2020 Annual Report

Stock Code:2377
MICRO‐STAR INTERNATIONAL CO., LTD.
2020 ANNUAL REPORT
MSI annual report is available at:

Taiwan Stock Exchange Market Observation Post System:
http://mops.twse.com.tw
Company website:
http://www.msi.com
Printed on April 30, 2021
Notice to readers
This English‐version annual report is a summary translation of the Chinese version and is not an official
document of the shareholders’ meeting. If there is any discrepancy between the English and Chinese
versions, the Chinese version shall prevail.
I. SPOKESPERSON & DEPUTY SPOKESPERSON
Spokesperson:Hung,Pao‐Yu
Title:Chief Financial Officer
Tel.:886‐2‐3234‐5599
E‐mail:080419861@msi.com
DEPUTY SPOKESPERSON
Deputy Spokesperson:Lin,Yi‐Kai
Title:Assistant Vice President of Finance Center Finance Division
Tel.:886‐2‐3234‐5599
DEPUTY SPOKESPERSON:Chang,Ju‐Ting
Title:Assistant Vice President of Finance Center Global Finance Division
Tel.:886‐2‐3234‐5599
II. HEADQUARTERS AND PLANTS

Tel.:886‐2‐3234‐5599
Address:No.69, Lide St., Zhonghe Dist., New Taipei City 235, Taiwan
(R.O.C)
Ⅲ.SECURITIES DEALING INSTITUTE

Name :Chinatrust Transfer Agent
Address :5F, No.83, Sec. 1, Chung‐Chin S. Rd., Zhongzheng Dist., Taipei
City
Tel. :886‐2‐6636‐5566
Website :http://www.ctbcbank.com
IV. AUDITORS
Name : CPA:Liang, Hua‐Ling & Lai,Chung‐Hsi
CPA Firm :PricewaterhouseCoopers, Taiwan
Address :27F, No.333, Sec. 1, Keelung Rd., Xinyi Dist., Taipei City 110
Tel. :(886) 2 2729‐6666
website:http://www.pwc.com
V. NAME OF TRADING SITE FOR LISTED SECURITIES OVERSEAS:

None
VI. COMPANY WEBSITE
http://www.msi.com
CONTENTS
Page
Ⅰ.Letter to shareholders 1
Ⅱ.Introduction of the company 4
(Ⅰ)Establishment date 4
(Ⅱ)Development history 4
Ⅲ.Corporate governance report 8
(Ⅰ)Corporate Organization 8
(Ⅱ)Directors, Supervisors, President, Vice President, Assistant V.P., and department heads 10
(Ⅲ)Remuneration paid during the most recent fiscal year to directors, supervisors, president and vice 16
presidents
(Ⅳ)Corporate governance 20
(Ⅴ)CPAs fees 43
(Ⅵ)CPA’s information 43
(Ⅶ)MSI’s chairman, president, and managers in charge of its finance and accounting operations did not 43
hold any positions within MSI’s independent audit firm or its affiliates in the most recent year
(Ⅷ)Information on Net Change in Shareholding and Net Change in Shares Pledged by Directors, 44
Supervisors, Department Heads, and Shareholders of 10% shareholding or more
(Ⅸ)Relationship among the Top Ten Shareholders 45
(Ⅹ)Ownership of Shares in Affiliated Enterprises 46
Ⅳ.Capital Overview 47
(Ⅰ)Capital and shares 47
(Ⅱ)Corporate bonds 52
(Ⅲ)Preferred shares 52
(Ⅳ)Overseas depositary receipts 52
(Ⅴ)Employee stock warrants 52
(Ⅵ)Restricted Employee Shares 52
(Ⅶ)The section on issuance of new shares in connection with mergers or acquisitions or with acquisitions 52
of shares of other companies shall specify the following matters
(Ⅷ)The status of implementation of capital allocation plans 52
Ⅴ.Operation summary 53
(Ⅰ)Business content 53
(Ⅱ)Market analysis and the condition of sale and production 66
(Ⅲ)Employees 71
(Ⅳ)Environmental expenditures information 71
(Ⅴ)Employee / employer relation 74
(Ⅵ)Material Contracts 77
Ⅵ.Financial information 78
(Ⅰ)Five‐year Financial Summary 78
(Ⅱ)Five‐year Financial Analysis 82
(Ⅲ)Supervisors’ /Audit Committee’s Report for the most recent year 85
(Ⅳ)Financial statements in the most recent year 86
(Ⅴ)Corporation‐only financial report audited and attested by a CPA from the most recent year 86
(Ⅵ)State the financial position of the Company if any insolvency occurs in the Company or in the affiliates 86
most recent year until the date this report is printed
Ⅶ.Review of Financial Conditions, Financial Performance, and Risk Management 87
(Ⅰ)Analysis of Financial Status 87
(Ⅱ)Analysis of Financial Performance 88
(Ⅲ)Analysis of cash flows 89
(Ⅳ)Major capital expenditures and impact on financial and business in the most recent year 89
(Ⅴ)Reinvestment in the most recent year 89
(Ⅵ)Risk analysis and evaluation in the most recent year and up to the date of the annual report printed 90
(Ⅶ)Other material events 97
Ⅷ.Special disclosures 98
(Ⅰ)Related party 98
(Ⅱ)Subscription of marketable securities privately in the most recent year and up to the date of the report 107
printed
(Ⅲ)Status of MSI Common Shares Acquired, Disposed of, and Held by Subsidiaries 107
(Ⅳ)Other Necessary Supplement 107
(Ⅴ)Occurrence of events difined in Securities Transaction Law Article 36.2.2 that has great impact on 107
shareholders’ equity or security price in the most recent year and up to the date of the repost printed
Ⅰ.Letter to Shareholders
Dear Shareholders:
In 2020, the spread of the COVID‐19 pandemic had a significant impact on the global economy,
and the work and life patterns in the areas affected by the pandemic also changed drastically.
Long‐distance working from home, learning from home and home entertainment, plus the product
buying effect brought by the successive launch of cost‐effective new products had all caused the
demand for PC and e‐sports related products to increase greatly; the rise in relative demand had also
resulted in the lack of supply of multiple upstream electronic components and tight global logistics,
making PC shipments clearly unable to meet the demand. Fortunately, thanks to the Company's good
long‐term relationship with the supply chain and channel customers, as well as the close grasp of the
needs of the end users, the Company was able to respond appropriately and supply smoothly. With
the concerted efforts of all employees of the Company and the full support of suppliers and customers,
in 2020, both the annual revenue and profit reached new highs.
(Ⅰ) Operating Performance in 2020

1.Consolidated financial results
Unit: NT$ thousands
Year 2020 2019 YoY amount YoY %
Item
Sales revenue 146,502,789 120,491,417 26,011,372 21.59%
Gross profit 21,302,840 15,862,156 5,440,684 34.30%
After‐tax profit 7,959,505 5,587,210 2,372,295 42.46%
Basic earnings per share(After‐tax)
9.42 6.61 2.81 42.51%
(NT$)
Diluted earnings per share (After‐tax)
9.34 6.56 2.78 42.38%
(NT$)
2. Profitability analysis
Year Financial Analysis for the Last Two‐Years
Item 2020 2019
Debt to asset ratio (%) 54.67 48.61
Financial structure(%) Long‐term capital to property, plant and
705.74 648.29
equipment(%)
Current ratio(%) 169.13 188.25
Solvency(%) Quick ratio(%) 99.71 103.70
Interest earned ratio (times) (%) 30,141.93 27,783.82
Return on assets (%) 11.51 9.71
Profitability Return on shareholders’equity (%) 23.92 18.33
(%) Profit ratio (%) 5.43 4.64
Basic after‐tax EPS(NT$) 9.42 6.61
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3.Research and Development Status
As a benchmark brand in the global gaming field, MSI is the most trust-worthy name in the
gaming and e-sports industry. We've dedicated countless hours and committed numerous
resources to the e-sports community to be a strong supporter for the world's most aspiring and
best gamers and used their knowledge and expertise in our products in return. MSI integrates
the e-sports functions required by the players, saves the trouble of exploring and adjusting by
the players themselves, and pushes the system performance to the extreme. MSI equals to True
Gaming! -- a true e-sports brand.
In addition to being recognized in the field of e-sports, MSI is also a pioneer and leading brand
in the field of global digital content creation. The Content Creation series inherits the profound
technology accumulated by MSI from the many years in e-sports, integrating accurate color
gamut display, abundant battery life, excellent sound experience and powerful performance in a
simple and stylish lightweight model. It is the best partner especially for design and creative
work professionals in fields such as photography, image editing, 3D graphics, audio and video
editing! Furthermore, the MSI Business and Productivity series is not only beautiful and light,
but also has ultimate performance, information security protection and long-lasting power, with
a boutique-like appearance made by simple and clean lines, just like the extraordinary taste of
the successful business persons.
MSI listens to the needs of customers and the market, invests in R&D and design resources to
create high-quality and well received laptops, graphics cards, monitors, motherboards, desktops
and accessories. The GAMING series launched has won unanimous praise from players. The
Content Creation series, which is carefully crafted especially for the digital content creation
community, is highly recognized in terms of artistic quality and efficiency, and has become a
leader in the high-end product market. Besides, MSI integrates servers that conform to the
concept of cloud, industrial computers that meet customer requirements, robots that lead smart
life, and automotive electronics that realize humanity technology to provide the most complete
AIoT solutions. It is also the leading brand in artificial intelligence, commercial and the Internet
of Things market.
(Ⅱ) Operating Plan for 2021

