mid-end segments. Therefore, Kenda will develop high
value added products and differentiations, particularly in the SUV, 4x4, UHP (ultra
high performance) tire markets.
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Due to COVID-19, bicycle exports declined sharply in the first half of the year but
demand surged during the second half of the year with bikes becoming the main
commuting and sporting vehicle. However, component makers were not able to
prepare for the supplies in time due to capacity constraints. Assembly plants thus
hoarded materials in order to ensure smooth shipments. Meanwhile, containers
arrived in Europe and the U.S. but unloading could not be processed on time. This
resulted in a container shortage and soaring transportation costs. The assembled
bicycles could not be exported due to a lack of containers. The sales of bicycles in
2020 dropped 20.05% from 2019. The average selling price increased from
US$631.03 in 2019 to USD646.24 in 2020. The market for electrically assisted
bicycles increased by 17.99% in 2020 from 2019. The average selling price declined
from US$1,339.43 in 2019 to US$1,298.45 in 2020.
2. Domestic market
(1) Establishment of distribution channels
With different distributors for motorcycle tires, bicycle tires and passenger car tires, the
Company has established a strong distribution network all over Taiwan. Our sales continue
growing because we are close to customers and our quality is well recognized.
(2) New product R&D, innovation and launch of high-performance products
The Company has developed innovative and high-performance bicycle tires, motorcycle
tires, ATV (all-terrain vehicle) and passenger car tires. The introduction of slick tires for
racing cars and low rolling resistant tires for electric vehicles continues to enhance
KENDA as a professional brand. We meet customers’ needs in both OEMs and
aftermarkets.
(3) Establishment of own brand
We have been engaged in sports marketing and investing in multimedia advertisements
around the world, so that KENDA is a widely-known global brand.
(4) Development of sports marketing
By participating in public interest campaigns, fulfilling social responsibility and
sponsoring national teams, professional baseball teams, cycling teams and golfing
competitions, we seek to enhance our brand exposure.
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(II) Main utilization and production/manufacturing process of key products
1. Main utilization of key products
By end Tires for agricultural and Tires for passenger
Bicycle tires Motorcycle tires
market industrial vehicles cars and trucks
Mountain bike tires Tires for racing vehicles Tires for agriculture use Tires for large trucks
Mountain bikes, cyclocross
Cyclocross bikes Forklift tires Light trucks
bikes
Racing cars,
By Street bikes Tires for golf carts High-speed caravans
recreational vehicles
vehicle
Street bikes Scooters Tires for beach buggies Passenger cars
Tires for mobility scooters
Tires for lawn Mowers
2. Production/manufacturing process of key products

(1) Manufacturing flows for cover tires
Bead building Forming of
Rubber compounding Extrusion of tread rubber/inner liner green tires Vulcanization Inspection Warehousing
Ply covering/cutting
(2) Manufacturing flows for inner tube:

Rubber compounding Tire tube extrusion Nose piecing Splicing Vulcanization Inspection Warehousing
(III) Supply of major materials

Product name Supply status
Natural rubber Mainly imported from Southeast Asia. Stable supply
Mainly imported from manufacturers in Asia and Europe and some
Synthetic rubber
domestic suppliers Stable supply
Reclaimed rubber Mainly imported from China and India. Stable supply
Butyl rubber Mainly imported from China and Europe. Stable supply
Mainly from manufacturers in Taiwan, China and other Asian
Carbon black
countries. Stable supply
Mainly from manufacturers in Taiwan, China and other Asian
Plies
countries. Stable supply
Mainly from manufacturers in China and other Asian countries. Stable
Steel wires
supply
(IV) List of suppliers/customers accounting for at least 10% of purchases/sales

during the past two years, amounts and percentages of total
purchases/sales
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1. Supplies accounting for at least 10% of purchases
Unit: NT$ Thousand
2020 2019 As of the first quarter of 2021
Item Name Amount As % of Relation Name Amount As % of Relation Name Amount As % of total Relation
total with the total with the purchases with the
purchases issuer purchases issuer during the issuer
for the for the most recent
year year quarter of the
current year
1 None - - - None - - - None - - -
Net Net Net
10,717,347 100 13,049,156 100 5,289,732 100
purchases purchases purchases
2. Customers accounting for at least 10% of sales

Unit: NT$ Thousand
2020 2019 As of the first quarter of 2021
Item Name Amount As % of Relation Name Amount As % of Relation Name Amount As % of total Relation
total sales with the total sales with the sales during with the
for the issuer for the issuer the most issuer
year year recent quarter
of the current
year
1 None - - - None - - - None - - -
Net Net Net
30,260,185 100 32,127,436 100 8,563,973 100
sales sales sales
Note 1: Please list the suppliers/customers accounting for at least 10% of purchases/sales during the past two years, amounts
and percentages of total purchases/sales. However, indications may be made in codes if customers’ names cannot be
disclosed due to contractual agreements or counterparties are non-related individuals.
Note 2: TWSE/TPEx listed companies should disclose financial data audited or reviewed by independent auditors for the
most recent period as of the print date of the annual report.
The Company’s relation with suppliers, implementation of risk management policies

and risk measurement criteria
As our demand for raw materials grows over time, the assurance of reliable quality and timely
supply of procured products is an important element of our supply chain management policy. For all the
raw materials, we seek to maintain multiple suppliers with good and reliable quality and healthy
operations, in order to avoid stock-outs. We conduct onsite audits on suppliers each year and on an
ad-hoc basis, to ensure supply quality, delivery dates and quantities and fulfil corporate social
responsibility. The global commodity market has been witnessing grater volatility during recent years.
Therefore, the procurement strategy is centered on stability, with purchase in required quantities and
control over inventory and cost risks.
The Company always views suppliers as long-standing and reliable partners. Good suppliers are a
key support to sales growth. Based on the principles of safety, prices, delivery dates, quality, service,
environmental protection and sustainability, the Company carefully selects qualified suppliers and
periodically reviews their product quality, delivery and service, as well as continued improvement and
emphasis on the environment issues.
The Company is concerned with the economic, environmental and social developments of the whole
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supply chain. We strive to enhance the supply chain to meet the international standards and become a
force driving the sustainability for the society. We aim to establish a supply chain that cares about the
environment, labor rights, safety, health and social responsibility and achieves sustainable development.
Supply chain risk management is integral to competitiveness. Therefore, we keep an close eye on risks
faced by suppliers. This includes fires and floods due to climate change, earthquakes and certifiable
diseases. We maintain at least two and three suppliers in different geographic locations for each material,
in order to have the flexibility to respond to operational risks due to international situation changes,
extreme climates and significant natural disasters. We proactively increase inventory and look for second
suppliers for the materials we rely on single suppliers. We ask suppliers to review operational status and
manage the risks associated with geographic distribution of production lines. This is to mitigate the risk
of raw materials shortage in the future due to extreme climate or international situation change.
(V) Production volumes and values during the most recent two years
Unit: 1,000 units; NT$1,000
Year 2020 2019
Production
volume/value Daily Production Production Daily Production Production
capacity volume value capacity volume value
Main products
Bicycle tires 149 44,519 2,534,686 140 43,401 2,627,233
Motorcycle tires and other 99 29,629 5,878,860 119 36,449 7,807,215
Radial tires 25 7,411 5,480,916 27 8,359 6,481,123
Inner tube 274 81,818 1,660,587 269 81,850 1,881,538
Others 2,832,818 2,936,296
Total 547 163,377 18,387,867 555 170,059 21,733,405
(VI) Sale volumes and values during the most recent two years
Unit: 1,000 units; NT$1,000
Year 2020 2019
Sale volume/ Domestic sales Exports Domestic sales Exports
value
Volume Value Volume Value Volume Value Volume Value
Main products
Bicycle tires 1,550 219,851 41,603 3,179,663 1,304 193,019 40,446 3,197,334
Motorcycle tires and 2,122 678,761 32,475 11,405,793 1,924 616,114 38,509 14,319,896
Radial tires 304 271,625 5,574 7,616,134 283 250,798 6,104 6,953,955
Inner tube 6,800 261,733 73,429 2,326,119 5,972 238,493 72,830 2,541,023
Others 38,038 4,262,467 46,535 3,770,269
Total 10,776 1,470,008 153,081 28,790,176 9,483 1,344,959 157,889 30,782,477
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III. Employees
Employees data during the most recent two years and as of the print date of the annual report
As of March 31,
Year 2019 2020
2021
No. of Office workers 3,362 3,544 3,568
Operators 8,155 7,929 8,102
employees
Total 11,517 11,473 11,670
Average age 34.72 35.36 34.69
Average tenure 5.61 5.37 5.37
Doctoral Degree 3 3 3
Distribution Master’s degree 76 84 86
of education Colleges and 2,515 2,476 2,413
backgrounds Senior high 2,524 3,112 3,299
Below senior 6,399 5,822 5,870
IV. Environmental protection expenses

(I) Losses and penalties due to environmental pollution during the most recent
two years
1. The Environmental Protection Administration audited the Yunlin plant on November 26,
2019, identified the volume of raw materials used per hour for compounding recipes
exceeding the maximum designed volume for stationary pollution sources stated in the
operation permit, and imposed a fine of NT$100,000 according to Article 62 of the Air
Pollution Control Act.
2. The Environmental Protection Bureau of Changhua County audited the Yuanlin plant on
August 19, 2019, identified the storage of hazardous chemical waste liquids for over one
year without cleaning or applying in advance for an extension for the storage, and
imposed a fine of NT$60,000 due to violation of the Waste Disposal Act.
(II) Response to the Restriction of Hazardous Substances (RoHS) Directives in

the European Union: N/A
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(III) Environmental expenses planned for the next three years
Unit: NT$
Year Equipment Volume Amount
Waste gas collection and ventilation improvement for the NT$8,600,000
operating environment at the vulcanization facilities of the One
Yunlin plant
Pipelines of separate sewerage systems for rainwater and
One NT$350,000
wastewater at the Yunlin plant
Rain awnings for storage facilities of classified wastes at
One NT$1,200,000
the Yunlin plant
Sewage treatment system at factory sites Two NT$4,000,000
Waste gas collection and ventilation improvement for the
2021 operating environment at the vulcanization facilities of the One NT$3,500,000
Yuanlin plant
Improvement of bag dust collectors and pollution control
One NT$3,000,000
equipment
Ventilation improvement for the operating environment at
One NT$1,500,000
factory sites
Improvement of collection and treatment equipment to
One NT$5,500,000
control VOCs in the waste gas area of factory sites
Solid food waste and grease separator for the canteen at the
One NT$500,000
Yuanlin pplant
Addition of dust collection systems at the compounding
One NT$2,000,000
facilities of the Yunlin plant
Addition and optimization of reclaimed water transport
One NT$500,000
pipes at the Yunlin plant
Pipelines of separate sewerage systems for rainwater and NT$350,000
One
Sludge treatment and improvement of wastewater
One NT$1,000,000
facilities
2022
Greenification at the factories One NT$500,000
the vulcanization facilities for inner tubes of the Yuanlin One NT$200,000
plant
One NT$2,500,000
equipment
Addition of storage facilities of classified wastes at the
One NT$1,200,000
Yunalin plant
Pipelines of separate sewerage systems for rainwater and NT$300,000
One
Separating and recycling equipment for grease and water One NT$200,000
2023 One NT$2,500,000
equipment
One NT$500,000
factory sites
Replacement of dry dust collectors at factory sites One NT$1,800,000
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(IV) Environmental safety & health policy
Green production, safety & health and sustainable operation
(V) Responding strategies:

The Company has been emphasizing both industrial development and environmental
protection since inception. We implement environmental friendly measures in water
conservation, energy efficiency, carbon reduction and resource sustainability, in order to
fulfill corporate social responsibility.
Going forward, we will continue to improve the environmental qualify by adhering to the
following strategies:
1. Careful operation and maintenance of water pollution control equipment and
enhancement of emergency response capability for wastewater treatment, in order
to avoid usual pollution events
2. Greenhouse gas inventory inspection; ISO 50001 energy management system;
continued carbon reduction; product carbon footprint disclosure and waste
reduction to reduce greenhouse gas emissions; better water recycling efficiency to
conserve water resources; reduction in wastes from the manufacturing sources;
enhancement of waste recycling and reuse
3. Implementation of the ISO 14001 environmental management system; pollution
control and prevention; continued improvement of green production performance
so that the manufacturing process is cleaner, more environmental friendly with
less environmental impact to achieve corporate sustainability
(VI) Systems, measures and implementation of environmental protection, safety

and health
The Company’s environmental safety and health management was established according
to the ISO 14001 and ISO 45001/TOSHMS standards. We became the first tire
manufacturer that obtained the ISO 14001certification in 1998 and the ISO
45001/TOSHM certification in 2009.
The environmental safety and health management system is implemented through a
combination of daily management and total production management (TPM) activities.
The Company integrates the environmental safety and health management plan with the
actual operation in the factories and uses the PDCA (Plan, Do, Check and Action) cycle
in implementations. The environmental and health risks associated with the company's
operations are systematically evaluated in order to determine the potential impacts on the
environment and employees from the use of the raw materials to the waste output
processes. The Company will evaluate, replace and reduce the raw materials, control and
mitigate the process pollution and effectively deal with end-of-pipe contamination for
items that may cause a significant environmental impact. When it comes to safety and
health, risk management is focusing on intrinsic safety of the equipment, safety of
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chemicals and operations at the starting point, in order to protect the safety and physical
and mental health for all employees.
In order to achieve the goal of sustainability, we have established the "Environmental
Safety and Health Policy" to continuously improve our environmental safety and health
performance, with "Zero Disaster, Zero Pollution" as the ultimate goal for environmental
protection and safety and health efforts.
We set annual targets for the environmental health and safety management system and are
committed to continuously improving environmental protection and health and safety
management to reduce environmental impacts. We strive to prevent pollution and
continuously improve the performance in environmental protection and management in
health and safety.
V. Labor relations
(I) Current and important labor agreements and implementation status
1. Employees’ benefits: To boost employees’ morale and work efficiency, enhance
employee engagement and establish a stable work environment, the Company
established Kenda Employee Benefit Committee in March 1966 to drive many
benefit measures and harmonize labor relations. Below is a description of employee
benefits:
(1) To nurture talents in line with corporate development strategies, we organize
multiple training and education curricula and provide a variety of professional
competence training each year.
(2) Annual health checks for employees each year
(3) Establishment of employee leisure clubs such as in bowling, tennis, table tennis,
wellbeing, mountain climbing and cycling
(4) Bonuses for Labor Day, Dragon Boat Festival, Middle Autumn Festival and
year-end banquet each year
(5) Organized employee travels each year
(6) Scholarships for employees and their children, subsidies for childcare,
weddings, funerals and hospital stays
(7) Canteens to provide free meals to employees
(8) To reduce commuting troubles and take care of family, the Company started
the flexible work system in January 2019.This is to respect the employees’
need to balance between work and family, cultivate a pleasant work
environment, boost moral and administrative efficiency.
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(9) The leave system started in January 2019 to be based on hours, to give
employees greater flexibility in attendance and time allocation.
(10) Unpaid parental leaves: The Company offers unpaid parental leaves according
to laws. The numbers of applicants for unpaid parental leaves in 2020 and 2019
are as follows:
No. of applicants for unpaid parental leaves Male Female Total
No. of applicants for unpaid parental leaves in 2020 6 32 38
No. of employees expected to return from unpaid parental 2 17 19
leaves in 2020
No. of employees expected and having returned from 2 17 19
unpaid leaves in 2020 (B)
Return rate (B/A) 100.00% 100.00% 100.00%
No. of applicants for unpaid parental leaves in 2019 and 4 12 16

with a tenure of at least one year (C)
No. of applicants for unpaid parental leaves in 2019 and 4 14 18
having returned subsequently (D)
Retention ratio (C/D) 100.00% 85.71% 88.89%
(11) Comprehensive employee insurance coverage: In addition to labor insurance

and national health insurance, we started in 2020 to provide group insurance
for all employees with comprehensive medical covers such as hospital stays,
cancers, critical illnesses, and occupational accidents.
2. Continued education: To encourage employees’ continued training, enhance employee
competences for the benefit of corporate operation capability and to ensure the
Company’s investment in training and education, full-time employees who have been
in continuous service for one year may apply for participation in training programs.
3. Training: To promote internal training and education activities, enhance the training
quality and effectively boost the competence of employees, the Company has
established Training & Education Committee. Training & Education Committee
consists of Chairperson and a number of members. All members hold managerial
roles of assistant vice presidents or above or supervisors in factory affairs. To ensure
effective discrimination of each job function that may affect product quality and
clarify the purposes and directions of training activities, committee members should
convene meetings at the end of each year to formulate training policies and review
annual training plans submitted by different departments. Quarterly meetings should
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be organized to examine the implementation effectiveness of the previous quarter, so
that there is basis for the Company’s overall training and education.
The Company’s training and education system can be divided into (I) by nature:
pre-employment and on-the-job training and education; (II) by venue: onsite and
offsite. On-the-job training and education includes orientation for new hires, training &
education for different levels and specializations. This comprehensive training and
education system aims to enhance the professional knowledge and skills of employees
and boost the quality of human resources for the organization by the completion of
different training programs. Pre-employment training and education contains the
company introduction; organization; business philosophy; quality policy; environment,
safety and health policy; human resource management charter; employee benefits;
social groups; industrial safety and health; introduction to the factory environment.
Orientation for new hires focuses on the introduction of business units; daily
management rules; document management rules; periodical work lists; management
styles; and basic skills for the job descriptions.
Training and education for different levels are the curricula required for different
positions. These include quality control methods (fundamentals and practicals);
knowledge about tires and product safety; IT system operation; word processing;
briefing techniques; cost management; human resource management; BSC
management; 3T basics and practical foundation; management information utilization;
marketing overview; planning and implementation of the internal control system;
understanding of financial reporting; strategic planning and goal setting, etc.
Training and education for different specializations are the training of specialized
functions or about government regulations for sales personnel. The curricula include
incoming materials inspections; manufacturing process inspections; product
appearance inspections; product function inspections; instruments and equipment
calibration; measurement system & analysis; audits on internal quality, environment,
safety and health; product design and product testing. Special programs are
organized for meeting annual targets. For instance, the classes designed for sales
department include business negotiations and psychology of bargaining; product
pricing methods; management skills; B2B brand marketing (how to do brand
marketing to corporate customers); and development of core competitiveness for sales
managers. The training programs for production managers and team leaders cover
safety, production efficiency, environmental protection, quality, human resources and
leadership.
Our training and education expenses totaled NT$9,224,640 in 2020. Given a total of
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55,687 hours, this translates to NT$27.94 hour/person. In sum, the enhancement of
human capital is one of the important tasks for the Company.
4. Retirement system
The Company makes pension contributions according to the Labor Standards Act
and the Labor Pension Act. The contributions under the new and old systems are 6%
and 15%, respectively. Pensions are paid monthly to personal accounts and in lump
sums from the dedicated account with Bank of Taiwan.
(1) Pension contributions according to laws range between 2% to 15% under the old
pension system. To protect employees’ life in retirement, the Company
contributes at the highest ratio of 15% each month to the account with Bank of
Taiwan. The contribution up to December 31, 2020 totaled NT$401,347,023.
(2) Contributions under the new pension system is at 6% monthly to personal wage
accounts of employees.
Retirement by employees is divided into voluntary retirement and mandatory retirement.

(1) Employees may retire voluntarily in any of the following circumstances:
(1.1) In service for 15 years or longer and aged 55 years old
(1.2) In service for 25 years or longer
(1.3) In service for 10 years or longer and aged 60 years old
(2) The Company may for mandatory retirement in any of the following
circumstances:
(2.1) Aged 65 years old
(2.2) Incapable of the job due to insanity or physical disability
(2.2) The definitions of insanity or physical disability are based on the
disabilities from the first grade to the six grade for labor insurance
(3) Retirement may be approved by the Company after a continued service and at
the age of 70 or higher.
Criteria for pension distributions (for those opt for the old system)
(1) One full year in service is entitled to a two-month pension credit. However, the
service over 15 years is granted one pension credit for each year beyond 15 years.
The number of pension credits is caped at 45. A service period of less than six
months is counted as half a year, a service period of more than six months as one
year. The service before the promulgation of the Labor Standards Act is
calculated according to Article 9 of the Regulations Governing the Retirement of
Factory Workers of Taiwan Province.
(2) If a worker is forced into mandatory retirement according to the second
paragraph of Article 54-1 of the Labor Standards Act due to insanity or physical
102
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disability caused by performing job duties, an extra 20% is granted on top of the
aforesaid pension credit scheme. The basis for the pension credit in the first
paragraph is based on the average monthly wage at the time of approved
retirement.
Criteria for pension distributions (for those opt for the new system)
Those who joined before July 1, 2005 may opt for the new system or the
old system or choose not to select either initially. Those who opt for the old
system or choose not to select initially may decide to change once before June 30,
2010. Failure to submit a request for change is deemed to have opted for the old
system (for the calculation of service and pensions). Those who opt for the new
system may not change. However, those who joined on or after July 1, 2005 are
placed under the new system. As required, the Company contributes each month
to the personal accounts of employees under the new system. Employees may also
contribute 1%~6% of wages to their personal accounts.
5. Human right protection policy
(1)The Company strives to protect workers’ rights and abides by the Labor
Standards Act and relevant government policies on human rights. In addition to
policy advocacy, we have established multiple communication channels and
management mechanisms, to ensure that workers are properly taken care of. We
create a corporate environment that respects, cares about and protects human
rights. We provide a safe and healthy working environment and establish
precautions to avoid accidents or health hazards at work. We do not discriminate
in hiring, remuneration, promotion, training, retirement or termination of
employment on the basis of race, nationality, religion, gender, age, social class,
physical disability, family and marital status, union membership, or political
preference. In addition, the Company does not interfere with the workers'
religion, political party, marriage and the right to worship all kinds of traditions
and customs. In 2019, the Company did not violate human rights or
discriminated or infringed the disadvantaged and the vulnerable. There were no
cases subject to human rights review or impact assessment.
(2) To ensure the mental and physical health of employees and compliance with the
Labor Standards Act, the Company does not employ child labor below 16 years
old.
(3) The Company respects freedom of employment and there is no forced labor via
coercion, threat, confinement or other illegal means. The Company does not
withhold wages as default penalties or damages. Employees have the right to
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terminate contracts according to the Labor Standards Law. We also ask our
suppliers to sign a statement for corporate social responsibility by committing
not to force or coerce labor.
6. Protective measures for employees’ safety and work environment and implementation
status
To protect work safety of all employees, the Company provides a work environment
with comprehensive facilities for occupational safety and health. In event of any
occupational hazards or accidents, employees will be sent to the hospital and relevant
assistance shall be provided according to the procedures in disaster responses. In
terms of human rights management, there is no unfair treatment. To avoid physical or
mental diseases caused by illegal infringement on the physical or mental status of
employees, any improper management by executives is strictly prohibited.
7. Labor agreement: There is no labor agreement given the Company’s long-standing
harmonious relation with workers and a lack of labor disputes.
(II) Losses incurred due to labor disputes during the most recent year and as of
the print date of the annual report; disclosure of the estimated amount up date
or possibly in the future and responding measures: none
VI. Important contracts: none
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Six. Financials
I. Summary financial statements during the most recent five years
(I) Names of the Certified Public Accountants and their audit opinions during the
most recent five years
Year Names of independent auditors Audit opinions
2016 Benny Shao; Ming-Tang Lai Unqualified opinion
2017 Milton Lin, Benny Shao Unqualified opinion
2018 Milton Lin, Chen-Yu Yang Unqualified opinion
2019 Wang, Yi-Wen, Tseng, Done-Yuin Unqualified opinion
2020 Wang, Yi-Wen, Tseng, Done-Yuin Unqualified opinion
(II) Summary balance sheet

Summary consolidated balance sheet –
International Financial ReportingStandards (IFRS)
Unit: NT$1,000
Year Financial data during the past five years Financial data as
of March 31,
Item 2016 2017 2018 2019 2020 2021 for the
current year
Current asset 28,702,073 25,263,266 23,622,678 23,140,356 22,572,473 25,503,189
Property, Plant and Equipment 10,529,959 12,078,899 14,065,181 14,246,939 14,543,978 14,246,217
Intangible asset 66,224 65,565 64,825 74,095 60,826 249,582
Other assets 2,579,136 3,545,312 2,396,794 4,558,395 5,212,762 5,201,695
Total assets 41,877,392 40,953,042 40,149,478 42,019,785 42,390,039 45,200,683
Before
8,182,924 9,380,640 10,092,227 8,473,776 10,038,519 10,763,524
distribution
Current liability
After
8,135,534 9,372,380 10,076,478 8,446,166 - -
distribution
Non-current liabilities 12,153,822 12,374,590 11,041,151 14,763,241 13,241,793 15,423,714
Before
20,336,746 21,755,230 21,133,378 23,237,017 23,280,312 26,187,238
distribution
Total liabilities
After
20,289,356 21,746,970 21,117,629 23,209,407 - -
distribution
Equity attributable to shareholders of
- - - - - -
the parent
Share capital 8,744,300 8,744,300 8,744,300 8,744,300 9,094,100 9,094,100
Additional paid-in capital 41 41 41 41 41 41
Before
12,973,016 11,530,840 11,240,693 11,368,463 11,407,078
Retained distribution 11,616,570
earnings After
12,925,626 11,522,580 11,224,944 11,340,853 - -
distribution
Other equities (176,741) (1,077,395) (968,955) (1,330,054) (1,601,002) (1,487,792)
Treasury shares - - - - - -
non-controlling interest 30 26 21 18 18 18
Total equity Before
21,540,646 19,197,812 19,016,100 18,782,768 19,109,727 19,013,445
distribution
After
21,493,256 19,189,552 19,000,351 18,755,158 - -
distribution
Note: Financial statements for the fourth quarter of 2020 audited by independent auditors
Pre-audited financial statements for the first quarter of 2021
105
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Summary individual balance sheet –
International Financial Reporting Standards (IFRS)
Unit: NT$1,000
Year
Financial data during the past five years
Item 2016 2017 2018 2019 2020
Current asset 4,885,924 4,786,544 3,208,256 3,764,394 3,779,578
Property, Plant and Equipment 3,343,302 3,567,654 4,252,214 4,191,659 4,031,537
Intangible asset 11,951 15,465 10,767 10,469 4,969
Other assets 28,226,925 25,880,390 25,914,305 25,484,608 25,853,715
Total assets 36,468,102 34,250,053 33,385,542 33,451,130 33,669,799
Before distribution 4,539,023 4,121,745 5,260,536 2,428,051 2,982,470

Current liability
After distribution 4,491,633 4,113,485 5,244,787 2,400,441 -
non-current liabilities 10,388,463 10,930,522 9,108,927 12,240,329 11,577,620

Total liabilities
Equity attributable to shareholders of the parent 21,540,616 19,197,786 19,016,079 18,782,750 19,109,709
Share capital 8,744,300 8,744,300 8,744,300 8,744,300 9,094,100
Additional paid-in capital 41 41 41 41 41
Retained Before distribution 12,973,016 11,530,840 11,240,693 11,368,463 11,616,570
earnings After distribution 12,925,626 11,522,580 11,224,944 11,340,853 -
Other equities (176,741) (1,077,395) (968,955) (1,330,054) (1,601,002)
Treasury shares - - - - -
non-controlling interest - - - - -

Total equity
106
~ 106 ~
(III) Summary income statement
Summary consolidated income statement –
Unit: NT$1,000
Year Financial data as of
Financial data during the past five years March 31, 2021 for
Item the current year
2016 2017 2018 2019 2020
Operating income 29,493,628 30,532,686 31,526,206 32,127,436 30,260,185 8,563,804

Gross profit 7,971,783 6,062,143 5,654,629 6,556,753 7,349,973 2,136,918
Operating profit (loss) 3,351,178 1,179,434 570,145 1,254,531 1,535,939 856,460
Non-operating income and
448,717 (520,025) 591,149 112,447 (244,476) (3,131)
expense
Profit before tax 3,799,895 659,409 1,161,294 1,366,978 1,291,463 853,329
Income from continuing
3,092,443 334,595 711,798 1,013,559 972,225 699,918
operation
Loss from discontinued
- (5,630) (22,636) 0 0 0
operations
Net profit 3,092,443 328,965 689,162 1,013,559 972,225 699,918
Other comprehensive
income recognized for the (1,352,166) (922,939) 228 (372,461) (295,494) (35,861)
period Profit after tax
Total comprehensive
1,740,277 (593,974) 689,390 641,098 676,731 664,057
income in the current period
Net profit attributable to
3,092,443 328,967 689,167 1,013,562 972,225 699,918
shareholders of the parent
Net profit attributable to
- (2) (5) (3) 0 0
non-controlling interest
Total comprehensive
income attributable to 1,740,277 (593,970) 689,395 641,101 676,731 664,057
Total comprehensive
income attributable to - (4) (5) (3) 0 0
Earnings per share (EPS) 3.54 0.38 0.79 1.16 1.07 0.77
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Summary individual income statement sheet –
Unit: NT$1,000
Year
Financial data during the past five years
Item
2016 2017 2018 2019 2020
Operating income 6,254,732 6,050,315 5,800,894 5,947,113 5,946,286

Gross profit 2,284,099 1,567,285 1,460,115 1,559,328 1,929,863
Operating profit (loss) 1,089,586 374,233 252,404 386,582 744,618
Non-operating income and expense 2,235,241 45,420 547,873 694,546 430,759
Profit before tax 3,324,827 419,653 800,277 1,081,128 1,175,377
Income from continuing operation 3,092,443 328,967 689,167 1,013,562 972,225
Loss from discontinued operations - - - - -
Net profit 3,092,443 328,967 689,167 1,013,562 972,225
Other comprehensive income recognized
for the period (1,352,166) (922,937) 228 (372,461) (295,494)
Profit after tax
Total comprehensive income in the current
1,740,277 (593,970) 689,395 641,101 676,731
period
Net profit attributable to shareholders of the
3,092,443 328,967 689,167 1,013,562 972,225
parent
Net profit attributable to non-controlling
- - - - -
interest
Total comprehensive income attributable to
1,740,277 (593,970) 689,395 641,101 676,731
Total comprehensive income attributable to
- - - - -
Earnings per share (EPS) 3.54 0.38 0.79 1.16 1.07
108
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II. Financial analysis for the most recent five years
Analysis of consolidated financials -
Year Financial analysis for the most recent five years As of March 31,
Item 2021
2016 2017 2018 2019 2020
Ratio of Liabilities to Assets 48.56 53.12 52.64 55.30 54.92 57.94

Financial
structure Ratio of long-term capital to
(％) property, plant and equipment 302.14 249.70 204.01 223.52 212.83 225.03
Current ratio 350.76 269.31 234.07 273.08 224.86 236.94

Solvency
Quick ratio 281.57 190.63 154.83 173.44 144.18 149.96
(％)
Interest coverage ratio 23.35 4.41 6.02 5.85 7.31 20.41
Accounts receivable turnover
7.76 7.51 7.73 8.38 7.74 2.02
(times)
Days sales outstanding 47.03 48.60 47.22 43.56 47.16 181.12
Inventory turnover (times) 3.76 3.78 3.48 3.30 2.93 0.78
Operating Accounts payable turnover
5.75 5.54 5.56 5.83 5.23 1.27
efficiency (times)
Days inventory outstanding 97.07 96.56 104.89 110.61 124.57 466.31
Property, Plant and Equipment
2.80 2.53 2.24 2.26 2.08 0.60
Turnover (times)
Total asset turnover (times) 0.70 0.75 0.79 0.76 0.71 0.19
Return on assets (%) 7.82 1.18 2.16 3.02 2.69 1.68
Return on equity (%) 14.31 1.62 3.61 5.36 5.13 3.68
Profit before tax to
Profitability 43.56 7.54 13.28 14.35 16.89 9.38
paid-in capital ratio (%)
Net margin (%) 10.49 1.08 2.19 3.15 3.21 8.17
Earnings per share (NT$) 3.54 0.38 0.79 1.16 1.07 0.77
Operating cash flow ratio (%) 54.69 -6.94 20.56 16.28 27.78 -3.78
Cash flow Cash flow adequacy ratio (%) 171.18 112.44 97.87 80.86 73.71 16.14
Cash re-investment ratio (%) 5.94 -5.70 2.48 1.13 5.53 -0.99
Operating leverage 2.09 3.09 8.01 4.52 4.43 2.19
Leverage
Financial leverage 1.05 1.20 1.63 1.29 1.15 1.05
Analysis on +/- change by at least 20%

1. Higher operating cash flow ratio due to the increase in net cash flows from operating activities
greater than the increase in current liabilities
2. Higher cash re-investment ratio due to a significant increase in cash flows from operating activities
and a reduction in cash dividends
109
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Analysis of individual financials -
Year Financial analysis for the most recent five years
Item
2016 2017 2018 2019 2020
Ratio of Liabilities to Assets 40.93 43.95 43.04 43.85 43.24

Financial
structure Ratio of long-term capital to property,
(％) plant and equipment 915.67 820.15 642.21 723.29 749.18
Current ratio 107.64 116.13 60.99 155.04 126.73

Solvency
(％) Quick ratio 92.50 97.02 46.12 121.63 97.71
Interest coverage ratio 26.33 4.02 6.46 8.61 10.70
Accounts receivable turnover (times) 3.36 3.58 4.06 3.35 3.12
Days sales outstanding 109 102 90 109 117
Inventory turnover (times) 5.53 6.30 5.51 5.43 4.86
Operating Accounts payable turnover (times) 4.67 5.20 5.47 5.70 4.94
efficiency Days inventory outstanding 66 58 66 67 75
Property, Plant and Equipment
1.95 1.75 1.48 1.41 1.45
Turnover (times)
Total asset turnover (times) 0.17 0.17 0.17 0.18 0.18
Return on assets (%) 8.91 1.26 2.31 3.37 3.19
Return on equity (%) 14.31 1.62 3.61 5.36 5.13
Profit before tax to paid-in capital ratio
Profitability (%) 38.02 4.80 9.15 12.36 12.92
Net margin (%) 49.44 5.44 11.88 17.04 16.35

Earnings per share (NT$) 3.54 0.38 0.79 1.16 1.07
Operating cash flow ratio (%) 21.17 41.38 14.47 39.50 100.34
Cash flow Cash flow adequacy ratio (%) 48.23 43.22 46.45 52.67 90.67
Cash re-investment ratio (%) (2.74) (0.14) -0.95 0.26 8.41
Operating leverage 1.64 3.46 4.4 3.64 2.39
Leverage
Financial leverage 1.14 1.59 2.22 1.58 1.19

1. Lower quick ration primarily due to an increase in current liabilities
2. Higher interest coverage ratio due to an increase in net profits and a reduce in interest expenses
3.Higher operating cash flow ratio primarily due to an increase in net cash flows from operating activities
4. Higher cash flow adequacy ratio (%) due to an increase of net cash flows from operating activities during
the past five years and an reduction in capital expenditures during the past five years
5. Higher cash re-investment ratiodue to a significant increase in cash flows from operating activities and a
reduction in cash dividends
6. Lower operating leverage primarily due to higher operating profits
7.Lower financial leverage due to higher operating profits
110
~ 110 ~
Calculation equations based on IFRS items:
1. Financial structure
(1) Liabilities to assets ratio ＝ total liabilities ／ total assets
(2) Ratio of long-term capital to property, plant and equipment ＝（Equity＋non-current liabilities ／ Net
property, plant and equipment
2. Solvency
(1) Current ratio ＝ current assets ／current liabilities
(2) Quick ratio ＝ (current assets － inventory － prepaid expenses)／ current liabilities
(3) Interest coverage ratio ＝ earnings before interest and taxes ／interest expenses
3. Operating efficiency
(1) Accounts receivable turnover (including accounts receivable and notes receivable due to operating activities)
＝ net sales ／average accounts receivable (including accounts receivable and notes receivable due to
operating activities)
(2) Days sales outstanding＝365／Accounts receivable turnover
(3) Inventory turnover ＝ cost of goods sold ／average inventory
(4) Accounts payable turnover (including accounts payable and notes payable due to operating activities) ＝
cost of goods sold ／average accounts payable
(including accounts payable and notes payable due to operating activities)
(5) Days inventory outstanding 365／ inventory turnover
(6) Property, plant and equipment turnover ＝net sales ／net average property, plant and equipment
(7) Total asset turnover ＝ net sales／average total assets
4. Profitability
(1) Return on assets＝(net income＋ interest expense × (1－ tax rate))／ average total assets
(2) Return on equity ＝ net income／average total equity
(3) Net margin ＝ net income ／net sales
(4) Earnings per share＝(net profit attributable to shareholders of the parent－preferred share dividends）／
weighted average number of issued shares (Note 1)
5. Cash flows
(1) Operating cash flow ratio＝Net cash flow from operating activities ／current liabilities
(2) Cash flow adequacy ratio ＝Net cash flows from operating activities during the past five years ／(capital
expenditure＋increase in inventory ＋cash dividends) during the past five years
(3) Cash re-investment ratio ＝(Net cash flows from operating activities－cash dividends)／(Gross property,
plant and equipment＋long-term investment ＋ other non-current assets＋working capital) (Note 2)
6. Leverage
(1) Operating leverage ＝(net sales － variable costs and expenses) ／operating profits (Note 3)
(2) Financial leverage ＝ operating profits／ (operating profits－interest expenses)
Note 1: The above calculation of earnings per share is based on the following:
1. It is based on the number of weighted average ordinary shares, not the number of issued shares at year
end.
2. Rights issues or treasury share transactions should be taken into account according to the outstanding
111
~ 111 ~
period in the calculation of the number of weighted average shares.
3. Capitalization of earnings or capital surplus via share issuance should be retrospectively adjusted pro rata
for earnings per share of prior years and half years, without taking into consideration the issuance periods.
4. If preferred shares are cumulative and not convertible, dividends for the current year (whether issued or
not) should be deducted from net incomes or added to net losses. If preferred shares are non-cumulative,
dividends to preferred shares should be deducted from net incomes but no adjustment is required for net
losses.
Note 2: The cash flow analysis should take into account the following issues:
1. Net cash flows from operating activities refer to the net cash inflows from operating activities in the
statement of cash flows.
2. Capital expenditures refer to the cash outflows each year on capex.
3. The increase in inventory is only calculated when the ending balance is greater than the opening balance.
If the inventory is reduced at year end, it is counted as zero.
4. Cash dividends include cash dividends to ordinary shares and to preferred shares.
5. Gross property, plant and equipment refers to the total value of property, plant and equipment before
accumulated depreciation.
Note 3: The issuer should divide all operating costs and expenses by nature into fixed and variable. Any estimates or
subjective judgement should be reasonable and consistent.
Note 4: The ratios in relation to paid-in capital for foreign companies shall be calculated with net value.
112
~ 112 ~
III. Review reports by Audit Committee on financial statements for the most
recent years
Audit Committee’s Audit Report
The Board of Directors has prepared and submitted the Company's 2020 annual business report,
financial statements and profit distribution proposal. The financial statements have been audited and
attested by CPA Wang, Yi-Wen and CPA Tseng, Tung-Yun from Deloitte Taiwan. An Independent’s
audit report has been issued. The above-mentioned business report, financial statements and proposal for
earnings distribution have been audited by the Audit Committee and found to be in order; therefore, we
hereby report the above in accordance with Article 14-4 of the Securities and Exchange Act and Article
219 of the Company Act for your review.
To
The 2021 Regular Shareholders Meeting
Convener of the Audit Committee: Hsieh, Chun-Mou
March 25, 2021
113
~ 113 ~
IV. Consolidated Financial Statements of the latest year duly
audited by the Certified Public Accountants
Kenda Rubber Ind. Co., Ltd. and Subsidiaries