To adjust to the future environment, MSI’s adopted operation guidelines, estimated goals and
important sales strategies for 2021 are as follows:
1.Operation guideline
(1)Sales and marketing aspect: progressively explore new markets and new customers and establish a
long-term entrusted stable business relationship with customers with potentials and sound financial
status to create mutual benefits.
(2)Product R&D aspect: Develop products which meet users’ needs.
(3)Manufacturing, quality and service aspect: continue implementing automated manufacturing to
increase quality and efficiency. Improve repair and services to enhance customer satisfaction.
(4)In business management: Continue to improve operational efficiency.
(5)Finance aspect: uphold the principle of steady and stable operation, and control various financial
risks.
2. Expected Sales and Rationales
We cover a wide range of products. While we continuously devote our efforts in the market of
high-end products and pursuit of stable growth of each product, we will seek to increase the shipment
in new product development and marketing, including motherboards, display cards, laptops, PCs,
gaming monitors, gaming peripherals, servers, industrial computers, and auto electronics. We
anticipate room for growth in the market. The company’s objective is to increase the overall revenue,
and will proactively broaden the market share of every product.
3.Important sales policies
(1)Production policy aspect: Always paying attention to the global major political and economic
situations to respond to the possible change in market demand and the suppliers’ productivity.
To increase capacity utilization rate by adopting planned procurement of components. To adopt
flexible production to reduce stock level yet fulfilling customer’s order demand. To observe the
dynamic of supply chains and to ensure an effective production of employees, equipment,
materials, and manufacturing methods.
(2)Sales policy aspect: to provide good quality products that fulfill customers’ need. To gain a
win-win success in sales target with our customers.
2
Looking forward into 2021, the COVID-19 pandemic still cannot be eliminated, and its
impact on industry supply and demand still exists, however, the uncertainty towards the
global ICT industry and the overall economic environment will gradually decrease. In
the face of rapid changes in the external environment, the Company will continue to
integrate departments such as business, marketing, R&D, and operation management to
improve the operational performance. All colleagues will also promote various
businesses in concert, so that the performance can continue to grow.As the outside
environment changes rapidly, we will coordinate the sales, marketing, R&D, and
operational departments, and keep raising the operational performance.The 2021
shipment forecast for motherboards and graphic cards is 24 million pieces.Our
employees will work together to promote every business to maintain the continuous
growth of performance.
I hereby on behalf of the MSI management team express our appreciation to all our
shareholders, customers and suppliers. We also appreciate the hard efforts of all
employees and directors made during the past year. We hope our shareholders will
keep supporting and encouraging us. We will work harder to achieve a greater
performance and sales results to share with you.
Sincerely yours,
Chairman: Hsu, Hsiang
3
II. Introduction of the Company
(Ⅰ)Establishment date: August 4, 1986
(Ⅱ)Development history
1986  Announced the 486 and 586 mainboards.
 MSI was established, focusing on the design and manufacture of Mainboards and Add‐on Cards.
 Announced the 386DX mainboards.
 Announced the 1st overclocking 286 mainboards.
1988  Obtained TUV ISO 9002:1994 quality management system certification.
1989  Announced the 1st Barebone product.
1991  Announced the 1st Graphics Card product.
1995  Inaugurated the MSI Plant I in Jung‐He, the suburb of Taipei.
 Obtained TUV ISO 9001:1994 quality management system certification.
1998  MSI became a public company as it went on IPO (Initial Public Offering) on the Taiwan Stock
Exchange (TAIEX).
 Announced the industry's 1st mainboard designed for Socket 7 processor, which supports
100MHz FSB.
 Announced industry's 1st mainboard designed to support Dual PentiumR II processor.
1999  Obtained BVQI ISO 14001:1996 environmental management system certification.
2000  Announced the 1st Server product.
 Established MSI Computer (Shenzhen) Co., Ltd.
2001  Established MSI Electronics (Kunshan) Co., Ltd.
 Established China service center in Shanghai.
 Announced the 1st Optical Device product.
 Inaugurated the MSI Plant Ⅲ in Jung‐He, Taipei County.
2002  Announced the world's 1st PC2PC WLAN mainboard.
 Announced the 1st MSI communication product.
 Announced the world's 1st PC2PC Bluetooth mainboard.
 Inaugurated its EU Hub in Netherlands.
2003  Announced the 1st Notebook product.
 Obtained BVQI OHSAS 18000:1999 occupational health and safety management system
certification.
 Announced the 1st Pen Tablet PC product
 Obtained UL QS 9000:1998 quality management system certification.
2004  Announced the 1st Portable Multimedia Player product.
 MSI CE products won the Good Design Awards in Japan.
2005  MSI CE products won the iF Design Award in Germany.
2006  MSI CE products won the iF Design Award in Germany.
 MSI is the only one winner in Tom's Hardware Guide (Worldwide No. 1 online IT Media) Both
"Editor's Choice awards for Intel® P975 and P965 platform.
 Announced the world's 1st Pocket Size DTV.
 Obtained UL QC 080000 hazardous substance process management system certification.
 Announced the world's 1st solar‐powered notebook and MP3 Player product (Concept Product).
2007  Announced the 1st double‐wheel and smart video & music interactive navigation service robot.
 The only one mainboard won the Best Choice of COMPUTEX 2007 award.
 Announced the world's 1st overclocking notebook.
 MSI Notebook (PR200) won the "Red Dot Award: Product Design 2007".
 Announced the world's 1st Crystal Collection Notebook product.
 Announced the world's 1st HATO Notebook (Concept Product).
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2008  Announced the world's 1st Hybrid Storage Netbook.
 MSI has been ranked No. 19 of the Top 20 Taiwan Global Brands
 MSI has been awarded "16th Industrial Technology Advancement Awards" by the Ministry of
Economic Affairs. "Excellent Enterprise Innovation Award" & "Individual Achievement Award"
affirmed the MSI R&D innovation strategy and management.
 MSI is the only one winner of Best Enterprise of COMPUTEX TAIPEI 2008; MSI mainboard &
notebook were honored to receive the "Best Choice of COMPUTEX TAIPEI 2008".
 Announced the 1st Car Infotainment product.
 Announced the world's 1st 10” Netbook product.
2009  MSI has been chosen as one of “2009 Top 50 Corporate Citizens” from CommomWealth
Magazine (Issue 416) in Taiwan. MSI has been chosen as one of "2009 Top 70 CSR Excellent
Enterprises" from Global Views magazine (Issue 273) in Taiwan.
 MSI Netbook & Car Infotainment product won the Best Choice of COMPUTEX TAIPEI 2009.
 Announced the world's power‐saving No. 1 Netbook.
 Announced the 1st Ultra Slim Notebook.
 Announced the 1st All‐in‐One PC
2010  X‐Slim X340 was handed the Taiwan Excellence Silver Award and voted second most popular.
 MSI Big Bang‐Fuzion mainboard and Telematics both won Best Choice of COMPUTEX.
 MSI participated in 2010 Taiwan Excellence Award selection, and all nominated products won
the prize.
2011  MSI Won one of Top 100 Taiwan Brands Distinguished among 500 brands.
 All the 23 products MSI participated in Taiwan Excellence Award selection won the prize,
WindTop AE2420 3D AIO won the Gold Award.
 MSI Z68A‐GD80 (G3), GT780DXR and N460GTX Hawk receive CES Innovations Award Honors.
2012  MSI X79 Series Mainboards break the World Record of 170MHz Base Clock and 5.83GHz CPU
Clock of Sandy
 MSI GT70 notebook is the only winner awarded Buyer's Choice, Best Choice, and Media's Choice
in Computex 2012.
 15 products of MSI got 2012 Taiwan Excellence Award.
 MSI Z68A‐GD80 (G3) and GT780DXR won CES 2012 Innovations Award.
2013  The No. 1 and Only Best Choice Golden Awarded Motherboard‐ MSI Z87‐GD65 GAMING
 MSI Taiwan Excellence Award Winner, 15 years of affirmation. Eleven product of the leading
company are awarded
 MSI has won the 2013 CES Innovations Awards with the GT70 Dragon Edition notebook and the
N680GTX Lightning graphics card.
2014  MSI GS70 laptop and AG2712A gaming All‐in‐One PC are prestigious CES Innovations 2014
honorees.
 MSI has been awarded from Taiwan Excellence for 16 consecutive years. A total of 13 MSI
products are awarded, including the Z87M GAMING motherboard, the GK‐601 Dragon Edition
gaming keyboard, the ultrathin GS70 laptop, the GT60 3K Edition laptop, the N780 Lightning
graphics card, the AG2712A gaming All‐in‐One PC and the Adora24 ultra‐slim All‐in‐One PC. In
2014, MSI was selected as one of the top 20 brands in the "Best Taiwan Global Brands"
 MSI Z97 XPOWER AC won COMPUTEX TAIPEI 2014 d&i and Best Choice Award
2015  MSI has been awarded from Taiwan Excellence for 17 consecutive years. 8 products are
awarded, including MB/ VGA/ NB/ AIO products.
 MSI GT72 Dominator Pro laptop, GS30 Shadow, AG240 4K Edition AIO and X99 GAMING 9 are
prestigious CES Innovations 2015 honorees.
 MSI was selected as one of the top 20 brands in the "2015 Best Taiwan Global Brands".
 Honored as World’s 4th Best Laptop Brand of 2015 and NO.1 in Ranking of Asian Brands by
Laptop Magazine.
2016  MSI GS40 Phantom, AIO Gaming 27XT, and Vortex Gaming Tower won CES 2016 Innovations
Award.
 GT80 Titan won iF DESIGN AWARD 2016
 MSI GAMING notebook won Readers' Choice Awards 2016
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2017  MSI VR One Backpack PC, GS63VR Stealth Pro gaming laptop and Z270 GAMING M7 gaming
motherboard won CES 2017 Innovations Award.
 MSI has been awarded from Taiwan Excellence, including gaming NB, MB, VGA, Desktop and
headset products.
 MSI won two iF Design Awards with Z270 TOMAHAWK gaming motherboard and Trident 3
gaming desktop PC.
2018  MSI won the CES 2018 Best E‐sports Innovation Gold Award with its powerful and clear‐cut
Trident 3 Arctic. In addition, along with Trident 3 Arctic, MSI Technology's high‐performance
Z370 GODLIKE GAMING e‐sports motherboard, top GTX 1080Ti Lightning e‐sports display card,
innovative Optix MPG27CQ curved e‐sports display and the new generation Infinite X e‐sports
desktop also won five CES 2018 Innovation Awards in the computer hardware and component
category and the e‐sports category.
 MSI passed the rigorous tests in the four areas of “Research and Development”, “Design”,
“Quality” and “Marketing” with its products such as notebooks, motherboard, display card,
e‐sports desktops, e‐sports peripherals, industrial computers and servers to win the Taiwan
Excellence Award for 20 consecutive years. Not only that, the VR One e‐sports backpack, in
addition to be the winner of Taiwan Excellence Awards, won the "Silver Award" for its emphasis
on the wireless VR e‐sports experience.
 Winning the internationally renowned iF Product Design Award, known as the Oscar Award for
Product Design, means an exceptional glory of the product for being selected out of thousands
of its kind. As the world‐leading e‐sports brand, MSI shone forth to win 3 major iF awards with
its outstanding e‐sports GL63 which carries gaming‐panel display, the lightest and thinnest
backpack e‐sports box VR ONE, and the pure white high‐quality motherboard X299 TOMAHAWK
AC.
 For the 17th COMPUTEX Best Choice Award for Innovative Technology of the Year, MSI's 4
products stood out from the 350 competing items to win 5 awards. The MSI Optix MPG27 series
of curved e‐sports display won the double champions for "Best Design Award" and "Category
Award". MSI has been developing its the automotive electronics brand for many years and its
FUNTORO smart fleet management and cloud service platform, with its brilliant performance,
won the "Gold Award". The MSI GE73 Raider RGB e‐sports notebook, and MSI FUNTORO smart
court business service solution, both claimed the "Category Award", once again affirming MSI's
leading position in the global e‐sports field, as well as its ambition to step into the field of
software platform services.
 The Computex Taipei Innovation Design Award was jointly organized by the Taiwan External
Trade Development Council (TAITRA) and iF International Forum Design GmbH (Germany). In
2018, MSI once again unveiled the breath‐taking next‐gen PRO 24X AIO computer to create a
new era for the high ‐tech industry.
 MSI was nominated as one of the “2018 Taiwan Top 20 International Brands”in the “Taiwan
International Brand Value Survey”conducted by Interbrand, a global authoritative brand value
survey agency which was commissioned by Taiwan Institute of Economic Research under the
program sponsored by the Industrial Development Bureau of the Ministry of Economic Affairs.
2019  MSI's products were favored by CES 2019 jurors with GS65 e‐sports notebook, Infinite e‐sports
desktop, Trident X e‐sports desktop, GeForce® RTX™ 2080 Ti GAMING X TR10 e‐sports display
card, Prestige PS341WU display, Optix MPG341QR smart e‐sports display and Optix MAG271QR
curved e‐sports display claimed a total of 12 major awards for innovation including the CES
Computer Hardware and Components Innovation Award, CES E‐sports Innovation Award, CES
High‐performance Home Audio / Video Innovation Award, CES Computer Peripheral Innovation
Award, CES e‐sports Innovation Award and so forth.
 MSI passed the rigorous tests in the four areas of “Research and Development”, “Design”,
“Quality” and “Marketing” with its notebooks, e‐sports desktops, e‐sports peripherals, industrial
computers, automatic electronics, etc.” under the careful evaluation and discussion of more
than 90 well‐known local experts across the industry, government and academia to win the
Taiwan Excellence Award for 21 consecutive years. Not only that, the game linking RGB colorful
lighting curved LED e‐sports screen Optix MPG27CQ/MPG27C, in addition to being the winner
of Taiwan Excellence Awards, won the "Silver Award" for its characteristics of linking with
games.
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 In 2019, MSI won the iF Design Award 2019 in 4 categories with its gaming laptop GF63 and
GF75, military style motherboard MAG Z390 TOMAHAWK, and Optix MPG27CQ, the first gaming
monitor synchronizing the game in the world.
 In Computex Taipei 2019, MSI received four design awards for the products: Trident X series
desktop PC, gaming laptop GS75, Prestige PS341WU display, and MS‐9A79 palm‐size shockproof
fanless Box PC.
 In the 18th COMPUTEX Best Choice Award, 5 of MSI’s products beat the other 300 competitors
and won 5 awards. The flagship gaming laptop MSI GT76 Titan has the most stunning
performance and won the gold award. MSI Trident X Plus gaming PC, MSI Optix MPG341CQR
monitor, MSI Prestige P100 Series creator PC, and MS‐9A95 AIoT cloud server and smart
management solution for global customer service under the edge computing structure received
the “Category Rewards.” It proves MSI’s dominant position in the global gaming field, and
ambition to extend into the creator market.
 Branding Taiwan valuation is hosted by the Industrial Development Bureau, MOEA. The Taiwan
Institute of Economic Research hires the global brand valuation institution Interbrand to
conduct the valuation by the same method used in the “Top 100 Global Brands” for
BusinessWeek. The valuation result is an important indicator for measuring the positions of
Taiwanese brands in the international market. MSI was selected as Top 20 Brands again in 2019.
2020  The global leading brand of gaming product MSI is recognized for its countless elite
performance. It receives the CES Innovation Award 2020 in 10 categories.
 MSI is the leader of the gaming industry, has a strong brand, and again won the 28th Taiwan
Excellence Award that covers four major aspects of “R&D,” “Design,” “Quality,” and ”Marketing.”
Subject to the prudent evaluation by the judges, MSI received 9 distinctions in the Taiwan
Excellence Award 2020. Among others, the Prestige P100 desktop PC in the Content Creation
series has won the Taiwan Excellence Silver Award 2020.
 In 2020, MSI GS66 Stealth gaming laptop, MSI MPG SEKIRA 500X gaming chassis, and MSI MPG
SEKIRA 500G multitasking computer chassis stood out among other competitors’ products, and
won the Germany iF Design Award 2020, the Academy Award in the world of design.
 MSI was selected as Top 20 Brands again in 2020.
2021  With the strong strength of an e-sports and creators' leading brand, MSI was selected by the
expert review team at the 29th Taiwan Excellence Award based on 4 major criteria: "R&D",
"Design", "Quality", and "Marketing", and after rigorous evaluation, MSI won 7 awards in the
2021 Taiwan Excellence Award, among which, Creator P100 creator desktop won the 2021
Taiwan Excellence Silver Award.
1. The most recent fiscal year as well as the current fiscal year up to the date of publication of the
annual report, include information on the following, Investment,merger and acquisition
activities,corporate reorganization：None.
(1) The most recent fiscal year as well as the current fiscal year up to the date of publication of
the annual report, include information on the following,merger and acquisition
activities,corporate reorganization：None.
(2) Investment in affiliates in the past year and up to the date of report：
For investments in affiliated enterprises, please see page 98～101 of this report.
2. Instances in which a major quantity of shares belonging to directors, supervisors, or shareholders
holding greater than a 10 percent stake in the company is transferred or otherwise changes
hands; any change in managerial control; any material change in operating methods or type of
business; and any other matters of material significance that could affect shareholders' equity.
This section shall further explain how the above matters will affect the company:None.
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Ⅲ.Corporate governance report
(Ⅰ)Corporate Organization
1. Organization Chart
Shareholders’ Meeting
Audit Committee
Board of Directors Internal Audit office
Remuneration Committee
Chairman
Vice Chairman
Management Committee
President
Global Management Center OSH Office
Finance Center EP & CSR Committee
Legal Affairs Office Info. Security Mgmt Committee
Note Book Graphics and Computing Customized Enterprise Automotive Corp. Corp. Corp. Corp. Corp.
B.U. peripheral and Display Product Platform & Commercial Sales & R&D Supply Manufacture Quality
BU BU Solutions Solution Solution Marketing Chain Assurance
BU B.U. B.U.
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2.Major Corporate Function
Department Functions
Internal Audit Office To investigate and assess the soundness, suitability, adequacy, status
of implementation, and operating performance of departmental
internal controls.
Management Committee Analyze and discuss group strategy, operation, organization, senior
manager appointment and removal, investment required for
business development, new business and other critical topics;
provide consultation and recommendations for the Board of
Directors, and lead the management team to implement.
President To manage the corporate operation and development affairs, to set
development and operational goals, and to supervise implement
process.
Global Management Center Handle the general management and development of the company,
including logistics, legal affairs, intellectual propertymanagement,
sustainable business development planning, implementation and
management, information system development, hardware and
system software usage and maintenance, human resources
administration, employee welfare, training and HR development,
general affairs, factory affairs and asset management. Provide
management and strategy recommendations to the President based
on operational statistics.
Finance Center (1) Accounting Division: Accounting and billing affairs, voucher
preparation, receipt review, and financial reports' preparation
and analysis.
(2)Finance Division: Fund dispatch, risk management, and registrar
and transfer operation.
(3)Global Finance Division: investment management.
Legal Affairs Office Responsible for regulatory compliance of the Company, contracts
review and litigations.
OSH Office Promote the actions in work safety and health.
EP & CSR Committee Promote the actions of environmental protection and corporate
social responsibility programs, review the annual objectives of
economic, environmental, and social aspects, and periodically
supervise the enforcement.
Info. Security Mgmt Promote information security management, and supervise the
Committee operation of the information security management mechanism.
Each Products B.U. Product development, sales and related business.
Corp.Sales & Marketing PO management, market cultivation, business information
collection, and customer credit investigation.
Corp.R&D Design, development and quality control of products; process
enhancement; and technology improvement.
Corp.Supply Chain Procurement, control and management of raw materials, and
production scheduling and management.
Corp. Manufacture Product manufacturing.
Corp.Quality Assurance Quality assurance, quality control, customer complaints, and
post‐delivery service.
9
(Ⅱ) Directors, Supervisors, President, Vice President, Assistant VP, and department heads
1. Directors
As of: April 13, 2021 Unit: Shares
Shareholding by
Shareholding when Spouse & Minor Executives, Directors or Supervisors
Remarks
Nationality/
Date Term Date of first Current Shareholding Nominee
Title Country of Name Gender elected Shareholding who are spouses or within two degrees
elected (Years) elected Arrangement
Origin
Shares % Shares % Shares % Shares % Title Name Relation
Chairman. Hsu,Hsiang Male 2018.06.15 3 1986.07.23 51,983,151 6.15% 51,983,151 6.15% 13,408,517 1.59% 9,376,328 1.11% －－－
Vice Huang,Chin‐Ching Male 2018.06.15 3 1986.07.23 20,937,377 2.48% 20,937,377 2.48% 2,148,564 0.25% 7,521,761 0.89% Director Liao,Chun‐Keng 2nd
Chairman consanguinity
Director Lin,Wen‐Tung Male 2018.06.15 3 1986.07.23 25,672,499 3.04% 25,672,499 3.04% 62,895 0.01% ─ ─ －－－
Director Yu, Hsien‐Neng Male 2018.06.15 3 1986.07.23 17,892,824 2.12% 17,892,824 2.12% 184,922 0.02% ─ ─ －－－
Director Kuo,Hsu‐Kuang Male 2018.06.15 3 2018.06.15 0 0.00% 75,000 0.01% 0 0.00% ─ ─ －－－
Director Liao,Chun‐Keng Male 2018.06.15 3 2018.06.15 35,000 0.00% 60,000 0.01% 0 0.00% ─ ─ Vice Huang,Chin‐Ching 2nd
R.O.C Chairman consanguinity
Director Hung,Yu‐Sheng Male 2018.06.15 3 2018.06.15 306,660 0.04% 306,660 0.04% 0 0.00% ─ ─ －－－
Independent Wang,Sung‐Chou Male 2018.06.15 3 2003.05.28 0 0.00% 0 0.00% 468 0.00% ─ ─ －－－

Director
( Note1)
Independent Liu ,Cheng‐Yi Male 2018.06.15 3 2012.06.15 0 0.00% 0 0.00% 0 0.00% ─ ─ －－－
Director
Independent Hsu,Kao‐Shan Male 2018.06.15 3 1998.02.28 418,686 0.05% 418,686 0.05% 220,924 0.03% ─ ─ －－－
Director
( Note1)
Note 1：Mr. Wang, Sung‐Chou, existing director between May 28, 2003 and June 14, 2006 and independent director between June 14, 2006 and June 16, 2009, was elected again as independent director on June 15, 2012 and June 12,
2015; Mr.Hsu,Kao‐Shan, existing director between Feb 28, 1998 and June 14, 2006, was elected as supervisor between June 14, 2006 and June 12, 2015 ,resigned on May 20, 2016, and elected as independent director on June
15, 2018.
10
Education Current Job
Title Name
Experience Title Representative
Chairman Hsu,Hsiang The electronic engineering from National Cheng Kung University. The Chairman of MSI
The engineer of Sony Industries Taiwan Co., Ltd. Director & President of MICRO‐STAR NETHERLANDS HOLDING B. V. MICRO STAR INTERNATIONAL CO., LTD.
Vice Huang,Chin‐Ching The electronics from Chung Yuan Christian University. The Vice Chairman and president of MSI
The engineer of Sony Industries Taiwan Co., Ltd. Director & President of the following companies:
Chairman MSI COMPUTER (AUSTRALIA) PTY. LTD. MICRO STAR INTERNATIONAL CO., LTD.
MSI COMPUTER CAYMAN CO., LTD. MICRO STAR INTERNATIONAL CO., LTD.
Director of the following company:
MSI COMPUTER CORP. MICRO STAR INTERNATIONAL CO., LTD.
Executive Director of the following company:
MSI ELECTRONIC (KUNSHAN) CO., LTD. MICRO ELECTRONICS
Director Lin,Wen‐Tung The electronic engineering from the Lien Ho Industrial and The Senior Vice President of MSI
Technological Junior College. Director & President of
The engineer of Sony Industries Taiwan Co., Ltd. MSI COMPUTER JAPAN CO., LTD. MICRO STAR INTERNATIONAL CO., LTD.
Director of the following company:
MSI COMPUTER (AUSTRALIA) PTY. LTD. MICRO STAR INTERNATIONAL CO., LTD.
Director Yu,Hsien‐Neng The electronics from Feng Chia University. The Senior Vice President of MSI
The engineer of Sony Industries Taiwan Co., Ltd. Director & President of the following companies:
MICRO‐STAR INTERNATIONAL (B.V.I) HOLDING CO., LTD. MSI PACIFIC
MSI POLSKA SP. Z O.O MSI HOLDING
Director of the following company
MSI COMPUTER CORP. MICRO STAR INTERNATIONAL CO., LTD.
Executive Director of the following companies:
MSI COMPUTER (SHENZHEN) CO., LTD. MSI(B.V.I.)
SHENZHEN MEGA INFORMATION CO., LTD. MSI PACIFIC
Director Kuo,Hsu‐Kuang The master of business administration from University of Southern The Executive Vice President & NB BU GM of MSI
Queensland
The manager of Chun‐Sheng Computer
Director Liao,Chun‐Keng The master of business administration from University of South Australia The Executive Vice President & GNP BU GM of MSI
The sales manager of Magic Systech Inc