Consolidated Financial Statements for the
Years Ended December 31, 2020 and 2019 and
Independent Auditors’ Report
~ 114 ~
DECLARATION OF CONSOLIDATION OF FINANCIAL STATEMENTS OF AFFILIATES
The entities that are required to be included in the combined financial statements of Kenda Rubber Ind.
Co., Ltd. as of and for the year ended December 31, 2020, under the “Criteria Governing 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 Financial Reporting Standard No. 10, “Consolidated Financial
Statements.” In addition, the information required to be disclosed in the combined financial statements is
included in the consolidated financial statements. Consequently, Kenda Rubber Ind. Co., Ltd. and
subsidiaries do not prepare a separate set of combined financial statements.
Very truly yours,
KENDA RUBBER IND. CO., LTD.
By
YANG CHI JEN
March 25, 2021
~ 115
- 1 -~
INDEPENDENT AUDITORS’ REPORT
The Board of Directors and Shareholders

Opinion
We have audited the accompanying consolidated financial statements of Kenda Rubber Ind. Co.,
Ltd. and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated
balance sheets as of December 31, 2020 and 2019, and the consolidated statements of
comprehensive income, changes in equity and cash flows for the years then ended, and the notes to
the consolidated financial statements, including a summary of significant accounting policies
(collectively referred to as the “consolidated financial statements”).
In our opinion, the accompanying consolidated financial statements present fairly, in all material
respects, the consolidated financial position of the Group as of December 31, 2020 and 2019, and
its consolidated financial performance and its consolidated cash flows for the years then ended in
accordance with the Regulations Governing the Preparation of Financial Reports by Securities
Issuers and the International Financial Reporting Standards (IFRS), International Accounting
Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued
into effect by the Financial Supervisory Commission of the Republic of China.
Basis for Opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Attestation
of Financial Statements by Certified Public Accountants, and auditing standards generally accepted
in the Republic of China. Our responsibilities under those standards are further described in the
Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our
report. We are independent of the Group in accordance with The Norm of Professional Ethics for
Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the consolidated financial statements for the year ended December 31, 2020. These
matters were addressed in the context of our audit of the consolidated financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
~ 116
- 2 -~
The key audit matter of the Group’s consolidated financial statements for the year ended December
31, 2020 is stated as follows:
Appropriateness of the Revenue Cutoff
The Group has worldwide sales network, and the terms of sales are different by customer or
geography. Revenue is recognized when performance obligations are satisfied by the transfer of the
promised goods to customers but the timing of the transfer may be based on the time of actual
delivery or on the time of actual receipt of the goods. The Group’s revenue recognition process
involves manual inspection of relevant documents, or an estimate of arrival time of the goods
shipped to customers based on historical experience to determine the timing of the transfer of
control of the promised goods to customers. Therefore, mistakes may occur in the evaluation
process, and revenue could be recorded in the incorrect reporting period.
The main audit procedures that we performed in respect of the cutoff of revenue recognition
included the following:
1. We obtained an understanding of and reviewed the sales contracts and the terms between the
Group and its customers to identify the appropriate point of revenue recognition.
2. We obtained an understanding of and evaluated the process and related controls over revenue
recognition.
3. We performed cutoff testing procedures covering a certain period before and after the balance
sheet date and examined relevant supporting documents. We determined that revenue was
recognized in the correct reporting period, as evidenced by sales terms.
Other Matter
We have also audited the parent company only financial statements of Kenda Rubber Ind. Co., Ltd.
as of and for the years ended December 31, 2020 and 2019, on which we have issued an
unmodified opinion.
Responsibilities of Management and Those Charged with Governance for the Consolidated
Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with the Regulations Governing the Preparation of Financial Reports by
Securities Issuers and the IFRS, IAS, IFRIC, and SIC endorsed and issued into effect by the
Financial Supervisory Commission of the Republic of China, and for such internal control as
management determines is necessary to enable the preparation of consolidated financial statements
that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to
liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Those charged with governance, including members of the audit committee, are responsible for
overseeing the Group’s financial reporting process.
~ 117
- 3 -~
Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards
generally accepted in the Republic of China will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these consolidated financial statements.
As part of an audit in accordance with the auditing standards generally accepted in the Republic of
China, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:
1. Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
4. Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditors’ report to the related disclosures in the consolidated financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditors’ report. However, future
events or conditions may cause the Group to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance of the
group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.
~ 118
- 4 -~
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the consolidated financial statements for the year
ended December 31, 2020, and are therefore the key audit matters. We describe the matter in our
auditors’ report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefits of such communication.
The engagement partners on the audits resulting in this independent auditors’ report are Yi-Wen
Wang and Done-Yuin Tseng.
Deloitte & Touche

Taipei, Taiwan
Republic of China
March 25, 2021
Notice to Readers
The accompanying consolidated financial statements are intended only to present the consolidated
financial position, financial performance and cash flows in accordance with accounting principles
and practices generally accepted in the Republic of China and not those of any other jurisdictions.
The standards, procedures and practices to audit such consolidated financial statements are those
generally applied in the Republic of China.
For the convenience of readers, the independent auditors’ report and the accompanying
consolidated financial statements have been translated into English from the original Chinese
version prepared and used in the Republic of China. If there is any conflict between the English
version and the original Chinese version or any difference in the interpretation of the two versions,
the Chinese-language independent auditors’ report and consolidated financial statements shall
prevail.
~ 119
- 5 -~
KENDA RUBBER IND. CO., LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars)
2020 2019
ASSETS Amount % Amount %
CURRENT ASSETS
Cash and cash equivalents (Note 6) $ 8,485,408 20 $ 7,626,509 18
Financial assets at fair value through profit or loss - current (Note 23) 973 - 1,019 -
Notes receivable, net (Notes 8 and 24) 430,967 1 315,758 1
Accounts receivable, net (Notes 8, 24 and 25) 3,413,863 8 3,372,114 8
Inventories (Notes 9 and 25) 7,689,491 18 7,930,788 19
Prepayments 409,003 1 512,559 1
Other financial assets - current (Notes 10 and 25) 1,840,620 4 3,178,117 8
Other current assets 302,148 1 203,492 -
Total current assets 22,572,473 53 23,140,356 55
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income - non-current (Notes 7 and 23) 578,419 1 515,415 1
Investments accounted for using the equity method 102,320 - 72,690 -
Property, plant and equipment (Notes 12 and 25) 14,543,978 34 14,246,939 34
Right-of-use assets (Note 13) 1,534,070 4 1,737,558 4
Investment properties (Note 14) 29,186 - - -
Intangible assets (Note 25) 60,826 - 74,095 -
Deferred tax assets (Note 20) 613,084 2 441,892 1
Other non-current assets (Notes 10 and 12) 2,355,683 6 1,790,840 5
Total non-current assets 19,817,566 47 18,879,429 45
TOTAL $ 42,390,039 100 $ 42,019,785 100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 15) $ 2,399,948 6 $ 2,372,653 6
Contract liabilities - current (Note 18) 273,652 1 220,603 1
Notes payable 41,116 - 159,852 -
Accounts payable (Note 24) 2,725,960 7 2,556,061 6
Lease liabilities - current (Note 13) 88,484 - 98,239 -
Other payables (Note 24) 1,695,073 4 1,586,122 4
Current tax liabilities 167,673 - 72,891 -
Current portion of long-term borrowings (Note 14) 2,517,453 6 1,291,805 3
Other current liabilities (Note 18) 129,160 - 115,550 -
Total current liabilities 10,038,519 24 8,473,776 20
NON-CURRENT LIABILITIES
Long-term borrowings (Note 15) 11,844,336 28 13,061,895 31
Deferred tax liabilities (Note 20) 316,927 1 547,324 1
Lease liabilities - non-current (Note 13) 363,273 1 452,527 1
Net defined benefit liabilities (Note 16) 254,583 - 251,574 1
Other non-current liabilities (Note 26) 462,674 1 449,921 1
Total non-current liabilities 13,241,793 31 14,763,241 35
Total liabilities 23,280,312 55 23,237,017 55
EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY (Note 17)

Share capital 9,094,100 22 8,744,300 21
Capital surplus 41 - 41 -
Retained earnings
Legal reserve 3,213,262 7 3,113,042 8
Special reserve 1,330,054 3 968,955 2
Unappropriated earnings 7,073,254 17 7,286,466 17
Total retained earnings 11,616,570 27 11,368,463 27
Other equity (1,601,002) (4) (1,330,054) (3)
Equity attributable to shareholders of the parent 19,109,709 45 18,782,750 45
NON-CONTROLLING INTERESTS 18 - 18 -
Total equity 19,109,727 45 18,782,768 45
TOTAL $ 42,390,039 100 $ 42,019,785 100
The accompanying notes are an integral part of the consolidated financial statements.
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(In Thousands of New Taiwan Dollars, Except Earnings Per Share)
2020 2019
Amount % Amount %
NET REVENUE (Notes 18 and 24) $ 30,260,185 100 $ 32,127,436 100
COST OF REVENUE (Notes 9, 19 and 24) 22,910,212 76 25,570,683 80
GROSS PROFIT 7,349,973 24 6,556,753 20
OPERATING EXPENSES (Notes 19 and 24)

Selling and marketing expenses 2,304,290 8 2,534,489 8
General and administrative expenses 1,216,493 4 1,356,141 4
Research and development expenses 1,326,430 4 1,403,681 4
Expected credit loss (Note 8) 29,239 - 7,911 -
Total operating expenses 4,876,452 16 5,302,222 16
OTHER OPERATING INCOME AND EXPENSES

(Note 19) (937,582) (3) - -
INCOME FROM OPERATIONS 1,535,939 5 1,254,531 4
NON-OPERATING INCOME AND EXPENSES

(Notes 19 and 24)
Interest income 108,171 - 162,833 -
Other income 250,339 1 246,543 1
Other gains and losses (363,884) (1) (18,993) -
Finance costs (241,442) (1) (281,907) (1)
Share of profit of associates 2,340 - 3,971 -
Total non-operating income and expenses (244,476) (1) 112,447 -
PROFIT BEFORE INCOME TAX 1,291,463 4 1,366,978 4
INCOME TAX EXPENSE (Note 20) (319,238) (1) (353,419) (1)
NET PROFIT FOR THE YEAR 972,225 3 1,013,559 3

(Continued)
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
2020 2019
Amount % Amount %
OTHER COMPREHENSIVE INCOME (LOSS)

(Notes 16 and 20)
Items that will not be reclassified subsequently to
profit or loss:
Remeasurement of defined benefit plans $ (29,832) - $ (13,769) -
Unrealized gain on investments in equity
instruments at fair value through other
comprehensive income 73,938 - 243,902 1
Income tax related to items that will not be
reclassified subsequently to profit or loss 5,286 - 2,407 -
Items that may be reclassified subsequently to profit
or loss:
Exchange differences on translation of the
financial statements of foreign operations (431,107) (1) (756,251) (2)
Income tax related to items that may be
reclassified subsequently to profit or loss 86,221 - 151,250 -
Other comprehensive loss for the year, net of

income tax (295,494) (1) (372,461) (1)
TOTAL COMPREHENSIVE INCOME FOR THE

YEAR $ 676,731 2 $ 641,098 2
NET INCOME (LOSS) ATTRIBUTABLE TO:

Shareholders of the Company $ 972,225 3 $ 1,013,562 3
Non-controlling interests - - (3) -
$ 972,225 3 $ 1,013,559 3
TOTAL COMPREHENSIVE INCOME (LOSS)

ATTRIBUTABLE TO:
Shareholders of the Company $ 676,731 2 $ 641,101 2
Non-controlling interests - - (3) -
$ 676,731 2 $ 641,098 2
EARNINGS PER SHARE (Note 21)

Basic $ 1.07 $ 1.11
Diluted $ 1.07 $ 1.11
The accompanying notes are an integral part of the consolidated financial statements. (Concluded)
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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In Thousands of New Taiwan Dollars, Except Dividends Per Share)
Equity Attributable to Shareholders of the Parent

Other Equity
Unrealized
Exchange Valuation Gain
Differences on on Financial
Translation of Assets at Fair
the Financial Value Through
Retained Earnings Statements of Other
Unappropriated Foreign Comprehensive Non-controlling
Share Capital Capital Surplus Legal Reserve Special Reserve Earnings Operations Income Total Interests Total Equity
BALANCE AT JANUARY 1, 2019 $ 8,744,300 $ 41 $ 3,044,125 $ 1,077,394 $ 7,119,174 $ (1,092,360) $ 123,405 $ 19,016,079 $ 21 $ 19,016,100
Appropriations of 2018 earnings

Legal reserve - - 68,917 - (68,917) - - - - -
Special reserve - - - (108,439) 108,439 - - - - -
Cash dividends to shareholders - NT$1.00 per share - - - - (874,430) - - (874,430) - (874,430)
Net profit for the year ended December 31, 2019 - - - - 1,013,562 - - 1,013,562 (3) 1,013,559
Other comprehensive income (loss) for the year ended

December 31, 2019, net of income tax - - - - (11,362) (605,001) 243,902 (372,461) - (372,461)
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Total comprehensive income (loss) for the year ended
December 31, 2019 - - - - 1,002,200 (605,001) 243,902 641,101 (3) 641,098
BALANCE AT DECEMBER 31, 2019 8,744,300 41 3,113,042 968,955 7,286,466 (1,697,361) 367,307 18,782,750 18 18,782,768

Legal reserve - - 100,220 - (100,220) - - - - -
Special reserve - - - 361,099 (361,099) - - - - -
Cash dividends to shareholders - NT$0.4 per share - - - - (349,772) - - (349,772) - (349,772)
Share dividends to shareholders - NT$0.4 per share 349,800 - - - (349,800) - - - - -
Net income for the year ended December 31, 2020 - - - - 972,225 - - 972,225 - 972,225
Other comprehensive income (loss) for the year ended

December 31, 2020, net of income tax - - - - (24,546) (344,886) 73,938 (295,494) - (295,494)
Total comprehensive income (loss) for the year ended

December 31, 2020 - - - - 947,679 (344,886) 73,938 676,731 - 676,731
BALANCE AT DECEMBER 31, 2020 $ 9,094,100 $ 41 $ 3,213,262 $ 1,330,054 $ 7,073,254 $ (2,042,247) $ 441,245 $ 19,109,709 $ 18 $ 19,109,727
The accompanying notes are an integral part of the consolidated financial statements.
-9-
CONSOLIDATED STATEMENTS OF CASH FLOWS
2020 2019
CASH FLOWS FROM OPERATING ACTIVITIES

Profit before income tax $ 1,291,463 $ 1,366,978
Adjustments for:
Depreciation expense 1,469,596 1,449,512
Amortization expense 23,697 19,533
Expected credit loss 29,239 7,911
Net (gain) loss on fair value changes of financial assets and
liabilities at fair value through profit or loss 46 (2)
Finance costs 241,442 281,907
Interest income (108,171) (162,833)
Dividend income (53,483) (65,256)
Share of profit of associates (2,340) (3,971)
Net loss on disposal of property, plant and equipment 38,003 1,809
Net loss on disposal of intangible assets - 55
Write-down (reversal of write-down) of inventories (23,933) 45,420
Impairment loss recognized on property, plant and equipment 16,040 -
Net loss on foreign currency exchange 705,350 100,616
Changes in operating assets and liabilities
Notes receivable (115,209) (202,687)
Accounts receivable (429,009) 115,950
Other receivables (33,032) 21,211
Inventories (42,328) (613,002)
Prepayments 103,556 (98,783)
Other current assets (3,601) (14,822)
Other non-current assets 140,948 (162,434)
Contract liabilities 53,049 (1,636)
Notes payable (118,736) (34,842)
Accounts payable 169,899 (60,127)
Other payables 128,638 (70,779)
Other current liabilities 13,610 (11,301)
Net defined benefit liabilities (26,823) (19,419)
Cash generated from operations 3,467,911 1,889,008
Interest received 111,704 164,660
Dividends received 53,483 65,256
Interest paid (244,155) (282,612)
Income tax paid (599,764) (456,959)
Net cash generated from operating activities 2,789,179 1,379,353
CASH FLOWS FROM INVESTING ACTIVITIES

Return of capital from financial assets at fair value through other
comprehensive income 3,942 4,024
Increase in investments accounted for using the equity method (33,733) -
Payments for property, plant and equipment (539,276) (1,023,893)
Proceeds from disposal of property, plant and equipment 23,808 153,572
(Continued)
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CONSOLIDATED STATEMENTS OF CASH FLOWS
2020 2019
Increase in refundable deposits $ (48,529) $ (714)

Payments for intangible assets (11,075) (18,613)
Decrease (increase) in other financial assets 61,535 (1,817,544)
Increase in prepayments for equipment (800,969) (2,033,971)
Net cash used in investing activities (1,344,297) (4,737,139)
CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from short-term borrowings 75,347 1,177,364
Proceeds from long-term borrowings 3,995,525 5,616,938
Repayments of long-term borrowings (3,958,700) (4,841,945)
Proceeds from guarantee deposits received 7,641 1,229
Repayment of the principal portion of lease liabilities (90,763) (91,334)
Cash dividends (349,772) (874,430)
Net cash generated from (used in) financing activities (320,722) 987,822
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE

OF CASH HELD IN FOREIGN CURRENCIES (265,261) (194,013)
NET INCREASE (DECREASE) IN CASH AND CASH

EQUIVALENTS 858,899 (2,563,977)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE

YEAR 7,626,509 10,190,486
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR $ 8,485,408 $ 7,626,509
The accompanying notes are an integral part of the consolidated financial statements. (Concluded)
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands of New Taiwan Dollars, Unless Specified Otherwise)
1. GENERAL INFORMATION
Kenda Rubber Ind. Co., Ltd. (the “Company”) was incorporated in the Republic of China (ROC) in March
1962. The Company is mainly engaged in manufacturing and trading of rubber products such as inner tubes
and tires of bicycles, scooters, industrial trucks and cars, and various products of carbon fiber.
The Company’s shares have been listed on the Taiwan Stock Exchange since December 20, 1990.
The consolidated financial statements of the Company and its subsidiaries (collectively referred to as the
“Group”) are presented in the Company’s functional currency, the New Taiwan dollar.
2. AUTHORIZATION OF FINANCIAL STATEMENTS
The consolidated financial statements were approved by the Company’s board of directors on March 25,
2021.
3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS
a. The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2021
Effective Date
New IFRSs Announced by IASB
Amendments to IFRS 4 “Extension of the Temporary Exemption from Effective immediately upon
Applying IFRS 9” promulgation by the IASB
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 January 1, 2021
“Interest Rate Benchmark Reform - Phase 2”
Amendment to IFRS 16 “Covid-19-Related Rent Concessions” June 1, 2020
b. New IFRSs in issue but not yet endorsed and issued into effect by the FSC
Effective Date
New, Revised or Amended Standards and Interpretations Announced by IASB (Note 1)
“Annual Improvements to IFRS Standards 2018-2020” January 1, 2022 (Note 2)

Amendments to IFRS 3 “Reference to the Conceptual Framework” January 1, 2022 (Note 3)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets To be determined by IASB
between an Investor and its Associate or Joint Venture”
IFRS 17 “Insurance Contracts” January 1, 2023
Amendments to IFRS 17 January 1, 2023
Amendments to IAS 1 “Classification of Liabilities as Current or January 1, 2023
Non-current”
Amendments to IAS 1 “Disclosure of Accounting Policies” January 1, 2023 (Note 6)
Amendments to IAS 8 “Definition of Accounting Estimates” January 1, 2023 (Note 7)
(Continued)
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Effective Date
Amendments to IAS 16 “Property, Plant and Equipment - Proceeds January 1, 2022 (Note 4)
before Intended Use”
Amendments to IAS 37 “Onerous Contracts - Cost of Fulfilling a January 1, 2022 (Note 5)
Contract”
(Concluded)
Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods
beginning on or after their respective effective dates.
Note 2: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of
financial liabilities that occur on or after the annual reporting periods beginning on or after
January 1, 2022. The amendments to IAS 41 “Agriculture” will be applied prospectively to
the fair value measurements on or after the annual reporting periods beginning on or after
January 1, 2022. The amendments to IFRS 1 “First-time Adoptions of IFRSs” will be applied
retrospectively for annual reporting periods beginning on or after January 1, 2022.
Note 3: The amendments are applicable to business combinations for which the acquisition date is on
or after the beginning of the annual reporting period beginning on or after January 1, 2022.
Note 4: The amendments are applicable to property, plant and equipment that are brought to the
location and condition necessary for them to be capable of operating in the manner intended
by management on or after January 1, 2021.
Note 5: The amendments are applicable to contracts for which the entity has not yet fulfilled all its
obligations on January 1, 2022.
Note 6: The amendments will be applied prospectively for annual reporting periods beginning on or
after January 1, 2023.
Note 7: The amendments are applicable to changes in accounting estimates and changes in accounting
policies that occur on or after the beginning of the annual reporting period beginning on or
As of the date the consolidated financial statements were authorized for issue, the Group is
continuously assessing the possible impact that the application of other standards and interpretations
will have on the Group’s financial position and financial performance and will disclose the relevant
impact when the assessment is completed.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Statement of compliance
The consolidated financial statements have been prepared in accordance with the Regulations
Governing the Preparation of Financial Reports by Securities Issuers and IFRSs as endorsed and issued
into effect by the FSC.
b. Basis of preparation
The consolidated financial statements have been prepared on the historical cost basis except for
financial instruments which are measured at fair value and net defined benefit liabilities which are
measured at the present value of the defined benefit obligation less the fair value of plan assets.
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The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the
fair value measurement inputs are observable and based on the significance of the inputs to the fair
value measurement in its entirety, are described as follows:
1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an
asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for an asset or liability.
c. Classification of current and non-current assets and liabilities
Current assets include:
 Assets held primarily for the purpose of trading;
 Assets expected to be realized within 12 months after the reporting period; and
 Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a
liability for at least 12 months after the reporting period.
Current liabilities include:
 Liabilities held primarily for the purpose of trading;
 Liabilities due to be settled within 12 months after the reporting period; and
 Liabilities for which the Group does not have an unconditional right to defer settlement for at least
12 months after the reporting period.
Assets and liabilities that are not classified as current are classified as non-current.
d. Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and the
entities controlled by the Company (i.e., its subsidiaries). Income and expenses of subsidiaries acquired
or disposed of are included in the consolidated statement of comprehensive income from the effective
date of acquisition and 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 of the Group. All intra-group transactions, balances, income and expenses are eliminated in full
upon consolidation. Total comprehensive income of subsidiaries is attributed to the shareholders of the
parent and to the non-controlling interests even if this results in the non-controlling interests having a
deficit balance.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control
over the subsidiaries are accounted for as equity transactions. The carrying amounts of the 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
shareholders of the parent.
See Note 11, Table 7 and Table 8 for detailed information on subsidiaries, including percentages of
ownership and main businesses.
e. Foreign currencies
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In preparing the financial statements of each individual entity, transactions in currencies other than the
entity’s functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing
at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated
at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or
translation are recognized in profit or loss in the period in which they arise.
Non-monetary items denominated in foreign currencies that are measured at fair value are retranslated
at the rates prevailing at the date when the fair value is determined. Exchange differences arising from
the retranslation of non-monetary items are included in profit or loss for the period except for exchange
differences arising from the retranslation of non-monetary items in respect of which gains and losses are
recognized directly in other comprehensive income; in which cases, the exchange differences are also
recognized directly in other comprehensive income.
For the purpose of presenting consolidated financial statements, the financial statements of the
Company’s foreign operations (including subsidiaries and associates in other countries) that are
prepared using functional currencies which are different from the currency of the Company are
translated into the presentation currency, the New Taiwan dollar, as follows: Assets and liabilities are
translated at the exchange rates prevailing at the end of the reporting period; and income and expense
items are translated at the average exchange rates for the period. The resulting currency translation
differences are recognized in other comprehensive income, attributed to the owners of the Company and
non-controlling interests as appropriate.
On the disposal of a foreign operation, all of the exchange differences accumulated in equity in respect
of that operation attributable to the owners of the Company are reclassified to profit or loss.
f. Inventories
Inventories consist of raw materials, supplies, finished goods and work in progress and are stated at the
lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be
appropriate to group similar or related items. The net realizable value is the estimated selling price of
inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are
recorded at the weighted-average cost on the balance sheet date.
g. Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost less
accumulated depreciation and accumulated impairment loss.
The depreciation of property, plant and equipment is recognized using the straight-line method. Each
significant part is depreciated separately. The estimated useful lives, residual values and depreciation
methods are reviewed at the end of each reporting period, with the effects of any changes in the
estimates accounted for on a prospective basis.
On derecognition of an item of property, plant and equipment, the difference between the sales proceeds
and the carrying amount of the asset is recognized in profit or loss.
h. Investment properties
Investment properties are properties held to earn rental and/or for capital appreciation. Investment
properties include right-of-use assets and properties under construction that meet the definition of
investment properties.
Investment properties are initially measured at cost, including transaction costs. Subsequent to initial
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recognition, investment properties are measured at cost less accumulated depreciation and accumulated
impairment loss.
Depreciation is recognized using the straight-line method.
On derecognition of an investment property, the difference between the net disposal proceeds and the
carrying amount of the asset is included in profit or loss.
i. Intangible assets
1) Intangible assets acquired separately
Intangible assets with finite useful lives that are acquired separately are initially measured at cost
and subsequently measured at cost less accumulated amortization and accumulated impairment loss.
Amortization is recognized on a straight-line basis. The estimated useful lives, residual values, and
amortization methods are reviewed at the end of each reporting period, with the effect of any
changes in the estimates accounted for on a prospective basis. Intangible assets with indefinite
useful lives that are acquired separately are measured at cost less accumulated impairment loss.
2) Derecognition of intangible assets
On derecognition of an intangible asset, the difference between the net disposal proceeds and the
carrying amount of the asset is recognized in profit or loss.
j. Impairment of property, plant and equipment, right-of-use asset, intangible assets other than goodwill
At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and
equipment, right-of-use asset and intangible assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to
estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of
the cash-generating unit to which the asset belongs.
The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable
amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying
amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting
impairment loss recognized in profit or loss.
When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset or
cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent
of the carrying amount (less amortization or depreciation expense) that would have been determined
had no impairment loss been recognized on the asset or cash-generating unit in prior years. A reversal
of an impairment loss is recognized in profit or loss.
k. Financial instruments
Financial assets and financial liabilities are recognized when the Group becomes a party to the
contractual provisions of the instruments.
Transaction costs that are directly attributable to the acquisition or issuance of financial assets and
financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss
or “FVTPL”) are added to or deducted from the fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of
financial assets or financial liabilities at FVTPL are recognized immediately in profit or loss.
1) Financial assets
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All regular way purchases or sales of financial assets are recognized and derecognized on a trade
date basis.
a) Measurement categories
Financial assets are classified into the following categories: Financial assets at FVTPL, financial
assets at amortized cost and investments in equity instruments at fair value through other
comprehensive income (“FVTOCI”).
i. Financial assets at FVTPL
Financial asset is classified as at FVTPL when such a financial asset is mandatorily

classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include
investments in equity instruments which are not designated as at FVTOCI.
Financial assets at FVTPL are subsequently measured at fair value, and any dividends and
remeasurement gains or losses on such financial assets are recognized in other gains or
losses. Fair value is determined in the manner described in Note 23: Financial Instruments.
ii. Financial assets at amortized cost
Financial assets that meet the following conditions are subsequently measured at amortized
cost:
i) The financial assets are held within a business model whose objective is to hold
financial assets in order to collect contractual cash flows; and
ii) The contractual terms of the financial assets give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal amount outstanding.
Subsequent to initial recognition, financial assets at amortized cost, including cash and cash
equivalents, accounts receivable, notes receivable, other receivables, other financial assets
and refundable deposits are measured at amortized cost, which equals the gross carrying
amount determined using the effective interest method less any impairment loss. Exchange
differences are recognized in profit or loss.
Interest income is calculated by applying the effective interest rate to the gross carrying
amount of such a financial asset
A financial asset is credit impaired when one or more of the following events have occurred:
i) Significant financial difficulty of the issuer or the borrower;
ii) Breach of contract, such as a default;
iii) It is becoming probable that the borrower will enter bankruptcy or undergo a financial
reorganization; or
iv) The disappearance of an active market for that financial asset because of financial
difficulties.
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Cash equivalents include time deposits with original maturities within 3 months from the
date of acquisition, which are highly liquid, readily convertible to a known amount of cash
and are subject to an insignificant risk of changes in value. These cash equivalents are held
for the purpose of meeting short-term cash commitments.
iii. Investments in equity instruments at FVTOCI
On initial recognition, the Group may make an irrevocable election to designate investments
in equity instruments as at FVTOCI. Designation as at FVTOCI is not permitted if the
equity investment is held for trading or if it is contingent consideration recognized by an
acquirer in a business combination.
Investments in equity instruments at FVTOCI are subsequently measured at fair value with
gains and losses arising from changes in fair value recognized in other comprehensive
income and accumulated in other equity. The cumulative gain or loss will not be reclassified
to profit or loss on disposal of the equity investments; instead, it will be transferred to
retained earnings.
Dividends on these investments in equity instruments are recognized in profit or loss when
the Group’s right to receive the dividends is established, unless the dividends clearly
represent a recovery of part of the cost of the investment.
b) Impairment of financial assets
The Group recognizes a loss allowance for expected credit losses on financial assets at
amortized cost (including accounts receivable).
The Group always recognizes lifetime expected credit losses (ECLs) for trade receivables. For
all other financial instruments, the Group recognizes lifetime ECLs when there has been a
significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on
a financial instrument has not increased significantly since initial recognition, the Group
measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.
Expected credit losses reflect the weighted average of credit losses with the respective risks of
default occurring as the weights. Lifetime ECLs represent the expected credit losses that will
result from all possible default events over the expected life of a financial instrument. In
contrast, 12-month ECLs represent the portion of lifetime ECLs that is expected to result from
default events on a financial instrument that are possible within 12 months after the reporting
date.
For internal credit risk management purposes, the Group determines the following situations as
indication that a financial asset is in default (without taking into account any collateral held by
the Group):
i. Internal or external information shows that the debtor is unlikely to pay its creditors.
ii. Financial asset is more than 180 days past due unless the Group has reasonable and
corroborative information to support a more lagged default criterion.
The impairment loss of all financial assets is recognized in profit or loss by a reduction in their
carrying amounts through a loss allowance account.
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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 party.
On derecognition of a financial asset at amortized cost in its entirety, the difference between the
asset’s carrying amount and the sum of the consideration received and receivable is recognized
in profit or loss. However, on derecognition of an investment in an equity instrument at
FVTOCI, the cumulative gain or loss which had been recognized in other comprehensive
income is transferred directly to retained earnings, without recycling through profit or loss.
2) Financial liabilities
a) Subsequent measurement
Financial liabilities are measured at amortized cost using the effective interest method.
b) Derecognition of financial liabilities
The difference between the carrying amount of a financial liability derecognized and the
consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognized in profit or loss.
l. Revenue recognition
The Group identifies contracts with customers, allocates the transaction price to the performance
obligations and recognizes revenue when performance obligations are satisfied.
Revenue from the sale of goods
Revenue from the sale of goods comes from sales of tires and tubes for vehicles, and other related
products. The Group recognizes revenue and accounts receivable when promised goods are delivered to
the customer’s specified location or loaded on vessels at which point the customer obtains control of the
goods and performance obligation is satisfied.
m. Leases
At the inception of a contract, the Group assesses whether the contract is, or contains, a lease.
1) The Group as lessor
Leases are classified as finance leases whenever the terms of a lease transfer substantially all the
risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
Lease payments (less any lease incentives payable) from operating leases are recognized as income
on a straight-line basis over the terms of the relevant leases.
2) The Group as lessee
The Group recognizes right-of-use assets and lease liabilities for all leases at the commencement
date of a lease, except for short-term leases and low-value asset leases accounted for applying a
recognition exemption where lease payments are recognized as expenses on a straight-line basis
over the lease period.
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Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease
liabilities adjusted for lease payments made at or before the commencement date, plus any initial
direct costs incurred and an estimate of costs needed to restore the underlying assets, and less any
lease incentives received. Right-of-use assets are subsequently measured at cost less accumulated
depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities.
Right-of-use assets are presented on a separate line in the consolidated balance sheets.
Right-of-use assets are depreciated using the straight-line method from the commencement dates to
the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.
However, if leases transfer ownership of the underlying assets to the Group by the end of the lease
terms or if the costs of right-of-use assets reflect that the Group will exercise a purchase option, the
Group depreciates the right-of-use assets from the commencement dates to the end of the useful
lives of the underlying assets.
Lease liabilities are initially measured at the present value of the lease payments, which comprise
fixed payments, in-substance fixed payments, variable lease payments which depend on an index or
a rate, residual value guarantees, the exercise price of a purchase option if the Group is reasonably
certain to exercise that option, and payments of penalties for terminating a lease if the lease term
reflects such termination, less any lease incentives receivable. The lease payments are discounted
using the interest rate implicit in a lease, if that rate can be readily determined. If that rate cannot be
readily determined, the Group uses its incremental borrowing rate.
Subsequently, lease liabilities are measured at amortized cost using the effective interest method,
with interest expense recognized over the lease terms. When there is a change in the lease term, the
Group remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets.
However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount
of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line
in the consolidated balance sheets.
n. Borrowing costs
Borrowing costs directly attributable to an 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.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
Other than those stated above, all other borrowing costs are recognized in profit or loss in the period in
which they are incurred.
o. Government grants
Government grants are not recognized until there is reasonable assurance that the Group will comply
with the conditions attached to them and that the grants will be received.
Government grants related to income are recognized in profit or loss on a systematic basis over the
periods in which the Group recognizes as expenses the related costs that the grants intend to
compensate. Specifically, government grants whose primary condition is that the Group should
purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and
transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.
The benefit of a government loan received at a below-market rate of interest is treated as a government
grant measured as the difference between the proceeds received and the fair value of the loan based on
prevailing market interest rates.
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p. Employee benefits
1) Short-term employee benefits
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted
amount of the benefits expected to be paid in exchange for the related services.
2) Retirement benefits
Payments to defined contribution retirement benefit plans are recognized as expenses when
employees have rendered services entitling them to the contributions.
Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit
retirement benefit plans are determined using the projected unit credit method. Current service cost
and net interest on the net defined benefit liabilities are recognized as employee benefits expense in
the period in which they occur. Remeasurement, comprising actuarial gains and losses and the
return on plan assets (excluding interest), is recognized in other comprehensive income in the period
in which it occurs. Remeasurement recognized in other comprehensive income is reflected
immediately in retained earnings and will not be reclassified to profit or loss.
Net defined benefit liabilities represent the actual deficit in the Group’s defined benefit plans.
q. Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
1) Current tax
Income tax payable (recoverable) is based on taxable profit (loss) for the year determined according
to the applicable tax laws of each tax jurisdiction.
According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is
provided for in the year the shareholders approve to retain earnings.
Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax
provision.
2) Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and
liabilities and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax
assets are generally recognized for all deductible temporary differences, unused loss carryforwards
and research and development expenditures 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 difference
and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred
tax assets arising from deductible temporary differences associated with such investments and
interests are recognized only to the extent that it is probable that there will be sufficient taxable
profits against which to utilize the benefits of the temporary differences and they are expected to
reverse in the foreseeable future.
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The carrying amount of deferred tax assets is reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable that sufficient taxable profits will be available to
allow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also
reviewed at the end of each reporting period and recognized to the extent that it has become
probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the
period in which the liabilities are settled or the assets are realized, based on tax rates and tax laws
that have been enacted or substantively enacted by the end of the reporting period. The
measurement of deferred tax liabilities and assets reflects the tax consequences that would follow
from the manner in which the Group expects, at the end of the reporting period, to recover or settle
the carrying amount of its assets and liabilities.
3) Current and deferred taxes
Current and deferred taxes 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 taxes are also recognized in other comprehensive income or directly in equity, respectively.
5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION

UNCERTAINTY
In the application of the Group’s accounting policies, management is required to make judgments,
estimations, and assumptions about the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical experience
and other factors that are considered relevant. Actual results may differ from these estimates.
The Group considers the economic implications of the COVID-19 when making its critical accounting
estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimates are revised if the revisions affect
only that period or in the period of the revisions and future periods if the revisions affect both current and
future periods.
Write-down of Inventories
The net realizable value of inventories is the estimated selling price in the ordinary course of business less
the estimated costs of completion and the estimated costs necessary to make the sale. The estimation of net
realizable value is based on current market conditions and historical experience with product sales of a
similar nature. Changes in market conditions may have a material impact on the estimation of the net
realizable value.
6. CASH AND CASH EQUIVALENTS
December 31
2020 2019
Cash on hand $ 4,822 $ 12,492

Checking accounts and demand deposits 6,687,188 6,945,578
Cash equivalents (time deposits with original maturities of 3 months
or less) 1,793,398 668,439
$ 8,485,408 $ 7,626,509
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7. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
December 31
2020 2019
Non-current
Investments in equity instruments at FVTOCI

Domestic unlisted shares $ 438,814 $ 367,064
Foreign unlisted shares 139,605 148,351
$ 578,419 $ 515,415
These investments in equity instruments are held for medium-to long-term strategic purposes. Accordingly,
the management elected to designate these investments in equity instruments as at FVTOCI as they believe
that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be
consistent with the Group’s strategy of holding these investments for long-term purposes.
8. NOTES AND ACCOUNTS RECEIVABLE
December 31
2020 2019
Notes receivable
At amortized cost $ 430,967 $ 315,758
Accounts receivable
At amortized cost
Gross carrying amount $ 3,504,194 $ 3,451,911
Less: Allowance for impairment loss (90,331) (79,797)
$ 3,413,863 $ 3,372,114
The credit periods of sales of goods are between 30 days and 90 days from the date of the invoice. No
interest is charged on accounts receivable.
The Group measures the loss allowance for accounts receivable at an amount equal to lifetime ECLs. The
expected credit losses on accounts receivable are estimated using a provision matrix approach considering
the past default experience of the customer, the customer’s current financial position, economic condition
of the industry in which the customer operates, as well as the GDP forecasts and industry outlook. The
Group uses different provision matrixes based on customer segments by geographical region, and
determines the expected credit loss rate.
The Group writes off an accounts receivable when there is evidence indicating that the debtor is in severe
financial difficulty and there is no realistic prospect of recovery. For accounts receivable that have been
written off, the Group continues to engage in enforcement activity to attempt to recover the receivables due.
Where recoveries are made, these are recognized in profit or loss.
~ 137
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The following table details the loss allowance of accounts receivable based on the Group’s provision
matrix.
December 31, 2020

Over
Not Past Due 1 to 30 Days 31 to 60 Days 61 to 90 Days 91 to 120 Days 121 to 180 Days 181 Days Total
Gross carrying amount $ 3,618,525 $ 193,134 $ 18,886 $ 5,229 $ 1,326 $ 3,194 $ 94,887 $ 3,935,161
Loss allowance (Lifetime
ECLs) (428 ) (1,327 ) (2,436 ) (252 ) (20 ) (443 ) (85,425 ) (90,331 )
Amortized cost $ 3,618,097 $ 191,807 $ 16,430 $ 4,977 $ 1,306 $ 2,751 $ 9,462 $ 3,844,830
December 31, 2019

Over
Not Past Due 1 to 30 Days 31 to 60 Days 61 to 90 Days 91 to 120 Days 121 to 180 Days 181 Days Total
Gross carrying amount $ 3,251,973 $ 318,254 $ 60,155 $ 23,930 $ 14,378 $ 11,735 $ 87,244 $ 3,767,669
Loss allowance (Lifetime
ECLs) - (3,183 ) (1,743 ) (1,198 ) (1,533 ) (3,625 ) (68,515 ) (79,797 )
Amortized cost $ 3,251,973 $ 315,071 $ 58,412 $ 22,732 $ 12,845 $ 8,110 $ 18,729 $ 3,687,872
The movements of the loss allowance of notes and accounts receivable were as follows:
For the Year Ended December 31

2020 2019
Balance at January 1 $ 79,797 $ 80,553

Add: Net remeasurement of loss allowance 29,569 8,675
Less: Amounts written off (19,124) (6,571)
Foreign exchange gains and losses 89 (2,860)
Balance at December 31 $ 90,331 $ 79,797
Refer to Note 25 for information relating to notes and accounts receivable pledged as security.
9. INVENTORIES
December 31
2020 2019
Finished goods $ 2,230,140 $ 2,582,090

Work in progress 409,782 494,585
Raw materials 2,993,420 3,337,417
Supplies 330,036 307,340
Merchandise 62,718 44,400
Inventory in transit 1,663,395 1,164,956
$ 7,689,491 $ 7,930,788
The cost of revenue associated with inventories were $22,910,212 thousand and $25,570,683 thousand,
respectively, for the years ended December 31, 2020 and 2019. The cost of revenue consisted of reversal of
inventory write-downs of $23,933 thousand and inventory write-downs of $45,420 thousand.
Refer to Note 25 for information relating to inventories pledged as security.
~ 138
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10. OTHER FINANCIAL ASSETS
December 31
2020 2019
Current
Time deposits with original maturities more than 3 months $ 1,838,434 $ 3,101,387
Others 2,186 76,730
$ 1,840,620 $ 3,178,117
Non-current
Repatriated funds $ 1,268,181 $ -
Repatriated funds refer to demand and time deposits pertinent to regulations governing repatriated offshore
funds, which the use is restricted.
Refer to Note 23 for information relating to credit risk management and valuation. Refer to Note 25 for
information relating to other financial assets pledged as security.
11. SUBSIDIARIES
a. Subsidiaries included in the consolidated financial statements
Proportion of Ownership
(%)
December 31
Investor Investee Nature of Activities 2020 2019 Remark
The Company American Kenda Rubber Ind. Co., Trading and investing activities 100% 100% -
Ltd. (KA)
Kenda Rubber Ind. Co., (Hong Trading and investing activities 100% 100% -
Kong) Ltd. (KHK)
Kenda Rubber (Vietnam) Co., Manufacturing and selling of 100% 100% -
Ltd. (KV) various types of tires
Kenda Rubber Industrial Co. Marketing planning activities 100% 100% -
(Europe GmbH) (KE)
Kenda International Corporation Investing activities 100% 100% -
Co., Ltd. (KIC)
Kenfong Industrial Co., Ltd. (KF) Manufacturing and selling of 100% 100% -
various types of tires
Pt. Kenda Rubber Indonesia (KI) Manufacturing and selling of 99.99% 99.99% -
KA Americana Development, Inc. Manufacturing of rims and 100% 100% -
(ADI) distribution and selling of
wheels and rims
KHK Kenda Rubber (Shenzhen) Ltd. Manufacturing and selling of 60% 60% -
(KS) various types of tires
Kenda Rubber (Tianjin) Co., Ltd. Manufacturing and selling of 13.64% 13.64% -
(KT) various types of tires
KIC Kenda Global Holding Co., Ltd. Investing activities 100% 100% -
(KGH)
Kenda Global Investment Investing activities 100% 100% -
Corporation (KGI)
KGI STARCO Europe A/S Investing activities 100% 100% -
KGH Kenda Global (China) Investment Investing activities 100% 100% -
Corporation (KGCI)
Kenda Rubber (Shenzhen) Ltd. Manufacturing and selling of 40% 40% -
(KS) various types of tires
(Continued)
~ 139
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Proportion of Ownership
(%)
December 31
Investor Investee Nature of Activities 2020 2019 Remark
KGCI Kenda Rubber (Tianjin) Co., Ltd. Manufacturing and selling of 86.36% 86.36% -
(KT) various types of tires
Kenda Rubber (China) Ltd. (KC) Manufacturing and selling of 100% 100% -
STARCO Europe A/S STARCO GB Ltd. Distribution and selling of various 100% 100% -
types of tires and rims
STARCO GmbH Distribution and selling of various 100% 100% -
STARCO Polska Sp.z.o.o. Distribution and selling of various 100% 100% -
STARCO NV Distribution and selling of various 100% 100% -
STARCO GS AG Distribution and selling of various 100% 100% -
STARCO Baltic OÜ Distribution and selling of various 100% 100% -
STARCO SAS Distribution and selling of various 100% 100% -
STARCO Beli Manastir d.o.o. Manufacturing of various types of 100% 100% -
rims
STARCO DML Manufacturing and distribution 100% 100% -
and selling of tires and rims
Jelshoj Imovina d.o.o. (STARCO Investing activities 100% 100% -
Jelshoj)
STARCO IPR GmbH Investing activities 100% 100% -
(Concluded)
b. Subsidiaries excluded from the consolidated financial statements: None.
12. PROPERTY, PLANT AND EQUIPMENT
Equipment
Under
Installation
and
Machinery and Other Construction in
Land Buildings Equipment Equipment Progress Total
Cost
Balance at January 1, 2020 $ 2,500,071 $ 6,934,123 $ 16,169,165 $ 2,034,339 $ 469,948 $ 28,107,646

Additions - 26,276 130,620 62,901 304,350 524,147
Disposals - (887) (632,689) (40,301) - (673,877)
Reclassification - 102,872 1,600,895 55,910 (309,910) 1,449,767
Effects of foreign currency
exchange differences (2,122) (89,947) (184,986) (14,470) (12,997) (304,522)
Balance at December 31, 2020 $ 2,497,949 $ 6,972,437 $ 17,083,005 $ 2,098,379 $ 451,391 $ 29,103,161
Accumulated depreciation
and impairment
Balance at January 1, 2020 $ - $ 2,556,876 $ 9,975,407 $ 1,328,424 $ - $ 13,860,707

Depreciation expense - 215,226 974,119 160,928 - 1,350,273
Disposals - (621) (575,794) (35,651) - (612,066)
Impairment - 6,320 9,720 - - 16,040
exchange differences - (12,152) (36,885) (6,734) - (55,771)
Balance at December 31, 2020 $ - $ 2,765,649 $ 10,346,567 $ 1,446,967 $ - $ 14,559,183
Carrying amount at January 1,

2020 $ 2,500,071 $ 4,377,247 $ 6,193,758 $ 705,915 $ 469,948 $ 14,246,939
Carrying amount at
December 31, 2020 $ 2,497,949 $ 4,206,788 $ 6,736,438 $ 651,412 $ 451,391 $ 14,543,978
(Continued)
~ 140
- 26 ~-
Equipment
Under
Installation
and
Machinery and Other Construction in
Land Buildings Equipment Equipment Progress Total
Cost
Balance at January 1, 2019 $ 2,504,537 $ 6,698,562 $ 15,639,129 $ 1,973,550 $ 358,387 $ 27,174,165

Additions - 73,905 415,186 67,339 467,463 1,023,893
Disposals - (919) (348,198) (18,559) - (367,676)
Reclassification - 348,067 887,175 51,197 (360,704) 925,735
exchange differences (4,466) (185,492) (424,127) (39,188) 4,802 (648,471)
Balance at December 31, 2019 $ 2,500,071 $ 6,934,123 $ 16,169,165 $ 2,034,339 $ 469,948 $ 28,107,646
and impairment
Balance at January 1, 2019 $ - $ 2,393,223 $ 9,512,681 $ 1,203,080 $ - $ 13,108,984

Depreciation expenses - 237,410 918,476 165,426 - 1,321,312
Disposals - (635) (196,818) (14,842) - (212,295)
Reclassification - 1,379 15,963 369 - 17,711
exchange differences - (74,501) (274,895) (25,609) - (375,005)
Balance at December 31, 2019 $ - $ 2,556,876 $ 9,975,407 $ 1,328,424 $ - $ 13,860,707
Carrying amount at January 1,

2019 $ 2,504,537 $ 4,305,339 $ 6,126,448 $ 770,470 $ 358,387 $ 14,065,181
Carrying amount at
December 31, 2019 $ 2,500,071 $ 4,377,247 $ 6,193,758 $ 705,915 $ 469,948 $ 14,246,939
(Concluded)
The above items of property, plant and equipment used by the Group are depreciated on a straight-line basis
over their estimated useful lives as follows:
Building 10-55 years

Machinery and equipment 3-30 years
Other equipment 2-20 years
A portion of the land for operational use in Chongyang section of Yuanlin City and Citong Township of
Yunlin County is categorized as agricultural and pasture land. The title of the land is currently registered
under a related party, Mr. Chen, who is the trustee in a land trust agreement with the Company. The
Company retains the certificate of title for land and the agreement stipulates that the nominal holder or
trustee is prohibited from transferring the ownership to another party. The land will be registered under the
Company once the category for land use has been changed.
The Group has been constructing factories in Vietnam; the prepayments for machinery and equipment of
$926,507 thousand and $1,535,058 thousand as of December 31, 2020 and 2019 were presented in other
non-current assets.
Property, plant and equipment pledged as collateral for borrowings are set out in Note 25.
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13. LEASE ARRANGEMENTS
a. Right-of-use assets
December 31
2020 2019
Carrying amount
Land $ 1,389,524 $ 1,513,028

Buildings 109,240 172,878
Machinery and equipment 24,058 34,795
Other equipment 11,248 16,857
$ 1,534,070 $ 1,737,558

2020 2019
Additions to right-of-use assets $ 4,117 $ 299,745
Depreciation charge for right-of-use assets

Land $ 30,471 $ 32,022
Buildings 69,410 75,318
Machinery and equipment 10,594 12,357
Other equipment 8,569 8,503
$ 119,044 $ 128,200
b. Lease liabilities
December 31
2020 2019
Carrying amount
Current $ 88,484 $ 98,239

Non-current $ 363,273 $ 452,527
Range of discount rates for lease liabilities was as follows:
December 31
2020 2019
Land 3.00% 3.00%

Buildings 2.75%-3.20% 2.75%-3.20%
Machinery and equipment 2.75%-3.20% 2.75%-3.20%
Other equipment 2.75%-3.20% 2.75%-3.20%
c. Material leasing activities and terms
KS, KC, and KT signed land use right contracts with Longhua, Penglang, Kunshan, and Tianjin
government in mainland China, respectively; the periods of the land use right contracts are between 40
and 50 years. KV signed a land use right contract with Jiangtian Industrial Zone, Dong Nai Province in
Vietnam; the period of the land use right contract is between 33 and 43 years.
~ 142
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The land use right contracts stipulated that the above companies have the rights to use, to make profit
from, to transfer, to sublet and have other rights to dispose, and should pay taxes associated with using
the land. The land use right contracts permit lessee to construct factories, office buildings and
employees’ dormitories on the land.
KI signed a land use right contract with the government of Serang, Banten Province in Indonesia. The
land use right contract permits KI to construct factories, office buildings and employees’ dormitories on
the land.
d. Other lease information

2020 2019
Expenses relating to short-term leases $ 33,889 $ 32,838

Expenses relating to low-value asset leases $ 196 $ 329
Total cash outflow for leases $ 138,439 $ 140,933
All lease commitments with lease terms commencing after the balance sheet dates are as follows:
December 31
2020 2019
Lease commitments $ 613,651 $ 728,585
14. INVESTMENT PROPERTIES
Right-of-use
Assets
Cost
Balance at January 1, 2020 $ -

Transfers from right-of-use assets 31,986
Effects of foreign currency exchange differences 607
Balance at December 31, 2020 $ 32,593
Accumulated depreciation and impairment
Balance at January 1, 2020 $ -

Depreciation expense 279
Transfers from right-of-use assets 3,065
Effects of foreign currency exchange differences 63
Balance at December 31, 2020 $ 3,407
Carrying amount at December 31, 2020 $ 29,186
~ 143
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Investment properties are depreciated using the straight-line method over their estimated useful lives as
follows:
Right-of-use assets 40-50 years
Due to the urbanization policy of future city development in Shenzhen, KS entered into a collaboration
agreement with Kaisa Urban Renewal Group (“Kaisa”) in October 2014 for the development of KS’s land
use rights. According to the agreement, KS and Kaisa will jointly transform KS’s industrial land into new
types of industrial (office), commercial, residential, and government subsidized buildings. The percentage
of joint development and allocation of housing units is based on the agreement subject to government
approval. KS is responsible of relocating the original factories, terminating employees, etc. Whereas, Kaisa
is responsible for demolishing the buildings, measuring, assessing, verifying rights, planning, signing of
compensation agreement, preparing and, acquiring land, construction, and development of the project.
Kaisa provided a guarantee deposit of RMB100,000 thousand (approximately $436,528 thousand presented
in non-current liabilities) to support KS’s financial need. The deposit will be offset against the market value
of property that shall be allocated to KS.
As of December 31, 2020, KS has commenced to relocate the original factories, terminate employees and
perform other related tasks and the associated right-of-use assets have been classified as investment
properties.
The determination of fair value was performed by independent qualified professional valuers, and the fair
value was measured using Level 3 inputs. The valuation was arrived at by reference to the Residual Land
Value Method. The fair value as appraised was $5,784,537 thousand.
15. BORROWINGS
a. Short-term borrowings
December 31
2020 2019
Unsecured borrowings $ 2,303,295 $ 2,188,147

Secured borrowings (Note 25) (1) 96,653 184,506
$ 2,399,948 $ 2,372,653
Range of interest rates 0.65%-3.72% 0.65%-3.72%
b. Long-term borrowings
December 31
2020 2019

Secured borrowings (Note 25) (1) 807,976 674,026
Project borrowing (2) 420,577 383,102
14,361,789 14,353,700
Less: Current portion 2,517,453 1,291,805
Long-term borrowings $ 11,844,336 $ 13,061,895
Range of interest rates 0.00%-3.25% 0.65%-4.50%

Maturity date 110-115 years 109-118 years
~ 144
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1) As stipulated in the loan agreements, the Company, KA, ADI and some of the subsidiaries of
STARCO Europe A/S should pledge assets as collaterals and, additionally, maintain certain
covenants related to financial ratios. There was no breach of loan agreements associated with
financial covenants as of December 31, 2020.
2) The Group participated in a project of the Ministry of Economic Affairs that encouraged Taiwanese
enterprises to invest locally. The Group expects to construct or expand factories, and acquire
machinery and equipment in Taiwan from 2019 to 2022. Any shortage of funds would be financed
via bank borrowings.
16. RETIREMENT BENEFIT PLANS
a. Defined contribution plan
The Company and its subsidiaries in Taiwan adopted a pension plan under the Labor Pension Act
(LPA), which is a state-managed defined contribution plan. Under the LPA, the Company makes
monthly contributions to employees’ individual pension accounts at 6% of monthly salaries and wages.
The employees of the Group’s subsidiaries in the United States, Vietnam, Indonesia, Europe and
mainland China are members of state-managed retirement benefit plans operated by the governments.
The subsidiaries are required to contribute specified percentages of payroll costs to the retirement
benefit schemes to fund the benefits. The only obligation of the Group with respect to the retirement
benefit plan is to make the specified contributions.
b. Defined benefit plans
The defined benefit plans adopted by the Company in accordance with the Labor Standards Act is
operated by the government of the ROC. Pension benefits are calculated on the basis of the length of
service and average monthly salaries of the 6 months before retirement. The Company contributes
amounts equal to 15% of total monthly salaries and wages to a pension fund administered by the
pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the
committee’s name. Before the end of each year, the Company assesses the balance in the pension fund.
If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees
who conform to retirement requirements in the next year, the Company is required to fund the
difference in one appropriation that should be made before the end of March of the next year. The
pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the
Company has no right to influence the investment policy and strategy.
The subsidiary in Indonesia adopted a defined benefit plan and the remeasurement of the plan is carried
out by qualified actuaries in compliant with the local labor standards law.
The amounts included in the consolidated balance sheets in respect of the Company’s defined benefit
plans are as follows:
December 31
2020 2019
Present value of defined benefit obligation $ 648,243 $ 640,063

Fair value of plan assets (403,452) (391,876)
Net defined benefit liabilities $ 244,791 $ 248,187
~ 145
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Movements in net defined benefit liabilities were as follows:
Present Value
of Defined Net Defined
Benefit Fair Value of Benefit
Obligation the Plan Assets Liabilities
Balance at January 1, 2019 $ 629,357 $ (361,751) $ 267,606

Service cost
Current service cost 7,480 - 7,480
Net interest expense (income) 6,181 (3,675) 2,506
Recognized in profit or loss 13,661 (3,675) 9,986
Remeasurement
Return on plan assets (excluding amounts
included in net interest) - (12,739) (12,739)
Actuarial loss - changes in demographic
assumptions 108 - 108
Actuarial loss - changes in financial
assumptions 15,491 - 15,491
Actuarial loss - experience adjustments 9,174 - 9,174
Recognized in other comprehensive income 24,773 (12,739) 12,034
Contributions from the employer - (41,439) (41,439)
Benefits paid (27,728) 27,728 -
Balance at December 31, 2019 640,063 (391,876) 248,187
Service cost
Remeasurement
Benefits paid (41,986) 41,986 -
Balance at December 31, 2020 $ 648,243 $ (403,452) $ 244,791
Through the defined benefit plans under the Labor Standards Act, the Company is exposed to the
following risks:
1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities,
bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the
mandated management. However, in accordance with relevant regulations, the return generated by
plan assets shall not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in the government and corporate bond interest rate will increase the present
value of the defined benefit obligation; however, this will be partially offset by an increase in the
return on the plans’ debt investments.
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3) Salary risk: The present value of the defined benefit obligation is calculated using the future salaries
of plan participants. As such, an increase in the salaries of the plan participants will increase the
present value of the defined benefit obligation.
The actuarial valuations of the present value of the defined benefit obligation were carried out by
qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations are as
follows:
December 31
2020 2019
Discount rate 0.30% 0.75%

Expected rate of salary increase 2.00% 2.00%
If possible reasonable changes in each of the significant actuarial assumptions occur and all other
assumptions remain constant, the present value of the defined benefit obligation will increase (decrease)
as follows:
December 31
2020 2019
Discount rates
0.25% increase $ (15,190) $ (15,496)
0.25% decrease $ 15,745 $ 16,078
Expected rates of salary increase
0.25% increase $ 15,439 $ 15,837
0.25% decrease $ (15,745) $ (15,346)
The above sensitivity analysis presented above may not be representative of the actual changes in the
present value of the defined benefit obligation as it is unlikely that changes in assumptions will occur in
isolation of one another as some of the assumptions may be correlated.
December 31
2020 2019
Expected contributions to the plans for the next year $ 34,436 $ 34,369
Average duration of the defined benefit obligation 9 years 9 years
17. EQUITY
a. Ordinary shares
December 31
2020 2019
Shares authorized (in thousands of shares) 910,000 880,000

Shares authorized, par value $10 (in thousands of dollars) $ 9,100,000 $ 8,800,000
Shares issued and fully paid (in thousands of shares) 909,410 874,430
Shares issued and fully paid (in thousands of dollars) $ 9,094,100 $ 8,744,300
The change in the Company’s share capital is mainly resulted from the process of converting its
retained earnings into share capital via issuing new shares.
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b. Retained earnings and dividends policy
The shareholders of the Company held their regular meeting on June 11, 2019 and in that meeting,
resolved the amendments to the Company’s Articles of Incorporation (the “Articles”). The amendments
explicitly stipulate that the Company’s board of directors is authorized to adopt a special resolution to
distribute dividends and bonuses in cash and a report of such distribution should be submitted in the
Under the dividends policy as set forth in the amended Articles, the Company takes into consideration
the Company’s operating environment, growth stage, future capital needs, long-term financial plans,
and the shareholders’ demand for cash inflows before resolving the amount of dividends. The
Company’s board of directors could propose dividends between 10% and 80% of distributable earnings
which comprise of the current remaining earning and undistributed earnings from previous year. When
distributing dividends via issuing shares, the motion should be submitted to shareholders’ meeting for
approval. The shareholders may adjust the ratio of share dividends to reflect the profit and the adequacy
of capital of the year. The cash dividends shall not be less than 10% of the total dividend declared. The
board of directors is authorized to adopt a resolution to distribute dividends, bonuses, legal reserve and
all or a portion of the capital surplus in cash and a report of such distribution should be submitted to the
Under the dividends policy as set forth in the Articles before the amendments, where the Company
retains unappropriated earnings during a fiscal year, the earnings shall be first reserved for paying taxes,
offsetting losses of previous years, setting aside as legal reserve at 10% of the remaining earnings,
except when the legal reserve equals to the paid-in capital of the Company. The Company could
appropriate or reverse a special reserve in accordance with the laws, regulations or order of competent
authority, when necessary.
The Company takes into consideration of the operating environment, growth stage, future capital needs,
long-term financial plans, and the shareholders’ demand for cash inflows, the Company’s board of
directors could propose dividends between 10% and 80% of distributable earning which comprise of the
current remaining earning and undistributed earnings from previous year. When distributing dividends
via issuing shares, the motion should be submitted to shareholders meeting for approval. The cash
dividends shall not be less than 10% of the total dividend declared. The shareholders may adjust the
ratio and the instruments of distributions to reflect the profit and the adequacy of capital of the year. For
the policies on the distribution of compensation of employees and remuneration of directors and
supervisors after the amendment, refer to compensation of employees and remuneration of directors and
supervisors in Note 19(g).
Appropriation of earnings to a legal reserve shall be made until the legal reserve equals the Company’s
paid-in capital. The legal reserve may be used to offset deficit. If the Company has no deficit and the
legal reserve has exceeded 25% of the Company’s paid-in capital, the excess may be transferred to
capital or distributed in cash.
Items referred to under Rule No. 1010012865 and in the directive titled “Questions and Answers for
Special Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed
from a special reserve by the Company.
The appropriations of earnings for 2019 and 2018 were as follows:
Appropriations of Earnings Dividends Per Share (NT$)

2019 2018 2019 2018
Legal reserve $ 100,220 $ 68,917

Special reserve (reversal) 361,099 (108,439)
Cash dividends 349,772 874,430 $ 0.4 $ 1.0
Share dividends 349,800 - 0.4 -
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The appropriations of earnings for 2020 were proposed by the Company’s board of directors on March
25, 2021 as follows:
For the Year

Ended
December 31,
2020
Legal reserve $ 94,768

Special reserve 270,948
Cash dividends 909,410
Cash dividends per share (NT$) 1.0
The appropriation of earnings for 2020 will be resolved by the shareholders in their meeting to be held
on June 18, 2021.
18. REVENUE
a. Revenue from contracts with customers

2020 2019
Major goods/service lines
Bicycle tires $ 3,399,514 $ 3,390,353

Motorcycle and bias tires 12,084,555 14,936,010
Radial tires 7,887,759 7,204,753
Tubes 2,587,852 2,779,516
Others 4,300,505 3,816,804
$ 30,260,185 $ 32,127,436
b. Contract balances
December 31
2020 2019
Contract liabilities - current $ 273,652 $ 220,603
The Group sells tires and other rubber products predominantly via dealers. It is stipulated in the
contracts that volume discount is offered if a specific threshold of purchase is achieved. The Group
provides agreed-upon percentages of refund or discount to dealers in accordance with the contracts.
Based on historical experience, the Group estimates a reasonable amount of refund and recognizes it as
refund liability (presented in other current liabilities).
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19. NET PROFIT
a. Other operating income and expenses

2020 2019
Severance costs (1) $ (691,578) $ -

Antidumping duties (2) (229,964) -
Impairment loss recognized on property, plant and equipment (1) (16,040) -
$ (937,582) $ -
1) Due to the urbanization policy of future city development in Shenzhen, KS entered into a
collaboration agreement with Kaisa for the development of KS’s land use rights. KS and Kaisa will
jointly transform KS’s industrial land into a new type of commercial buildings. Hence, per the
agreement, KS will relocate the original factories, terminate employees, etc. The development was
already approved by City Renewal and Land Development Bureau of Shenzhen Municipality in
Longhua District, Shenzhen in December 2019. KS has commenced to terminate employment
contracts with its employees since January 2020 and offered severance packages which totaled
$691,578 thousand (RMB161 million). Additionally, KS has initiated to relocate and dispose its
property, plant and equipment. A review of the recoverable amount of the related equipment was
carried out and led to the recognition of an impairment loss of $16,040 thousand. Refer to Note 14
for information associated with the collaboration agreement.
2) Per administrative review, the U.S. Department of Commerce notified KA in June 2019 to impose
anti-dumping duties (“ADD”) on the total import price of automobile tires imported from China
between August 2016 and July 2017. The result of the administrative review was unrepresentative
to all enterprises importing automobile tires from China. The ADD rate was raised from 8.72% to
64.57%. Based on historical experience, KA considered that the duty rate was unreasonable and has
filed an appeal to the U.S. Court of Appeals for the Federal Circuit. However, the Group accrued
ADD of US$7,778 thousand ($229,964 thousand) and associated interest expense of US$789
thousand ($23,341 thousand) in the financial statements for the year ended December 31, 2020.
b. Other income

2020 2019
Dividends income $ 53,483 $ 65,256

Others 196,856 181,287
$ 250,339 $ 246,543
c. Other gains and losses

2020 2019
Net foreign exchange gains (losses) $ (315,565) $ 8,237

Net loss on disposal of property, plant and equipment (38,003) (1,809)
Net gain (loss) on financial assets and financial liabilities
classified as at FVTPL (46) 2
Others (10,270) (25,423)
$ (363,884) $ (18,993)
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d. Financial costs

2020 2019
Interest on bank loans $ 204,827 $ 262,101

Interest on lease liabilities 13,591 16,432
Others 23,341 5,210
Less: Amounts included in the cost of qualifying assets (317) (1,836)
$ 241,442 $ 281,907
e. Depreciation and amortization

2020 2019
An analysis of depreciation by function

Operating costs $ 1,119,319 $ 1,038,555
Operating expenses 350,277 410,957
$ 1,469,596 $ 1,449,512
An analysis of amortization by function

Operating costs $ 4,678 $ 6,271
Operating expenses 19,019 13,262
$ 23,697 $ 19,533
f. Employee benefits expense

2020 2019
Short-term benefits
Salary expense $ 4,769,041 $ 5,047,729
Labor/health insurance expense 462,176 469,621
5,231,217 5,517,350
Post-employment benefits
Defined contribution plans 247,027 338,783
Defined benefit plans 11,572 11,713
258,599 350,496
Termination benefits (see Note 19(a)) 691,578 -
Other employee benefits 188,049 221,674
Total employee benefits expense $ 6,369,443 $ 6,089,520
An analysis of employee benefits expense by function

Operating costs $ 3,359,368 $ 3,644,552
Operating expenses 2,318,497 2,444,968
Other operating income and expenses 691,578 -
$ 6,369,443 $ 6,089,520
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g. Compensation of employees and remuneration of directors
According to the Company’s Articles, the Company accrued compensation of employees and
remuneration of directors at rates from 0.5% to 1% and no higher than 3%, respectively, of net profit
each year. The compensation of employees and the remuneration of directors for the years ended
December 31, 2020 and 2019, which were approved by the Company’s board of directors on March 25,
2021 and March 26, 2020, respectively, are as follows:

2020 2019
Amount Accrual rate Amount Accrual rate
Compensation of
employees $ 11,188 0.93% $ 11,040 1.00%
Remuneration of directors $ 16,793 1.40% $ 16,570 1.49%
If there is a change in the amounts after the annual consolidated financial statements are authorized for
issue, the differences are recorded as a change in the accounting estimate.
There is no difference between the actual amounts of compensation of employees and remuneration of
directors paid and the amounts recognized in the consolidated financial statements for the years ended
December 31, 2019 and 2018.
Information on the compensation of employees and remuneration of directors resolved by the

Company’s board of directors is available at the Market Observation Post System website of the Taiwan
Stock Exchange.
20. INCOME TAXES RELATING TO CONTINUING OPERATIONS.
a. Income tax recognized in profit or loss
Major components of income tax expense are as follows:

2020 2019
Current tax
In respect of the current year $ 482,534 $ 484,088
Adjustments for prior year 148,706 (14,058)
631,240 470,030
Deferred tax
In respect of the current year (115,567) (114,224)
Adjustments for prior year (196,435) (2,387)
(312,002) (116,611)
Income tax expense recognized in profit or loss $ 319,238 $ 353,419
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A reconciliation of accounting profit and income tax expense is as follows:

2020 2019
Profit before tax from continuing operations $ 1,291,463 $ 1,366,978
Income tax expense calculated at the statutory rate $ 362,228 $ 517,126

Nondeductible expenses in determining taxable income (111,114) (127,311)
Tax-exempt income (7,280) (7,247)
Investment tax credits (16,370) (9,291)
Adjustments for prior years’ tax (47,729) (16,445)
Tax incentives associated with repatriation 120,114 -
Others 19,389 (3,413)
b. Income tax recognized in other comprehensive income

2020 2019
Deferred tax
Remeasurement of defined benefit plans $ 5,286 $ 2,407

Translation of the financial statements of foreign operations 86,221 151,250
Total income tax recognized in other comprehensive income $ 91,507 $ 153,657
c. Deferred tax assets and liabilities
The movements of deferred tax assets and deferred tax liabilities are as follows:
For the year ended December 31, 2020
Recognized
in Other
Recognized Compre-
Opening in Profit or hensive Exchange Closing
Balance Loss Income Differences Balance
Deferred tax assets
Exchange differences on
translation of the financial
statements of foreign
operations $ 242,933 $ - $ 86,221 $ - $ 329,154
Loss carryforwards - 102,038 - (3,732) 98,306
Property, plant and equipment 57,657 (15,677) - 377 42,357
Unrealized loss on inventory 38,613 (5,750) - (992) 31,871
Unrealized gains on
intercompany sales 26,584 4,663 - - 31,247
Defined benefit obligations 25,470 - 5,286 - 30,756
Others 50,635 (165) - (1,077) 49,393
$ 441,892 $ 85,109 $ 91,507 $ (5,424) $ 613,084

(Continued)
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Recognized
in Other
Recognized Compre-
Deferred tax liabilities
Reserve for land value increment

tax $ 208,226 $ - $ - $ - $ 208,226
Deferred depreciation expense 68,204 12,637 - (4,128) 76,713
Share of profit of associates 246,844 (246,844) - - -
Others 24,050 7,314 - 624 31,988
$ 547,324 $ (226,893) $ - $ (3,504) $ 316,927

(Concluded)
Recognized
in Other
Recognized Compre-
Deferred tax assets
operations $ 91,683 $ - $ 151,250 $ - $ 246,933
Property, plant and equipment 49,903 9,915 - (2,161) 57,657
Unrealized loss on inventory 37,976 1,290 - (653) 38,613
Unrealized gains on
intercompany sales 19,153 7,431 - - 26,584
Defined benefit obligations 23,063 - 2,407 - 25,470
Others 34,117 17,572 - (1,054) 50,635
$ 255,895 $ 36,208 $ 153,657 $ (3,868) $ 441,892
Share of profit of associates $ 324,009 $ (77,165) $ - $ - $ 246,844

Reserve for land value increment
tax 208,226 - - - 208,226
Deferred depreciation expense 46,318 23,424 - (1,538) 68,204
Others 51,529 (26,662) - (817) 24,050
$ 630,082 $ (80,403) $ - $ (2,355) $ 547,324
d. Income tax assessments
The Company’s income tax returns through 2018, except 2017, have been assessed by the tax
authorities. KF’s income tax returns through 2018 have been assessed by the tax authorities.
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21. EARNINGS PER SHARE
Unit: NT$ Per Share

2020 2019
Basic and diluted earnings per share $ 1.07 $ 1.11
The weighted average number of shares outstanding used for the earnings per share computation was
adjusted retroactively for the issuance of bonus shares. The basic and diluted earnings per share adjusted
retrospectively for the year ended December 31, 2019 are as follows:
Unit: NT$ Per Share
Before After
Retrospective Retrospective
Adjustment Adjustment
The earnings and weighted average number of ordinary shares outstanding used in the computation of
earnings per share from continuing operations and discontinued operations are as follows:
Net profit for the year

2020 2019
Earnings used from continuing operations in the computation of

basic and diluted earnings per share $ 972,225 $ 1,013,562
The weighted average number of ordinary shares outstanding (in thousands of shares) is as follows:

2020 2019
Weighted average number of ordinary shares used in the

computation of basic earnings per share 909,410 909,410
Effect of potentially dilutive ordinary shares
Compensation of employees 419 406

computation of diluted earnings per share 909,829 909,816
The Group may settle the compensation of employees in cash or shares; therefore, the Group assumes that
the entire amount of the compensation will be settled in shares, and the resulting potential shares are
included in the weighted average number of shares outstanding used in the computation of diluted earnings
per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in the computation
of diluted earnings per share until the number of shares to be distributed to employees is resolved in the
following year.
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22. CAPITAL MANAGEMENT
The Group requires to maintain an adequate level of capital to expand and optimize facilities and
equipment. The Group’s capital management strategy aims to ensure that the necessary financial resources
and operating plan are sufficient to meet the next 12 months’ requirements for working capital, capital
expenditures, research and development expenses, debt repayment and other needs.
23. FINANCIAL INSTRUMENTS
a. Fair value of financial instruments not measured at fair value
Please refer to the information on the consolidated balance sheet. The management of the Group
considered the carrying amounts of financial assets and liabilities not measured at fair value on the
consolidated balance sheet approximate the fair value.
b. Fair value of financial instruments measured at fair value on a recurring basis
1) Fair value hierarchy
December 31, 2020
Level 1 Level 2 Level 3 Total
Financial assets at FVTPL
Domestic listed shares $ 973 $ - $ - $ 973
Financial assets at FVTOCI
Investments in equity
instruments
Domestic and foreign unlisted
shares $ - $ - $ 578,419 $ 578,419
December 31, 2019
Domestic listed shares $ 1,019 $ - $ - $ 1,019
instruments
shares $ - $ - $ 515,415 $ 515,415
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2) Reconciliation of Level 3 fair value measurements of financial instruments