Director Hung,Yu‐Sheng ITI International Business Administration Program The Executive Vice President & CND BU GM of MSI
Shih Chien College of Design and Management The Executive Director of the following company:
MA of Pou Chen Group MSI (Shenzhen) Co., Ltd. STAR INFORMATION HOLDING CO., LTD
Independent Wang,Sung‐Chou The master of business administration from National Chengchi Independent Director of MICRO STAR INTERNATIONAL CO., LTD.
University. Director of the following company:
Director Kae Lee Investment Co., Ltd.
Director of the KGI INVESTMENT ADVISORY CORPORATION
China Securities Co., Ltd.( now KGI Securities Co., Ltd.) Supervisor of the following companies:
Supervisor of the GARND PACIFIC PETROCHEMICAL CORPORATION、 KK Enterprise Co., Ltd.、Taiwan Sports Lottery Company
Videoland Inc.
Independent Liu ,Cheng‐Yi The master of science in finance from The City University of New York. None
Director of Administration Division of Micro Star International Co., Ltd.
Director Supervisor of TXC CORPORATION
Independent Director of Jochu Technology Co., Ltd.
The Assistant Manager of Twin Head International Corp.
Independent Hsu,Kao‐Shan Criminal investigation of Central Police University Li Tsai Attorneys‐At‐Law
Supervisor of Micro Star International Co., Ltd.
Director Attorney of Yung Jan Attorneys‐At‐Law
11
With over five years of job experience and the following business qualification Independence Criteria(Note) Also an
Criteria
Teachers of public or private colleges for Judge, prosecutor, attorney, accountant, or With job experience in independent
the subject of commerce, law, finance, business salespersons passed national exam & commerce, law, finance, 1 2 3 4 5 6 7 8 9 10 11 12 director of other
Name
accounting, or business certified specialists or technicians accounting, or business public company
Hsu,Hsiang          0
Huang,Chin‐Ching         0
Lin,Wen‐Tung           0
Yu, Hsien‐Neng           0
Kuo,Hsu‐Kuang            0
Liao,Chun‐Keng          0
Hung,Yu‐Sheng            0
Wang,Sung‐Chou               0
Liu ,Cheng‐Yi              0
Hsu,Kao‐Shan               0
(1) Not an employee of the company or its affiliate.
(2) Not a director or supervisor of the company or its affiliate (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company,
subsidiaries, or a subsidiary under the same parent company).
(3) Not the person himself, spouse or minor child, or individual shareholder holding more than 1% of the company’s outstanding shares in the name of a third party, or top 10 shareholder.
(4) Not the spouse, relative within the second degree of consanguinity, or direct blood relative within the third degree of consanguinity of a manager, a person under (2) or (3).
(5) Not directly holding more than 5% of the company’s outstanding shares, top 5 shareholder, or a director, supervisor or employee of a corporate shareholder appointing its representative as the director or supervisor of the
company pursuant to Article 27 paragraphs 1 or 2 of the Company Act (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent
company, subsidiaries, or a subsidiary under the same parent company).
6) Not a director, supervisor, or employee of a company controlled by the same person holding the majority of the Board or the voting shares of the company and the other company (except for independent directors appointed in
accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company, subsidiaries, or a subsidiary under the same parent company).
(7) Not a director (governor), supervisor, or employee of a company or institution whose chairman, president, or a person holding an equivalent position is the same person or the spouse of the chairman, president, or a person
holding an equivalent position at the company (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company, subsidiaries, or
a subsidiary under the same parent company).
(8) Not a director (governor), supervisor, manager, or shareholder with more than 5% shareholding of a specific company or institution having financial or business relationship with the company (except for independent directors
appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company, subsidiaries, or a subsidiary under the same parent company) .
(9) Not a professional individual, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution, or their spouses, who 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 has received cumulative compensation exceeding NT$500,000
in the past 2 years; provided however that 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.
(10) Not a spouse or relative within the second degree of consanguinity of any other director.
(11) No such situation under Article 30 of the Company Act.
(12) Not a government, corporate or its representative elected pursuant to Article 27 of the Company Act.
12
2. Information of the management
Base Date: April 13, 2021 Unit: Shares
Managers who are
Shareholding
Nationality Spouse & Minor Spouses or Within Two
Remarks
Date Shareholding by Nominee
Title /Country of Name Gender Shareholding Experience (Education) Other Position Degrees of
Elected Arrangement
Origin Shareholding Kinship
Shares % Shares % Shares % Title Name Relation
Chairman Hsu,Hsiang Male 1994.4 51,983,151 6.15% 13,408,517 1.59% 9,376,328 1.11% The electronic engineering from National Refer to page 11 －－－
Cheng Kung University.
The engineer of Sony Industries Taiwan
Co., Ltd.
President (Note1) Huang,Chin‐Ching Male 2001.7 20,937,377 2.48% 2,148,564 0.25% 7,521,761 0.89% The electronics from Chung Yuan Christian Refer to page11 SVP Liao,Chun Note1
‐Keng
University.
co., Ltd.
Senior Vice President of Lin,Wen‐Tung Male 2001.7 25,672,499 3.04% 62,895 0.01% －－ The electronic engineering from the Lien Refer to page 11 －－－
Management Committee Ho Industrial and Technological Junior
College.
co., Ltd.
Senior Vice President of Yu,Hsien‐Neng Male 2001.7 17,892,824 2.12% 184,922 0.02% －－ The electronics from Feng Chia University. Refer to page 11 －－－
Management Committee The engineer of Sony Industries Taiwan
co., Ltd.
Senior Vice President of Lu,Chi‐Long Male 2001.7 18,650,835 2.21% 1,965,350 0.23% －－ The electronics from National Taiwan None －－－
Management Committee R.O.C University of Science and Technology.
co., Ltd.
Executive Vice President & Kuo,Hsu‐Kuang Male 2013.4 75,000 0.01% 0 0.00% －－ The master of business administration None －－－
NB BU GM from University of Southern Queensland
The manager of Chun‐Sheng Computer
Executive Vice President& Liao,Chun‐Keng Male 2014.4 60,000 0.01% 0 0.00% －－ The master of business administration None EVP & Huang,Chi Note1
GNP n‐Ching
GNP BU GM from University of South Australia BU GM
The Sales Manager of Magic Systech Inc.
Executive Vice President & Hung,Yu‐Sheng Male 2012.4 306,660 0.04% 0 0.00% －－ ITI International Business Administration Refer to page 11 －－－
CND BU GM Program
Shih Chien College of Design and Management
MA of Pou Chen Group
EPS BU GM Tsai,Rong‐Fong Male 2010.3 123,647 0.01% 297,646 0.04% －－ The electronics from Chung Yuan Christian None －－－
University.
The General Manager of DTK Technology
(Hong Kong).
ACS BU GM Huang,Wen‐Shan Male 2019.12 723 0.00% 0 0.00% －－ The electronics from National Taiwan University of None －－－
Science and Technology.
Twinhead International Corp. Assistant Manager
13
Vice President & CPS BU GM Wu,Ta‐Hsin Male 2019.1 0 0.00% 0 0.00% －－ Communications, University of the Pacific. None －－－
FIC Sales Director
Vice President of Corp. R&D Teng,Chi‐Hung Male 2010.3 543,183 0.06% 1,124 0.00% －－ The institute of electronics from National None －－－
Chiao Tung University.
Ali Corporation Technical Manager
Vice President of Corp. Li,Chao‐Ming Male 2010.3 11,498 0.00% 0 0.00% －－ The master of mechanical system from President of the following －－－
University of Liverpool companies:
Manufacture & Quality MSI COMPUTER (SHENZHEN)
Assurance ACER INCORPORATED Manager
CO., LTD.
MSI ELECTRONICS (KUNSHAN)
CO., LTD.
Vice President of Corp. Sales Chiu,Chih‐Keng Male 2015.4 152,925 0.02% 0 0.00% －－ Institute of Technology and Industrial Director on behalf of MSI －－－
Engineering from St. John’s & St. Mary’s College HOLDING & President of the
& Marketing following companies:
DTK Computer M.D.
MSI COMPUTER SARL
MSI COMPUTER EUROPE B.V.
MYSTAR COMPUTER B.V.
MSI COMPUTER (UK) LTD.
MSI ITLAY S.R.L.
LLC « MSI COMPUTER »
MSI IBERIA S.L. (MICRO‐STAR
NETHERLANDS HOLDING B.V.
representative)
Vice President of Corp. Sales Tung,Ti‐Chun Male 2019.4 0 0.00% 0 0.00% －－ University of Phoenix Director & President of MSI －－－
DFI‐ITOX Inc. Tech Support & MIS COMPUTER CORP. and
& Marketing MICRO‐STAR CANADA LTD.
(MICRO‐STAR INTERNATIONAL
R.O.C CO., LTD. representative)
Vice President of Corp. Chen,Te‐Ling Female 2019.1 0 0.00% 0 0.00% －－ Department of Foreign Languages and None －－－
Supply Chain Literatures,National Taiwan University . D‐LINK
CORPORATION Administrator
Vice President of NB BU Lin,Chin‐Kuan Male 2014.4 363,375 0.04% 0 0.00% －－ Institute of Electrical and Control Engineering None －－－
R&D Division from National Chiao Tung University
Wistron Corporation Manager
Vice President of NB BU Lu,Kuo‐Huang Male 2017.4 0 0.00% 0 0.00% －－ Hwa Hsia Institute of Agricultural Technology None －－－
R&D Division
Vice President of NB Peng,Jen‐Fang Male 2017.4 159,671 0.02% 0 0.00% －－ National Taiwan University of Science and None －－－
Product Mgt. Division Technology
Vice President of NB Pan,Tsai‐Yu Male 2019.4 0 0.00% 0 0.00% －－ National Taiwan Unversity Of Science and None －－－
Operations Mgt. Division Technology
Askey Computer Corporation. Manager
Vice President of NB Huang,Wen‐Hui Female 2021.4 200 0.00% 0 0.00% －－ The master of business administration from None －－－
OEM sales Division University of South Australia
The Purchasing Manager of Fujitsu Technology
Vice President of CND BU Yeh,Chun‐Te Male 2020.4 10,000 0.00% 3,155 0.00% －－ Szehai Institute of Technology and Commerce None －－－
First International Computer Supervisor
Vice President of EPS BU Lu,Cheng‐Lung Male 2015.4 91,555 0.01% 0 0.00% －－ Department of Business Administration, Tamkang None －－－
University
Sales & Marketing Division JUMBO POWER TRADING CO., LTD. Special Assistant
Vice President of Corp. Marketing Cheng,Hui‐Cheng Male 2019.4 0 0.00% 0 0.00% －－ Fu Jen Catholic University None －－－
Division Wistron Corporation. Product manager
14
Vice President of Global Tsai,Wei‐Hsin Male 2010.3 77 0.00% 0 0.00% －－ Chinese Culture University Department of International None －－－
Business Administration
Management Center LITE‐ON TECHNOLOGY CORP. Communications Group
Accounting Department Assistant Vice President
Vice President of Finance Hung,Pao‐Yu Female 2016.4 343,218 0.04% 0 0.00% －－ Finance MBA, National Taiwan University Supervisor of the following －－－
President Securities Corp. Underwriting Department companies:
Center Manager MSI COMPUTER (SHENZHEN)
CO., LTD.
(MSI(B.V.I.)Representative)
SHENZHEN MEGA INFORMATION
CO., LTD. (MSI PACIFIC
Representative)
MSI (Shenzhen) Co., Ltd. (STAR
INFORMATION Representative)
MSI (Shanghai) Co., Ltd. (MSI
PACIFIC Representative)
Director on behalf of MICRO
STAR of the following
company:
MSI PACIFIC INTERNATIONAL
HOLDING CO., LTD.
Director on behalf of MSI
PACIFIC of the following
companies:
MICRO ELECTRONICS HOLDING
R.O.C CO., LTD.
MEGA TECHNOLOGY HOLDING
CO., LTD.
MEGA COMPUTER CO., LTD.
MHK INTERNATIONAL CO., LTD.
STAR INFORMATION HOLDING
CO., LTD.
Director on behalf of MEGA
TECHNOLOGY of the following
company:
RAIDEALS INC.
Assistant Vice President of Liu,Chu‐Hao Male 2010.3 10,000 0.00% 14,609 0.00% －－ Department of Accounting, Tamkang Supervisor of MSI －－－
ELECTRONIC (KUNSHAN) CO.,
Internal Auditing Office University LTD (MICRO ELECTRONICS
Mag Technology Co., Ltd. Audit Assistant Representative)
Manager Supervisor of MSI KOREA CO.,
LTD.(MSI PACIFIC Representative
Supervisor of MSI COMPUTER
JAPAN CO., LTD. (MICRO STAR
Representative)
President & Chief Executive Chiang,Sheng‐Chang Male 2010.3 704,074 0.08% 0 0.00% ─ ─ The institute of electronics from National None －－－
Officer Chiao Tung University.
(Note2) The assistant vice president of ALi
Corporation.
Note1：Mr. Huang,Chin‐Ching and Mr. Liao,Chun‐Keng are 2nd consanguinity
Note2：Mr. Chiang, Sheng‐Chang Dismissed on July 7, 2020.
3. The Chairman, president, or equivalent officer (the most senior manager) is the same person, are spouses, or relatives within the first degree of consanguinity:None.
15
(Ⅲ)Remuneration paid during the most recent fiscal year to directors, supervisors, president and vice presidents
1.Remuneration of Directors, Supervisors
(1) Remuneration of Directors (including Independent Directors)
Unit：NT$
Remuneration of Directors Ratio of Total Remuneration received by Directors who are also employees Ratio of Total
Remuneration Compensation Compensation
Base Remuneration to (A+B+C+D) to Salary, Bonuses, and (A+B+C+D+E+F+G) to Paid to Directors
Severance Pay(B) Allowances(D) Severance Pay (F) Remuneration to Employee(G)
Compensation(A) Directors (C) Net Income (%) Allowances(E) Net Income (%) from an Invested
Title Name Companies Companies Companies Companies Companies Companies Companies Companies in the Companies Company Other
in the in the in the in the in the in the in the MSI consolidated in the than the
MS
consolidated MSI consolidated MSI consolidated MSI consolidated MSI consolidate MSI consolidate MSI consolidated Financial statements MSI consolidated Company’s
I
financial financial financial financial financial financial financial Cash Stock Cash Stock financial Subsidiary
statements statements statements statements statements statements statements amount amount amount amount statements
Chairman Hsu,Hsiang
Vice Chairman Huang,Chin‐Ching
Director Lin,Wen‐Tung
Director Yu, Hsien‐Neng
0 0 0 0 52,000,000 52,000,000 0 0 0.65% 0.65% 95,819,503 95,819,503 0 0 50,000,000 0 50,000,000 0 2.49% 2.49% None
Director Kuo,Hsu‐Kuang
Director Liao,Chun‐Keng
Director Hung,Yu‐Sheng
Director(Note) Chiang,Sheng‐Chang
Independent Director Wang,Sung‐Chou
Independent Director Liu,Cheng‐Yi 0 0 0 0 19,500,000 19,500,000 0 0 0.25% 0.25% 0 0 0 0 0 0 0 0 0.25% 0.25% None
Independent Director Hsu,Kao‐Shan
1.Please describe the payment policy, system, standard and structure of the independent director remuneration, and the relevance between the amount of the remuneration and the responsibilities, risks, contributed time, and other factors: Pursuant to Article 16‐4 of the company’s bylaws, and based on the
company’s operational performance, director’s performance, and payment standard of the same industry, the remuneration committee will propose the recommendations to the Board of Directors to decide the remuneration of the company’s independent directors
2.Remuneration received in the most recent year by the director of the company for rendering services (such as serving as a non‐employed consultant) to any company listed in the Financial Report：None.
Note: Dismissed on July 7, 2020.
Remuneration Bracket
Name of Directors
Total of (A+B+C+D) Total of (A+B+C+D+E+F+G)
Range of Remuneration
Companies in the consolidated Companies in the consolidated financial
MSI MSI
financial statements H statements (Ⅰ)
Below 1,000,000
1,000,000(included)～2,000,000(excluded)
Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、 Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、 Wang,Sung‐Chou、Liu ,Cheng‐Yi、Hsu,Kao‐Shan Wang,Sung‐Chou、Liu ,Cheng‐Yi、Hsu,Kao‐Shan
Yu, Hsien‐Neng、Chiang,Sheng‐Chang、Kuo,Hsu‐Kuang、 Yu, Hsien‐Neng、Chiang,Sheng‐Chang、Kuo,Hsu‐Kuang、
Liao,Chun‐Keng、Hung,Yu‐Sheng、Wang,Sung‐Chou、 Liao,Chun‐Keng、Hung,Yu‐Sheng、Wang,Sung‐Chou、
Liu ,Cheng‐Yi、Hsu,Kao‐Shan Liu ,Cheng‐Yi、Hsu,Kao‐Shan
Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、 Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、
15,000,000(included)～30,000,000(excluded) Yu, Hsien‐Neng、Chiang,Sheng‐Chang、 Yu, Hsien‐Neng、Chiang,Sheng‐Chang、
Kuo,Hsu‐Kuang、Liao,Chun‐Keng、Hung,Yu‐Sheng Kuo,Hsu‐Kuang、Liao,Chun‐Keng、Hung,Yu‐Sheng
Over $100,000,000
Total 71,500,000 71,500,000 217,319,503 217,319,503
16
2. Remuneration of President and Vice Presidents
Unit：NT$
Ratio of total compensation
Compensation
Salary(A) Severance Pay(B) Bonuses and Allowances (C) Remuneration to Employee(D) (A+B+C+D) to net
paid to the
income (%)
President and
Companies Companies Companies Companies
Title Name in the in the in the MSI in the consolidated
Companies Vice President
in the consolidated from an Invested
MSI consolidated MSI consolidated MSI consolidated financial statements MSI
financial Company Other Than the
financial financial financial Cash Stock Cash Stock
statements Company’s Subsidiary
statements statements statements amount amount amount amount
Chairman Hsu,Hsiang
President Huang,Chin‐Ching
Senior Vice President of Management Committee Lin,Wen‐Tung
Senior Vice President of Management Committee Yu,Hsien‐Neng
Senior Vice President of Management Committee Lu,Chi‐Long
Executive Vice President & NB BU GM Kuo,Hsu‐Kuang
Executive Vice President & GNP BU GM Liao,Chun‐Keng
Executive Vice President & CND BU GM Hung,Yu‐Sheng
EPS BU GM Tsai,Rong‐Fong
ACS BU GM Huang,Wen‐Shan
Vice President & CPS BU GM Wu,Ta‐Hsin
Vice President of Corp. R&D Teng,Chi‐Hung
Vice President of Corp. Manufacture & Quality
Li,Chao‐Ming
Assurance 79,304,039 79,304,039 1,944,000 1,944,000 160,397,000 160,397,000 112,000,000 0 112,000,000 0 4.44% 4.44% None
Vice President of Corp. Sales & Marketing Chiu,Chih‐Keng
Vice President of Corp. Sales & Marketing Tung,Ti‐Chun
Vice President of Corp. Supply Chain Chen,Te‐Ling
Vice President of NB BU R&D Division Lin,Chin‐Kuan
Vice President of NB BU R&D Division Lu,Kuo‐Huang
Vice President of NB Product Mgt. Division Peng,Jen‐Fang
Vice President of NB Operations Mgt. Division Pan,Tsai‐Yu
Vice President of NB OEM sales Division Huang,Wen‐Hui
Vice President of CND BU Yeh,Chun‐Te
Vice President of EPS BU Sales & Marketing
Lu,Cheng‐Lung
Division
Vice President of Corp. Marketing Division Cheng,Hui‐Cheng
Vice President of Global Management Center Tsai,Wei‐Hsin
Vice President of Finance Center Hung,Pao‐Yu
President & Chief Executive Officer ( Note) Chiang,Sheng‐Chang
Note:Dismissed on July 7, 2020.
17
Remuneration Bracket
Name of President and Vice President
Range of Remuneration
MSI Companies in the consolidated financial statements E
Below 1,000,000
Lu,Kuo‐Huang、Pan,Tsai‐Yu i、Huang,Wen‐Hui、Yeh,Chun‐Te、Lu,Cheng‐Lung、Cheng,Hui‐Cheng、
5,000,000(included)～10,000,000(excluded) Lu,Kuo‐Huang、Pan,Tsai‐Yu i、Huang,Wen‐Hui、Yeh,Chun‐Te、Lu,Cheng‐Lung、Cheng,Hui‐Cheng、Chiang,Sheng‐Chang
Chiang,Sheng‐Chang
Lu,Chi‐Long、Tsai,Rong‐Fong、Huang,Wen‐Shan、Wu,Ta‐Hsin、Teng,Chi‐Hung、Li,Chao‐Ming、 Lu,Chi‐Long、Tsai,Rong‐Fong、Huang,Wen‐Shan、Wu,Ta‐Hsin、Teng,Chi‐Hung、Li,Chao‐Ming、Chiu,Chih‐Keng、
Chiu,Chih‐Keng、Tung,Ti‐Chun、Chen,Te‐Ling、Lin,Chin‐Kuan、Peng,Jen‐Fang、Tsai,Wei‐Hsin、Hung,Pao‐Yu Tung,Ti‐Chun、Chen,Te‐Ling、Lin,Chin‐Kuan、Peng,Jen‐Fang、Tsai,Wei‐Hsin、Hung,Pao‐Yu
Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、Yu, Hsien‐Neng、Kuo,Hsu‐Kuang、Liao,Chun‐Keng、 Hsu,Hsiang、Huang,Chin‐Ching、Lin,Wen‐Tung、Yu, Hsien‐Neng、Kuo,Hsu‐Kuang、Liao,Chun‐Keng、Hung,Yu‐Shen
Hung,Yu‐Shen
Over $100,000,000
Total 353,645,039 353,645,039
Names of managers receiving remuneration to employees, and status of allocation thereof
Title Name Stock Amount Cash Amount Total Ratio of Total Amount to Net Income (%)
Chairman Hsu,Hsiang
President Huang,Chin‐Ching
Senior Vice President of Management Committee Lin,Wen‐Tung
Senior Vice President of Management Committee Yu, Hsien‐Neng
Senior Vice President of Management Committee Lu,Chi‐Long
Executive Vice President & NB BU GM Kuo,Hsu‐Kuang
Executive Vice President & GNP BU GM Liao,Chun‐Keng
Executive Vice President & CND BU GM Hung,Yu‐Sheng
EPS BU GM Tsai,Rong‐Fong
ACS BU GM Huang,Wen‐Shan
Vice President & CPS BU GM Wu,Ta‐Hsin
Vice President of Corp. R&D Teng,Chi‐Hung
Managers
Vice President of Corp.Manufacture & Quality Assurance Li,Chao‐Ming

Vice President of Corp. Sales & Marketing Chiu,Chih‐Keng
0 113,900,000 113,900,000 1.43%
Vice President of Corp. Sales & Marketing Tung,Ti‐Chun
Vice President of Corp. Supply Chain Chen,Te‐Ling
Vice President of NB BU R&D Division Lin,Chin‐Kuan
Vice President of NB BU R&D Division Lu,Kuo‐Huang
Vice President of NB Product Mgt. Division Peng,Jen‐Fang
Vice President of NB Operations Mgt. Division Pan,Tsai‐Yu
Vice President of NB OEM sales Division Huang,Wen‐Hui
Vice President of CND BU Yeh,Chun‐Te
Vice President of EPS BU Sales & Marketing Division Lu,Cheng‐Lung
Vice President of Corp. Marketing Division Cheng,Hui‐Cheng
Vice President of Global Management Center Tsai,Wei‐Hsin
Vice President of Finance Center Hung,Pao‐Yu
Assistant Vice President of Internal Auditing Office Liu,Chu‐Hao
President & Chief Executive Officer Chiang,Sheng‐Chang
18
3.The Company is in any situation under Article 10, paragraph 1, subparagraph 3, subsections 2‐1 or 2‐5 of the Regulations Governing Information to be Published in
Annual Reports of Public Companies: No
4. Compare and state the ratio of total remuneration paid to the company’s Directors, Supervisors, President, and V.P. by the company and the companies in the
consolidated financial statements to net income in the last two years; also, describe the policy, standard, and combination of remuneration paid; moreover, the
procedure of defining remuneration and its relation to business performance and future risks
(1)Analyze the ratio of the total remuneration paid to the company’s Directors, Supervisors, President, and V.P. in the last two years to net income:
Year Directors & Supervisors President and
Vice President
Ratio of the total remuneration paid to the company’s Directors, Supervisors Ratio of the total remuneration paid to the
in the last two years to net income President, and V.P. in the last two years to
net income
Item 2020 2019 2020 2019
0.90% 0.88% 4.44% 4.89%
1.Policies of remuneration Articles 19‐1 of Incorporation of Micro‐Star International Co., Ltd. Carried out in accordance with the
The pre‐tax income of the current fiscal year shall first offset the accumulated deficits. If the balance is positive, then the Company Company’s Remuneration Management
shall allocate the remuneration to be distributed to employees, directors and supervisors in accordance with the following ratio. Regulations, Performance Review Regulation,
Employee remuneration in the percentage of 6% to 10%. Individuals eligible for employee remuneration include the Company’s Employee Bonus Evaluation and Distribution
employees and the employees of the Company’s subsidiaries meeting certain requirements. Such requirements are to be set by the Rules.
Board of Directors.
Remuneration to be distributed to directors and supervisors shall not exceed 1%.
The decision of the percentage of remuneration to be distributed to employees, directors and supervisors set forth in the preceding
Paragraph, the forms of distribution (cash or stock dividends) and the amounts and shares thereof shall be made through the special
resolutions of the Board of Directors and reported to the shareholders’ meeting.
(The Company established an Audit Committee to replace supervisors on June 15, 2018)
2.Criteria and composition of The remunerations of directors are distributed based on the number of directors and considering the contribution of individual Includes base salary, Duty allowance and
remuneration directors to the Company. performance bonuses.
3.Procedures to fix Resolved by the board meeting, and approved by the general meeting of shareholders. Based on their educational and professional
remuneration backgrounds.
4.Interrelationship with MSI Based on the Company’s performance and profitability. Remuneration is paid based on target
business achievement rate, performance, profitability
and contribution of the respective.
(2) Except for the Company, all the other companies included in the Consolidated Statement did not pay remunerations for the directors, supervisors, president, and vice presidents of
the Company.
19
(Ⅳ) Corporate governance
1.Board of Directors
The Board had 10 (A) meetings in 2020 and up to date till the Annual Report printed:
Title Name Attendance in Person (B) By Proxy Attendance Rate (%) (B/A) Remarks
Chairman Hsu,Hsiang 10 0 100.00%
Vice Chairman Huang,Chin‐Ching 9 1 90.00%
Director Lin,Wen‐Tung 10 0 100.00%
Director Yu, Hsien‐Neng 9 1 90.00%
Director Chiang,Sheng‐Chang 3 0 100.00% Note1
Director Kuo,Hsu‐Kuang 10 0 100.00%
Director Liao,Chun‐Keng 10 0 100.00%
Director Hung,Yu‐Sheng 10 0 100.00%
Independent Director Wang,Sung‐Chou 10 0 100.00% Note2
Independent Director Liu,Cheng‐Yi 10 0 100.00% Note2
Independent Director Hsu,Kao‐Shan 10 0 100.00% Note2
Note1:Dismissed since his death on July 7, 2020, should have attended three times.
Note2:Independent directors attended in person in 2020 and up to date till the Annual Report printed (with an attendance rate of 100%).
Other matters that require to be recorded:

1. Should any of the following take place in a board meeting, the date and number of the meeting, the content of the proposal, opinions of all
Independent Directors and the Company's response to such opinions shall be recorded:
(1) For details of the date and number of the board meeting, the content of the proposal, opinions of all Independent Directors and the Company's
response to such opinions, please see pages 41 ~ 43.
(2) Items specified in Article 14-3 of the Securities and Exchange Act: No dissenting or qualified opinion.
(3) Aside from the above matters, other resolutions adopted by the Board of Directors to which an Independent Director has a dissenting or
qualified opinion that is on record or stated in a written statement: None.
2. For execution status of Directors' recusals from the resolutions due to conflicts of interests, the names of the Directors, content of the proposals and
reasons for recusals as well as the participation in voting shall be recorded:
(1) Date: 2020.1.17, 2020.3.20
Name of the Director: Hsu,Hsiang. Huang,Chin‐Ching. Yu,Hsien‐Neng. Chiang,Sheng‐Chang. Lin,Wen‐Tung.
Kuo,Hsu‐Kuang. Liao,Chun‐Keng. Hung,Yu‐Sheng.
Date: 2020.8.7, 2020.10.6, 2021.1.29, 2021.3.22
Name of the Director:Hsu,Hsiang. Huang,Chin‐Ching. Yu,Hsien‐Neng. Lin,Wen‐Tung. Kuo,Hsu‐Kuang. Liao,Chun‐Keng. Hung,Yu‐Sheng.
Agenda item: Proposal of the Remuneration committee.
Reason for recusal and participation in voting: The Board of Directors reminded the Directors to pay attention to recusal due to conflict of
interests and did not provide each Director's own remuneration details.
Directors Hsu,Hsiang. Huang,Chin‐Ching. Yu,Hsien‐Neng. Lin,Wen‐Tung. Chiang,Sheng‐Chang . Kuo,Hsu‐Kuang. Liao,Chun‐Keng. Hung,Yu‐Sheng.
recused themselves from discussing and voting on the part of the proposal involving their own remuneration.
3.Board of Director Self (Peer) Evaluation Cycle and Period, Scope, Method, and Topic are as below:
Implementation of Board of Director Evaluation
Cycle Period Scope Method
Once per year January 1, 2020 to December 31, 2020 Board of Directors, individual Internal self‐evaluation
director and functional questionnaire for the Board
committees (functional committees) and
each director
Topic
The performance evaluation of the Board of Directors, directors, functional committees of 2020 was completed on January 29, 2021. The
evaluation topics of each scope include the following:
(1) Board of Directors performance evaluation: The performance evaluation of the Board of Directors includes the level of participation in the
company’s operation, decision quality of the Board of Directors, body and structure of the Board of Directors, selection of directors and
continuing study, internal control.
(2) Individual director performance evaluation: The performance evaluation of individual directors includes the knowledge of the company’s
objectives and tasks, understanding of the responsibilities of directors, level of participation in the company’s operation, internal
relationship cultivation and communication, continuing study of the director’s profession, internal control.
(3) Functional committee’s performance evaluation: Including the level of participation in the company’s operation, understanding of the
responsibilities of the functional committee, decision quality of the functional committee, body of the functional committee and selection
of members, internal control.
(4) Disclosed in the Market Observation Post System: http://mops.twse.com.tw
4、The goals of the year and the most recent year on the strengthening of the board of directors’ functions：
(1) Voluntarily to establish Independent directors in 2012.
(2) To accommodate electronic voting during shareholders’ meetings, the Articles of Incorporation were revised on June 17, 2014, and the
nomination system is adopted for the election of Board members.
(3) Since 2014, the Company's shareholders' meetings have adopted voting by poll, and the result of shareholders' votes for and against and the
number of abstentions of each proposal are recorded in the minutes.
(4) In compliance with the competent authority's promotion of corporate governance, a position adjustment was carried out on January 1, 2019,
and the Chairman and President positions are not held by the same person.
(5) In compliance with the competent authority's promotion of corporate governance, it is expected that a full re-election will be carried out upon
the expiration of the term of office of Directors, adding one female Director.
(6) The average attendance rate of all Directors actually attending the Board meetings of the current Board of Directors (June 15, 2018 ~ as of
the publication date of this Annual Report): 96.43%. The average attendance rate of all Directors actually attending the Board meetings of
the current Board of Directors in 2020 as of the publication date of this Annual Report: 98.06%.
20
2. Audit Committee or Attendance of Supervisors at Board Meetings:
(1)Attendance of Supervisors at Board Meetings:The Company established an Audit Committee to replace supervisors on June 15, 2018 and
the supervisors are relieved of the position starting on that day.
(2)Operation of the Audit Committee:
7 meetings (A) held by Audit Committee in 2020 and up to date till the Annual Report printed, the attendance of the independent
directors is as follows:
Title Name Attendance in Person (B) Attendance Remarks