2020 2019
Financial assets at FVTOCI - equity instruments

Adjustments from initial application - -
Recognized in other comprehensive income (included in
unrealized valuation gain (loss) on financial assets at
FVTOCI) 73,938 243,902
Return of capital (3,942) (4,024)
Effects of exchange rate difference (6,992) (2,587)
3) Valuation techniques and inputs applied for Level 3 fair value measurement
The fair values of domestic and foreign unlisted equity securities were determined using the market
approach and asset-based pricing approach. Market approach derives fair value by reference to
identical or comparable publicly-traded companies. It takes into consideration observable
transaction prices on an active stock market, implied valuation multiples, related transactions and
statistics. Asset-based pricing approach separately evaluates a target’s assets and liabilities. It
utilizes fair market value, replacement cost, liquidation value or related approaches to reflect the
value of an enterprise or operating unit as a whole. A decrease in significant unobservable inputs,
such as discount for lack of control and marketability, would result in an increase in fair value of the
investments.
c. Categories of financial instruments
December 31
2020 2019
Financial assets
FVTPL
Listed shares $ 973 $ 1,019
Financial assets at amortized cost (1) 15,751,855 14,726,955
Equity instruments 578,419 515,415
Financial liabilities
Amortized cost (2) 21,686,560 21,478,308
Note 1: The balances include financial assets at amortized cost, which comprise cash and cash
equivalents, notes receivable, accounts receivable, other receivables, other financial assets and
refundable deposits.
Note 2: The balances include financial liabilities at amortized cost, which comprise short-term and
long-term borrowings (including the current portion), notes payable, accounts and other
payables, and guarantee deposits.
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d. Financial risk management objectives and policies
The Group’s major financial instruments include equity investments, accounts receivable, accounts
payable and borrowings. The Group’s corporate treasury function provides services to the business,
coordinates access to domestic and international financial markets, and monitors and manages the
financial risks relating to the operations of the Group through internal risk reports that analyze
exposures by degree and magnitude of risks. These risks include market risk (including foreign
currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
1) Market risk
The Group’s activities exposed it primarily to the financial risks of changes in foreign currency
exchange rates (see (a) below) and interest rates (see (b) below).
There has been no change to the Group’s exposure to market risks or the manner in which these
risks are managed and measured.
a) Foreign currency risk
Several subsidiaries of the Company have foreign currency denominated sales and purchases,
which expose the Group to foreign currency risk.
The carrying amounts of the Group’s foreign currency denominated monetary assets and
monetary liabilities (including those eliminated on consolidation) are set out in Note 27.
Sensitivity analysis
The Group is mainly exposed to the currency USD, Euro, RMB and Vietnamese Dong.
The sensitivity analysis measures the effect of a 1% increase and decrease in the New Taiwan
dollar (the functional currency) against the relevant foreign currencies. The sensitivity rate of
1% is used when reporting foreign currency risk internally to key management personnel and
represents management’s assessment of the reasonably possible change in foreign exchange
rates. The sensitivity analysis included only outstanding foreign currency denominated
monetary items, and adjusts their translation at the end of the year for a 1% change in foreign
currency rates. The pre-tax profit in 2020 and 2019 would have increased/decreased by $73,846
and $88,984 thousand had the New Taiwan dollar strengthened/weakened by 1% against the
relevant currency.
b) Interest rate risk
The Group is exposed to interest rate risk because entities in the Group borrow funds at both
fixed and floating interest rates. The risk is managed by the Group by maintaining an
appropriate mix of fixed and floating rate borrowings. The Group’s interest rate risk is resulted
from cash and cash equivalents. Specifically, the Group is exposed to cash flow interest rate risk
by holding cash and cash equivalents at floating rate. The risk is partially mitigated by
borrowings at floating rates. Holding cash and cash equivalents and borrowings at fixed rate
exposes the Group to fair value interest risk. The Group considers the overall interest rate trends
and adjusts the portfolio of fixed and floating rate instruments accordingly.
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The carrying amounts of the Group’s financial assets and financial liabilities with exposure to
interest rates at the end of the year were as follows:
December 31
2020 2019
Fair value interest rate risk

Financial assets $ 3,631,832 $ 3,573,961
Financial liabilities 4,026,490 2,449,043
Cash flow interest rate risk
Financial assets 7,957,494 7,022,082
The sensitivity analysis below was determined based on the Group’s exposure to interest rates
for both derivative and non-derivative instruments at the end of the year. For floating rate
liabilities, the analysis was prepared assuming the amount of each liability outstanding at the
end of the year was outstanding for the whole year.
If interest rates had been 10 basis points higher/lower and all other variables were held constant,
the Group’s pre-tax profit for the years ended December 31, 2020 and 2019 would have
decreased/increased by $5,230 thousand and $7,806 thousand, respectively.
c) Other price risk
The Group was exposed to equity price risk through its investments in equity instruments.
Equity investments are held for strategic rather than for trading purposes; the Group does not
actively trade these investments. The Group measures the price risk of equity securities via
sensitivity analysis.
The sensitivity analysis below was determined based on the exposure to equity price risks at the
end of the year.
If equity prices had been 5% higher/lower, pre-tax profit for the years ended December 31, 2020
and 2019 would have increased/decreased by $49 thousand and $51 thousand, respectively, as a
result of the changes in fair value of financial assets at FVTPL, and the pre-tax other
comprehensive income for the years ended December 31, 2020 and 2019 would have
increased/decreased by $28,921 thousand and $25,771 thousand, respectively, as a result of the
changes in fair value of financial assets at FVTOCI.
2) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting
in a financial loss to the Group. At the end of the year, the Group’s maximum exposure to credit
risk is mainly resulted from the carrying amount of the respective recognized financial assets as
stated in the balance sheets.
To maintain the quality of accounts receivable, the Group established operating procedures related
to credit risk management to manage credit risks. Risk factors associated with individual customers
include a customer’s financial condition, internal credit rating, transaction history, current
macroeconomic environment and other items that might affect a customer’s ability to pay.
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In order to minimize credit risk, the management of the Group has delegated a team responsible for
determining credit limits, credit approvals and other monitoring procedures to ensure that follow-up
action is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of
each individual trade debt at the end of the reporting period to ensure that adequate allowance is
made for possible irrecoverable amounts. In this regard, the management believes the Group’s
credit risk was significantly reduced. The Group writes off accounts receivable when there is
evidence indicating that the debtor is in severe financial difficulty and there is no realistic prospect
of recovery. For accounts receivable that have been written off, the Group continues to engage in
enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are
3) Liquidity risk
The Group manages liquidity risk by monitoring and maintaining a level of cash and cash
equivalents deemed adequate to finance the Group’s operations and mitigate the effects of
fluctuations in cash flows. In addition, management monitors the utilization of bank borrowings and
ensures compliance with loan covenants.
The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve
borrowing facilities, and continuously monitoring forecasted and actual cash flows as well as
matching the maturity profiles of financial assets and liabilities. The Group had available unutilized
short-term bank loan facilities set out in b) below.
a) Liquidity and interest rate risk tables for non-derivative financial liabilities
The following table details the Group’s remaining contractual maturities for its non-derivative
financial liabilities with agreed upon repayment periods. The table has been drawn up based on
the undiscounted cash flows of financial liabilities from the earliest date on which the Group
can be required to pay. The table includes both interest and principal cash flows. Specifically,
bank loans with a repayment on demand clause were included in the earliest time band
regardless of the probability of the banks choosing to exercise their rights. The maturity dates
for other non-derivative financial liabilities were based on the agreed upon repayment dates.
December 31, 2020
On Demand or
Less than 1 More than 5
Year 1-5 Years Years
Non-derivative financial liabilities
Non-interest bearing $ 4,462,149 $ - $ -

Lease liabilities 88,484 95,722 267,551
Variable interest rate liabilities 3,384,859 10,021,810 45,136
Fixed interest rate liabilities 1,737,462 1,800,139 86,253
$ 9,672,954 $ 11,917,671 $ 398,940
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December 31, 2019
On Demand or
Non-derivative financial liabilities
Non-interest bearing $ 4,302,035 $ - $ -

Lease liabilities 98,239 144,630 307,897
Fixed interest rate liabilities 1,588,899 298,152 33,156
$ 8,252,577 $ 12,986,247 $ 727,695
b) Financing facilities
December 31
2020 2019
Unsecured bank overdraft facilities, reviewed annually

Amount used $ 113,216 $ 38,444
Amount unused 14,550 109,663
$ 127,766 $ 148,107
Secured bank overdraft facilities:

Amount used $ - $ -
Amount unused - 3,101
$ - $ 3,101
Unsecured bank borrowing facilities

Amount used $ 16,042,726 $ 15,250,265
Amount unused 10,064,250 13,345,325
$ 26,106,976 $ 28,595,590
Secured bank loan facilities which may be extended by

mutual agreement:
Amount used $ 605,795 $ 1,437,644
Amount unused 1,642,739 1,440,898
$ 2,248,534 $ 2,878,542
e. Transfers of financial assets
The Group transferred a portion of its banker’s acceptance bills in mainland China to some of its
suppliers in order to settle the accounts payable to these suppliers. As the Group has transferred
substantially all risks and rewards relating to these bills receivable, it derecognized the full carrying
amount of the bills receivable and the associated accounts payable. However, if the derecognized bills
receivable are not paid at maturity, the suppliers have the right to request that the Group pay the
unsettled balance; therefore, the Group still has continuing involvement in these bills receivable.
~ 161
- 47 ~-
The maximum exposure to loss from the Group’s continuing involvement in the derecognized bills
receivable is equal to the face amounts of the transferred but unsettled bills receivable, and as of
December 31, 2020 and 2019, the face amounts of these unsettled bills receivable were $501,693
thousand and $748,868 thousand, respectively. The unsettled bills receivable will be due in 6 months
after December 31, 2020 and was due in 6 months after December 31, 2019. Taking into consideration
the credit risk of these derecognized bills receivable, the Group estimates that the fair values of its
continuing involvement are not significant.
During the years ended December 31, 2020 and 2019, the Group did not recognize any gains or losses
upon the transfer of the banker’s acceptance bills. No gains or losses were recognized from the
continuing involvement, both during the current year or cumulatively.
24. TRANSACTIONS WITH RELATED PARTIES
Balances and transactions between the Company and its subsidiaries, which are related parties of the
Company, have been eliminated on consolidation and are not disclosed in this note. Details of transactions
between the Group and other related parties are disclosed as follows.
a. Related party name and category
Related Party Name Related Party Category
Kenlight Trading Corp. Other related party

Jienshang Co., Ltd. Other related party
Total Lubricants Taiwan Ltd. Other related party
Kenstone Metal Co., Ltd. Other related party
Honko Technical Lubricants (Kunshan) Co., Ltd. Other related party
Kenstone Metal (K.S.) Co., Ltd. Other related party
Americana Development Holding (ADH) Other related party
Yang & Company, LLC (Y&C) Other related party
Haro Bikes Corp. (HBC) Other related party
Greentech Holding Corp. (GHC) Other related party
STARCO Huanmei Associate
Other related parties refer to companies having a chairman that is within second-degree relative, the
same as the Company’s chairman, or are determined as related parties in substance.
b. Revenue

Line Item Related Party Category 2020 2019
Sales of goods Other related parties $ 8,815 $ 13,659
c. Purchases

Related Party Category 2020 2019
Other related parties $ 223,743 $ 238,357

Associates 174,285 207,422
$ 398,028 $ 445,779
~ 162
- 48 ~-
d. Receivables from related parties
December 31
Accounts receivable Other related parties $ 948 $ 5,543

Other receivables Other related parties 1,104 1,010
$ 2,052 $ 6,553
e. Payables to related parties
December 31
Accounts payable Other related parties $ 58,579 $ 73,837

Accounts payable Associates 38,678 61,301
Other payables Other related parties 3,088 6,286
$ 100,345 $ 141,424
f. Investments accounted for using the equity method
The Group invested in STARCO Huanmei of $33,733 thousand (EUR 10,000 thousand) via cash
injection during the second quarter of 2020.
g. Others

Manufacturing expense Other related parties $ 18,873 $ 19,551

Operating expense Other related parties 1,869 3,937
$ 20,742 $ 23,488
h. Lease arrangements - the Group is lessee
The Group leased offices and warehouses from other related parties and paid rent based on local rent
levels on a monthly basis.

Related Party Category/Name 2020 2019
Lease expense
Other related parties

ADH $ 10,962 $ 11,312
Y&C 11,293 11,654
Others 1,412 1,412
$ 23,667 $ 24,378
~ 163
- 49 ~-
i. Lease arrangements - Group is lessor
The Group leased warehouses to other related parties and received rent based on local rent levels on a
monthly basis.

Lease income
Other related parties

HBC $ 2,102 $ 2,198
j. Remuneration of key management personnel

2020 2019
Short-term employee benefits $ 32,622 $ 30,974

Post-employment benefits 92 84
$ 32,714 $ 31,058
25. ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY
KA’s operating assets, including but not limited to cash and cash equivalents, accounts receivable,
inventories, property, plant and equipment and intangible assets, were pledged as collateral for bank
borrowings, and lien was placed by the banks correspondingly. The above assets were $4,927,314 thousand
and $5,395,608 thousand as of December 31, 2020 and 2019, respectively.
Except as stated above, the following assets of the Group were pledged as collaterals for acceptance bills
and short-term and long-term borrowings.
December 31
2020 2019
Accounts receivable $ 17,439 $ 33,687

Inventories 105,836 190,322
Property, plant and equipment 206,501 396,727
Others 11,154 76,730
$ 340,930 $ 697,466
26. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS
In addition to those disclosed in other notes, significant contingencies and unrecognized commitments of
the Group were as follows:
a. Capital expenditures contracted but yet incurred are as follows:
December 31
Item 2020 2019
Property, plant and equipment $ 325,798 $ 955,658
~ 164
- 50 ~-
b. Contingencies
1) Products liability insurance
The Group has entered into a product liability insurance for the products manufactured by the
Group and sold globally. The period of insurance agreement is from August 6, 2020 to August 6,
2021. The coverage of insurance policy is from August 6, 2004 to August 6, 2021. The maximum
reparation of one single event is US$10,000 thousand.
2) The Company had entered into an exclusive agency contract with Gabjohn for the product
distributed in Nigeria. Due to circumstances related to local sales, the Company switched to other
agencies to distribute products in Nigeria. Consequently, Gabjohn filed a lawsuit against the
Company for breach of exclusive agency contract and demanded $90,000 thousand (NGN500,000
thousand) as compensation. The Company signed an attorney agreement with Tommy & Jason
International Intellectual Property Rights Co., Ltd. (collectively as Tommy & Jason), which then
engaged a lawyer in the local intellectual Property Office, Adeniji Kazeem & Co., to handle the
litigation and regularly reported the related proceedings. The lawsuit is currently awaiting in the
High Court of Nigeria. Upon the date of issuance of the financial statements for the year ended
December 31, 2020, the outcome of the dispute cannot be predicted with sufficient reliability.
27. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES
The Group’s significant financial assets and liabilities denominated in foreign currencies aggregated by the
foreign currencies other than functional currencies of the entities in the Group and the related exchange
rates between foreign currencies and respective functional currencies were as follows:
December 31, 2020
Foreign Carrying
Currency Exchange Rate Amount
Financial assets
Monetary items
USD $ 117,941 28.48 (USD:NTD) $ 3,359,324
USD 116,104 6.52 (USD:RMB) 3,306,997
USD 5,030 7.75 (USD:HKD) 143,277
JPY 949,674 0.06 (JPY:RMB) 261,920
RMB 49,479 4.37 (RMB:NTD) 215,991
EUR 6,126 8.03 (EUR:RMB) 213,240
IDR (in million) 71,724 0.07 (VND:USD) 145,528
$ 7,646,277
Monetary items
USD 6,989 28.48 (USD:NTD) $ 199,072
USD 4,483 6.52 (USD:RMB) 127,684
VND (in million) 136,912 0.04 (VND:USD) 171,414
IDR (in million) 30,342 0.07 (EUR:USD) 61,563
GBP 1,414 1.12 (GBP:EUR) 55,017
$ 614,750
~ 165
- 51 ~-
December 31, 2019
Foreign Carrying
Financial assets
Monetary items
USD $ 83,258 30.10 (USD:NTD) $ 2,506,137
USD 174,646 6.98 (USD:RMB) 5,257,017
RMB 100,210 0.14 (RMB:USD) 432,386
EUR 34,622 1.12 (EUR:USD) 1,167,283
EUR 11,116 7.82 (EUR:RMB) 374,795
$ 9,774,601
Monetary items
USD 5,113 30.10 (USD:NTD) $ 153,805
USD 6,215 6.98 (USD:RMB) 187,073
EUR 10,500 1.12 (EUR:USD) 354,011
$ 876,160
For the years ended December 31, 2020 and 2019, net foreign exchange gains (losses) were $(315,565)
thousand and $8,237 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses)
by each significant foreign currency due to the variety of the foreign currency transactions and functional
currencies of the entities in the Group.
28. SEPARATELY DISCLOSED ITEMS
a. Information about significant transactions and investees:
1) Financing provided to others (Table 1)
2) Endorsements/guarantees provided (Table 2)
3) Marketable securities held (Table 3)
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20%
of the paid-in capital (None)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital
(None)
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital
(None)
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the
paid-in capital (Table 4)
~ 166
- 52 ~-
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital
(Table 5)
9) Trading in derivative instruments (None)
10) Intercompany relationships and significant intercompany transactions (Table 6)
11) Information on investees (Table 7)
b. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal business
activities, paid-in capital, method of investment, inward and outward remittance of funds,
ownership percentage, net income of investees, investment income or loss, carrying amount of the
investment at the end of the year, repatriations of investment income, and limit on the amount of
investment in the mainland China area (Table 8)
2) Any of the following significant transactions with investee companies in mainland China, either
directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or
losses:
a) The amount and percentage of purchases and the balance and percentage of the related payables
at the end of the year (Table 6)
b) The amount and percentage of purchases and the balance and percentage of the related payables
at the end of the year (Table 6)
c) The amount of property transactions and the amount of the resultant gains or losses (None)
d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the

end of the year and the purposes (Table 2)
e) The highest balance, the ending balance, the interest rate range, and total current period interest
with respect to the financing of funds (Table 1)
f) Other transactions that have a material effect on the profit or loss for the year or on the financial
position, such as the rendering or receipt of services (None)
c. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the
name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder
(Table 9)
~ 167
- 53 ~-
29. SEGMENT INFORMATION
Information reported to the chief operating decision maker for the purpose of resource allocation and
assessment of segment performance focuses on the types of goods or services delivered or provided.
a. Segment revenue and results
The following is an analysis of the Group’s revenue and results from continuing operations by
reportable segments:
Regions Adjustment and

Asia Excluding Asia Others Elimination Total
Revenue
Revenue from external customers $ 16,477,628 $ 13,782,557 $ - $ - $ 30,260,185

Segment revenue 7,923,203 86,582 - (8,009,785) -
$ 24,400,831 $ 13,869,139 $ - $ (8,009,785) $ 30,260,185
Interest income $ 95,722 $ 2,087 $ 17,522 $ (7,160) $ 108,171
Finance costs $ 157,010 $ 93,917 $ 809 $ (10,294) $ 241,442
Depreciation and amortization $ 1,242,100 $ 251,177 $ 16 $ - $ 1,493,293
Segment income (excluding share of

profit of associates and other
operating income and expenses) $ 2,201,153 $ 71,816 $ 76,214 $ (122,478) $ 2,226,705
Other operating income and
expenses (937,582)
Share of profit of associates
accounted for using the equity
method 2,340
Profit before tax $ 1,291,463
Total assets $ 42,390,039
Regions Adjustment and

Asia Excluding Asia Others Elimination Total
Revenue
Revenue from external customers $ 18,467,526 $ 13,659,910 $ - $ - $ 32,127,436

Segment revenue 7,788,098 86,141 - (7,874,239) -
$ 26,255,624 $ 13,746,051 $ - $ (7,874,239) $ 32,127,436
Interest income $ 171,041 $ 6,313 $ 34,609 $ (49,130) $ 162,833
Finance costs $ 223,275 $ 109,059 $ 1,954 $ (52,381) $ 281,907
Depreciation and amortization $ 1,214,328 $ 254,709 $ 8 $ - $ 1,469,045
Segment income (excluding share of

profit of associates and other
operating income and expenses) $ 1,301,475 $ 54,545 $ 6,987 $ - $ 1,363,007
Share of profit of associates
accounted for using the equity
method 3,971
Profit before tax $ 1,366,978
Total assets $ 42,019,785
Inter-segment revenue was accounted for according to market prices.
~ 168
- 54 ~-
Segment profit represents the profit before tax earned by each segment without share of profit of
associates, other operating income and expenses and income tax expense. This was the measure
reported to the chief operating decision maker for the purpose of resource allocation and assessment of
segment performance.
Refer to Note 18 for information relating to revenue from contracts with customers.
b. Geographical information
The Group operates in four principal geographical areas - China, the United States, Taiwan and
Vietnam.
The Group’s revenue from continuing operations from external customers by location of operations and
information about its non-current assets by location of assets are detailed below.
Revenue from External

Customers
For the Year Ended Non-current Assets
December 31 December 31
2020 2019 2020 2019
USA $ 11,616,653 $ 11,000,911 $ 831,186 $ 962,845

China 6,512,025 7,495,447 4,385,379 4,779,737
Taiwan 1,603,239 1,469,835 5,796,034 4,590,260
Vietnam 1,058,495 1,096,947 5,563,553 5,484,305
Others 9,469,773 11,064,296 1,886,765 1,958,190
$ 30,260,185 $ 32,127,436 $ 18,462,917 $ 17,775,337
Non-current assets include property, plant and equipment, right-of-use assets, investment properties and
other non-current assets.
c. Information about major customers
There is no single customers contributing 10% or more to the Group’s revenue for the years ended
December 31, 2020 and 2019.
~ 169
- 55 ~-
TABLE 1

FINANCING PROVIDED
FOR THE YEAR ENDED DECEMBER 31, 2020
Collateral Financing Limits Financing

Financial Maximum Amount
Related Ending Interest Nature for Transaction Reason for Allowance for for Each Company’s Total
No. Financing Company Counterparty Statement Balance for Actually
Party Balance Rate Financing Amounts Financing Bad Debt Item Value Borrowing Financing Amount
Account the Period Drawn
Company Limits
1 KGI STARCO Europe A/S Finance Yes $ 1,055,325 $ - $ - 0.7-1.5% The need for - Operating - - $ - Ninety percent Ninety five percent
receivables short-term capital (90%) of the (95%) of the
financing financing financing
company’s net company’s net
worth, $1,150,664 worth, $1,214,590
2 KGI STARCO GmBH Finance Yes 96,761 - - 1.5000% The need for - Operating - - - Ninety percent Ninety five percent
worth, $1,150,664 worth, $1,214,590
3 KGI STARCO Baltic OÜ Finance Yes 13,922 - - 1.5000% The need for - Operating - - - Ninety percent Ninety five percent
worth, $1,150,664 worth, $1,214,590
4 STARCO Europe A/S STARCO NV Finance Yes 17,403 - - 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
receivables short-term capital of the financing of the financing
~ 170 ~
financing company’s net company’s net
worth, $81,015 worth, $121,522
5 STARCO Europe A/S STARCO DML Finance Yes 33,797 33,240 30,386 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
6 STARCO Europe A/S STARCO GS AG Finance Yes 57,221 51,026 23,703 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
7 STARCO Europe A/S STARCO Beli Manastir d.o.o. Finance Yes 13,574 - - 3.0000% The need for - Operating - - - Fifty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
8 STARCO Beli Manastir d.o.o. STARCO GS AG Finance Yes 23,042 23,042 3,481 3.9600% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $144,808 worth, $217,212
(Continued)
- 56 -
Company Limits
9 STARCO Europe A/S STARCO GmBH Finance Yes $ 13,922 $ - $ - 3.0000% The need for $ - Operating $ - - $ - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
10 STARCO Europe A/S Starco SAS. Finance Yes 13,922 13,922 13,922 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
Note: All intra-group transactions are eliminated upon consolidation.
(Concluded)
~ 171 ~
- 57 -
TABLE 2

ENDORSEMENTS/GUARANTEES PROVIDED
Guaranteed Party Ratio of

Limits on Maximum Outstanding Accumulated
Endorsements/ Amount Endorsements/ Endorsements/ Endorsement/
Endorsements/ Amount Endorsements/ Aggregate
Guarantees Guarantees Guarantee
Endorsement/ Guarantees Endorsed/Gua Guarantees at Actual Amount Endorsed/ Guarantees to Endorsements/
No. Relationship Given by Parent Given by Given on Behalf Note
Guarantee Provider Name Given on ranteed the End of the Borrowed Guaranteed by Net Equity in Guarantee Limit
(Note 1) on Behalf of Subsidiaries on of Companies in
Behalf of Each During the Period Collateral Latest Financial (Note 3) Subsidiaries Behalf of Parent Mainland China
Party Period (Note 4) Statements
(%)
0 The Company KGI a $ 7,451,739 $ 1,218,218 $ - $ - $ - 0.00 $ 14,903,478 Yes No No -

(Note 2) (Note 3)
ADI a 7,451,739 170,898 170,898 113,932 - 0.92 14,903,478 Yes No No -
(Note 2) (Note 3)
KA a 7,451,739 170,898 170,898 170,898 - 0.92 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO DML a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GB Ltd. a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO NV a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO SAS a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
~ 172 ~
STARCO Baltic OÜ a 7,451,739 569,660 569,660 10,453 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GS AG a 7,451,739 569,660 569,660 45,259 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GmbH a 7,451,739 569,660 569,660 69,612 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO Polska Sp.z.o.o. a 7,451,739 569,660 569,660 111,653 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO Europe A/S a 7,451,739 2,449,196 2,449,196 1,270,427 - 13.15 14,903,478 Yes No No -
(Note 2) (Note 3)
KV a 7,451,739 2,819,817 2,819,817 724,750 - 15.14 14,903,478 Yes No No -
(Note 2) (Note 3)
KT a 7,451,739 655,109 484,211 - - 2.60 14,903,478 Yes No Yes -
(Note 2) (Note 3)
KI a 7,451,739 968,422 882,973 530,923 - 4.74 14,903,478 Yes No No -
(Note 2) (Note 3)
1 KHK KS a 888,841 873,056 873,056 - - 39.29 1,777,682 No No Yes -

(Note 2) (Note 3)
(Continued)
- 58 -
Limits on Maximum Outstanding Accumulated
Endorsements/ Amount Endorsements/ Endorsements/ Endorsement/
Endorsements/ Amount Endorsements/ Aggregate
Guarantees Guarantees Guarantee
Endorsement/ Guarantees Endorsed/Gua Guarantees at Actual Amount Endorsed/ Guarantees to Endorsements/
No. Relationship Given by Parent Given by Given on Behalf Note
Guarantee Provider Name Given on ranteed the End of the Borrowed Guaranteed by Net Equity in Guarantees
(Note 1) on Behalf of Subsidiaries on of Companies in
Behalf of Each During the Period Collateral Latest Financial Limit (Note 3)
Subsidiaries Behalf of Parent Mainland China
Party Period (Note 4) Statements
(%)
2 KGCI KS a $ 4,057,730 $ 3,942,224 $ 3,942,224 $ - $ - 34.43 $ 8,115,461 No No Yes -

(Note 2) (Note 3)
3 STARCO Europe A/S STARCO GB Ltd. a 202,537 175,226 77,878 - - 38.45 405,075 No No No -
(Note 2) (Note 3)
STARCO NV a 202,537 156,628 156,628 17,438 - 77.33 405,075 No No No -
(Note 2) (Note 3)
Note 1: Relationships between the guarantee provider and guaranteed party:
a. A subsidiary in which the Company holds directly and indirectly over 90% of an equity interest.
Note 2: Limit on endorsements to a single company is 40% of the Company’s net worth.
Limit on endorsements to a single company is 40% of KHK’s net worth.
Limit on endorsements to a single company is 40% of KGCI’s net worth.
Limit on endorsements to a single company is 100% of STARCO Europe A/S’s net worth.
Note 3: Limit on aggregate endorsements is 80% of the Company’s net worth.

Limit on aggregate endorsements is 80% of KHK’s net worth.
Limit on aggregate endorsements is 80% of KGCI’s net worth.
Limit on aggregate endorsements is 200% of STARCO Europe A/S’s net worth.
~ 173 ~
Note 4: KGCI and KHK jointly provided endorsement/guarantee for KS of RMB 800 million, but the limit for KHK is RMB 200 million.
Note 5: The Company provided shared endorsement/guarantee for nine subsidiaries including STARCO Europe A/S, STARCO GmbH, STARCO Polska Sp.z.o.o., STARCO SAS, STARCO GS AG, STARCO NV, STARCO GB Ltd, STARCO DML and STARCO
Baltic OÜ. The total amount of the shared endorsement/guarantee is US$20,000 thousand.
(Concluded)
- 59 -
TABLE 3

MARKETABLE SECURITIES HELD
DECEMBER 31, 2020
December 31, 2020

Holding Company Type and Name of Marketable Relationship with the Holding
Financial Statement Account Carrying Percentage of Fair Value Note
Name Securities Company Shares/Units
Amount Ownership % (Note 1)
The Company Shares and equity

China Development Financial - Financial assets at FVTPL - current 105 $ 973 0.00 $ 973 -
Holding Corporation
Kenjou Ind. Co., Ltd. The chairman of Kenjou Ind. Co., Ltd. Equity instruments at FVTOCI - non-current 7,382 314,467 10.86 314,467 -
and the chairman of the Company are
second-degree relatives
Chang Hwa Golf Co., Ltd. - Equity instruments at FVTOCI - non-current 30 197 0.08 197 -
Ou Hua Venture Capital Co., Ltd. - Equity instruments at FVTOCI - non-current 315 1,880 5.15 1,880 -
Yu Hua Venture Capital Co., Ltd. - Equity instruments at FVTOCI - non-current 146 491 2.50 491 -
Total Lubricants Taiwan Ltd. The chairman of Total Lubricants Equity instruments at FVTOCI - non-current 81 121,779 6.80 121,779 -
Taiwan Ltd. and the chairman of the
Company are second-degree relatives
BOMY (BVI) CO., LTD. - Equity instruments at FVTOCI - non-current 2,000 12,709 9.73 12,709 -
KGI Shares and equity
~ 174 ~
Kenjou Investment Co., Ltd. The chairman of Kenjou Investment Co., Equity instruments at FVTOCI - non-current - 126,896 13.00 126,896 -
Ltd. and the chairman of the Company
are second-degree relatives
Note: Fair value of domestic listed shares is determined based on its closing price on December 31, 2020.
- 60 -
TABLE 4

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
Notes/Accounts
Transaction Details Abnormal Transaction
Receivable (Payable)
Company Name Related Party Relationship Note
Purchases/ Payment
Amount % to Total Payment Terms Unit Price Amount % to Total
Sales Terms
The Company KA Subsidiary Sales $ 1,263,521 23.49 In accordance with mutual agreements Agreed by both parties - $ 444,151 36.34 -
KF Subsidiary Sales 546,734 10.17 In accordance with mutual agreements Agreed by both parties - 155,971 12.76 -
KV Subsidiary Sales 201,067 3.74 In accordance with mutual agreements Agreed by both parties - 30,563 2.50 -
ADI Indirectly owned subsidiary Sales 682,643 12.69 In accordance with mutual agreements Agreed by both parties - 246,464 20.17 -
KC KA Subsidiary of ultimate parent company Sales 370,433 5.55 In accordance with mutual agreements Agreed by both parties - 148,422 12.80 -
ADI Subsidiary of ultimate parent company Sales 253,302 3.79 In accordance with mutual agreements Agreed by both parties - 125,494 10.82 -
STARCO NV Subsidiary of ultimate parent company Sales 179,729 2.69 In accordance with mutual agreements Agreed by both parties - 49,934 4.31 -
KS Subsidiary of ultimate parent company Sales 100,143 1.50 In accordance with mutual agreements Agreed by both parties - 45,364 3.91 -
KV KA Subsidiary of ultimate parent company Sales 1,775,946 30.41 In accordance with mutual agreements Agreed by both parties - 683,122 58.42 -
KT KS Subsidiary of ultimate parent company Sales 489,728 18.08 In accordance with mutual agreements Agreed by both parties - 130,432 21.73 -
STARCO BELI Manastir STARCO GmbH Subsidiary of ultimate parent company Sales 121,962 4.06 In accordance with mutual agreements Agreed by both parties - 23,891 6.35 -
d.o.o.
STARCO Europe A/S STARCO Huanmei Associate Purchases 172,534 5.75 In accordance with mutual agreements Agreed by both parties - (38,678) (10.29) -
~ 175 ~
- 61 -
TABLE 5

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2020
Overdue Amounts Received

Turnover Allowance for
Company Name Related Party Relationship Ending Balance in Subsequent
Rate Amount Actions Taken Impairment Loss
Period (Note 2)
The Company KA Subsidiary $ 444,151 2.79 $ 94,651 - $ 145,284 -

ADI Indirectly owned subsidiary 246,464 2.35 18,620 - 177,760 -
KF Subsidiary 155,971 3.60 - - 100,520 -
KHK Subsidiary 130,626 - - - - -
KIC Subsidiary 103,552 - - - - -
KC KA Subsidiary of ultimate parent company 148,422 2.41 240 - 55,635 -

ADI Subsidiary of ultimate parent company 125,494 2.01 103 - 96,937 -
KV KA Subsidiary of ultimate parent company 683,122 2.91 - - 273,977 -

ADI Subsidiary of ultimate parent company 192,971 3.20 - - 179,596 -
KT KS Subsidiary of ultimate parent company 130,432 7.51 - - 130,432 -
STARCO IPR GmbH STARCO Europe A/S Parent company 200,526 - 200,526 - - -
~ 176 ~
Note 1: All intra-group transactions are eliminated upon consolidation.
Note 2: Amounts received as of March 18, 2021.
- 62 -
TABLE 6

INTERCOMPANY RELATIONSHIPS AND SIGNIFICANT INTERCOMPANY TRANSACTIONS
Intercompany Details (Note 3)

No. Relationship
Investee Company Counterparty % of Total Sales
(Note 1) (Note 2) Financial Statement Account Amount Payment Terms
or Assets
0 The Company ADI a Sales revenue $ 682,643 (Note 4) 2.26

KV a Other income 9,985 (Note 4) 0.03
KV a Service revenue 197,669 (Note 4) 0.65
KV a Sales revenue 201,067 (Note 4) 0.66
KT a Service revenue 85,124 (Note 4) 0.28
KT a Sales revenue 40,503 (Note 4) 0.13
KS a Service revenue 19,347 (Note 4) 0.06
KS a Sales revenue 14,904 (Note 4) 0.05
KI a Service revenue 33,728 (Note 4) 0.11
KI a Sales revenue 60,271 (Note 4) 0.20
KF a Other income 7,511 (Note 4) 0.02
KF a Service revenue 17,300 (Note 4) 0.06
KF a Sales revenue 546,734 (Note 4) 1.81
KC a Service revenue 214,572 (Note 4) 0.71
KC a Sales revenue 59,693 (Note 4) 0.20
~ 177 ~
KA a Sales revenue 1,263,521 (Note 4) 4.18
STARCO GmbH a Sales revenue 14,000 (Note 4) 0.05
STARCO GB Ltd. a Sales revenue 7,296 (Note 4) 0.02
1 KC KA c Sales revenue 370,433 (Note 4) 1.22

KT c Sales revenue 31,741 (Note 4) 0.10
ADI c Sales revenue 253,302 (Note 4) 0.84
The Company b Sales revenue 6,562 (Note 4) 0.02
KS c Sales revenue 100,143 (Note 4) 0.33
KV c Sales revenue 8,286 (Note 4) 0.03
KF c Sales revenue 13,108 (Note 4) 0.04
STARCO GB Ltd. c Sales revenue 44,053 (Note 4) 0.15
STARCO Polska Sp.z.o.o. c Sales revenue 66,337 (Note 4) 0.22
STARCO NV c Sales revenue 179,729 (Note 4) 0.59
2 KT KS c Sales revenue 489,728 (Note 4) 1.62

ADI c Sales revenue 240,152 (Note 4) 0.79
KC c Sales revenue 23,841 (Note 4) 0.08
KE c Sales revenue 7,950 (Note 4) 0.03
STARCO GS AG c Sales revenue 5,963 (Note 4) 0.02
(Continued)
- 63 -
No. Relationship
or Assets
3 KI KV c Sales revenue $ 34,607 (Note 4) 0.11

4 KA The Company b Commission income 14,718 (Note 4) 0.05
5 KV ADI c Sales revenue 610,973 (Note 4) 2.02

The Company b Sales revenue 12,747 (Note 4) 0.04
KA c Sales revenue 1,775,946 (Note 4) 5.87
KI c Sales revenue 43,388 (Note 4) 0.14
STARCO GB Ltd. c Sales revenue 19,182 (Note 4) 0.06
6 KE The Company b Service revenue 81,219 (Note 4) 0.27
7 KGI STARCO Europe A/S a Interest income 6,379 (Note 4) 0.02
8 KS KC c Sales revenue 22,031 (Note 4) 0.07

KC c Service revenue 5,820 (Note 4) 0.02
KI c Service revenue 8,761 (Note 4) 0.03
9 STARCO Europe A/S STARCO GB Ltd. a Sales revenue 47,250 (Note 4) 0.16
STARCO NV a Sales revenue 70,795 (Note 4) 0.23
STARCO GmbH a Sales revenue 51,128 (Note 4) 0.17
~ 178 ~
STARCO Polska Sp.z.o.o. a Sales revenue 42,358 (Note 4) 0.14
10 STARCO Beli Manastir d.o.o. STARCO GB Ltd. c Sales revenue 64,728 (Note 4) 0.21
STARCO GmbH c Sales revenue 121,962 (Note 4) 0.40
STARCO Polska Sp.z.o.o. c Sales revenue 63,016 (Note 4) 0.21
STARCO GS AG c Sales revenue 32,128 (Note 4) 0.11
11 STARCO GmbH STARCO SAS c Sales revenue 56,386 (Note 4) 0.19
12 STARCO NV STARCO SAS c Sales revenue 56,996 (Note 4) 0.19

STARCO Baltic OÜ c Sales revenue 10,311 (Note 4) 0.03
13 STARCO Polska Sp.z.o.o. STARCO Baltic OÜ c Sales revenue 84,453 (Note 4) 0.28
14 STARCO DML STARCO GmbH c Sales revenue 19,472 (Note 4) 0.06
(Continued)
- 64 -
No. Relationship
or Assets
0 The Company ADI a Accounts receivable $ 245,900 (Note 4) 0.58

ADI a Other receivable 564 (Note 4) 0.00
KV a Accounts receivable 30,563 (Note 4) 0.07
KA a Accounts receivable 439,302 (Note 4) 1.04
KA a Other receivable 4,849 (Note 4) 0.01
KC a Accounts receivable 16,396 (Note 4) 0.04
KF a Accounts receivable 155,971 (Note 4) 0.37
KHK a Other receivable 130,626 (Note 4) 0.31
KI a Accounts receivable 26,981 (Note 4) 0.06
KIC a Other receivable 103,552 (Note 4) 0.24
KT a Accounts receivable 9,111 (Note 4) 0.02
1 KC KA c Accounts receivable 148,422 (Note 4) 0.35

ADI c Accounts receivable 125,494 (Note 4) 0.30
KS c Accounts receivable 45,364 (Note 4) 0.11
STARCO GB Ltd. c Accounts receivable 14,981 (Note 4) 0.04
STARCO Polska Sp.z.o.o. c Accounts receivable 26,072 (Note 4) 0.06
STARCO NV c Accounts receivable 49,934 (Note 4) 0.12
2 KT ADI c Accounts receivable 98,622 (Note 4) 0.23

KS c Accounts receivable 130,432 (Note 4) 0.31
3 KI KV c Accounts receivable 9,567 (Note 4) 0.02
4 KA The Company c Accounts receivable 20,111 (Note 4) 0.05
~ 179 ~
5 KIC KGH a Other receivable 87,095 (Note 4) 0.21
KGI a Other receivable 16,457 (Note 4) 0.04
6 KV KA c Accounts receivable 683,122 (Note 4) 1.61

ADI c Accounts receivable 192,971 (Note 4) 0.46
KI c Accounts receivable 11,030 (Note 4) 0.03
7 KS KC c Accounts receivable 7,807 (Note 4) 0.02
8 STARCO Europe A/S STARCO DML a Other receivable 30,386 (Note 4) 0.07
STARCO GS AG a Other receivable 23,703 (Note 4) 0.06
STARCO SAS a Other receivable 13,922 (Note 4) 0.03
STARCO GB Ltd. a Accounts receivable 67,624 (Note 4) 0.16
STARCO NV a Accounts receivable 21,187 (Note 4) 0.05
STARCO GmbH a Accounts receivable 13,710 (Note 4) 0.03
STARCO Polska Sp.z.o.o. a Accounts receivable 72,970 (Note 4) 0.17
STARCO GS AG a Accounts receivable 10,883 (Note 4) 0.03
(Continued)
- 65 -
No. Relationship
or Assets
9 STARCO Beli Manastir d.o.o. STARCO Europe A/S b Accounts receivable $ 8,292 (Note 4) 0.02
STARCO GmBH c Accounts receivable 23,891 (Note 4) 0.06
STARCO GB Ltd. c Accounts receivable 16,938 (Note 4) 0.04
STARCO Polska Sp.z.o.o. c Accounts receivable 21,359 (Note 4) 0.05
10 STARCO GmbH STARCO Europe A/S b Accounts receivable 33,324 (Note 4) 0.08
STARCO SAS c Accounts receivable 6,868 (Note 4) 0.02
11 STARCO NV STARCO SAS c Accounts receivable 20,679 (Note 4) 0.05
12 STARCO Polska Sp.z.o.o STARCO Europe A/S b Accounts receivable 7,425 (Note 4) 0.02
13 STARCO SAS STARCO Europe A/S b Accounts receivable 18,956 (Note 4) 0.04
14 STARCO IPR GmbH STARCO Europe A/S b Other receivable 200,526 (Note 4) 0.47
STARCO NV c Accounts receivable 6,283 (Note 4) 0.01
STARCO GmBH c Accounts receivable 33,440 (Note 4) 0.08
15 STARCO GS AG STARCO Europe A/S b Accounts receivable 8,623 (Note 4) 0.02
Note 1: The parent company and its subsidiaries are coded as follows:
a. The parent company is coded as “0”.

b. Subsidiaries are coded sequentially, beginning from “1” and in the order presented in the table above.
~ 180 ~
Note 2: Nature of relationship is as follows:
a. From the parent company to its subsidiary.

b. From a subsidiary to the parent company
c. Between subsidiaries.
Note 3: For calculation of account balance ratio to total assets, the numerator is the balance sheet account balance and the denominator is the total assets. For calculation of account balance ratio to total sales, the numerator is the income statement
account balance and the denominator is the total sales.
Note 4: Terms are in accordance with mutual agreements.
(Concluded)
- 66 -
TABLE 7

INFORMATION ON INVESTEES
Original Investment Amount As of December 31, 2020 Net Income Share of Profits
Investor Investee Location Main Business Activities December 31, December 31, Shares (In Percentage of Carrying (Losses) of the (Losses) of Note
2020 (Note 1) 2019 (Note 1) Thousands) Ownership Value (Note 1) Investee (Note 1) Investee (Note 1)
The Company KA United States Trade and investment US$ 9,000 US$ 9,000 - 100.00 NT$ 1,455,742 NT$ 13,020 NT$ 13,020 Note 3
KHK Hong Kong Trade and investment HK$ 100 HK$ 100 - 100.00 NT$ 2,254,806 NT$ (516,197) NT$ (516,197) Note 3
US$ 30,600 US$ 30,600
KV Vietnam Manufacturing various types of tires US$ 67,680 US$ 64,180 - 100.00 NT$ 7,080,904 NT$ 979,711 NT$ 907,573 Notes 3 and 4
KIC Cayman Islands Investment US$ 81,753 US$ 81,753 - 100.00 NT$ 11,748,010 NT$ 76,327 NT$ 76,327 Note 3
KE Germany Marketing planning EUR 25 EUR 25 - 100.00 NT$ 12,449 NT$ 3,281 NT$ 3,281 Note 3
KF Taiwan Selling various types of tires NT$ 199,000 NT$ 199,000 19,900 100.00 NT$ 252,259 NT$ 36,062 NT$ 36,062 Note 3
KI Indonesia Manufacturing various types of tires US$ 52,999 US$ 44,999 - 99.99 NT$ 1,052,062 NT$ 75,223 NT$ 75,223 Note 3
KA ADI United States Manufacturing, distribution and selling of wheels and rims US$ 20,000 US$ 20,000 - 100.00 US$ 46,858 US$ 3,450 Note 1 Note 3
KIC KGH Cayman Islands Investment US$ 112,050 US$ 112,050 - 100.00 US$ 400,653 US$ (1,942) Note 1 Note 3
KGI Mauritius. Investment US$ 1,703 US$ 1,703 - 100.00 US$ 11,374 US$ 4,528 Note 1 Note 3
KGI STARCO Europe A/S Denmark Investment EUR 6,936 EUR 6,936 - 100.00 US$ 4,783 US$ 2,094 Note 1 Note 3
STARCO Europe A/S STARCO GB Ltd. United Kingdom Distribution and selling of various types of tires and rims EUR 552 EUR 552 - 100.00 EUR 5,466 EUR 387 Note 1 Note 3
STARCO GmbH Germany Distribution and selling of various types of tires and rims EUR 511 EUR 511 - 100.00 EUR ,3,262 EUR 416 Note 1 Note 3
STARCO Polska Sp.z.o.o. Poland Distribution and selling of various types of tires and rims EUR 34 EUR 34 - 100.00 EUR 2,391 EUR 342 Note 1 Note 3
STARCO NV Belgium Distribution and selling of various types of tires and rims EUR 2,810 EUR 2,810 - 100.00 EUR 3,464 EUR 341 Note 1 Note 3
STARCO GS AG Switzerland Distribution and selling of various types of tires and rims EUR 299 EUR 299 - 100.00 EUR 710 EUR 115 Note 1 Note 3
STARCO Baltic OÜ Estonia Distribution and selling of various types of tires and rims EUR 3 EUR 3 - 100.00 EUR 337 EUR 103 Note 1 Note 3
STARCO SAS France Distribution and selling of various types of tires and rims EUR 183 EUR 183 - 100.00 EUR (111) EUR 49 Note 1 Note 3
STARCO Beli Manastir d.o.o. Croatia Manufacturing of various types of rims EUR 9,741 EUR 9,741 - 100.00 EUR 10,569 EUR 343 Note 1 Note 3
STARCO DML United Kingdom Manufacturing, distribution and selling of wheels and rims EUR 1,030 EUR 1,030 - 100.00 EUR 514 EUR 77 Note 1 Note 3
STARCO Jelshoj Croatia Investment EUR 3 EUR 3 - 100.00 Note 2 Note 2 Note 1 Note 3
~ 181 ~
STARCO IPR GmbH Switzerland Investment EUR 17 EUR 17 - 100.00 EUR 6,855 EUR (41) Note 1 Note 3
Note 1: The share of profits (losses) of the investee is not disclosed herein as such amount was already included in the share of profits/losses of the investor.
Note 2: The carrying value and net income (losses) of the investee were already included in those of STARCO Beli.
Note 4: The differences between net income and share of profits or losses are unrealized (realized) profits or losses on transactions with investees.
- 67 -
TABLE 8

INFORMATION ON INVESTMENTS IN MAINLAND CHINA
FOR YEAR ENDED DECEMBER 31, 2020
Remittance of Funds Accumulated

Accumulated Accumulated
Outward %
Outward Carrying Repatriation of
Remittance for Ownership Investment
Method of Remittance for Net Income (Loss) Amount as of Investment
Investee Company Main Businesses and Products Paid-in Capital Investment from of Direct or Gain (Loss) Note
Investment Investment from Outward Inward of the Investee December 31, Income as of
Taiwan as of Indirect (Note 3)
Taiwan as of 2020 December 31,
December 31, Investment
January 1, 2020 2020
2020
KS Manufacturing and selling of various $ 712,075 Note 1 $ 712,075 - - $ 712,075 $ (798,123) 100.0 $ (788,374) $ 2,871,504 $ 4,994,238 -
types of tires (US$ 25,000) (US$ 25,000) (US$ 25,000)
KC Manufacturing and selling of various 1,993,810 Notes 1 and 7 1,993,810 - - 1,993,810 422,047 100.0 Note 4 Note 4 - -
KT Manufacturing and selling of various 6,266,260 Notes 1, 2 and 7 444,335 - - 444,335 (148,405) 100.0 (144,981) 3,941,795 - -
KGCI Investment 4,585,763 Notes 1 and 2 - - - - 281,295 100.0 281,295 10,270,472 - -

(US$ 161,000)
Shanghai Bomy Foodstuff Co., Manufacturing and selling of various 569,660 Note 1 56,966 - - 56,966 - 10.0 - 12,709 - -
Ltd. types of foods and drinks (US$ 20,000) (US$ 2,000) (US$ 2,000)
Ningbo Jingshang Huaxiang Internal and external parts for 744,346 Note 1 48,507 - - 48,507 - 2.6 - 126,896 45,544 -
Auto Parts Co., Ltd. automobiles (US$ 26,133) (US$ 1,703) (US$ 1,703)
~ 182 ~
STARCO Huanmei Manufacturing of rims 69,612 Note 1 Note 9 - - Note 9 9,544 33.0 2,340 102,320 - Note 9
(EUR 2,000)
Accumulated Outward Remittance for Upper Limit on the Amount of Investments

Investment Amount Authorized by
Investments in Mainland China as of Stipulated by the Investment Commission, MOEA
the Investment Commission, MOEA
December 31, 2020 (Note 5)
$ 3,255,692 $ 9,163,879 Note 6

(US$ 114,303) (US$ 319,703)
(Note 5) (EUR 1,660)
(Note 5)
Note 1: Indirect investment in mainland China through a subsidiary in a third place.
Note 2: Differences between the paid-in capital and accumulated outward investment from Taiwan are resulted from dividend reinvestment and cash injection.
Note 3: The share of profits (losses) is recognized based on the financial statements audited by an international accounting firm that collaborated with accounting firms in Taiwan.
Note 4: The share of profits (losses) and the carrying amount of KC were not disclosed herein as such amounts were already included in those of KGCI.
Note 5: The difference between the investment amount of US$319,703 thousand authorized by the Investment Commission and the accumulated outward remittance of US$114,303 thousand for investments in mainland China was due to dividend reinvestment and cash injection.
Note 6: Per the certificate of operational headquarters issued by Industrial Development Bureau of MOEA, the Company has no limitation on the accumulated remittance for investments in mainland China.
Note 7: The paid-in capital of KC and part of paid-in capital of KT were included in that of its investors and, therefore, they were not included when calculating the investment authorized and the investment remittance from Taiwan to mainland China.
Note 8: Foreign currencies were translated into NTD using spot rates as of December 31, 2020 or average exchange rates for the year.
Note 9: STARCO Huanmei was indirectly acquired via business combination and its share capital was increased through capital injection of EUR1,000 thousand by STARCO Europe A/S.
- 68 -
TABLE 9

INFORMATION OF MAJOR SHAREHOLDERS
December 31, 2020
Shares
Name of Major Shareholder Number of Percentage of
Shares Ownership (%)
Yang Chi Jen 91,622,924 10.07

Yang Ying Ming 65,555,015 7.21
Fubon Life Insurance Co., Ltd. 49,416,761 5.43
~ 183
- 69 ~-
V. Individual Consolidated Financial Statements Duly Audited
By The Certified Public Accountants In Recent Years
Financial Statements for the

Years Ended December 31, 2020 and 2019 and
Independent Auditors’ Report
~ 184 ~
INDEPENDENT AUDITORS’ REPORT
The Board of Directors and Shareholders

Opinion
We have audited the accompanying financial statements of Kenda Rubber Ind. Co., Ltd. (the
“Company”), which comprise the balance sheet as of December 31, 2020 and 2019, and the
statements of comprehensive income, changes in equity and cash flows for the years then ended,
and notes to the financial statements, including a summary of significant accounting policies
(collectively referred to as the “financial statements”).
In our opinion, the accompanying financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2020 and 2019, and its financial
performance and its cash flows for the years then ended in accordance with the Regulations
Governing the Preparation of Financial Reports by Securities Issuers.
Basis for Opinion
We conducted our audits in accordance with the Regulations Governing Auditing and Attestation
of Financial Statements by Certified Public Accountants and auditing standards generally accepted
in the Republic of China. Our responsibilities under those standards are further described in the
Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the Company in accordance with The Norm of Professional Ethics for Certified
Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities
in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements for the year ended December 31, 2020. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
~ 185
- 1 -~
The key audit matter of the Company’s financial statements for the year ended December 31, 2020
is stated as follows:
Appropriateness of the Revenue Cutoff
The Company has worldwide sales network, and the terms of sales are different by customer or
geography. Revenue is recognized when performance obligations are satisfied by the transfer of the
promised goods to customers but the timing of the transfer may be based on the time of actual
delivery or on the time of actual receipt of the goods. The Company’s revenue recognition process
involves manual inspection of relevant documents, or an estimate of arrival time of the goods
shipped to customers based on historical experience to determine timing of the transfer of control
of the promised goods to customers. Therefore, mistakes may occur in the evaluation process, and
revenue could be recorded in the incorrect reporting period.
The main audit procedures that we performed in respect of the cutoff of revenue recognition
included the following:
1. We obtained an understanding of and reviewed the sales contracts and the terms between the
Company and its customers to identify the appropriate point of revenue recognition.
2. We obtained an understanding of and evaluated the process and related controls over revenue
recognition.
3. We performed cutoff testing procedures covering a certain period before and after the balance
sheet date and examined relevant supporting documents. We determined that revenue was
recognized in the correct reporting period, as evidenced by sales terms.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with the Regulations Governing the Preparation of Financial Reports by Securities
Issuers, and for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud
or error.
In preparing the financial statements, management is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the
Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance, including members of the audit committee, are responsible for
overseeing the Company’s financial reporting process.
Auditors’ Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with the auditing standards generally accepted in the
Republic of China will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements.
~ 186
- 2 -~
As part of an audit in accordance with the auditing standards generally accepted in the Republic of
China, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:
1. Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
4. Conclude on the appropriateness of management’s use of the going concern basis of

accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditors’ report to the related disclosures in the financial statements or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditors’ report. However, future events or
conditions may cause the Company to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of entities
or business activities within the Company to express an opinion on the financial statements.
We are responsible for the direction, supervision and performance of the audit. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the financial statements for the year ended December
31, 2020, and are therefore the key audit matters. We describe these matters in our auditors’ report
unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
~ 187
- 3 -~
The engagement partners on the audits resulting in this independent auditors’ report are Yi Wen
Wang and Done Yuin Tseng.
Deloitte & Touche

Taipei, Taiwan
Republic of China
March 25, 2021
Notice to Readers
The accompanying financial statements are intended only to present the financial position,
financial performance and cash flows in accordance with accounting principles and practices
generally accepted in the Republic of China and not those of any other jurisdictions. The standards,
procedures and practices to audit such financial statements are those generally applied in the
Republic of China.
For the convenience of readers, the independent auditors’ report and the accompanying financial
statements have been translated into English from the original Chinese version prepared and used
in the Republic of China. If there is any conflict between the English version and the original
Chinese version or any difference in the interpretation of the two versions, the Chinese-language
independent auditors’ report and financial statements shall prevail.
~ 188
- 4 -~
BALANCE SHEETS
DECEMBER 31, 2020 AND 2019
2020 2019
ASSETS Amount % Amount %
CURRENT ASSETS
Cash and cash equivalents (Note 6) $ 1,393,602 4 $ 653,707 2
Financial assets at fair value through profit or loss - current (Note 7) 973 - 1,019 -
Notes receivable (Notes 9 and 22) 22,802 - 10,586 -
Accounts receivable from unrelated parties (Note 9) 292,808 1 263,819 1
Accounts receivable from related parties (Notes 9 and 24) 929,378 3 1,041,552 3
Other receivables (Note 24) 270,429 1 980,095 3
Inventories (Note 10) 852,900 2 791,518 2
Other current assets 16,686 - 22,098 -
Total current assets 3,779,578 11 3,764,394 11
NON-CURRENT ASSETS
Financial assets at fair value through other comprehensive income - non-current (Note 8) 451,523 1 393,435 1
Investments accounted for using the equity method (Note 11) 23,531,238 70 24,679,402 74
Property, plant and equipment (Notes 12 and 24) 4,031,537 12 4,191,659 13
Right-of-use assets (Notes 13 and 24) 21,955 - - -
Intangible assets 4,969 - 10,469 -
Deferred tax assets (Note 20) 419,743 1 316,811 1
Other financial assets - non-current (Note 14) 1,268,181 4 - -
Other non-current assets 161,075 1 94,960 -
Total non-current assets 29,890,221 89 29,686,736 89
TOTAL $ 33,669,799 100 $ 33,451,130 100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term borrowings (Note 15) $ 200,000 1 $ 350,000 1
Contract liabilities - current (Note 18) 24,316 - 9,277 -
Notes payable 685 - 1,003 -
Accounts payable (Note 24) 376,963 1 337,139 1
Other payables (Note 24) 470,432 2 431,439 1
Current tax liabilities (Note 20) 95,441 - 9,731 -
Lease liabilities (Notes 13 and 24) 5,141 - - -
Current portion of long-term borrowings (Note 15) 1,795,070 5 1,276,062 4
Other current liabilities 14,422 - 13,400 -
Total current liabilities 2,982,470 9 2,428,051 7
NON-CURRENT LIABILITIES
Long-term borrowings (Note 15) 11,093,789 33 11,535,185 35
Deferred tax liabilities (Note 20) 216,190 - 456,907 1
Lease liabilities - non-current (Notes 13 and 24) 16,843 - - -
Net defined benefit liabilities - non-current (Note 14) 244,791 1 248,187 1
Other non-current liabilities 6,007 - 50 -
Total non-current liabilities 11,577,620 34 12,240,329 37
Total liabilities 14,560,090 43 14,668,380 44
EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY (Note 17)

Share capital 9,094,100 27 8,744,300 26
Capital surplus 41 - 41 -
Retained earnings
Legal reserve 3,213,262 10 3,113,042 9
Special reserve 1,330,054 4 968,955 3
Unappropriated earnings 7,073,254 21 7,286,466 22
Other equity (1,601,002) (5) (1,330,054) (4)
Total equity 19,109,709 57 18,782,750 56
TOTAL $ 33,669,799 100 $ 33,451,130 100
The accompanying notes are an integral part of the financial statements.
~ 189 ~
-5-
STATEMENTS OF COMPREHENSIVE INCOME
2020 2019
Amount % Amount %
NET REVENUE (Notes 18 and 24) $ 5,946,286 100 $ 5,947,113 100
COST OF REVENUE (Notes 10, 19 and 24) 3,993,110 67 4,360,674 73
GROSS PROFIT 1,953,176 33 1,586,439 27
UNREALIZED GAIN ON TRANSACTIONS WITH

SUBSIDIARIES (23,313) - (27,111) (1)
REALIZED GROSS PROFIT 1,929,863 33 1,559,328 26
OPERATING EXPENSES (Notes 19 and 24)

Selling and marketing expenses 595,528 10 590,751 10
General and administrative expenses 193,162 3 204,099 4
Research and development expenses 390,596 7 373,031 6
Expected credit loss (Note 9) 5,959 - 4,865 -
Total operating expenses 1,185,245 20 1,172,746 20
INCOME FROM OPERATIONS 744,618 13 386,582 6
NON-OPERATING INCOME AND EXPENSES

(Notes 19 and 24)
Interest income 7,947 - 4,300 -
Other income 98,279 2 99,339 2
Other gains and losses (149,814) (3) (18,295) -
Finance costs (120,940) (2) (141,181) (2)
Share of profit of subsidiaries 595,287 10 750,383 12
Total non-operating income and expenses 430,759 7 694,546 12
PROFIT BEFORE INCOME TAX 1,175,377 20 1,081,128 18
INCOME TAX EXPENSE (Note 20) 203,152 4 67,566 1
NET PROFIT FOR THE YEAR 972,225 16 1,013,562 17

(Continued)
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STATEMENTS OF COMPREHENSIVE INCOME
2020 2019
Amount % Amount %
OTHER COMPREHENSIVE INCOME (LOSS)

Items that will not be reclassified subsequently to
profit or loss:
Remeasurement of defined benefit plans (Note 16) $ (26,430) - $ (12,034) -
Unrealized gain on investments in equity
instruments at fair value through other
comprehensive income 62,030 1 228,127 4
Share of other comprehensive income of
subsidiaries 8,506 - 14,040 -
Income tax related to items that will not be
reclassified subsequently to profit or loss
(Note 20) 5,286 - 2,407 -
49,392 1 232,540 4
Items that may be reclassified subsequently to profit
or loss:
Exchange differences on translation of the
financial statements of foreign operations (431,107) (7) (756,251) (13)
Income tax related to items that may be
reclassified subsequently to profit or loss
(Note 20) 86,221 1 151,250 3
(344,886) (6) (605,001) (10)
Other comprehensive loss for the year, net of

income tax (295,494) (5) (372,461) (6)
TOTAL COMPREHENSIVE INCOME FOR THE

YEAR $ 676,731 11 $ 641,101 11
EARNINGS PER SHARE (Note 21)

Basic $ 1.07 $ 1.11
Diluted $ 1.07 $ 1.11
The accompanying notes are an integral part of the financial statements. (Concluded)
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STATEMENTS OF CHANGES IN EQUITY
(In Thousands of New Taiwan Dollars, Except Dividends Per Share)
Other Equity
Unrealized
Exchange Valuation Gain
Differences on on Financial
Translation of Assets at Fair
The Financial Value Through
Retained Earnings Statements of Other
Unappropriated Foreign Comprehensive
Capital Stock Share Surplus Legal Reserve Special Reserve Earnings Operations Income Total Equity
BALANCE AT JANUARY 1, 2019 $ 8,744,300 $ 41 $ 3,044,125 $ 1,077,394 $ 7,119,174 $ (1,092,360) $ 123,405 $ 19,016,079

Legal reserve - - 68,917 - (68,917) - - -
Special reserve - - - (108,439) 108,439 - - -
Cash dividends to shareholders - NT$1.00 per share - - - - (874,430) - - (874,430)
Net income for the year ended December 31, 2019 - - - - 1,013,562 - - 1,013,562
Other comprehensive income (loss) for the year ended December 31, 2019, net of income tax - - - - (11,362) (605,001) 243,902 (372,461)
Total comprehensive income (loss) for the year ended December 31, 2019 - - - - 1,002,200 (605,001) 243,902 641,101
~ 192 ~
BALANCE AT DECEMBER 31, 2019 8,744,300 41 3,113,042 968,955 7,286,466 (1,697,361) 367,307 18,782,750

Legal reserve - - 100,220 - (100,220) - - -
Special reserve - - - 361,099 (361,099) - - -
Cash dividends to shareholders - NT$0.4 per share - - - - (349,772) - - (349,772)
Share dividends to shareholders - NT$0.4 per share 349,800 - - - (349,800) - - -
Net income for the year ended December 31, 2020 - - - - 972,225 - - 972,225
Other comprehensive income (loss) for the year ended December 31, 2020, net of income tax - - - - (24,546) (344,886) 73,938 (295,494)
Total comprehensive income (loss) for the year ended December 31, 2020, net of income tax - - - - 947,679 (344,886) 73,938 676,731
BALANCE AT DECEMBER 31, 2020 $ 9,094,100 $ 41 $ 3,213,262 $ 1,330,054 $ 7,073,254 $ (2,042,247) $ 441,245 $ 19,109,709
The accompanying notes are an integral part of the financial statements.
-8-
STATEMENTS OF CASH FLOWS
2020 2019
CASH FLOWS FROM OPERATING ACTIVITIES

Profit before income tax $ 1,175,377 $ 1,081,128
Adjustments for:
Depreciation expense 302,935 282,503
Amortization expense 15,002 14,651
Expected credit loss 5,959 4,865
Net (gain) loss on fair value changes of financial assets at fair value
through profit or loss 46 (2)
Finance costs 120,940 141,181
Interest income (7,947) (4,300)
Dividend income (36,402) (36,237)
Share of profit of subsidiaries (595,287) (750,383)
Net loss (gain) on disposal of property, plant and equipment (310) 552
Write-down (reversal of write-down) of inventories (14,872) 14,507
Unrealized gain on transactions with subsidiaries 23,313 27,111
Net loss on foreign currency exchange 23,568 23,150
Transfer of prepayments for equipment to expenses 18,587 10,854
Changes in operating assets and liabilities
Notes receivable (12,216) 2,961
Accounts receivable 61,806 (144,552)
Other receivables 850,326 16,143
Inventories (46,510) 8,972
Prepayments 7,140 (2,548)
Other current assets 2,203 (2,382)
Other non-current assets (5,029) -
Contract liabilities 15,039 (7,630)
Notes payable (318) (730)
Accounts payable 40,218 (44,266)
Other payables 33,440 53,773
Other current liabilities 1,022 54
Net defined benefit liabilities (29,826) (31,453)
Cash generated from operations 1,948,204 657,922
Interest received 8,653 4,300
Dividends received 1,528,753 601,342
Interest paid (119,498) (143,244)
Income tax paid (373,513) (161,233)
Net cash generated from operating activities 2,992,599 959,087
CASH FLOWS FROM INVESTING ACTIVITIES

Return of capital from financial assets at fair value through other
comprehensive income 3,942 4,024
Return of capital from investments accounted for using the equity
method - 669,940
Payments for property, plant and equipment (42,732) (67,245)
(Continued)
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STATEMENTS OF CASH FLOWS
2020 2019
Proceeds from disposal of property, plant and equipment $ 9,040 $ 6,229

Increase in refundable deposits (340) (31)
Payments for intangible assets (9,083) (14,353)
Decrease (increase) in other financial assets (1,268,181) 50,000
Increase in prepayments for equipment (178,486) (158,972)
Net cash generated from (used in) investing activities (1,485,840) 489,592
CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from short-term borrowings 600,000 150,000
Repayments of short-term borrowings (750,000) (350,000)
Proceeds from long-term borrowings 3,779,686 5,372,720
Repayments of long-term borrowings (3,703,918) (4,773,928)
Proceeds from guarantee deposits received 5,957 -
Repayment of the principal portion of lease liabilities (1,660) -
Cash dividends (349,772) (874,430)
Acquisition of subsidiaries (347,157) (1,393,530)
Net cash used in financing activities (766,864) (1,869,168)
NET INCREASE (DECREASE) IN CASH AND CASH

EQUIVALENTS 739,895 (420,489)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE

YEAR 653,707 1,074,196
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR $ 1,393,602 $ 653,707
The accompanying notes are an integral part of the financial statements. (Concluded)
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NOTES TO FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Kenda Rubber Ind. Co., Ltd. (the “Company”) was incorporated in the Republic of China (ROC) in March
1962. The Company is mainly engaged in manufacturing and trading of rubber products such as inner tubes
and tires of bicycles, scooters, industrial trucks and cars, and various products of carbon fiber.
The Company’s shares have been listed on the Taiwan Stock Exchange since December 20, 1990.
The accompanying financial statements of the Company are presented in the Company’s functional
currency, the New Taiwan dollar.
2. AUTHORIZATION OF FINANCIAL STATEMENTS
The accompanying financial statements were approved and authorized for issue by the Board of Directors
on March 25, 2021.
3. APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS
a. The IFRSs endorsed by the Financial Supervisory Commission (FSC) for application starting from 2021
Effective Date
New IFRSs Announced by IASB
Amendments to IFRS 4 “Extension of the Temporary Exemption from Effective immediately upon
Applying IFRS 9” promulgation by the IASB
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 January 1, 2021
“Interest Rate Benchmark Reform - Phase 2”
Amendment to IFRS 16 “Covid-19 - Related Rent Concessions” June 1, 2020
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b. New IFRSs in issue but not yet endorsed and issued into effect by the FSC
Effective Date
“Annual Improvements to IFRS Standards 2018-2020” January 1, 2022 (Note 2)

Amendments to IFRS 3 “Reference to the Conceptual Framework” January 1, 2022 (Note 3)
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets To be determined by IASB
between an Investor and its Associate or Joint Venture”
IFRS 17 “Insurance Contracts” January 1, 2023
Amendments to IFRS 17 January 1, 2023
Amendments to IAS 1 “Classification of Liabilities as Current or January 1, 2023
Non-current”
Amendments to IAS 1 “Disclosure of Accounting Policies” January 1, 2023 (Note 6)
Amendments to IAS 8 “Definition of Accounting Estimates” January 1, 2023 (Note 7)
Amendments to IAS 16 “Property, Plant and Equipment - Proceeds January 1, 2022 (Note 4)
before Intended Use”
Amendments to IAS 37 “Onerous Contracts - Cost of Fulfilling a January 1, 2022 (Note 5)
Contract”
Note 1: Unless stated otherwise, the above New IFRSs are effective for annual reporting periods
beginning on or after their respective effective dates.
Note 2: The amendments to IFRS 9 will be applied prospectively to modifications and exchanges of
financial liabilities that occur on or after the annual reporting periods beginning on or after
January 1, 2022. The amendments to IAS 41 “Agriculture” will be applied prospectively to
the fair value measurements on or after the annual reporting periods beginning on or after
January 1, 2022. The amendments to IFRS 1 “First-time Adoptions of IFRSs” will be applied
retrospectively for annual reporting periods beginning on or after January 1, 2022.
Note 3: The amendments are applicable to business combinations for which the acquisition date is on
or after the beginning of the annual reporting period beginning on or after January 1, 2022.
Note 4: The amendments are applicable to property, plant and equipment that are brought to the
location and condition necessary for them to be capable of operating in the manner intended
by management on or after January 1, 2021.
Note 5: The amendments are applicable to contracts for which the entity has not yet fulfilled all its
obligations on January 1, 2022.
Note 6: The amendments will be applied prospectively for annual reporting periods beginning on or
Note 7: The amendments are applicable to changes in accounting estimates and changes in accounting
policies that occur on or after the beginning of the annual reporting period beginning on or
As of the date the financial statements were authorized for issue, the Company is continuously
assessing the possible impact that the application of other standards and interpretations will have on the
Company’s financial position and financial performance and will disclose the relevant impact when the
assessment is completed.
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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Statement of compliance
The financial statements have been prepared in accordance with the Regulations Governing the
Preparation of Financial Reports by Securities Issuer.
b. Basis of preparation
The financial statements have been prepared on the historical cost basis except for financial instruments
which are measured at fair value and net defined benefit liabilities which are measured at the present
value of the defined benefit obligation less the fair value of plan assets.
The fair value measurements, which are grouped into Levels 1 to 3 based on the degree to which the
fair value measurement inputs are observable and based on the significance of the inputs to the fair
value measurement in its entirety, are described as follows:
1) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an
asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
3) Level 3 inputs are unobservable inputs for an asset or liability.
When preparing these parent company only financial statements, the Company used the equity method
to account for its investments in subsidiaries. In order for the amounts of the net profit for the year,
other comprehensive income for the year and total equity in the parent company only financial
statements to be the same with the amounts attributable to the owners of the Company in its
consolidated financial statements, adjustments arising from the differences in accounting treatments
between the parent company only basis and the consolidated basis were made to investments accounted
for using the equity method, the share of profit or loss of subsidiaries, the share of other comprehensive
income of subsidiaries and the related equity items, as appropriate, in these parent company only
financial statements.
c. Classification of current and non-current assets and liabilities
Current assets include:
 Assets held primarily for the purpose of trading;
 Assets expected to be realized within 12 months after the reporting period; and
 Cash and cash equivalents unless the asset is restricted from being exchanged or used to settle a
liability for at least 12 months after the reporting period.
Current liabilities include:
 Liabilities held primarily for the purpose of trading;
 Liabilities due to be settled within 12 months after the reporting period; and
 Liabilities for which the Company does not have an unconditional right to defer settlement for at
least 12 months after the reporting period.
Assets and liabilities that are not classified as current are classified as non-current.
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d. Foreign currencies
In preparing the financial statements of each individual entity, transactions in currencies other than the
entity’s functional currency (i.e., foreign currencies) are recognized at the rates of exchange prevailing
at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated
at the rates prevailing at that date. Exchange differences on monetary items arising from settlement or
translation are recognized in profit or loss in the period in which they arise.
Non-monetary items denominated in foreign currencies that are measured at fair value are retranslated
at the rates prevailing at the date when the fair value is determined. Exchange differences arising from
the retranslation of non-monetary items are included in profit or loss for the period except for exchange
differences arising from the retranslation of non-monetary items in respect of which gains and losses are
recognized directly in other comprehensive income; in which cases, the exchange differences are also
recognized directly in other comprehensive income.
Non-monetary item denominated in a foreign currency and measured at historical cost is stated at the
reporting currency as originally translated from the foreign currency.
e. Inventories
Inventories consist of raw materials, supplies, finished goods and work in progress and are stated at the
lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be
appropriate to Company similar or related items. The net realizable value is the estimated selling price
of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories
are recorded at the weighted-average cost on the balance sheet date.
f. Investments in subsidiaries
The Company uses the equity method to account for its investments in subsidiaries.
A subsidiary is an entity (including a structured entity) that is controlled by the Company.
Under the equity method, an investment in a subsidiary is initially recognized at cost and adjusted
thereafter to recognize the Company’s share of the profit or loss and other comprehensive income of the
subsidiary. The Company also recognizes the changes in the Company’s share of equity of subsidiaries.
Changes in the Company’s ownership interest in a subsidiary that do not result in the Company losing
control of the subsidiary are accounted for as equity transactions. The Company recognizes directly in
equity any difference between the carrying amount of the investment and the fair value of the
consideration paid or received.
The Company assesses its investment for any impairment by comparing the carrying amount with the
estimated recoverable amount as assessed based on the investee’s financial statements as a whole.
Impairment loss is recognized when the carrying amount exceeds the recoverable amount. If the
recoverable amount of the investment subsequently increases, the Company recognizes a reversal of the
impairment loss; the adjusted post-reversal carrying amount should not exceed the carrying amount that
would have been recognized (net of amortization or depreciation) had no impairment loss been
recognized in prior years. An impairment loss recognized on goodwill cannot be reversed in a
subsequent period.
Profit or loss resulting from downstream transactions is eliminated in full only in the parent company
only financial statements. Profit and loss resulting from upstream transactions and transactions between
subsidiaries is recognized only in the parent company only financial statements and only to the extent of
interests in the subsidiaries that are not related to the Company.
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g. Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost less
accumulated depreciation and accumulated impairment loss.
The depreciation of property, plant and equipment is recognized using the straight-line method. Each
significant part is depreciated separately. The estimated useful lives, residual values and depreciation
methods are reviewed at the end of each reporting period, with the effects of any changes in the
estimates accounted for on a prospective basis.
On derecognition of an item of property, plant and equipment, the difference between the sales proceeds
and the carrying amount of the asset is recognized in profit or loss.
h. Intangible assets
1) Intangible assets acquired separately
Intangible assets with finite useful lives that are acquired separately are initially measured at cost
and subsequently measured at cost less accumulated amortization and accumulated impairment loss.
Amortization is recognized on a straight-line basis. The estimated useful lives, residual values, and
amortization methods are reviewed at the end of each reporting period, with the effect of any
changes in the estimates accounted for on a prospective basis. Intangible assets with indefinite
useful lives that are acquired separately are measured at cost less accumulated impairment loss.
2) Derecognition of intangible assets
On derecognition of an intangible asset, the difference between the net disposal proceeds and the
carrying amount of the asset is recognized in profit or loss.
i. Impairment of property, plant and equipment, right-of-use asset and intangible assets
At the end of each reporting period, the Company reviews the carrying amounts of its property, plant
and equipment, right-of-use asset and intangible assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent of the impairment loss. When it is not possible to
estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount
of the cash-generating unit to which the asset belongs.
The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable
amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying
amount of the asset or cash-generating unit is reduced to its recoverable amount, with the resulting
impairment loss recognized in profit or loss.
When an impairment loss is subsequently reversed, the carrying amount of the corresponding asset or
cash-generating unit is increased to the revised estimate of its recoverable amount, but only to the extent
of the carrying amount (less amortization or depreciation expense) that would have been determined
had no impairment loss been recognized on the asset or cash-generating unit in prior years. A reversal
of an impairment loss is recognized in profit or loss.
j. Financial instruments
Financial assets and financial liabilities are recognized when the Company becomes a party to the
contractual provisions of the instruments.
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Transaction costs that are directly attributable to the acquisition or issuance of financial assets and
financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss
or “FVTPL”) are added to or deducted from the fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of
financial assets or financial liabilities at FVTPL are recognized immediately in profit or loss.
1) Financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a trade
date basis.
a) Measurement categories
Financial assets are classified into the following categories: Financial assets at FVTPL, financial
assets at amortized cost and investments in equity instruments at fair value through other
comprehensive income (“FVTOCI”).
i. Financial assets at FVTPL
Financial asset is classified as at FVTPL when such a financial asset is mandatorily