Rate (%)
【Ｂ/Ａ】
June 15,2018 Newly
Independent director Wang,Sung‐Chou 7 100.00%
appointed
June 15,2018 Newly
Independent director Liu,Cheng‐Yi 7 100.00%
appointed
June 15,2018 Newly
Independent director Hsu,Kao‐Shan 7 100.00%
appointed
Other items that shall be recorded:
1. If any of the following applies to the operations of the Audit Committee , the date and session of the Board of Directors’ Meeting, as well as the
resolutions, resolutions of the Audit Committee and the corporation’s actions in response to the opinions of the Audit Committee should be
stated.
(1)Items listed in Article 14(5) of the Securities and Exchange Act.
(2)Except the items in the preceding issues, other resolutions approved by two‐thirds of all directors but yet to be approved by the Audit
Committee:None.
2. Execution process where the independent director abstain from begin a stakeholder, the name of the director, the content of proposal, the reson
of abstinence and the results of the voting should be stated: None
Audit Committees’ Execution process

opinions where the
independent director
abstain from begin a
Corporation’s
Audit Audit stakeholder
responses to
Committee Committee The reson The
Agenda the comments
Meeting Resolution Wang,Sung Liu,Cheng of results
Results Hsu,Kao‐Shan of the Audit
Date ‐Chou ‐Yi abstinence of the
Committee
voting
should
be
stated
2020.1.17 (1)Investment in preferred shares of BlueStack Proposal
(2020/1) Systems, Inc. in the United States. approved
None None None None None None
2020.03.20 (1)2019 Financial Statement of this Company.

Proposal
(2020/2) (2)The Statement on Internal Control System of None None None None None None
approved
2019 of this Company.
2020.04.30 (1)Business Performance Report ‐ First Quarter Proposal
(2020/3) 2020 approved
2020.08.07 (1)Financial Report of second quarter, 2020