classified as at FVTPL. Financial assets mandatorily classified as at FVTPL include
investments in equity instruments which are not designated as at FVTOCI.
Financial assets at FVTPL are subsequently measured at fair value, and any dividends and
remeasurement gains or losses on such financial assets are recognized in other gains or
losses. Fair value is determined in the manner described in Note 21: Financial Instruments.
ii. Financial assets at amortized cost
Financial assets that meet the following conditions are subsequently measured at amortized
cost:
i) The financial assets are held within a business model whose objective is to hold
financial assets in order to collect contractual cash flows; and
ii) The contractual terms of the financial assets give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal amount outstanding.
Subsequent to initial recognition, financial assets at amortized cost, including cash and cash
equivalents, accounts receivable, notes receivable, other receivables, other financial assets
and refundable deposits are measured at amortized cost, which equals the gross carrying
amount determined using the effective interest method less any impairment loss. Exchange
differences are recognized in profit or loss.
Interest income is calculated by applying the effective interest rate to the gross carrying
amount of such a financial asset
A financial asset is credit impaired when one or more of the following events have occurred:
i) Significant financial difficulty of the issuer or the borrower;
ii) Breach of contract, such as a default;
iii) It is becoming probable that the borrower will enter bankruptcy or undergo a financial
reorganization; or
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iv) The disappearance of an active market for that financial asset because of financial
difficulties.
Cash equivalents include time deposits with original maturities within 3 months from the
date of acquisition, which are highly liquid, readily convertible to a known amount of cash
and are subject to an insignificant risk of changes in value. These cash equivalents are held
for the purpose of meeting short-term cash commitments.
iii. Investments in equity instruments at FVTOCI
On initial recognition, the Company may make an irrevocable election to designate

investments in equity instruments as at FVTOCI. Designation as at FVTOCI is not
permitted if the equity investment is held for trading or if it is contingent consideration
recognized by an acquirer in a business combination.
Investments in equity instruments at FVTOCI are subsequently measured at fair value with
gains and losses arising from changes in fair value recognized in other comprehensive
income and accumulated in other equity. The cumulative gain or loss will not be reclassified
to profit or loss on disposal of the equity investments; instead, it will be transferred to
retained earnings.
Dividends on these investments in equity instruments are recognized in profit or loss when
the Company’s right to receive the dividends is established, unless the dividends clearly
represent a recovery of part of the cost of the investment.
b) Impairment of financial assets
The Company recognizes a loss allowance for expected credit losses on financial assets at
amortized cost (including accounts receivable).
The Company always recognizes lifetime expected credit losses (ECLs) for trade receivables.
For all other financial instruments, the Company recognizes lifetime ECLs when there has been
a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk
on a financial instrument has not increased significantly since initial recognition, the Company
measures the loss allowance for that financial instrument at an amount equal to 12-month ECLs.
Expected credit losses reflect the weighted average of credit losses with the respective risks of
default occurring as the weights. Lifetime ECLs represent the expected credit losses that will
result from all possible default events over the expected life of a financial instrument. In
contrast, 12-month ECLs represent the portion of lifetime ECLs that is expected to result from
default events on a financial instrument that are possible within 12 months after the reporting
date.
For internal credit risk management purposes, the Company determines the following situations
as indication that a financial asset is in default (without taking into account any collateral held
by the Company):
i. Internal or external information shows that the debtor is unlikely to pay its creditors.
ii. Financial asset is more than 180 days past due unless the Company has reasonable and
corroborative information to support a more lagged default criterion.
The impairment loss of all financial assets is recognized in profit or loss by a reduction in their
carrying amounts through a loss allowance account.
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c) Derecognition of financial assets
The Company derecognizes a financial asset only when the contractual rights to the cash flows
from the asset expire or when it transfers the financial asset and substantially all the risks and
rewards of ownership of the asset to another party.
On derecognition of a financial asset at amortized cost in its entirety, the difference between the
asset’s carrying amount and the sum of the consideration received and receivable is recognized
in profit or loss. However, on derecognition of an investment in an equity instrument at
FVTOCI, the cumulative gain or loss which had been recognized in other comprehensive
income is transferred directly to retained earnings, without recycling through profit or loss.
2) Financial liabilities
a) Subsequent measurement
Financial liabilities are measured at amortized cost using the effective interest method.
b) Derecognition of financial liabilities
The difference between the carrying amount of a financial liability derecognized and the
consideration paid, including any non-cash assets transferred or liabilities assumed, is
k. Revenue recognition
The Company identifies contracts with customers, allocates the transaction price to the performance
obligations and recognizes revenue when performance obligations are satisfied.
Revenue from the sale of goods
Revenue from the sale of goods comes from sales of tires and tubes for vehicles, and other related
products. The Company recognizes revenue and accounts receivable when promised goods are
delivered to the customer’s specified location or loaded on vessels at which point the customer obtains
control of the goods and performance obligation is satisfied.
l. Leases
At the inception of a contract, the Company assesses whether the contract is, or contains, a lease.
1) The Company as lessor
Leases are classified as finance leases whenever the terms of a lease transfer substantially all the
risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
Lease payments (less any lease incentives payable) from operating leases are recognized as income
on a straight-line basis over the terms of the relevant leases.
2) The Company as lessee
The Company recognizes right-of-use assets and lease liabilities for all leases at the commencement
date of a lease, except for short-term leases and low-value asset leases accounted for applying a
recognition exemption where lease payments are recognized as expenses on a straight-line basis
over the lease period.
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Right-of-use assets are initially measured at cost, which comprises the initial measurement of lease
liabilities adjusted for lease payments made at or before the commencement date, plus any initial
direct costs incurred and an estimate of costs needed to restore the underlying assets, and less any
lease incentives received. Right-of-use assets are subsequently measured at cost less accumulated
depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities.
Right-of-use assets are presented on a separate line in the balance sheets.
Right-of-use assets are depreciated using the straight-line method from the commencement dates to
the earlier of the end of the useful lives of the right-of-use assets or the end of the lease terms.
However, if leases transfer ownership of the underlying assets to the Company by the end of the
lease terms or if the costs of right-of-use assets reflect that the Company will exercise a purchase
option, the Company depreciates the right-of-use assets from the commencement dates to the end of
the useful lives of the underlying assets.
Lease liabilities are initially measured at the present value of the lease payments, which comprise
fixed payments, in-substance fixed payments, variable lease payments which depend on an index or
a rate, residual value guarantees, the exercise price of a purchase option if the Company is
reasonably certain to exercise that option, and payments of penalties for terminating a lease if the
lease term reflects such termination, less any lease incentives receivable. The lease payments are
discounted using the interest rate implicit in a lease, if that rate can be readily determined. If that
rate cannot be readily determined, the Company uses its incremental borrowing rate.
Subsequently, lease liabilities are measured at amortized cost using the effective interest method,
with interest expense recognized over the lease terms. When there is a change in the lease term, the
Company remeasures the lease liabilities with a corresponding adjustment to the right-of-use-assets.
However, if the carrying amount of the right-of-use assets is reduced to zero, any remaining amount
of the remeasurement is recognized in profit or loss. Lease liabilities are presented on a separate line
in the balance sheets.
m. Borrowing costs
Borrowing costs directly attributable to an 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.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
Other than those stated above, all other borrowing costs are recognized in profit or loss in the period in
which they are incurred.
n. Government grants
Government grants are not recognized until there is reasonable assurance that the Company will comply
with the conditions attached to them and that the grants will be received.
Government grants related to income are recognized in other income on a systematic basis over the
periods in which the Company recognizes as expenses the related costs that the grants intend to
compensate. Specifically, government grants whose primary condition is that the Company should
purchase, construct or otherwise acquire non-current assets are recognized as deferred revenue and
transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.
The benefit of a government loan received at a below-market rate of interest is treated as a government
grant measured as the difference between the proceeds received and the fair value of the loan based on
prevailing market interest rates.
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o. Employee benefits
1) Short-term employee benefits
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted
amount of the benefits expected to be paid in exchange for the related services.
2) Retirement benefits
Payments to defined contribution retirement benefit plans are recognized as expenses when
employees have rendered services entitling them to the contributions.
Defined benefit costs (including service cost, net interest and remeasurement) under defined benefit
retirement benefit plans are determined using the projected unit credit method. Current service cost
and net interest on the net defined benefit liabilities are recognized as employee benefits expense in
the period in which they occur. Remeasurement, comprising actuarial gains and losses and the
return on plan assets (excluding interest), is recognized in other comprehensive income in the period
in which it occurs. Remeasurement recognized in other comprehensive income is reflected
immediately in retained earnings and will not be reclassified to profit or loss.
Net defined benefit liabilities represent the actual deficit in the Company’s defined benefit plans.
p. Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
1) Current tax
According to the Income Tax Act in the ROC, an additional tax on unappropriated earnings is
provided for in the year the shareholders approve to retain earnings.
Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax
provision.
2) Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and
liabilities and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax
assets are generally recognized for all deductible temporary differences, unused loss carryforwards
and research and development expenditures 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 Company is able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax assets arising from deductible temporary differences associated with such investments
and interests are recognized only to the extent that it is probable that there will be sufficient taxable
profits against which to utilize the benefits of the temporary differences and they are expected to
reverse in the foreseeable future.
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The carrying amount of deferred tax assets is reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable that sufficient taxable profits will be available to
allow all or part of the assets to be recovered. A previously unrecognized deferred tax asset is also
reviewed at the end of each reporting period and recognized to the extent that it has become
probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the
period in which the liabilities are settled or the assets are realized, based on tax rates and tax laws
that have been enacted or substantively enacted by the end of the reporting period. The
measurement of deferred tax liabilities and assets reflects the tax consequences that would follow
from the manner in which the Company expects, at the end of the reporting period, to recover or
settle the carrying amount of its assets and liabilities.
3) Current and deferred taxes
Current and deferred taxes 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 taxes are also recognized in other comprehensive income or directly in equity, respectively.
5. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION

UNCERTAINTY
In the application of the Company’s accounting policies, management is required to make judgments,
estimations, and assumptions about the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical experience
and other factors that are considered relevant. Actual results may differ from these estimates.
The Company considers the economic implications of the COVID-19 when making its critical accounting
estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimates are revised if the revisions affect
only that period or in the period of the revisions and future periods if the revisions affect both current and
future periods.
Write-down of Inventories
The net realizable value of inventories is the estimated selling price in the ordinary course of business less
the estimated costs of completion and the estimated costs necessary to make the sale. The estimation of net
realizable value is based on current market conditions and historical experience with product sales of a
similar nature. Changes in market conditions may have a material impact on the estimation of the net
realizable value.
6. CASH AND CASH EQUIVALENTS
December 31
2020 2019
Cash on hand $ 427 $ 424

Checking accounts and demand deposits 1,097,978 653,283
Cash equivalents (time deposits with original maturities of 3 months
or less) 295,197 -
$ 1,393,602 $ 653,707
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7. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
December 31
2020 2019
Financial assets at fair value through profit or loss (FVTPL) - current
Financial assets mandatorily classified as at FVTPL

Non-derivative financial assets
Domestic listed shares $ 973 $ 1,019
8. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
December 31
2020 2019
Non-current
Investments in equity instruments at FVTOCI

Domestic unlisted shares $ 438,814 $ 367,064
Foreign unlisted shares 12,709 26,371
$ 451,523 $ 393,435
These investments in equity instruments are held for medium-to long-term strategic purposes. Accordingly,
the management elected to designate these investments in equity instruments as at FVTOCI as they believe
that recognizing short-term fluctuations in these investments’ fair value in profit or loss would not be
consistent with the Company’s strategy of holding these investments for long-term purposes.
9. NOTES RECEIVABLE AND ACCOUNTS RECEIVABLE
December 31
2020 2019
Notes receivable
Carrying amount at amortized cost $ 22,802 $ 10,586
Accounts receivable
At amortized cost
Gross carrying amount $ 1,225,720 $ 1,314,253
Less: Allowance for impairment loss (3,534) (8,882)
$ 1,222,186 $ 1,305,371
The credit period of sales of goods was 30 days to 90 days from the date of the invoice. No interest is
charged on accounts receivable.
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The Company measures the loss allowance for accounts receivable at an amount equal to lifetime ECLs.
The expected credit losses on accounts receivable are estimated using a provision matrix approach
considering the past default experience of the customer, the customer’s current financial position, economic
condition of the industry in which the customer operates, as well as the GDP forecasts and industry outlook.
The Company uses different provision matrixes based on customer segments by geographical region, and
determines the expected credit loss rate.
The Company writes off accounts receivable when there is information indicating that the debtor is in
severe financial difficulty and there is no realistic prospect of recovery. For accounts receivable that have
been written off, the Company continues to engage in enforcement activity to attempt to recover the
receivables due. Where recoveries are made, these are recognized in profit or loss.
The following table details the loss allowance of accounts receivable based on the Company’s provision
matrix.
December 31, 2020

121 to 180 Over
Not Past Due 1 to 30 Days 31 to 60 Days 61 to 90 Days 91 to 120 Days Days 181 Days Total
Gross carrying amount $ 1,126,937 $ 111,552 $ 3,780 $ 953 $ 1,865 $ - $ 3,435 $ 1,248,522
Loss allowance (Lifetime ECLs) - (37 ) (62 ) - - - (3,435 ) (3,534 )
Amortized cost $ 1,126,937 $ 111,515 $ 3,718 $ 953 $ 1,865 $ - $ - $ 1,244,988
December 31, 2019

121 to 180 Over
Not Past Due 1 to 30 Days 31 to 60 Days 61 to 90 Days 91 to 120 Days Days 181 Days Total
Gross carrying amount $ 1,120,919 $ 167,609 $ 22,571 $ 69 $ - $ 3,132 $ 10,539 $ 1,324,839

Loss allowance (Lifetime ECLs) - (94 ) (46 ) (2 ) - (940 ) (7,800 ) (8,882 )
Amortized cost $ 1,120,919 $ 167,515 $ 22,525 $ 67 $ - $ 2,192 $ 2,739 $ 1,315,957
The movements of the loss allowance of notes and accounts receivable were as follows:

2020 2019

Add: Net remeasurement of loss allowance 6,290 5,630
Less: Amounts written off (11,638) -
10. INVENTORIES
December 31
2020 2019
Finished goods $ 315,054 $ 365,322

Raw materials 226,401 153,252
Supplies 48,920 45,014
Inventory in transit 141,293 97,510
$ 852,900 $ 791,518
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The cost of revenue associated with inventories were $3,749,493 thousand and $4,095,773 thousand,
respectively, for the years ended December 31, 2020 and 2019. The cost of revenue consisted of reversal of
inventory write-downs of $14,872 thousand and inventory write-downs of $14,507 thousand.
11. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Investment in Subsidiaries
December 31
2020 2019
Ownership Ownership
Amount (%) Amount (%)
Kenda International Corporation Co.,

Ltd. (KIC) $ 11,745,828 100.00 $ 13,043,717 100.00
Kenda Rubber (Vietnam) Co., Ltd.
(KV) 6,894,307 100.00 6,266,250 100.00
Kenda Rubber Ind. Co., (Hong Kong)
Ltd. (KHK) 2,253,786 100.00 2,903,416 100.00
American Kenda Rubber Ind. Co.,
Ltd. (KA) 1,323,172 100.00 1,413,919 100.00
Pt. Kenda Rubber Indonesia (KI) 1,049,708 99.99 796,583 99.99
Kenfong Industrial Co., Ltd. (KF) 251,988 100.00 246,737 100.00
Kenda Rubber Industrial Co. (Europe
GmbH) (KE) 12,449 100.00 8,780 100.00
$ 23,531,238 $ 24,679,402
Per administrative review, the U.S. Department of Commerce notified KA in June 2019 to impose
anti-dumping duties (“ADD”) on the total import price of automobile tires imported from China between
August 2016 and July 2017. The result of the administrative review was unrepresentative to all enterprises
importing automobile tires from China. The ADD rate was raised from 8.72% to 64.57%. Based on
historical experience, KA considered that the duty rate was unreasonable and has filed an appeal to the U.S.
Court of Appeals for the Federal Circuit. However, the Company accrued ADD of US$7,778 thousand
($229,964 thousand) and associated interest expense of US$789 thousand ($23,341 thousand) in the
financial statements for the year ended December 31, 2020.
The investments accounted for using the equity method and the share of profit or loss of subsidiaries were
based on the financial statements audited by respective auditors for the same accounting periods.
Refer to Table 7 for the nature of activities, principal places of business and countries of incorporation of
the subsidiaries.
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12. PROPERTY, PLANT AND EQUIPMENT
Balance at
Balance at December 31,
January 1, 2020 Additions Disposals Reclassification 2020
Cost
Land $ 2,166,617 $ - $ - $ - $ 2,166,617

Buildings 856,813 690 - 28,262 885,765
Machinery 3,054,682 24,147 (28,538) 80,474 3,130,765
Other equipment 716,947 4,484 (3,819) 19,328 736,940
Equipment under installation and
construction in progress 39,459 21,799 - (29,330) 31,928
6,834,518 $ 51,120 $ (32,357) $ 98,734 6,952,015
Buildings 311,257 $ 27,363 $ - $ - 338,620

Machinery 1,890,233 210,797 (20,148) - 2,080,882
Other equipment 441,369 63,086 (3,479) - 500,976
2,642,859 $ 301,246 $ (23,627) $ - 2,920,478
$ 4,191,659 $ 4,031,537
Balance at
Balance at December 31,
January 1, 2019 Additions Disposals Reclassification 2019
Cost
Land $ 2,166,617 $ - $ - $ - $ 2,166,617

Buildings 811,712 543 (894) 45,452 856,813
Machinery 2,903,304 34,875 (35,498) 152,001 3,054,682
Other equipment 694,044 3,779 (5,188) 24,312 716,947
Equipment under installation and
construction in progress 71,692 34,025 - (66,258) 39,459
6,647,369 $ 73,222 $ (41,580) $ 155,507 6,834,518
Buildings 285,512 $ 26,380 $ (635) $ - 311,257

Machinery 1,724,639 195,347 (29,753) - 1,890,233
Other equipment 385,004 60,776 (4,411) - 441,369
2,395,155 $ 282,503 $ (34,799) $ - 2,642,859
$ 4,252,214 $ 4,191,659
A portion of the land for operational use in Chongyang section of Yuanlin City and Citong Township of
Yunlin County is categorized as agricultural and pasture land. The title of the land is currently registered
under a related party, Mr. Chen, who is the trustee in a land trust agreement with the Company. The
Company retains the certificate of title for land and the agreement stipulates that the nominal holder or
trustee is prohibited from transferring the ownership to another party. The land will be registered under the
Company once the category for land use has been changed.
The above items of property, plant and equipment used by the Company are depreciated on a straight-line
basis over their estimated useful lives as follows:
Building 10-55 years

Machinery 3-30 years
Other equipment 2-18 years
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13. LEASE ARRANGEMENTS
a. Right-of-use assets
December 31
2020 2019
Carrying amount
Buildings $ 21,955 $ -

2020 2019
Additions to right-of-use assets $ 23,644 $ -
Depreciation charge for right-of-use assets

Buildings $ 1,689 $ -
b. Lease liabilities
December 31
2020 2019
Carrying amount
Current $ 5,141 $ -
Non-current $ 16,843 $ -
Discount rate for lease liabilities was as follows:
December 31
2020 2019
Buildings 0.8% -
c. Material leasing activities and terms
The Company leases buildings for the use of product manufacturing with lease terms of 5 years. The
Company does not have bargain purchase options to acquire the buildings at the end of the lease terms.
In addition, the Company is prohibited from subleasing or transferring all or any portion of the
underlying assets without the lessor’s consent.
d. Other lease information

2020 2019
Expenses relating to short-term leases $ 1,807 $ 2,159

Expenses relating to low-value asset leases $ 156 $ 166
Total cash outflow for leases $ (3,683) $ (2,325)
The Company’s leases of certain buildings and other equipment qualify as short-term leases and leases
of certain office equipment qualify as low-value asset leases. The Company has elected to apply the
recognition exemption and thus, did not recognize right-of-use assets and lease liabilities for these
leases.
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14. OTHER FINANCIAL ASSETS
December 31
2020 2019
Non-current
Repatriated funds $ 1,268,181 $ -
Repatriated funds refer to demand and time deposits pertinent to regulations governing repatriated offshore
funds, which the use is restricted.
Refer to Note 23 for information relating to credit risk management and valuation.
15. BORROWINGS
a. Short-term borrowings
December 31
2020 2019
Unsecured borrowings $ 200,000 $ 350,000
Range of rates 0.65%-0.68% 0.765%-0.78%
b. Long-term borrowings
December 31
2020 2019

Project borrowings 420,577 383,103
Less: Current portion (1,795,070) (1,276,062)
Long-term borrowings $ 11,093,789 $ 11,535,185
Range of rates 0.35%-1.09% 0.6%-1.2876%

Maturity date 110- 115 years 109-115 years
The Company participated in a project of the Ministry of Economic Affairs that encouraged Taiwanese
enterprises to invest locally. The Company expects to construct or expand factories, and acquire
machinery and equipment in Taiwan from 2019 to 2022. Any shortage of funds would be financed via
bank borrowings.
16. RETIREMENT BENEFIT PLANS
a. Defined contribution plan
The Company adopted a pension plan under the Labor Pension Act (LPA), which is a state-managed
defined contribution plan. Under the LPA, the Company makes monthly contributions to employees’
individual pension accounts at 6% of monthly salaries and wages.
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b. Defined benefit plans
The defined benefit plans adopted by the Company in accordance with the Labor Standards Law is
operated by the government of the ROC. Pension benefits are calculated on the basis of the length of
service and average monthly salaries of the 6 months before retirement. The Company contributes
amounts equal to 15% of total monthly salaries and wages to a pension fund administered by the
pension fund monitoring committee. Pension contributions are deposited in the Bank of Taiwan in the
committee’s name. Before the end of each year, the Company assesses the balance in the pension fund.
If the amount of the balance in the pension fund is inadequate to pay retirement benefits for employees
who conform to retirement requirements in the next year, the Company is required to fund the
difference in one appropriation that should be made before the end of March of the next year. The
pension fund is managed by the Bureau of Labor Funds, Ministry of Labor (the “Bureau”); the
Company has no right to influence the investment policy and strategy.
The amounts included in the balance sheets in respect of the Company’s defined benefit plans are as
follows:
December 31
2020 2019
Present value of defined benefit obligation $ 648,243 $ 640,063

Fair value of plan assets (403,452) (391,876)
Net defined benefit liabilities $ 244,791 $ 248,187
The amounts included in the balance sheets in respect of the Company’s defined benefit plans are as
follows:
Present Value
Balance at January 1, 2019 $ 629,357 $ (361,751) $ 267,606

Service cost
Remeasurement
Benefits paid (27,728) 27,728 -
Balance at December 31, 2019 640,063 (391,876) 248,187
(Continued)
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Present Value
Service cost
Current service cost $ 6,656 $ - $ 6,656
Current service cost and gain on
settlements (299) - (299)
Remeasurement
Benefits paid (41,986) 41,986 -
Balance at December 31, 2020 $ 648,243 $ (403,452) $ 244,791
Through the defined benefit plans under the Labor Standards Law, the Company is exposed to the
following risks:
1) Investment risk: The plan assets are invested in domestic and foreign equity and debt securities,
bank deposits, etc. The investment is conducted at the discretion of the Bureau or under the
mandated management. However, in accordance with relevant regulations, the return generated by
plan assets shall not be below the interest rate for a 2-year time deposit with local banks.
2) Interest risk: A decrease in both government and corporate bond interest rate will increase the
present value of the defined benefit obligation; however, this will be partially offset by an increase
in the return on the plans’ debt investments.
3) Salary risk: The present value of the defined benefit obligation is calculated using the future salaries
of plan participants. As such, an increase in the salaries of the plan participants will increase the
present value of the defined benefit obligation.
The actuarial valuations of the present value of the defined benefit obligation were carried out by
qualified actuaries. The significant assumptions used for the purposes of the actuarial valuations are as
follows:
December 31
2020 2019
Discount rates 0.30% 0.75%

Expected rates of salary increase 2.00% 2.00%
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If possible reasonable changes in each of the significant actuarial assumptions occur and all other
assumptions remain constant, the present value of the defined benefit obligation will increase (decrease)
as follows:
December 31
2020 2019
Discount rates
0.25% increase $ (15,190) $ (15,496)
0.25% decrease $ 15,745 $ 16,078
Expected rates of salary increase
0.25% increase $ 15,439 $ 15,837
0.25% decrease $ (14,977) $ (15,346)
The above sensitivity analysis presented above may not be representative of the actual changes in the
present value of the defined benefit obligation as it is unlikely that changes in assumptions will occur in
isolation of one another as some of the assumptions may be correlated.
December 31
2020 2019
Expected contributions to the plans for the next year $ 34,436 $ 34,369
Average duration of the defined benefit obligation 9 years 9 years
17. EQUITY
a. Ordinary shares
December 31
2020 2019
Shares authorized (in thousands of shares) 910,000 880,000

Shares authorized, par value $10 (in thousands of dollars) $ 9,100,000 $ 8,800,000
Shares issued and fully paid (in thousands of shares) 909,410 874,430
Shares issued and fully paid (in thousands of dollars) $ 9,094,100 $ 8,744,300
The change in the Company’s share capital is mainly resulted from the process of converting its
retained earnings into share capital via issuing new shares.
b. Retained earnings and dividends policy
The shareholders of the Company held their regular meeting on June 11, 2019 and in that meeting,
resolved the amendments to the Company’s Articles of Incorporation (the “Articles”). The amendments
explicitly stipulate that the Company’s board of directors is authorized to adopt a special resolution to
distribute dividends and bonuses in cash and a report of such distribution should be submitted in the
Under the dividends policy as set forth in the amended Articles, the Company takes into consideration
the Company’s operating environment, growth stage, future capital needs, long-term financial plans,
and the shareholders’ demand for cash inflows before resolving the amount of dividends. The
Company’s board of directors could propose dividends between 10% and 80% of distributable earnings
which comprise of the current remaining earning and undistributed earnings from previous year. When
distributing dividends via issuing shares, the motion should be submitted to shareholders’ meeting for
approval. The shareholders may adjust the ratio of share dividends to reflect the profit and the adequacy
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of capital of the year. The cash dividends shall not be less than 10% of the total dividend declared. The
board of directors is authorized to adopt a resolution to distribute dividends, bonuses, legal reserve and
all or a portion of the capital surplus in cash and a report of such distribution should be submitted to the
Under the dividends policy as set forth in the Articles before the amendments, where the Company
retains unappropriated earnings during a fiscal year, the earnings shall be first reserved for paying taxes,
offsetting losses of previous years, setting aside as legal reserve at 10% of the remaining earnings,
except when the legal reserve equals to the paid-in capital of the Company. The Company could
appropriate or reverse a special reserve in accordance with the laws, regulations or order of competent
authority, when necessary.
The Company takes into consideration of the operating environment, growth stage, future capital needs,
long-term financial plans, and the shareholders’ demand for cash inflows, the Company’s board of
directors could propose dividends between 10% and 80% of distributable earning which comprise of the
current remaining earning and undistributed earnings from previous year. When distributing dividends
via issuing shares, the motion should be submitted to shareholders meeting for approval. The cash
dividends shall not be less than 10% of the total dividend declared. The shareholders may adjust the
ratio and the instruments of distributions to reflect the profit and the adequacy of capital of the year. For
the policies on the distribution of compensation of employees and remuneration of directors and
supervisors after the amendment, refer to compensation of employees and remuneration of directors and
supervisors in Note 19.
An appropriation of earnings to a legal reserve shall be made until the legal reserve equals the
Company’s paid-in capital. The legal reserve may be used to offset deficits. If the Company has no
deficit and the legal reserve has exceeded 25% of the Company’s paid-in capital, the excess may be
transferred to capital or distributed in cash.
Items referred to under Rule No. 1010012865 and in the directive titled “Questions and Answers for
Special Reserves Appropriated Following Adoption of IFRSs” should be appropriated to or reversed
from a special reserve by the Company.
The appropriations of earnings for 2019 and 2018 were as follows:
Appropriations of Earnings Dividends Per Share (NT$)

2019 2018 2019 2018
Legal reserve $ 100,220 $ 68,917

Special reserve (reversal) 361,099 (108,439)
Cash dividends 349,772 874,430 $ 0.4 $ 1.0
Share dividends 349,800 - 0.4 -
The appropriations of earnings for 2020 were proposed by the Company’s board of directors on March
25, 2021 as follows:
Appropriations Dividends Per

of Earnings Share (NT$)
Legal reserve $ 94,768

Special reserve 270,947
Cash dividends 909,410 $ 1.0
The appropriation of earnings for 2020 will be resolved by the shareholders in their meeting to be held
on June 18, 2021.
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18. REVENUE
2020 2019
Revenue from contracts with customers

Revenue from the sale of goods $ 5,378,546 $ 5,331,630
Revenue from the rendering of services 567,740 615,483
$ 5,946,286 $ 5,947,113
a. Contract information
The Company sells tires and other rubber products predominantly via dealers. It is stipulated in the
contracts that volume discount is offered if a specific threshold of purchase is achieved. The Company
provides agreed-upon percentages of refund or discount to dealers in accordance with the contracts.
Based on historical experience, the Company estimates a reasonable amount of refund and recognizes it
as refund liability (presented in other current liabilities).
b. Contract balances
December 31
2020 2019
Contract liabilities - current $ 24,316 $ 9,277
c. Disaggregation of revenue
Refer to Statement 6 for information about the disaggregation of revenue.
19. NET PROFIT
a. Other income

2020 2019
Dividends $ 36,402 $ 36,237

Rental income 9,454 8,824
Others 52,423 54,278
$ 98,279 $ 99,339
b. Other gains and losses

2020 2019
Net gain (loss) on financial assets classified as at FVTPL $ (46) $ 2

Net gain (loss) on disposal of property, plant and equipment
(Note 22) 310 (552)
Net foreign exchange losses (149,590) (17,743)
Others (488) (2)
$ (149,814) $ (18,295)
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c. Financial cost

2020 2019
Interest on bank loans $ 121,197 $ 142,097

Interest on lease liabilities 60 -
Less: Amounts included in the cost of qualifying assets (317) (916)
$ 120,940 $ 141,181
d. Employee benefits, depreciation and amortization expenses
Operating Operating
Costs Expenses Total
Short-term benefits
Salary expense $ 742,459 $ 509,795 $ 1,252,254
Labor/health insurance expense 64,512 50,768 115,280
Post-employment benefits
Defined contribution plans 28,654 20,625 49,279
Defined benefit plans 2,685 5,405 8,090
Remuneration of directors 1,866 17,077 18,943
Other employee benefit expense 13,248 11,541 24,789
Depreciation expense 231,837 71,098 302,935
Amortization expense 2,172 12,830 15,002
Short-term benefits
Salary expense 714,657 475,309 1,189,966
Labor/health insurance expense 65,263 47,728 112,991
Post-employment benefits 33,322 13,275 46,597

Defined contribution plans 3,268 6,718 9,986
Defined benefit plans 1,960 16,735 18,695
Remuneration of directors
Other employee benefit expense 12,885 9,849 22,734
Depreciation expense 218,894 63,609 282,503
Amortization expense 2,154 12,497 14,651
1) For the years ended December 31, 2020 and 2019, the Company employed 1,965 and 1,968
employees on average, respectively, which included 6 board members who did not concurrently
serve as employees for both years.
2) The employment benefit expenses, on average, were $740 thousand and $705 thousand for the years
ended December 31, 2020 and 2019, respectively. The average salary expense were $639 thousand
and $607 thousand for the years ended December 31, 2020 and 2019, respectively. The average
salary expense changed by 5.3%.
3) The Company did not have supervisors for the years ended December 31, 2020 and 2019.
Therefore, no compensation to supervisors was remunerated.
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4) In addition to the pursuit of operating results, the Company values employee salary and benefits,
embraces sustainability, promotes a win-win situation between capital and labor, implements
corporate governance, maximizes social responsibility, and contributes to economic prosperity.
Compensation packages for directors and managers are periodically assessed and evaluated by
remuneration committee. Compensation policies for employees are re-evaluated annually with
consideration of industry standards to offer competitive employee salary and benefits.
e. Compensation of employees and remuneration of directors
According to the Company’s Articles, the Company accrued compensation of employees and
remuneration of directors at rates from 0.5% to 1% and no higher than 3%, respectively, of net profit
each year. The compensation of employees and the remuneration of directors for the years ended
December 31, 2020 and 2019, which were approved by the Company’s board of directors on March 25,
2021 and March 26, 2020, respectively, are as follows:

2020 2019
Amount Accrual rate Amount Accrual rate
Compensation of
employees $ 11,188 0.93% $ 11,040 1.00%
Remuneration of directors $ 16,793 1.40% $ 16,570 1.49%
If there is a change in the amounts after the annual financial statements were authorized for issue, the
differences are recorded as a change in the accounting estimate.
There is no difference between the actual amounts of compensation of employees and remuneration of
directors paid and the amounts recognized in the financial statements for the years ended December 31,
2019 and 2018.
Information on the compensation of employees and remuneration of directors resolved by the

Company’s board of directors is available at the Market Observation Post System website of the Taiwan
Stock Exchange.
20. INCOME TAXES RELATING TO CONTINUING OPERATIONS.
a. Major Components of income tax recognized in profit or loss

2020 2019
Current tax
In respect of the current year $ 300,423 $ 155,552
455,293 153,016
Deferred tax
In respect of the current year (55,707) (83,063)
(252,141) (85,450)
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A reconciliation of accounting profit and income tax expense is as follows:

2020 2019
Profit before tax from continuing operations $ 1,175,377 $ 1,081,128
Income tax expense calculated at the statutory rate $ 235,075 $ 216,226

Nondeductible items in determining taxable income (113,128) (125,190)
Tax-exempt income (7,280) (7,247)
Unrecognized temporary differences - (2,009)
Investment tax credits (9,454) (9,291)
Adjustments for prior years’ tax (41,564) (4,923)
Tax incentives associated with repatriation 120,114 -
Others 19,389 -
b. Income tax recognized in other comprehensive income

2020 2019
Deferred tax
In respect of the current year

Translation of the financial statements of foreign operations $ 86,221 $ 151,250
Remeasurement of defined benefit plans 5,286 2,407
Total income tax recognized in other comprehensive income $ 91,507 $ 153,657
c. Deferred tax assets and liabilities
The movements of deferred tax assets and deferred tax liabilities are as follows:
Recognized in
Other
Compre-
Opening Recognized in hensive Closing
Balance Profit or Loss Income Balance
Deferred tax assets
Temporary differences
Unrealized loss on inventory $ 11,301 $ (2,974) $ - $ 8,327
Unrealized gains on
intercompany sales 26,584 4,663 - 31,247
Defined benefit obligations 25,470 - 5,286 30,756
operations 242,933 - 86,221 329,154
Others 10,523 9,736 - 20,259
$ 316,811 $ 11,424 $ 91,507 $ 419,743

(Continued)
~ 219
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Recognized in
Other
Compre-
Share of profit of subsidiaries $ 246,845 $ (246,845) $ - $ -
Reserve for land value
increment tax 208,226 - - 208,226
Others 1,836 6,128 - 7,964
$ 456,907 $ (240,717) $ - $ 216,190

(Concluded)
Recognized in
Other
Compre-
Deferred tax assets
Unrealized loss on inventory $ 8,400 $ 2,901 $ - $ 11,301
Unrealized gains on
intercompany sales 19,153 7,431 - 26,584
Defined benefit obligations 23,063 - 2,407 25,470
operations 91,683 - 151,250 242,933
Others 10,842 (319) - 10,523
$ 153,141 $ 10,013 $ 153,657 $ 316,811
Share of profit of associates $ 324,009 $ (77,164) $ - $ 246,845
Reserve for land value
increment tax 208,226 - - 208,226
Others 109 1,727 - 1,836
$ 532,344 $ (75,437) $ - $ 456,907
d. Income tax assessments
The Company’s income tax returns through 2018, except 2017, have been assessed by the tax
authorities.
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21. EARNINGS PER SHARE
Unit: NT$ Per Share

2020 2019
The weighted average number of shares outstanding used for the earnings per share computation was
adjusted retroactively for the issuance of bonus shares. The basic and diluted earnings per share adjusted
retrospectively for the year ended December 31, 2019 are as follows:
Net Profit for the Year

2020 2019
Earnings used in the computation of basic and diluted earnings per

share $ 972,225 $ 1,013,562
Unit: In Thousands of Shares

2020 2019

computation of basic earnings per share 909,410 909,410
Effect of potentially dilutive ordinary shares
Compensation of employees 419 406

computation of diluted earnings per share 909,829 909,816
The Company may settle the compensation of employees in cash or shares; therefore, the Company
assumes that the entire amount of the compensation will be settled in shares, and the resulting potential
shares are included in the weighted average number of shares outstanding used in the computation of
diluted earnings per share, as the effect is dilutive. Such dilutive effect of the potential shares is included in
the computation of diluted earnings per share until the number of shares to be distributed to employees is
resolved in the following year.
22. CAPITAL MANAGEMENT
The Company requires to maintain an adequate level of capital to expand and optimize facilities and
equipment. The Company’s capital management strategy aims to ensure that the necessary financial
resources and operating plan are sufficient to meet the next 12 months’ requirements for working capital,
capital expenditures, research and development expenses, debt repayment and other needs.
~ 221
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23. FINANCIAL INSTRUMENTS
a. Fair value of financial instruments not measured at fair value
Please refer to the information on the balance sheet. The management of the Company considered the
carrying amounts of financial assets and liabilities not measured at fair value on the balance sheet
approximate the fair value.
b. Fair value of financial instruments measured at fair value on a recurring basis
1) Fair value hierarchy
December 31, 2020
Domestic listed shares $ 973 $ - $ - $ 973
instruments
shares $ - $ - $ 451,523 $ 451,523
December 31, 2019
Domestic listed shares $ 1,019 $ - $ - $ 1,019
instruments
shares $ - $ - $ 393,435 $ 393,435
2) Reconciliation of Level 3 fair value measurements of financial instruments

2020 2019
Financial assets at FVTOCI - equity instruments

Recognized in other comprehensive income (included in
unrealized valuation gain (loss) on financial assets at
FVTOCI) 62,030 228,127
Return of capital (3,942) (4,024)
~ 222
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3) Valuation techniques and inputs applied for Level 3 fair value measurement
The fair values of domestic and foreign unlisted equity securities were determined using the market
approach and asset-based pricing approach. Market approach derives fair value by reference to
identical or comparable publicly-traded companies. It takes into consideration observable
transaction prices on an active stock market, implied valuation multiples, related transactions and
statistics. Asset-based pricing approach separately evaluates a target’s assets and liabilities. It
utilizes fair market value, replacement cost, liquidation value or related approaches to reflect the
value of an enterprise or operating unit as a whole. A decrease in significant unobservable inputs,
such as discount for lack of control and marketability, would result in an increase in fair value of the
investments.
c. Categories of financial instruments
December 31
2020 2019
Financial assets
FVTPL
Listed shares $ 973 $ 1,109
Financial assets at amortized cost (1) 4,186,141 2,958,360
Equity instruments 451,523 393,435
Amortized cost (2) 13,942,946 13,930,878
Note 1: The balances include financial assets at amortized cost, which comprise cash and cash
equivalents, notes receivable, accounts receivable, other receivables, other financial assets and
refundable deposits.
Note 2: The balances include financial liabilities at amortized cost, which comprise short-term and
long-term borrowings (including the current portion), notes payable, accounts payable and
other payables, and guarantee deposits.
d. Financial risk management objectives and policies
The Company’s major financial instruments include equity investments, accounts receivable, accounts
payable and borrowings. The Company’s corporate treasury function provides services to the business,
coordinates access to domestic and international financial markets, and monitors and manages the
financial risks relating to the operations of the Company through internal risk reports that analyze
exposures by degree and magnitude of risks. These risks include market risk (including foreign
currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
1) Market risk
The Company’s activities exposed it primarily to the financial risks of changes in foreign currency
exchange rates (see (a) below) and interest rates (see (b) below).
There has been no change to the Company’s exposure to market risks or the manner in which these
risks are managed and measured.
~ 223
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a) Foreign currency risk
The Company have foreign currency denominated sales and purchases, which expose the
Company to foreign currency risk.
The carrying amounts of the Company’s foreign currency denominated monetary assets and
monetary liabilities are set out in Note 26.
The Company is mainly exposed to USD.
The sensitivity analysis measures the effect of a 1% increase and decrease in the New Taiwan
dollar (the functional currency) against USD. The sensitivity rate of 1% is used when reporting
foreign currency risk internally to key management personnel and represents management’s
assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis
included only outstanding foreign currency denominated monetary items, and adjusts their
translation at the end of the year for a 1% change in foreign currency rates. The pre-tax profit in
2020 and 2019 would have increased/decreased by $31,619 and $23,576 thousand had the New
Taiwan dollar strengthened/weakened by 1% against USD.
b) Interest rate risk
The Company is exposed to interest rate risk because entities in the Company borrow funds at
both fixed and floating interest rates. The risk is managed by the Company by maintaining an
appropriate mix of fixed and floating rate borrowings. The Company’s interest rate risk is
resulted from cash and cash equivalents and borrowings. Specifically, the Company is exposed
to cash flow interest rate risk by holding cash and cash equivalents at floating rate. The risk is
partially mitigated by borrowings at floating rates. Holding cash and cash equivalents and
borrowings at fixed rate exposes the Company to fair value interest risk. The Company
considers the overall interest rate trends and adjusts the portfolio of fixed and floating rate
instruments accordingly.
The carrying amounts of the Company’s financial assets and financial liabilities with exposure
to interest rates at the end of the year were as follows:
December 31
2020 2019
Fair value interest rate risk

Financial assets $ 926,236 $ 8,400
Financial liabilities 2,719,566 350,000
Cash flow interest rate risk
Financial assets 1,743,032 653,056
The sensitivity analysis below was determined based on the Company’s exposure to interest
rates for both derivative and non-derivative instruments at the end of the year. For floating rate
liabilities, the analysis was prepared assuming the amount of each liability outstanding at the
end of the year was outstanding for the whole year.
If interest rates had been 10 basis points higher/lower and all other variables were held constant,
the Company’s pre-tax profit for the years ended December 31, 2020 and 2019 would have
decreased/increased by $86,482 thousand and $121,582 thousand, respectively.
~ 224
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c) Other price risk
The Company was exposed to equity price risk through its investments in equity instrument.
Equity investments are held for strategic rather than for trading purposes; the Company does not
actively trade these investments. The Company measures the price risk of equity securities via
sensitivity analysis.
The sensitivity analysis below was determined based on the exposure to equity price risks at the
end of the year.
If equity prices had been 5% higher/lower, pre-tax profit for the years ended December 31, 2020
and 2019 would have both increased/decreased by $49 thousand and $51 thousand, respectively,
as a result of the changes in fair value of financial assets at FVTPL, and the pre-tax other
comprehensive income for the years ended December 31, 2020 and 2019 would have
increased/decreased by $22,576 thousand and $19,672 thousand, respectively, as a result of the
changes in fair value of financial assets at FVTOCI.
2) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting
in a financial loss to the Company. At the end of the year, the Company’s maximum exposure to
credit risk is mainly resulted from the carrying amount of the respective recognized financial assets
as stated in the balance sheets.
To maintain the quality of accounts receivable, the Company established operating procedures
related to credit risk management to manage credit risks. Risk factors associated with individual
customers include a customer’s financial condition, internal credit rating, transaction history,
current macroeconomic environment and other items that might affect a customer’s ability to pay.
In order to minimize credit risk, the management of the Company has delegated a team responsible
for determining credit limits, credit approvals and other monitoring procedures to ensure that
follow-up action is taken to recover overdue debts. In addition, the Company reviews the
recoverable amount of each individual trade debt at the end of the reporting period to ensure that
adequate allowance is made for possible irrecoverable amounts. In this regard, the management
believes the Company’s credit risk was significantly reduced. The Company writes off accounts
receivable when there is evidence indicating that the debtor is in severe financial difficulty and there
is no realistic prospect of recovery. For accounts receivable that have been written off, the Company
continues to engage in enforcement activity to attempt to recover the receivables due. Where
recoveries are made, these are recognized in profit or loss.
3) Liquidity risk
The Company manages liquidity risk by monitoring and maintaining a level of cash and cash
equivalents deemed adequate to finance the Company’s operations and mitigate the effects of
fluctuations in cash flows. In addition, management monitors the utilization of bank borrowings and
ensures compliance with loan covenants.
~ 225
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The Company manages liquidity risk by maintaining adequate reserves, banking facilities and
reserve borrowing facilities, and continuously monitoring forecasted and actual cash flows as well
as matching the maturity profiles of financial assets and liabilities. The Company had available
unutilized short-term bank loan facilities set out in b) below.
a) Liquidity and interest rate risk tables for non-derivative financial liabilities
The following table details the Company’s remaining contractual maturities for its
non-derivative financial liabilities with agreed upon repayment periods. The table has been
drawn up based on the undiscounted cash flows of financial liabilities from the earliest date on
which the Company can be required to pay. The table includes both interest and principal cash
flows. Specifically, bank loans with a repayment on demand clause were included in the earliest
time band regardless of the probability of the banks choosing to exercise their rights. The
maturity dates for other non-derivative financial liabilities were based on the agreed upon
repayment dates.
December 31, 2020
On Demand or
Non-interest bearing $ 848,080 $ - $ -

Lease liabilities 5,141 16,843 -
Fixed interest rate liabilities 931,901 1,717,616 84,632
$ 2,950,422 $ 11,085,181 $ 129,768
December 31, 2019
On Demand or
Non-interest bearing $ 769,581 $ - $ -

Fixed interest rate liabilities 351,341 - -
$ 2,532,056 $ 11,547,784 $ 164,288
b) Financing facilities
December 31
2020 2019
Unsecured bank overdraft facilities

Amount used $ 13,093,432 $ 13,167,664
Amount unused 5,152,854 7,876,688
$ 18,246,286 $ 21,044,352
~ 226
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22. TRANSACTIONS WITH RELATED PARTIES
Details of transactions between the Company and other related parties are disclosed as follows.
a. Related party name and category
Related Party Name Related Party Category
KA Subsidiary
KV Subsidiary
KE Subsidiary
KF Subsidiary
KI Subsidiary
American Development, Inc. (ADI) Subsidiary
Kenda Rubber (Shenzhen) Ltd. (KS) Subsidiary
Kenda Rubber (Tianjin) Co., Ltd. (KT) Subsidiary
Kenda Rubber (China) Ltd. (KC) Subsidiary
Kenda Global (China) Investment Corporation (KGCI) Subsidiary
STARCO Europe A/S Subsidiary
STARCO GB Ltd. Subsidiary
STARCO GmbH Subsidiary
STARCO Polska Sp.z.o.o. Subsidiary
STARCO NV Subsidiary
STARCO GS AG Subsidiary
STARCO SAS Subsidiary
Kenlight Trading Corp. Other related party
Jienshang Co., Ltd. Other related party
Total Lubricants Taiwan Ltd. Other related party
Kenstone Metal Co., Ltd. Other related party
Other related parties refer to companies having a chairman that is within second-degree relative, the
same as the Company’s chairman, or are determined as related parties in substance.
b. Revenue

Item Related Party Category/Name 2020 2019
Sales of goods Subsidiaries

KA $ 1,263,521 $ 1,332,912
ADI 682,643 796,393
KF 546,734 524,647
Others 406,265 445,584
Other related parties 8,367 7,732
$ 2,907,530 $ 3,107,268
The credit term for related parties were similar to those for non-related parties. The credit terms is
between 45 and 90 days.
~ 227
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Rendering of services Subsidiaries

KC $ 214,572 $ 233,836
KV 197,669 139,210
KT 85,124 77,800
KS 19,347 129,458
Others 51,028 35,178
$ 567,740 $ 615,482
Revenue from the rendering of services refers to consulting service and trademark licensing revenue.
c. Purchases

Subsidiaries $ 20,945 $ 30,410

$ 86,916 $ 74,892
The payment terms for related parties were similar to those for non-related parties. The payment terms
are between 45 and 90 days.
d. Receivables from related parties
December 31
Accounts receivable Subsidiaries

KA $ 439,302 $ 458,107
ADI 245,900 334,883
KF 155,971 145,552
Others 87,338 100,845
Other related parties 867 2,165
$ 929,378 $ 1,041,552
Other receivables Subsidiaries

KHK $ 130,626 $ 567,870
KIC 103,552 378,580
Others 14,261 13,561
$ 248,439 $ 960,011
The outstanding accounts receivable from related parties are unsecured. For the years ended December
31, 2020 and 2019, no impairment losses were recognized for accounts receivable from related parties.
~ 228
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e. Payables to related parties
December 31
Accounts payable Subsidiaries $ 7,322 $ 7,974

$ 13,964 $ 16,993
Other payables Subsidiaries

KA $ 23,702 $ 13,981
Other 565 181
Other related parties 126 126
$ 24,393 $ 14,288
The outstanding accounts payable to related parties are unsecured.
f. Acquisitions of property, plant and equipment
Purchase Price
Subsidiaries $ 31 $ 8,784
g. Disposals of property, plant and equipment
Proceeds Gain on Disposal

For the Year Ended For the Year Ended
December 31 December 31
Related Party Category/Name 2020 2019 2020 2019
Subsidiaries
KV $ 1,276 $ 4,137 $ 114 $ 197
KC 1,684 1,130 52 25
KI 5,381 938 457 352
Others 518 24 129 24
$ 8,859 $ 6,229 $ 752 $ 598
h. Lease arrangements

Acquisition of right-of-use assets
Subsidiary
KF $ 23,644 $ -
~ 229
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Line Item Related Party Category/Name 2020 2019
Lease liabilities Subsidiary

KF $ 21,984 $ -

Lease expense
Subsidiary
KF $ 60 $ -
i. Endorsements and guarantees
Endorsements and guarantees provided by the Company
December 31
Subsidiaries $ 6,977,993 $ 6,212,981
j. Others

Item Related Party Categories/Name 2020 2019
Service cost Subsidiary

KE $ 77,771 $ 76,361
Operating expense Subsidiaries $ 16,354 $ 18,872

$ 17,775 $ 20,293
Other income Subsidiaries $ 16,398 $ 15,576
k. Compensation of key management personnel

2020 2019
Short-term employee benefits $ 29,065 $ 27,260

Post-employment benefits 92 84
$ 29,157 $ 27,344
The remuneration of directors and key executives, as determined by the remuneration committee, was
based on individual performance and market trend.
~ 230
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25. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS
In addition to those disclosed in other notes, significant contingencies and unrecognized commitments of
the Company were as follows:
a. Capital expenditures contracted but yet incurred are as follows:
December 31
Item 2020 2019
Property, plant and equipment $ 112,006 $ 77,167
b. Contingencies
1) Products liability insurance
The Company has entered into a product liability insurance for the products manufactured by the
Company and sold globally. The period of insurance agreement is from August 6, 2020 to August 6,
2021. The coverage of insurance policy is from August 6, 2004 to August 6, 2021. The maximum
reparation of one single event is US$10,000 thousand.
2) The Company had entered into an exclusive agency contract with Gabjohn for the product
distributed in Nigeria. Due to circumstances related to local sales, the Company switched to other
agencies to distribute products in Nigeria. Consequently, Gabjohn filed a lawsuit against the
Company for breach of exclusive agency contract and demanded $90,000 thousand (NGN500,000
thousand) as compensation. The Company signed an attorney agreement with Tommy & Jason
International Intellectual Property Rights Co., Ltd. (collectively as Tommy & Jason), which then
engaged a lawyer in the local intellectual Property Office, Adeniji Kazeem & Co., to handle the
litigation and regularly reported the related proceedings. The lawsuit is currently awaiting in the
High Court of Nigeria. Upon the date of issuance of the financial statements for the year ended
December 31, 2020, the outcome of the dispute cannot be predicted with sufficient reliability.
26. SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES
The Company’s significant financial assets and liabilities denominated in foreign currencies aggregated by
the foreign currencies other than functional currencies of the entities in the Company and the related
exchange rates between foreign currencies and respective functional currencies were as follows:
December 31, 2020
Foreign Carrying
Financial assets
Monetary items
USD $ 117,941 28.48 (USD:NTD) $ 3,359,924
RMB 49,479 4.37 (RMB:NTD) 215,988
EUR 889 34.81 (EUR:NTD) 30,938
$ 3,606,250
(Continued)
~ 231
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Foreign Carrying
Non-monetary items
Investments accounted for using the
equity method
USD $ 826,875 28.48 (USD:NTD) $ 23,591,531
Monetary items
USD 6,931 28.48 (USD:NTD) $ 197,412
(Concluded)
December 31, 2019
Foreign Carrying
Financial assets
Monetary items
USD $ 83,258 30.10 (USD:NTD) $ 2,506,137
GBP 430 39.36 (GBP:NTD) 16,911
EUR 383 33.72 (EUR:NTD) 12,916
JPY 35,813 0.28 (EUR:NTD) 9,092
$ 2,545,866
Non-monetary items
Investments accounted for using the
equity method
USD 819,014 30.10 (USD:NTD) $ 24,653,122
Monetary items
USD 4,934 30.10 (USD:NTD) $ 148,508
EUR 205 33.72 (EUR:NTD) 6,916
$ 155,424
For the years ended December 31, 2020 and 2019, net foreign exchange losses were $149,590 thousand and
$17,743 thousand, respectively. It is impractical to disclose net foreign exchange gains (losses) by each
significant foreign currency due to the variety of the foreign currency transactions and functional currencies
of the entities in the Company.
27. SEPARATELY DISCLOSED ITEMS
a. Information about significant transactions and investees:
1) Financing provided to others (Table 1)
2) Endorsements/guarantees provided (Table 2)
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3) Marketable securities held (excluding investments in subsidiaries and associates) (Table 3)
4) Marketable securities acquired or disposed of at costs or prices of at least NT$300 million or 20%
of the paid-in capital (None)
5) Acquisition of individual real estate at costs of at least NT$300 million or 20% of the paid-in capital
(None)
6) Disposal of individual real estate at prices of at least NT$300 million or 20% of the paid-in capital
(None)
7) Total purchases from or sales to related parties amounting to at least NT$100 million or 20% of the
paid-in capital (Table 4)
8) Receivables from related parties amounting to at least NT$100 million or 20% of the paid-in capital
(Table 5)
9) Trading in derivative instruments (None)
10) Information on investees (Table 6)
b. Information on investments in mainland China
1) Information on any investee company in mainland China, showing the name, principal business
activities, paid-in capital, method of investment, inward and outward remittance of funds,
ownership percentage, net income of investees, investment income or loss, carrying amount of the
investment at the end of the year, repatriations of investment income, and limit on the amount of
investment in the mainland China area (Table 7)
2) Any of the following significant transactions with investee companies in mainland China, either
directly or indirectly through a third party, and their prices, payment terms, and unrealized gains or
losses.
a) The amount and percentage of purchases and the balance and percentage of the related payables
at the end of the year (consolidated financial statements Table 6)
b) The amount and percentage of purchases and the balance and percentage of the related payables
at the end of the year (consolidated financial statements Table 6)
c) The amount of property transactions and the amount of the resultant gains or losses (None)
d) The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the

end of the year and the purposes (Table 2)
e) The highest balance, the ending balance, the interest rate range, and total current period interest
with respect to the financing of funds (Table 1)
f) Other transactions that have a material effect on the profit or loss for the year or on the financial
position, such as the rendering or receipt of services (None)
c. Information of major shareholders: List all shareholders with ownership of 5% or greater showing the
name of the shareholder, the number of shares owned, and percentage of ownership of each shareholder
(Table 8)
~ 233
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TABLE 1

FINANCING PROVIDED

Company Limits
1 KGI STARCO Europe A/S Finance Yes $ 1,055,325 $ - $ - 0.7-1.5% The need for $ - Operating $ - - $ - Ninety percent Ninety five percent
worth, $1,150,664 worth, $1,214,590
2 KGI STARCO GmBH Finance Yes 96,761 - - 1.5000% The need for - Operating - - - Ninety percent Ninety five percent
worth, $1,150,664 worth, $1,214,590
3 KGI STARCO Baltic OÜ Finance Yes 13,922 - - 1.5000% The need for - Operating - - - Ninety percent Ninety five percent
worth, $1,150,664 worth, $1,214,590
4 STARCO Europe A/S STARCO NV Finance Yes 17,403 - - 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
~ 234 ~
worth, $81,015 worth, $121,522
5 STARCO Europe A/S STARCO DML Finance Yes 33,797 33,240 30,386 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
6 STARCO Europe A/S STARCO GS AG Finance Yes 57,221 51,026 23,703 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
7 STARCO Europe A/S STARCO Beli Manastir d.o.o. Finance Yes 13,574 - - 3.0000% The need for - Operating - - - Fifty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
8 STARCO Beli Manastir d.o.o. STARCO GS AG Finance Yes 23,042 23,042 3,481 3.9600% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $144,808 worth, $217,212
(Continued)
- 51 -
Company Limits
9 STARCO Europe A/S STARCO GmBH Finance Yes $ 13,922 $ - $ - 3.0000% The need for $ - Operating $ - - $ - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522
10 STARCO Europe A/S Starco SAS. Finance Yes 13,922 13,922 13,922 3.0000% The need for - Operating - - - Forty percent (40%) Sixty percent (60%)
worth, $81,015 worth, $121,522

(Concluded)
~ 235 ~
- 52 -
TABLE 2

ENDORSEMENTS/GUARANTEES PROVIDED

Accumulated Endorsements/
Limits on Maximum Outstanding Endorsements/ Endorsements/
Endorsements/ Guarantees
Endorsements/ Amount Endorsements/ Amount Aggregate Guarantees Guarantees
Actual Guarantees to Given on
Endorsement/ Guarantees Endorsed/ Guarantees at Endorsed/ Endorsements/ Given by Given by
No. Relationship Amount Net Equity in Behalf of Note
Guarantee Provider Name Given on Guaranteed the End of the Guaranteed by Guarantees Parent on Subsidiaries
(Note 1) Borrowed Latest Companies in
Behalf of Each During the Period Collateral Limit (Note 3) Behalf of on Behalf of
Financial Mainland
Party Period (Note 4) Subsidiaries Parent
Statements China
(%)
0 The Company KGI a $ 7,451,739 $ 1,218,218 $ - $ - $ - 0.00 $ 14,903,478 Yes No No -

(Note 2) (Note 3)
ADI a 7,451,739 170,898 170,898 113,932 - 0.92 14,903,478 Yes No No -
(Note 2) (Note 3)
KA a 7,451,739 170,898 170,898 170,898 - 0.92 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO DML a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GB Ltd. a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO NV a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
~ 236 ~
STARCO SAS a 7,451,739 569,660 569,660 - - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO Baltic OÜ a 7,451,739 569,660 569,660 10,453 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GS AG a 7,451,739 569,660 569,660 45,259 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO GmbH a 7,451,739 569,660 569,660 69,612 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO Polska Sp.z.o.o. a 7,451,739 569,660 569,660 111,653 - 3.06 14,903,478 Yes No No -
(Note 2) (Note 3)
STARCO Europe A/S a 7,451,739 2,449,196 2,449,196 1,270,427 - 13.15 14,903,478 Yes No No -
(Note 2) (Note 3)
KV a 7,451,739 2,819,817 2,819,817 724,750 - 15.14 14,903,478 Yes No No -
(Note 2) (Note 3)
KT a 7,451,739 655,109 484,211 - - 2.60 14,903,478 Yes No Yes -
(Note 2) (Note 3)
KI a 7,451,739 968,422 882,973 530,923 - 4.74 14,903,478 Yes No No -
(Note 2) (Note 3)
1 KHK KS a 888,841 873,056 873,056 - - 39.29 1,777,682 No No Yes -
(Note 2) (Note 3)
(Continued)
- 53 -
Accumulated Endorsements/
Limits on Maximum Outstanding Endorsements/ Endorsements/
Endorsements/ Guarantees
Endorsements/ Amount Endorsements/ Amount Aggregate Guarantees Guarantees
Actual Guarantees to Given on
Endorsement/ Guarantees Endorsed/ Guarantees at Endorsed/ Endorsements/ Given by Given by
No. Relationship Amount Net Equity in Behalf of Note
Guarantee Provider Name Given on Guaranteed the End of the Guaranteed by Guarantees Parent on Subsidiaries
(Note 1) Borrowed Latest Companies in
Behalf of Each During the Period Collateral Limit (Note 3) Behalf of on Behalf of
Financial Mainland
Party Period (Note 4) Subsidiaries Parent
Statements China
(%)
2 KGCI KS a $ 4,057,730 $ 3,942,224 $ 3,942,224 $ - $ - 34.43 $ 8,115,461 No No Yes -

(Note 2) (Note 3)
3 STARCO Europe A/S STARCO GB Ltd. a 202,537 175,226 77,878 - - 38.45 405,075 No No No -
(Note 2) (Note 3)
STARCO NV a 202,537 156,628 156,628 17,438 - 77.33 405,075 No No No -
(Note 2) (Note 3)
Note 1: Relationships between the guarantee provider and guaranteed party:
a. A subsidiary in which the Company holds directly and indirectly over 90% of an equity interest.
Note 2: Limit on endorsements to a single company is 40% of the Company’s net worth.
Limit on endorsements to a single company is 40% of KHK’s net worth.
Limit on endorsements to a single company is 40% of KGCI’s net worth.
Limit on endorsements to a single company is 100% of STARCO Europe A/S’s net worth.
Note 3: Limit on aggregate endorsements is 80% of the Company’s net worth.

Limit on aggregate endorsements is 80% of KHK’s net worth.
Limit on aggregate endorsements is 80% of KGCI’s net worth.
Limit on aggregate endorsements is 200% of STARCO Europe A/S’s net worth.
~ 237 ~
Note 4: KGCI and KHK jointly provided endorsement/guarantee for KS of RMB 800 million, but the limit for KHK is RMB 200 million.
Note 5: The Company provided shared endorsement/guarantee for nine subsidiaries including STARCO Europe A/S, STARCO GmbH, STARCO Polska Sp.z.o.o., STARCO SAS, STARCO GS AG, STARCO NV, STARCO GB Ltd., STARCO DML and STARCO
Baltic OÜ. The total amount of the shared endorsement/guarantee is US$20,000 thousand.
(Concluded)
- 54 -
TABLE 3

MARKETABLE SECURITIES HELD
DECEMBER 31, 2020
December 31, 2020

Holding Company Type and Name of Marketable Relationship with the Holding
Financial Statement Account Carrying Percentage of Fair Value Note
Name Securities Company Shares/Units
Amount Ownership % (Note)
The Company Shares and equity

China Development Financial - Financial assets at FVTPL - current 105 $ 973 0.00 $ 973 -
Holding Corporation
Kenjou Ind. Co., Ltd. The chairman of Kenjou Ind. Co., Ltd. Equity instruments at FVTOCI - non-current 7,382 314,467 10.86 314,467 -
and the chairman of the Company are
second-degree relatives
Chang Hwa Golf Co., Ltd. - Equity instruments at FVTOCI - non-current 30 197 0.08 197 -
Ou Hua Venture Capital Co., Ltd. - Equity instruments at FVTOCI - non-current 315 1,880 5.15 1,880 -
Yu Hua Venture Capital Co., Ltd. - Equity instruments at FVTOCI - non-current 146 491 2.50 491 -
Total Lubricants Taiwan Ltd. The chairman of Total Lubricants Equity instruments at FVTOCI - non-current 81 121,779 6.80 121,779 -
Taiwan Ltd. and the chairman of the
Company are second-degree relatives
BOMY (BVI) CO., LTD. - Equity instruments at FVTOCI - non-current 2,000 12,709 9.73 12,709 -
KGI Shares and equity
~ 238 ~
Kenjou Investment Co., Ltd. The chairman of Kenjou Investment Co., Equity instruments at FVTOCI - non-current - 126,896 13.00 126,896 -
Ltd. and the chairman of the Company
are second-degree relatives
Note: Fair value of domestic listed shares is determined based on its closing price on December 31, 2020.
- 55 -
TABLE 4

TOTAL PURCHASES FROM OR SALES TO RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
Notes/Accounts
Transaction Details Abnormal Transaction
Receivable (Payable)
Company Name Related Party Relationship Note
Purchases/ Payment
Amount % to Total Payment Terms Unit Price Amount % to Total
Sales Terms
The Company KA Subsidiary Sales $ 1,263,521 23.49 In accordance with mutual agreements Agreed by both parties - $ 444,151 36.34 -
KF Subsidiary Sales 546,734 10.17 In accordance with mutual agreements Agreed by both parties - 155,971 12.76 -
KV Subsidiary Sales 201,067 3.74 In accordance with mutual agreements Agreed by both parties - 30,563 2.50 -
ADI Indirectly owned subsidiary Sales 682,643 12.69 In accordance with mutual agreements Agreed by both parties - 246,464 20.17 -
KC KA Subsidiary of ultimate parent company Sales 370,433 5.55 In accordance with mutual agreements Agreed by both parties - 148,422 12.80 -
STARCO NV Subsidiary of ultimate parent company Sales 179,729 2.69 In accordance with mutual agreements Agreed by both parties - 49,934 4.31 -
KS Subsidiary of ultimate parent company Sales 100,143 1.50 In accordance with mutual agreements Agreed by both parties - 45,364 3.91 -
KV KA Subsidiary of ultimate parent company Sales 1,775,946 30.41 In accordance with mutual agreements Agreed by both parties - 683,122 58.42 -
KT KS Subsidiary of ultimate parent company Sales 489,728 18.08 In accordance with mutual agreements Agreed by both parties - 130,432 21.73 -
STARCO BELI Manastir STARCO GmbH Subsidiary of ultimate parent company Sales 121,962 4.06 In accordance with mutual agreements Agreed by both parties - 23,891 6.35 -
d.o.o.
STARCO Europe A/S STARCO Huanmei Associate Purchases 172,534 5.75 In accordance with mutual agreements Agreed by both parties - (38,678) (10.29) -
~ 239 ~
- 56 -
TABLE 5

RECEIVABLES FROM RELATED PARTIES AMOUNTING TO AT LEAST NT$100 MILLION OR 20% OF THE PAID-IN CAPITAL
DECEMBER 31, 2020
Overdue Amounts Received

Turnover Allowance for
Company Name Related Party Relationship Ending Balance in Subsequent
Rate Amount Actions Taken Impairment Loss
Period (Note 2)
The Company KA Subsidiary $ 444,151 2.79 $ 94,651 - $ 145,284 -

ADI Indirectly owned subsidiary 246,464 2.35 18,620 - 177,760 -
KF Subsidiary 155,971 3.60 - - 100,520 -
KHK Subsidiary 130,626 - - - - -
KIC Subsidiary 103,552 - - - - -
KC KA Subsidiary of ultimate parent company 148,422 2.41 240 - 55,635 -

ADI Subsidiary of ultimate parent company 125,494 2.01 103 - 96,937 -
KV KA Subsidiary of ultimate parent company 683,122 2.91 - - 273,977 -

ADI Subsidiary of ultimate parent company 192,971 3.20 - - 179,596 -
KT KS Subsidiary of ultimate parent company 130,432 7.51 - - 130,432 -
STARCO IPR GmbH STARCO Europe A/S Parent company 200,526 - 200,526 - - -
~ 240 ~
Note 2: Amounts received as of March 18, 2021.
- 57 -
TABLE 6

INFORMATION ON INVESTEES
Original Investment Amount As of December 31, 2020 Net Income Share of Profits
Investor Investee Location Main Business Activities December 31, December 31, Shares (In Percentage of Carrying (Losses) of the (Losses) of Note
2020 (Note 1) 2019 (Note 1) Thousands) Ownership Value (Note 1) Investee (Note 1) Investee (Note 1)
The Company KA United States Trade and investment US$ 9,000 US$ 9,000 - 100.00 NT$ 1,455,742 NT$ 13,020 NT$ 13,020 Note 3
KHK Hong Kong Trade and investment HK$ 100 HK$ 100 - 100.00 NT$ 2,254,806 NT$ (516,197) NT$ (516,197) Note 3
US$ 30,600 US$ 30,600
KV Vietnam Manufacturing various types of tires US$ 67,680 US$ 64,180 - 100.00 NT$ 7,080,904 NT$ 979,711 NT$ 907,573 Notes 3 and 4
KIC Cayman Islands Investment US$ 81,753 US$ 81,753 - 100.00 NT$ 11,748,010 NT$ 76,327 NT$ 76,327 Note 3
KE Germany Marketing planning EUR 25 EUR 25 - 100.00 NT$ 12,449 NT$ 3,281 NT$ 3,281 Note 3
KF Taiwan Selling various types of tires NT$ 199,000 NT$ 199,000 19,900 100.00 NT$ 252,259 NT$ 36,062 NT$ 36,062 Note 3
KI Indonesia Manufacturing various types of tires US$ 52,999 US$ 44,999 - 99.99 NT$ 1,052,062 NT$ 75,223 NT$ 75,223 Note 3
KA ADI United States Manufacturing, distribution and selling of wheels and rims US$ 20,000 US$ 20,000 - 100.00 US$ 46,858 US$ 3,450 Note 1 Note 3
KIC KGH Cayman Islands Investment US$ 112,050 US$ 112,050 - 100.00 US$ 400,653 US$ (1,942) Note 1 Note 3
KGI Mauritius. Investment US$ 1,703 US$ 1,703 - 100.00 US$ 11,374 US$ 4,528 Note 1 Note 3
KGI STARCO Europe A/S Denmark Investment EUR 6,936 EUR 6,936 - 100.00 US$ 4,783 US$ 2,094 Note 1 Note 3
STARCO Europe A/S STARCO GB Ltd. United Kingdom Distribution and selling of various types of tires and rims EUR 552 EUR 552 - 100.00 EUR 5,466 EUR 387 Note 1 Note 3
STARCO GmbH Germany Distribution and selling of various types of tires and rims EUR 511 EUR 511 - 100.00 EUR ,3,262 EUR 416 Note 1 Note 3
STARCO Polska Sp.z.o.o. Poland Distribution and selling of various types of tires and rims EUR 34 EUR 34 - 100.00 EUR 2,391 EUR 342 Note 1 Note 3
STARCO NV Belgium Distribution and selling of various types of tires and rims EUR 2,810 EUR 2,810 - 100.00 EUR 3,464 EUR 341 Note 1 Note 3
STARCO GS AG Switzerland Distribution and selling of various types of tires and rims EUR 299 EUR 299 - 100.00 EUR 710 EUR 115 Note 1 Note 3
STARCO Baltic OÜ Estonia Distribution and selling of various types of tires and rims EUR 3 EUR 3 - 100.00 EUR 337 EUR 103 Note 1 Note 3
STARCO SAS France Distribution and selling of various types of tires and rims EUR 183 EUR 183 - 100.00 EUR (111) EUR 49 Note 1 Note 3
STARCO Beli Manastir d.o.o. Croatia Manufacturing of various types of rims EUR 9,741 EUR 9,741 - 100.00 EUR 10,569 EUR 343 Note 1 Note 3
STARCO DML United Kingdom Manufacturing, distribution and selling of wheels and rims EUR 1,030 EUR 1,030 - 100.00 EUR 514 EUR 77 Note 1 Note 3
STARCO Jelshoj Croatia Investment EUR 3 EUR 3 - 100.00 Note 2 Note 2 Note 1 Note 3
~ 241 ~
STARCO IPR GmbH Switzerland Investment EUR 17 EUR 17 - 100.00 EUR 6,855 EUR (41) Note 1 Note 3
Note 1: The share of profits (losses) of the investee is not disclosed herein as such amount was already included in the share of profits or losses of the investor.
Note 2: The carrying value and net income (losses) of the investee were already included in those of STARCO Beli.
Note 4: The differences between net income and share of profits or losses are unrealized (realized) profits or losses on transactions with investees.
- 58 -
TABLE 7

INFORMATION ON INVESTMENTS IN MAINLAND CHINA
FOR YEAR ENDED DECEMBER 31, 2020
Remittance of Funds Accumulated

Accumulated Accumulated
Outward %
Outward Carrying Repatriation of
Remittance for Ownership Investment
Method of Remittance for Net Income (Loss) Amount as of Investment
Investee Company Main Businesses and Products Paid-in Capital Investment from of Direct or Gain (Loss) Note
Investment Investment from Outward Inward of the Investee December 31, Income as of
Taiwan as of Indirect (Note 3)
Taiwan as of 2020 December 31,
December 31, Investment
January 1, 2020 2020
2020
KS Manufacturing and selling of various $ 712,075 Note 1 $ 712,075 - - $ 712,075 $ (798,123) 100.0 $ (788,374) $ 2,871,504 $ 4,994,238 -
KC Manufacturing and selling of various 1,993,810 Notes 1 and 7 1,993,810 - - 1,993,810 422,047 100.0 Note 4 Note 4 - -
KT Manufacturing and selling of various 6,266,260 Notes 1, 2 and 7 444,335 - - 444,335 (148,405) 100.0 (144,981) 3,941,795 - -
KGCI Investment 4,585,763 Notes 1 and 2 - - - - 281,295 100.0 281,295 10,270,472 - -

(US$ 161,000)
Shanghai Bomy Foodstuff Co., Manufacturing and selling of various 569,660 Note 1 56,966 - - 56,966 - 10.0 - 12,709 - -
Ltd. types of foods and drinks (US$ 20,000) (US$ 2,000) (US$ 2,000)
Ningbo Jingshang Huaxiang Internal and external parts for 744,346 Note 1 48,507 - - 48,507 - 2.6 - 126,896 45,544 -
Auto Parts Co., Ltd. automobiles (US$ 26,133) (US$ 1,703) (US$ 1,703)
~ 242 ~
STARCO Huanmei Manufacturing of rims 69,612 Note 1 Note 9 - - Note 9 9,544 33.0 2,340 102,320 - Note 9
(EUR 2,000)
Accumulated Outward Remittance for Upper Limit on the Amount of Investments

Investment Amount Authorized by
Investments in Mainland China as of Stipulated by the Investment Commission, MOEA
the Investment Commission, MOEA
December 31, 2020 (Note 5)
$ 3,255,692 $ 9,163,879 Note 6

(US$ 114,303) (US$ 319,703)
(Note 5) (EUR 1,660)
(Note 5)
Note 1: Indirect investment in mainland China through a subsidiary in a third place.
Note 2: Differences between the paid-in capital and accumulated outward investment from Taiwan are resulted from dividend reinvestment and cash injection.
Note 3: The share of profits (losses) is recognized based on the financial statements audited by an international accounting firm that collaborated with accounting firms in Taiwan.
Note 4: The share of profits (losses) and the carrying amount of KC were not disclosed herein as such amounts were already included in those of KGCI.
Note 5: The difference between the investment amount of US$319,703 thousand authorized by the Investment Commission and the accumulated outward remittance of US$114,303 thousand for investments in mainland China was due to dividend reinvestment and cash injection.
Note 6: Per the certificate of operational headquarters issued by Industrial Development Bureau of MOEA, the Company has no limitation on the accumulated remittance for investments in mainland China.
Note 7: The paid-in capital of KC and part of paid-in capital of KT were included in that of its investors and, therefore, they were not included when calculating the investment authorized and the investment remittance from Taiwan to mainland China.
Note 8: Foreign currencies were translated into NTD using spot rates as of December 31, 2020 or average exchange rates for the year.
Note 9: STARCO Huanmei was indirectly acquired via business combination and its share capital was increased through capital injection of EUR1,000 thousand by STARCO Europe A/S.
- 59 -
TABLE 8

INFORMATION OF MAJOR SHAREHOLDERS
December 31, 2020
Shares
Name of Major Shareholder Number of Percentage of
Shares Ownership (%)
Yang Chi Jen 91,622,924 10.07

Yang Ying Ming 65,555,015 7.21
Fubon Life Insurance Co., Ltd. 49,416,761 5.43
~ 243
- 60 ~-
THE CONTENTS OF STATEMENTS OF MAJOR ACCOUNTING ITEMS
Item Statement Index
Major Accounting Items in Assets, Liabilities and Equity

Statement of cash and cash equivalents 1
Statement of inventories 2
Statement of changes in investments accounted for using the equity method 3
Statement of short-term borrowings 4
Statement of long-term borrowings 5
Major Accounting Items in Profit or Loss
Statement of operating revenue 6
Statement of operating cost 7
Statement of manufacturing expenses 8
Statement of operating expenses 9
~ 244
- 61 ~-
STATEMENT 1

STATEMENT OF CASH AND CASH EQUIVALENTS
DECEMBER 31, 2020
Item Amount
Cash and cash on hand $ 427

Cash in banks
Checking accounts deposits 62
Demand deposits 157,002
Foreign deposits (1) 940,914
Time deposits (2) 295,197
$ 1,393,602
Note 1: Including US$29,111 thousand (US$1=NT$28.48), JPY15,487 thousand (JPY1=NT$0.28), GBP487

thousand (GBP1=NT$38.94), EUR731 thousand (EUR1=NT$34.81) and RMB14,456 thousand
(RMB1=NT$4.37).
Note 2: Including US$5,000 thousand (US$1=NT$28.48) and RMB35,000 thousand (RMB1=NT$4.37).
~ 245
- 62 ~-
STATEMENT 2

STATEMENT OF INVENTORIES - MANUFACTURING
DECEMBER 31, 2020
Amount
Market Value
Item Cost (Note)
Finished goods $ 327,533 $ 456,372

Raw materials 227,197 231,666
Supplies 48,967 48,792
Inventory in transit 145,785 143,875
894,535 $ 1,126,094
Less: Allowance for impairment loss (41,635)
$ 852,900
Note: Inventories are individually measured at the lower of cost or net realizable value.
~ 246
- 63 ~-
TABLE 3

STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Exchange
Differences on
Translation of
the Financial
Statements of Marker Value
Beginning Balance Decrease Share of Profit Foreign Others Ending Balance or Net Assets
Name % Amount Increase (Note 1) or Loss Operations (Note 2) % Amount Value
Investments accounted for using the equity method

Subsidiary
KIC 100.00 $ 13,043,717 $ - $ (1,461,499) $ 76,325 $ 75,240 $ 12,045 100.00 $ 11,745,828 $ 11,748,010
KV 100.00 6,266,250 104,797 - 907,573 (383,892) (421) 100.00 6,894,307 7,080,904
KHK 100.00 2,903,416 - (152,342) (516,197) 19,621 (712) 100.00 2,253,786 2,254,806
KA 100.00 1,413,919 - - 13,020 (82,453) (21,314) 100.00 1,323,172 1,455,742
KI 99.99 796,583 242,360 - 75,223 (60,011) (4,447) 99.99 1,049,708 1,052,068
KF 100.00 246,737 - (30,853) 36,062 - 42 100.00 251,988 252,259
KE 100.00 8,780 - - 3,281 388 - 100.00 12,449 12,449
~ 247 ~
$ 24,679,402 $ 347,157 $ (1,644,694) $ 595,287 $ (431,107) $ (14,807) $ 23,531,238 $ 23,856,238
Note 1: Decrease in investments refer to issuance of cash dividends and remittance of dividends.
Note 2: Others refer to unrealized gains (losses) on investments in equity instruments at FVTOCI, remeasurement of defined benefit plans and adjustments for realized and unrealized gains (losses) on downstream transactions with subsidiaries
and associates.
- 64 -
STATEMENT 4

STATEMENT OF SHORT-TERM BANK BORROWINGS
DECEMBER 31, 2020
Annual
Interest Collateral or
Creditor Type and Bank Loan Period Rates (%) Amount Pledge
Unsecured loans
Taipei Fubon Bank 2021.03.24 0.65 $ 100,000 None
Mizuho Bank Co., Ltd. 2021.01.15 0.68 100,000 None
$ 200,000
~ 248
- 65 ~-
STATEMENT 5

STATEMENT OF LONG-TERM BANK BORROWINGS
DECEMBER 31, 2020
Maturity Date Collateral or

Creditor Bank (Note) Amount Pledge
Unsecured loans
The Shanghai Commercial & Saving Bank, Ltd. 2023.12.11 $ 300,000 None
CTBC Bank Co., Ltd. 2024.10.04 375,150 None
Mizuho Bank Co., Ltd. 2021.03.19 500,000 None
O-Bank Co., Ltd. 2026.08.01 965,582 None
Taipei Fubon Bank 2024.09.15 978,839 None
Taishin International Bank Co., Ltd. 2022.09.27 800,000 None
Bank Sinopac Company Limited 2022.09.20 262,500 None
MEGA International commercial bank Co., Ltd. 2022.09.25 675,000 None
Agriculture Bank of Taiwan 2022.12.25 600,000 None
Bank of Taiwan 2023.08.13 1,300,000 None
Hua Nan Commercial Bank, Ltd. 2026.09.20 1,398,589 None
Chang Hwa commercial Bank Ltd. 2025.09.28 600,000 None
Cathay United Bank 2022.09.26 1,000,000 None
KGI Commercial Bank Co., Ltd. 2022.03.30 1,000,000 None
HSBC Bank Taiwan Limited 2022.10.03 1,000,000 None
The Export-Import Bank of the Republic of China 2026.05.22 1,133,200 None
12,888,860
Less: Current portion of long-term borrowings (1,795,070)
$ 11,093,790
Note: The maturity date listed above is the last maturity date of multiple borrowings.
~ 249
- 66 ~-
STATEMENT 6

STATEMENT OF OPERATING REVENUE
Quantity
Item (Thousands) Amount
Bicycle tires 3,302 $ 496,208

Motorcycle and bias tires 1,323 1,545,362
Tubes 15,380 630,309
Radial tires 4,450 2,306,259
Others 67,313 409,549
5,387,687
Less: Sales return (205)
Sales allowance (8,936)
Sales revenue 5,378,546
Service revenue 567,740
Operating revenue $ 5,946,286
~ 250
- 67 ~-
STATEMENT 7

STATEMENT OF OPERATING COSTS
Item Amount
Cost of merchandise
Merchandise at the beginning of the year $ 11,679
Purchase 117,668
Merchandise at the end of the year (9,688)
Less: Inventory scraps (1,706)
Others (64)
Total merchandise sold $ 117,889
Cost of goods manufactured
Raw materials at the beginning of the year 153,252
Material purchased 2,296,179
Less: Raw material at the end of the year (226,401)
Raw material sold (234,720)
Others (848)
Raw material consumed 1,987,462
Direct labor 563,818
Manufacturing overhead 794,414
Manufacturing cost 3,345,694
Add: Work in progress at the beginning of the year 118,741
Inventory overage 777
Others 4
Less: Work in process at the end of the year (111,544)
Inventory shortage (39)
Transfer to manufacturing cost (18,288)
Transfer to operating expense (2,334)
Others (8,708)
(21,391)
Cost of goods manufactured 3,324,303
Add: Finished goods at the beginning of the year 365,322
Inventory overage 34
Less: Finished goods at the end of the year (315,054)
Inventory shortage (36)
Inventory scraps (3,584)
Transfer to operating expense (1,985)
Others (2,123)
42,574
Total cost of revenue 3,484,766
Other cost of revenue
Cost of raw material sold 234,720
Cost of supplies sold 20,308
Unallocated fixed manufacturing overhead 8,630

Inventory shortage (overage) (752)
Inventory scraps 5,648
Others (3,827)
Total other cost of revenue 264,727
Service cost 243,617
Cost of revenue $ 3,993,110
~ 251
- 68 ~-
STATEMENT 8

STATEMENT OF MANUFACTURING EXPENSE
Item Amount
Depreciation $ 229,085
Indirect labor 140,033
Fuel expense 98,211
Utilities 112,443
Repairs and maintenance 62,986
Auxiliary materials 43,174
Others (Note) 117,112
$ 803,044
Note: The balance for each items did not exceed 5% of the account balance.
~ 252
- 69 ~-
STATEMENT 9

STATEMENT OF OPERATING EXPENSES
General and Research and Expected

Item Marketing Administrative Development Credit Losses Total
Salary $ 177,271 $ 209,074 $ 274,777 $ - $ 661,122

Advertisement 103,737 118 7 - 103,862
Taxes 68,969 16,542 1,392 - 86,903
Packing expense 67,048 - - - 67,048
Depreciation 42,329 6,612 24,909 - 73,850
Import/export
expense 37,329 - - - 37,329
Shipping expense 32,709 - - - 32,709
Insurance 25,599 16,456 21,560 - 63,615
Others 54,378 45,436 84,794 5,959 190,567
Service costs (13,841) (101,076) (16,843) - (131,760)
$ 595,528 $ 193,162 $ 390,596 $ 5,959 $ 1,185,245
~ 253
- 70 ~-
VI. Financial difficulty experienced by the Company or its affiliates during
the most recent year and as of the print date of this annual report: none
Seven. Review and analysis of financials and financial

performance and risks
I. Financial status: Main reasons and material effects of significant change

in assets, liabilities and shareholder equity during the
most recent year and the responding plans going
forward
Comparison and Analysis of Financial Status

Un it: NTD Thousands
Year Difference
2020 2019
Item Amount %
Current asset 22,572,473 23,140,356 (567,883) -2.45%
Financial assets at FVTPL 578,419 515,415 63,004 12.22%
Property, Plant and 14,543,978 14,246,939 297,039 2.08%
Equipment
Intangible asset 60,826 74,095 (13,269) -17.91%
Other assets 4,634,343 4,042,980 591,363 14.63%
Total assets 42,390,039 42,019,785 370,254 0.88%
Current liability 10,038,519 8,473,776 1,564,743 18.47%
non-current liabilities 13,241,793 14,763,241 (1,521,448) -10.31%
Total liabilities 23,280,312 23,237,017 43,295 0.19%
Equity attributable to 19,109,709 18,782,750 326,959 1.74%
Share capital 9,094,100 8,744,300 349,800 4.00%
Additional paid-in capital 41 41 0 0.00%
Retained earnings 11,616,570 11,368,463 248,107 2.18%
Other equities (1,601,002) (1,330,054) (270,948) 20.37%
Total Equity 19,109,727 18,782,768 326,959 1.74%
Other equity: due to an increase in translation difference of overseas operations
252
~ 254 ~
II. Financial performance: Main reasons for significant change in revenues,
operating profits and profits before tax during
the most recent two years, expected sales and
basis for the expectation, possible influence on
the Company’s finance and business going
forward, and responding plans
(I) Comparison and Analysis of Operating Performance

Comparison and Analysis of Operating Performance
Unit: NTD Thousands
Year Change
Item 2020 2019
Amount %
Operating income 30,260,185 32,127,436 (1,867,251) -5.81%
Operating cost 22,910,212 25,570,683 (2,660,471) -10.40%
Gross profit 7,349,973 6,556,753 793,220 12.10%
Operating expenses 4,876,452 5,302,222 (425,770) -8.03%
Profit from operations 1,535,939 1,254,531 281,408 22.43%
Non-operating income and expense (244,476) 112,447 (356,923) -317.41%
Profit before tax from continuing 1,291,463 1,366,978 (75,515) -5.52%
operations
income tax expense 319,238 353,419 (34,181) -9.67%
Income from continuing operation 972,225 1,013,559 (41,334) -4.08%
Profit (loss) from discontinued operations 0 0 0 0.00%
Current period net profit 972,225 1,013,559 (41,334) -4.08%
Other comprehensive income (net of tax) (295,494) (372,461) 76,967 -20.66%
Total comprehensive income in the current 676,731 641,098 35,633 5.56%
period
Net profit attributable to shareholders of 972,225 1,013,562 (41,337) -4.08%
the parent
Analysis on +/- change
1. Higher profits during the period primarily due to a reduction in
operating costs
2. Non-operating income and expense: primarily due to other gains or losses
3. Other comprehensive income (net of tax): lower translation difference for overseas operations
(II) Change in gross profits:gross profit affected by the reduction in operating costs less than the
reduction in revenues
253
~ 255 ~
III. Cash flows: analysis and explanation of cash flow changes during the
most recent year; improvement plan for inadequate liquidity
; and cash flow liquidity for the next year
(I) Liquidity analysis for the most recent two years

Unit: NTD Thousands
Year
Item 2020 2019 Change (%)
Operating cash flow ratio 27.78% 16.28% 70.64%
Cash flow adequacy ratio 73.71% 80.86% -8.84%
Cash re-investment ratio 5.53% 1.13% 389.38%
Analysis on +/- change
1. Higher operating cash flow ratio due to the increase in net cash flows from operating activities
greater than the increase in current liabilities
2. Higher cash re-investment ratio due to a significant increase in cash flows from operating
activities and a reduction in cash dividends
(II) Cash flow liquidity for the next year

Unit: NTD Thousands
Expected Measures to make up

Cash balance net cash flows Expected Expected the cash gap
at the beginning from cash outflows cash surplus
Investment Financing
of the period operating activities for the year (gap)
plan plan
for the year
8,485,408 2,924,922 2,381,161 9,029,169 - -
IV. Impact of major capital expenditures on finance and business during most
recent year
254
~ 256 ~
(I) Utilization and funding sources of major capital expenditures
Unit: NTD Thousands
Actual or expected
Actual or expected Actual or expected Total amount capital utilization
Project
funding sources completion dates required 2020 2021
(actual) (expected)
Equipment
Internal capital and
addition and 2020 1,340,245 1,340,245
bank loans
replacement
Equipment
Internal capital and
addition and 2021 5,053,603 5,053,603
bank loans
replacement
(II) Expected possible benefits

Increase of production capacity for passenger car tires, motorcycle tires, and bicycle tires in
order to boost the Company’s market shares in these markets
V. Investment policies, main causes for profit or loss and improvement plans
in the most recent year and investment plans for the coming year
Investment policies in the most recent years

The Company continues to invest in facility expansion for its core business in order to boost
capacity, sales and profits.
Investment plans for the coming year

The Company continues to carefully evaluate investment projects and develop the global
market in line with incremental capacity, in order to grow revenues and profits.
VI. Risks
(I) Impact of interest rate changes, exchange rate changes, and inflation on the
Company’s profit and loss and responding measures going forward
Exports account for 95% of the Company’s revenues and imports of raw materials and other
materials account for 97% of the total purchases. A relative high proportion of imports and
exports is in US dollars and Euro. Most of our customers are overseas. Therefore, exchange rate
255
~ 257 ~
changes affect the Company’s profits.
As a principle, the Company seeks to hedge currency risks and does not speculate. Finance
personnel keeps a close eye on movements of the currency market and change of financial
information, in order to stay on top of exchange rate directions. Meanwhile, the relation with
banks is strengthened and advice from foreign exchange banks is taken into account to ensure
reasonable currency hedging activities.
The Company regularly reviews borrowing rates and stays in close conversations with banks
to obtain favorable interest rates in the market.
(II) Policies regarding highly-risky, highly-leveraged investments, lending,

endorsements and guarantees, and derivatives trading; main reasons for related
profits or losses, and responding measures
Endorsements and guarantees are provided by the Company to indirect investees

according to the terms and conditions agreed with financial institutions. This may be dealt by a
local branch of the financial institution within the approved credit limit or with L/C loans
guaranteed by the Company from another institution designated by the lending bank.
The Company’s lending, endorsements and guarantees are in adherence to regulations set
by competent authorities and relevant management rules established internally. We are not
involved in trading of derivatives.
(III) R&D plans and expected R&D expenses
1. Establishment of a high-speed consistency and low rolling resistance system for tires
(NT$40 million)
2. Application and accreditation of green and sustainable materials (NT$30 million)
3. R&D of smart tires (NT$20 million)
4. Development of all steel STR trailer tires (NT$30 million)
5. Testing equipment for dynamic fatigue and tilting for bicycles and establishment of the
testing technology (NT$10 million)
6. Extruders for the laboratory (NT$2 million)
7. A low VOC laboratory and testing method establishment (NT$10 million)
8. Establishment of tire impact testing system and testing method (NT$10 million)
256
~ 258 ~
(IV) Impact of major policy and law changes, domestic and overseas, on the
Company’s finance and business and responding measures: none
(V) Impact of technology and industry changes on the Company’s finance and
business and responding measures: none
(VI) Impact of corporate image changes on the Company’s crisis management and
responding measures: none
(VII) Expected benefits and potential risks of M&As ongoing, and responding
measures: none
(VIII) Expected benefits and potential risks of facility expansions, and responding
measures: increase of sales and operating profits
(IX) Risks associated with purchase or sales concentration and responding measures:
none
(X) Impact and risk of significant transfers or change of stakes by directors,

supervisors or major shareholders with at least 10% holdings, and responding
measures: none
(XI) Impact and risk of change of control, and responding measures: none
(XII) Litigation or non-litigation events: It is necessary to describe major litigations,

non-litigations or administrative litigations with confirmed judgments or still
ongoing involved by the Company or any of its directors, supervisors,
General Manager, de facto responsible persons, major shareholders with at
least 10% stakes or any of the subordinated companies. If the outcome may
have material influence on shareholders’ equity or securities prices, it is
necessary to disclose the matters in contention, underlying amounts, start
dates of the litigations, main parties involved and progress as of the print date
of the annual report: none
The Company previously had an exclusive distribution agreement with Gabjohn in Nigeria.
Due to the sales condition, the trading companies commissioned by the Company switched to
other distributors in Nigeria to sell our products. Gabjohn filed a lawsuit against the Company
regarding the breach of the exclusive distribution contract and demands a compensation of
257
~ 259 ~
about NT$90 million (or NGN 500 million). For the local liaison with regard to this
litigation, the Company entered a litigation contract with Chu Mao Intellectual Property
Limited for Nigeria so that Chu Mao Intellectual Property Limited can handle the litigation
via AdenijiKazeem & Co., a local intellectual property law firm in Nigeria. According to
the regular updates from Chu Mao Intellectual Property Limited on the litigation, the case is
still with the high court. As of the publication date for 2020 financial report, it has not been
possible to reasonably estimate the possible outcome of the dispute regarding distribution
rights.
(XIII) Other important risks and responding measures

Risk management policy and management guidelines
Major issues Risk assessment Risk management policy and management guidelines
items
1. An environmental safety and health management was established
according to the ISO 14001 and ISO 45001/TOSHMS (CNS
45001) standards.
2. The environmental safety and health management system
Safety, health and
(including environmental safety and health policies and targets)
environmental
must be combined with factory operations and implemented in the
risks
PDCA (Plan, Do, Check and Action) cycle.
3. A COVID-19 taskforce has been established to implement and
manage measures put in place by the Taiwan Centers for Disease
Control.
1. To ensure the supply chain security, we maintain at least two and
three suppliers in different geographic locations for each material.
Environment We proactively increase inventory and look for second suppliers
for the materials we rely on single suppliers, , in order to have the
flexibility to respond to stock-out risks due to international
In response to situation changes, extreme climates and significant natural
climate change disaster.
risks: 2. Greenhouse gas emission reduction
3. To mitigate product transportation risks, there are safety
inventories at production sites and business premises around the
world. Where we do not have presences, we coordinate with
customers to ensure a safety level of inventory. These efforts aim
to reduce the risk of supply shortage by flexibly responding
extreme climate and major natural disasters.
258
~ 260 ~
items
1. Quality meetings are convened each month for management,
control and review of yield enhancements.
2. A robust channel has been established for customer complaints, so
that any quality concern from existing customers and end
consumers can be dealt with properly and appropriately.
3. Product liability insurance is purchased for production and selling
activities, to ensure our customers in the distribution and use of
Product risks
our products.
4. Pursuant to relevant laws on tires, we formulate specifications for
raw materials and products, in order to produce non-polluting and
environmental friendly tires of lightweight, with low rolling
resistance and high wet grip performance. This reduces the unit
consumption of materials for tires and lowers energy consumption
of vehicles and emission of greenhouse gases.
1. We stay on top of market prices, product quality and industry
trends by keeping an eye on competition, in order to stay in the
Market risk game.
Social
2. We constantly assess the financial health and default risk of
customers, in order to avoid losses.
1. Assessments are conducted on the demand and supply in the raw
materials market, in order to avoid adverse effects on
price-performance ratio due to price increases reflective of costly
Raw material raw materials.
risks 2. We screen and select suppliers based on assessment on their
financial health and default risks. We carefully review whether the
quality of raw materials meets regulatory standards, so as to avoid
losses due to default or defect of raw materials.
1. Planning and implementation of a robust employee benefit policy
and a retirement system
2. Asking employees to adhere to non-compete clauses and sign
Employee risks confidentiality agreements, to avoid risks
3. Oversight and compliance with laws and regulations and
establishment of a channel for employees to communicate and
complain
1. Business units encode the laws and regulations they should
comply with into internal rules and regularly conduct
self-evaluations on legal compliance.
Corporate Legal compliance 2. Decision-making is proceeded according to the hierarchical
governance risks structure of authorization. Cross-functional meetings are convened
when necessary.
3. Legal Department handles risk control and attorneys are hired to
provide advice on legal issues.
259
~ 261 ~
items
1. Planning and management of sufficient working capital.
2. Control of exchange rate risks and adjustment of selling prices and
transaction currencies given a certain degree of exchange rate
volatility.
Financial risks 3. Focus on the core business, with investments only in low-risk
instruments for hedging purposes. No involvement in trading of
derivatives.
4. Stringent rules in place and compliant with laws regarding risks in
endorsement, guarantee and lending.
Regulation of information access authorization; implementation of IT
Information
system control, factory access control, premise access control in
security risks
order to manage the risks associated with trade secrets.
VII. Other important matters: none
260
~ 262 ~
Eight. Special Notes & Supplementary Information
I. Data on affiliated companies
(I) Organization of affiliated companies
1. Kenda Rubber Ind. Co., Ltd.’s Organization Chart for Affiliated Companies
KD
100% 100% 100% 100% 99.99% 100% 100%

KHK KIC KF KE KI KV KA
100% 100%
100%
KGH KGI ADI
13.64% 60% 40% 100% 13%

100%
STARCO KJI
KT KS KGCI
~ 263 ~
100%
86.36% KC
Note A. Companies controlled and subordinated as inferred according to inferred by Article 369-3 of the
Company Act
B. Codes explained:
Code Company name Location Code Company name Location
KD KENDA RUBBER IND.. CO., LTD. Taiwan KJI KENJOU INVESTMENT CO.LTD. Mauritius
KA AMERICAN KENDA RUBBER IND.. CO., LTD Ohio, USA KGH KENDA GLOBAL HOLDING CO., LTD. Cayman Is.
ADI AMERICANA DEVELOPMENT, INC. Ohio, USA KGCI KENDA GLOBAL HOLDING (CHINA) CO., LTD. Kunshan, Jiangsu
KV KENDA RUBBER (VIETNAM) CO., LTD. Dong Nai, Vietnam KC KENDA RUBBER (CHINA) CO., LTD. Kunshan, Jiangsu
KI PT. KENDA RUBBER INDONESIA Indonesia KS KENDA RUBBER (SHENZHEN) CO., LTD. Shenzhen,
Guangdong
KE KENDA RUBBER INDUSTRIAL CO, EUROPE GmbH Oldenburg German KHK KENDA RUBBER (HONG KONG) CO., LTD. Hong Kong
KF KENFONG INDUSTRIAL CO., LTD. Taiwan KT KENDA RUBBER (TIANJIN) LIMITED Jinhai, Tianjin
KIC KENDA INTERNATIONAL CORPORATION Cayman Is. STARCO STARCO EUROPE A/S Aarhus, Denmark
KGI KENDA GLOBAL INVESTMENT CORPORATION Mauritius
2. Basic data of affiliated companies
Unit: Thousands
Establishment Main businesses or
Company name Address Paid-in Capital
date production activities
AMERICAN KENDA RUBBER 7095 Americana Parkway
1991.02.11 USD 9,000 Investment and trading
IND. CO., LTD. Reynoldsburg, OHIO 43068 USA
Production of wheel rims
and tires
AMERICANA
1998.11.09 Ohio USA USD 20,000 Assembly and
DEVELOPMENT,INT.
distribution of wheel
rims
Cho Chieu Street, Ho Nai 3 Industrial
KENDA RUBBER (VIETNAM) Zone, Trang Bom District, Dong Nai Production and sale of a
1997.04.03 USD 67,680
CO., LTD. Province, Vietnam variety of tires
Industrial Zone
J1. Raya Cikande Rangkasbitung
PT. KENDA RUBBER Production and sale of a
2014.12.10 KM.5,Desa kareo, Kec. Jawilan USD 52,999
INDONESIA variety of tires
Serang 42177 Benten
KENDA RUBBER INDUSTRIAL Greimelstraße 28 83236 Übersee
2013.04.19 EUR 25 Marketing and planning
CO, EUROPE GmbH Germany
KENFONG INDUSTRIAL CO., No. 2, Section 1,Chungshan Road, Selling of a variety of
2013.11.22 NTD 199,000
LTD. Yuanlin City, Changhua County tires
P.O.Box 31119, Grand
KENDA INTERNATIONAL Pavilion,Hibiscus Way,802 West Bay Investment consultancy
1999.03.30 USD 81,753
CORPORATION Road, Grand Cayman, and trading
KY1-1205,Cayman Islands
KENDA GLOBAL INVESTMENT Level 3, Alexander House,35 Investment consultancy
2003.12.11 USD 1,703
CORPORATION Cybercity,Ebene, Mauritius and trading
P.O.Box 31119, Grand
KENDA GLOBAL HOLDING Pavilion,Hibiscus Way,802 West Bay Investment consultancy
1997.01.03 USD 112,050
CO.,LTD. Road, Grand Cayman, and trading
KY1-1205,Cayman Islands
KENDA GLOBAL HOLDING No. 2, Kun Jia Road, Development
2014.04.16 USD 161,000 Investment and trading
(CHINA) CO., LTD. Zone, Kunsan City, Jiangsu Province
KENDA RUBBER (CHINA) CO., No. 2, Kun Jia Road, Development Production and sale of a
1994.03.25 USD 70,000
LTD. Zone, Kunsan City, Jiangsu Province variety of tires
Gongye West Road, Dalang
KENDA RUBBER (SHENZHEN) Production and sale of a
1990.09.07 Sub-District, Baoan District, Shenzhen USD 25,000
CO., LTD. variety of tires
City
No. 51-63, Container Port Road, Kwai HKD 100
KENDA RUBBER (HONG Chung, New Territories, Hong Kong
1991.05.07 Investment and trading
KONG) CO., LTD. Room 613, 6/F, Kwai Shun Industrial USD 30,600
Centre
South District, Jinghai Economic
KENDA RUBBER (TIANJIN) Development Zone, Jinghai District , Production and sale of a
2007.12.06 USD 220,000
LIMITED Tianjin variety of tires
No. 6/8, Taian Dao
Production of wheel rims
and tires
STARCO EUROPE A/S 2017.10.02 Sintrupvej 71B, st.tv., 8220 Brabrand DKK 10,320 Assembly and
distribution of wheel
rims
3. Data inferring the same shareholders for controlling and subordinated companies: none
4. Businesses involved by the group and its affiliated companies: general investment, international trade
262
~ 264 ~
5. Names and shareholders of directors, supervisors, and General Managers of affiliated companies
Shareholding
Shares Ratio
Company name Title Name or representative (contribution
No. of shares (capital contribution)
as % of
capital)
AMERICAN KENDA RUBBER Yang, Chi-Jen
Director Kenda holds 500 shares 100%
IND. CO., LTD. Yang Shih,Ching-Huey
AMERICANA DEVELOPMENT, Yang, Chi-Jen
Director American Kenda Rubber holds 1,500 shares 100%
INC. Yang Shih,Ching-Huey
Director Yang, Ying-Ming; Yang, Chi-
KENDA RUBBER (VIETNAM) Jen; Chang, Hong-Der; Chen, (Kenda contributed US$67,680,000 in
(100%)
CO., LTD. ChaoJung; Huang Feng-Chou capitalization)
President Huang Feng-Chou
Director Chen, Chao-Jung; Tseng, Shen
-Tung; Huang, Feng Chou (Kenda contributed US$52,999,000 in
PT. KENDA RUBBER
Supervisor Yang, Ying-Ming; Yang, Chi- capitalization) (99.99%)
INDONESIA Jen; Chang, Hong-Der
President Tseng, Sheng-Tun
KENDA RUBBER INDUSTRIAL (Kenda contributed €25,000 in
Director Yang, Chi-Jen capitalization)
(100%)
CO, EUROPE GmbH
KENFONG INDUSTRIAL CO.,
Jen; Chen, Cha-Jung Kenda holds 19,900,000 shares 100%
LTD.
Supervisor Chang, Hong-Der
KENDA INTERNATIONAL Yang, Ying Ming (Kenda contributed US$ 81,753,000 in
Director (100%)
CORPORATION Yang, Chi Jen capitalization)
KENDA GLOBAL (KENDA INTERNATIONAL
Yang, Ying-Ming
INVESTMENT Director CORPORATION contributed (100%)
Chen, Chao-Jung US$1,703,000 in capitalization)
CORPORATION
(KENDA INTERNATIONAL
KENDA GLOBAL HOLDING Yang, Ying-Ming
Director CORPORATION contributed (100%)
CO., LTD. Yang, Chi-Jen US$112,050,000 in capitalization)
(KENDA GLOBAL HOLDING CO., LTD.
KENDA GLOBAL HOLDING Jen; Chen, Chao-Jung
contributed US$161,000,000 in (100%)
(CHINA) CO., LTD. Supervisor Chang, Hong-Der capitalization)
President Lin, Chien-Liang
(KENDA GLOBAL HOLDING (CHINA)
KENDA RUBBER (CHINA) CO., Jen; Chang, Hong-Der
CO., LTD.contributed US$ 70,000,000 in (100%)
LTD. Supervisor Chen, Chao-Jung capitalization)
President Lin, Chien-Liang
Director Yang, Ying-Ming
(KENDA GLOBAL HOLDING CO., LTD.
Yang, Chi-Jen contributed US$1,000,000 in capitalization)
(40%)
KENDA RUBBER (SHENZHEN) Chen, Chao-Jung
CO., LTD. President Yang, Jui-Wen
(KENDA RUBBER (HK) CO., LTD.
(60%)
contributed US$1,500,000 in capitalization)
(Kenda contributed US$ 30,600,000 in
KENDA RUBBER (HONG capitalization)
Director Yang, Ying-Ming Kenda contributed HK$100,000 in
(100%)
KONG) CO., LTD.
capitalization)
Director Yang, Ying-Ming (KENDA GLOBAL HOLDING (CHINA)
Yang, Chi-Jen CO., LTD.
(86.36 %)
Chen, Chao-Jung contributed US$190,000,000 in
KENDA RUBBER (TIANJIN) capitalization)
Supervisor Chang, Hong-Der
LIMITED (KENDA RUBBER (HK) CO., LTD.
President Lai, Hsi-Jung
contributed US$30,000,000 in (13.64 %)
capitalization)
Yang, Ying-Ming (KENDA GLOBAL INVESTMENT
STARCO EUROPE A/S Director Yang, Chi-Jen CORPORATION contributed€ 6,935,916 in (100%)
Jeffrey Pizzola capitalization)
263
~ 265 ~
6. Operational status of affiliated companies: financial standing and operational results of affiliated
companies
Unit: NTD Thousands
Earnings
per share
Total Operating Operating Profit or loss
Company name Capitalization Total assets Net (NT$)
liabilities income profit (net of tax)
(net of
tax)
KENDA RUBBER
714,415 3,694,516 823,012 2,871,504 1,732,106 (145,851) (798,123) (31.92)
(SHENZHEN) CO., LTD.
AMERICAN KENDA RUBBER
268,598 5,111,904 3,656,162 1,455,742 10,773,301 260,573 12,680 1.41
IND. CO., LTD.
KENDA RUBBER (HONG
907,219 2,385,398 130,592 2,254,806 0 (113) (516,198) (16.86)
KONG) CO., LTD.
KENDA RUBBER (CHINA)
2,252,262 7,579,000 1,134,521 6,444,479 6,677,025 549,115 422,048 6.03
CO., LTD.
KENDA GLOBAL HOLDING
3,578,118 11,499,383 87,570 11,411,813 0 (2,140) (57,414) (0.51)
CO., LTD.
KENDA RUBBER (VIETNAM)
2,121,380 8,893,650 1,812,747 7,080,903 5,839,743 1,128,366 979,711 14.41
CO., LTD.
KENDA INTERNATIONAL
2,454,785 11,851,562 103,552 11,748,010 0 (219) 76,327 0.93
CORPORATION
KENDA GLOBAL
INVESTMENT 55,293 340,429 16,457 323,972 0 (1,718) 133,863 78.60
CORPORATION
KENDA RUBBER (TIANJIN)
6,870,512 4,493,851 552,056 3,941,795 2,709,303 (162,062) (148,405) (0.67)
LIMITED
KENDA RUBBER
INDUSTRIAL CO, EUROPE 976 19,392 6,943 12,449 93,310 2,320 3,281 131.23
GmbH
KENFONG INDUSTRIAL CO.,
199,000 457,201 204,942 252,259 679,355 43,037 36,062 0.18
LTD.
KENDA GLOBAL HOLDING
5,057,582 10,271,123 652 10,270,471 0 (437) 281,295 1.75
(CHINA) CO., LTD.
PT. KENDA RUBBER
1,660,346 1,745,997 693,911 1,052,086 817,013 (9,303) 75,224 1.42
INDONESIA
STARCO EUROPE A/S 49,563 2,661,475 2,410,701 250,774 3,002,528 83,597 61,985 38.03
Note: All the above numbers are converted at exchange rates on the year-end reporting date.
264
~ 266 ~
(II) Consolidated financial statements of affiliated companies
For the Company in 2020 (from January 1, 2020 to December 31, 2020), the entities to be
included in the consolidated financial statements of affiliated companies according to the Criteria
Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated
Financial Statements of Affiliated Enterprises are identical with the entities to be included in the
parent’s consolidated financial statements under the International Financial Reporting Standards (IFRS)
10. As the consolidated financial statements of affiliated companies are disclosed in the parent’s
consolidated financial statements, the consolidated financial statements of affiliated companies are not
separately prepared. (As above the statement for consolidated financials of affiliated companies)
(III) Relation reports: none
II. Private placement of marketable securities during the most recent year and
as of the print date of this annual report:
None
III. Possession or disposal of the Company’s shares by subsidiaries during the

most recent year and as of the print date of this annual report: none
IV. Other required supplementary information

The Company does not invest in financial instruments other than shares and depositary receipts.
Therefore, hedge accounting is not required.
265
~ 267 ~
★Spokesperson
KENDA RUBBER IND.CO., LTD.

Name: Kuei-Chun Liu
Title: Assistant Vice President, Finance
Telephone: (04) 8345171
E-mail：chun@kenda.com.tw
★Deputy Spokesperson
Name: Ching-Hui Wu
Title: Finance Manager
Telephone: (04) 8345171
E-mail：bake@kenda.com.tw
★Addresses and telephone numbers of Headquarters and factory sites:

Headquarters: No. 146, Section 1, Chung Shan Road, Yuanlin City, Changhua County
Telephone: (04) 8345171-82　Fax: (04) 8331865
CHAIRMAN
Website: http://www.kendatire.com YANG, CHI-JEN
Main Factory: No. 146, Section 1, Zhongshan Road, Yuanlin City, Changhua County
Telephone: (04) 8345171-82　Fax: (04) 8331865
Yunlin Factory: No. 50, Yanping Road, Citong Village, Citong Township, Yunlin County
Telephone: (05) 5845271-2　Fax: (05) 5849325
Taipei Office: 11F, Rear Building, No. 201-24, Dunhua North Road, Taipei City
Telephone: (02) 27153125-7　Fax: (02) 27198900
★Stock transfer agent

Name: Transfer Agency Department, CTBC Bank
Address: 5F, No. 83, Section 1, Chongqing South Rd., Zhongzheng Dist., Taipei City
Telephone: (02) 6636-5566
Website: https://www.ctbcbank.com
★Financial statements auditors for the most recent year

Accounting firm: Deloitte & Touche Taiwan
Auditors: Wang, Yi-Wen and Tseng, Done-Yuin, CPA
Address: 20F, No. 100, Songren Road, Taipei City
Telephone: (02)2725-9988
Website: https:// www.deloitte.com.tw

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★Spokesperson

KENDA RUBBER IND.CO., LTD.

★Addresses and telephone numbers of Headquarters and factory sites:

★Stock transfer agent

★Financial statements auditors for the most recent year

Individual Unit: NTD Thousands; %

(II) Budget implementation

Individual Unit: NTD Thousands

II. Summary of Business Plan for 2021

(I) Business policy for 2021:

III. The company's future development strategy

IV. The effect of external competition

V. The effect of legal environment

Kenda Rubber Ind. Co., Ltd.

II. Organization and operations:

R&D Division III

Information on Directors and Independent Directors (2)

Chen, Chao- Jung

Remuneration Range Table

Vice Chairman Chang, Hong-Der 5 0 100%

Director Yang, Ying-Ming 5 0 100%

Director Hsiao, Ru-Po 5 0 100%

Board of Results of the The Company’s handling of the

Implementation Status (Note 1) Non-implementation

 Achievements: The Company's directors are all qualified and experienced in

evaluations are also conducted annually.

What is being evaluated Score

A. Participation in the operation of the company. 20

B. Recognition of the duties of the Audit Committee 23

C. Improvement in the quality of decision making by the Audit 30

D. Composition of the Audit Committee, and election and 10

independent auditors and audit team is available.

1. The Company's Remuneration Committee is responsible for periodically reviewing the

2. Information on the members of the Remuneration Committee:

3. Information on the meeting status of the Remuneration Committee

(IX) The implementation status of the company's internal control system

Kenda Rubber Ind. Co., Ltd.

V. Information on CPA fees:

Accounting firm Name of CPA Audit period Remark

CPA professional fees range table

(II) Regarding the successor CPA:

VII. Chairman, President, finance or accounting managers who have worked

Director Yang, Ying-Ming 1,437,540 0 0 0

Director Hsiao, Ru-Po (240,797) 0 (7,000,000) 0

(III) Information on the share pledge:

KA subsidiary - 100.00 - - - 100.00

KHK Subsidiary - 100.00 - - - 100.00

KV Subsidiary - 100.00 - - - 100.00

KE Subsidiary - 100.00 - - - 100.00

KF, Subsidiary - 100.00 - - - 100.00

KI Subsidiary - 99.99 - 0.01 - 100.00

Note: Long-term investments accounted for using the equity method.

April 20, 2021

(II) Shareholder structure

1 ~ 999 13,643 3,058,873 0.34%

1,000 ~ 5,000 10,654 22,275,106 2.45%

5,001 ~ 10,000 2,273 15,785,625 1.74%

10,001 ~ 15,000 939 11,157,446 1.23%

15,001 ~ 20,000 430 7,603,345 0.84%

20,001 ~ 30,000 447 10,664,447 1.17%

30,001 ~ 40,000 218 7,502,421 0.82%

40,001 ~ 50,000 139 6,290,296 0.69%

50,001 ~ 100,000 238 16,665,385 1.83%