Proposal
(2020/4) (2)Evaluated the independence of CPA approved
engagement.
2020.11.10 (1)Financial Report of third quarter, 2020 Proposal
(2020/5) None None None None None None
approved
2021.3.22 (1)2020 Financial Statement of this Company.
(2021/1) (2)The Statement on Internal Control System of
2020 of this Company. Proposal
approved
(3)Approved amendments to”Internal Control
System” , ”Implementation Rules for Internal
Auditing”.
2021.4.29 (1)Business Performance Report ‐ First Quarter Proposal
(2021/2) 2021 None None None None None None
approved
3.Communication between directors and head of internal audit and CPA (including material issues, audit methods and results relating to the
corporation’s finances and business).
(1) The internal audit supervisor submits an audit summary report to the Audit Committee on a monthly basis in accordance with the annual audit plan.
(2) The Company convenes an audit committee, and invites the accounting and auditing supervisors attend and invites relevant supervisors as needed.
(3)The independent directors and the internal audit office, and the CPA have the direct channel to communicate with each other, by phone, written
correspondence, or face‐to‐face meeting. The communication is smooth.
(4)The independent directors shall call the communication meeting at least once per year with the CPA, and at least once per quarter with the internal audit
office. For the communication details, please refer to the Company's website:https://tw.msi.com/about/company/
21
3. Corporate Governance Implementation Status and Deviations from “Corporate Governance Best‐Practice Principles for TWSE/TPEx Listed Companies”
Implementation Status Deviations
from “the
Corporate
Governance
Best‐Practice
Evaluation Item Principles for
Y N Abstract Illustration
TWSE/TPEx
Listed
Companies”
and Reasons
1. If the Company established and disclosed Corporate Governance Principles in The Company has established the Corporate Governance Best‐Practice Principles based on “Corporate
accordance with Corporate Governance Best‐Practice Principles for TWSE/TPEx Listed V Governance Best‐Practice Principles has been disclosed on the Company’s website. None
Companies?
2. Shareholding Structure & Shareholders’ Rights In addition to the existing hotline and email channels, the Company has established an internal operating
(1) If the Company established internal procedures to handle shareholder suggestions, V procedure, and has designated appropriate departments, such as Investor Relations, Public Relations, Legal None
proposals, complaints and litigation and execute accordingly? Department, to handle shareholders’ suggestions, doubts, disputes and litigation.
(2) If the Company maintained of a list of major shareholders and a list of ultimate The Finance Dept is responsible for collecting the updated information of major shareholders and the list of
V None
owners of these major shareholders? ultimate owners of those shares.
(3) If risk management mechanism and “firewall” between the Company and its 「Group business management regulations」 are made to strictly regulate the activities of trading,
affiliates are in place? endorsement and loans between the Company and its affiliates. In addition, the “Criteria of Internal Control
V Mechanism for a Public Company”, outlined by the Financial Supervisory Commission when drafting the None
guidelines for the “Supervision and Governance of Subsidiaries”, was followed in order to implement total risk
control with espect to subsidiaries.
(4) If the Company established internal policies that forbid insiders from trading based To protect shareholders’ rights and fairly treat shareholders, the Company has established the internal rules to
on non‐disclosed information? V forbid insiders trading on undisclosed information. The Company has also strongly advocated these rules in None
order to prevent any violations and has been disclosed on the Company’s website.
22
3.Structure of Board of Directors and its responsibility The Company has the “Corporate Governance Principles” in place and diversified policies are established with
(1) Does the Board of Directors set and implement a diversification policy? regard to the composition of members of the Board of Directors. The directors (including independent
directors) are nominated. The Board of Directors members are nominated according to law by shareholders
and naturally elected during a shareholders’ meeting.
Member diversification is considered by the Board members. Factors taken into account include, but are not
limited to gender, age, cultures, educational background, race, professional experience, skills, knowledge and
terms of service. The members of board of directors possess a diveres range of expertise in the fields of
Operational Decision
Making, Operations Management, Crisis Management, Industy Knowledge, International Market Outlook,
Leadership Decision Making, Finance& Accounting and law, can adequately fulfill the Company’s future
development needs.
Name Gender Age Operational Operation Crisis Industry International Leadership Finance& law
Decision Management Management Knowledge Market Outlook Decision Making Accounting
Making
Hsu,Hsiang Male 64        
V None
Huang,Chin‐Ching Male 63      
Lin,Wen‐Tung Male 63      
Yu, Hsien‐Neng Male 63      
Kuo,Hsu‐Kuang Male 54      
Liao,Chun‐Keng Male 57      
Hung,Yu‐Sheng Male 50      
Wang,Sung‐Chou Male 59    
Liu,Cheng‐Yi Male 60    
Hsu,Kao‐Shan Male 59    
There are 10 (100%) male members and 0(0%) female members on the Board.7 (70%) of them are
employees and 3 (30%) are non‐employees. The average age is 59. The company will work on having 1 female
member on the Board, reducing the number of employee‐directors, and recruiting younger members.
(2) If the Company established any other functional committee in addition to In order for the sound supervision and reinforcement of management, the Company established the The company
Compensation Committee, Audit Committee as required by law? Remuneration Committee and Audit Committee. The functional committees shall be responsibilities for the has not yet
Board of Directors. established
other
functional
committee.Sc
heduled to
radually
V establish
according to
the laws and
regulations
as well as the
practical
requirement
of the
company.
23
(3) Does the company specify the process and method of the performance evaluation The Company has the Guidelines for Evaluating Performance of the Board of Directors in place.
of the Board of Directors, conduct the annual evaluation, and report the evaluation Self‐assessments are organized once a year and cover participation in corporate operation, quality of decisions
results to the Board of Directors and use such for considering the remuneration made by the Board of Directors, the composition and structure of the Board of Directors, the election and
and re‐appointment of each director? V continuing education of Board directors, among others. The questionnaires were sent out in November 2020 None
to respective directors. The 2020 Board of Directors self‐assessment was completed on January 29, 2021. The
Company has disclosed the results on the website of the Company and considered the remuneration and
re‐appointment of each directors to serve at the Remuneration Committee and the Board meeting.
(4) If the Company assess the independence of CPA periodically? The Board has reviewed the qualification of CPA’s independency on August 7, 2020. The review includes the
evaluation, as below items:
assessment Independen
Assessment
result(Y/N) (Y/N)
The designated accountant does not have direct or indirect financial interest
N Y
relationship with the Company.
The designated accountant does not have a financing or guarantee relationship
N Y
with the Company or any director of the Company.
The designated accountant does not have close business relationship or potential
N Y
employment relationship with the Company.
The designated accountant does/did not currently/ in the recent two years serve as
V None
a director, supervisor, or manager of the Company or play a role having significant N Y
influence on the audit case.
The designated accountant does not promote or act as an intermediate for the
N Y
shares or other securities issued by the Company.
The designated accountant does not serve as the advocate of the Company nor as
the representative of the Company to mediate the dispute between the Company N Y
and any third party.
The designated accountant does not have kinship with any directors or managers of
N Y
the Company or the person having significant influence on the audit service.
The assessment results show that the declaration of independence has not been breached in the relationship
between the Company and the CPAs; independence disqualified.
4. Does the public (OTC) company appoint the adequate number of competent corporate The Financial Department of the Company is set up with dedicated corporate governance personnel who have
governance staff, and a corporate governance manager to be responsible for handling more than 3 years of experience in the managerial work such as corporate finance, stock affairs and meeting
corporate governance scheme (including but not limited to providing information to proceedings with the scope of duties as follows: providing the information required by the directors to conduct
the directors and supervisors necessary to perform their duties, assisting the directors business, propagating the regulations related to the operation, assisting the directors with compliance with laws
and supervisors in legal compliance, processing the Board meetings and shareholders and regulations, arranging for directors for further study, handling matters related to the board of directors and
meetings according to the laws, processing company registration and registration of shareholders' meeting, changing registration and corporate governance, etc. The board of directors pass the
changes, and producing minutes of the Board meetings and shareholders meetings)? resolution on March 21st, 2019 to have these personnel supervised by a corporate governance supervisor who is
qualified as a manager and reports the implementation to the board of directors at least once a year.
V None
Business execution in the most recent year is as follows: (1) Corporate governance and securities‐related acts
promotion (2) Assistance with the convening of Board of Directors and Shareholders Meetings (3)
Preparation of the Board's agenda, provision of meeting materials and delivery of notices, reminding of
avoidance of conflict of interests, production and mailing of the proceedings (4) Publication of the Company’s
major news (5) Arrangement of the annual training of the directors (6) Registration of the shareholders'
meeting, and production of the meetings notice, the annual report, the handbooks within the statutory time
limit (7) Change registration with the Ministry of Economic Affairs after amendment of the by‐laws or
re‐election of directors.(8)The educational programs provided for the first‐time corporate governance staff
24
were completed as required. Please see page 28.
5. If the Company established communication channel with interested parties (Including The Company's website has a “Stakeholder Section” under Corporate Social Responsibility, which provides
but not limited to shareholders, employees, customers and suppliers, etc.) and information including investors/shareholders, customers/consumers, suppliers/contractors, employees,
disclosed key corporate social responsibility issues frequently enquired by government agencies and the media to the stakeholders who are responsible for verification. The information
stakeholders on the designated area of the corporate website? is compiled through public information observatories, the Company’s website, financial reports, corporate
social responsibility reports and online questionnaires to confirm the issues concerned by the stakeholders on
MSI and degree and importance of the concerns, and prioritize or incorporate the issues of concern into the
Company’s annual goals. In addition, the company's website discloses the information of the "Stakeholders'
Complaints Channel" and provides the information to the responsible units through the contact window as the
communication channel for the stakeholders and the Company responds to the important issues of concern to
stakeholders by meetings, phone calls and emails to protect the rights and interests of all stakeholders.
Relevant chapters on stakeholder concerns, communication methods and frequency, and information on
topics of concern are disclosed at http://tw.msi.com/Corporate Governance/Corporate Social
Responsibility/Corporate Social Responsibility Report. The information is reported to the Board of Directors at
V least once a year. None
In addition, the “Stakeholders” section provides the contact windows for each stakeholder, the “stakeholder
complaint submission” is disclosed on the company’s website. Stakeholders may contact through meeting,
phone, or e‐mail. The critical issues which the stakeholders are concerned about will be answered properly to
maintain the interests of each stakeholder.
The critical issues which the stakeholders are concerned about, communication method and frequency, and
concerned issues are disclosed on http://tw.msi.com/corporate governance/CSR/CSR report. The Board of
Directors receives the report at least once per year. The 2020 report has been presented to the Board on
November 10, 2020.
Disclosure of Information
Market Observation Post System http://mops.twse.com.tw (Stock Code:2377)
MSI Investor Information https://tw.msi.com/about/investor/
MSI Corporate Governance https://tw.msi.com/about/company/
MSI CSR https://tw.msi.com/html/popup/csr_tw/index.html
6. If the Company engaged professional transfer agent to host annual general The Company has delegated the share administrations agency of Chinatrust Commercial Bank to handle
V None
shareholders’ meeting? shareholder meetings and related services.
7. Information Disclosure The Company has a section on its website to disclose related information of its finance, operation, and
(1) If the Company set up a corporate website to disclose information regarding the V corporate governance. Investors may also obtain information about the Company through the Market None
Company’s finance, business and corporate governance? Observation Post System http://mops.twse.com.tw.
(2) If the Company adopted any other information disclosure channels (e.g., The Company has websites in 20 languages, including Chinese and English, such as
maintaining an English‐language website, appointing designated personnel to http://tw.msi.com/(Chinese) and http://www.msi.com/about/investor (English) and dedicated employees to
V None
handle information collection and disclosure, appointing spokespersons, take charge of the Company’s information collection and disclosure.
webcasting investors conference, etc)? The spokesperson system isestablished and implemented.
(3) Does the company publish and file the annual financial report within two months The company publishes and files the annual financial report, and financial reports of the first, second, and Early
publication/filing
after the end of the fiscal year, and make early publication and filing of the third quarters, as well as the monthly operation reports, within the statutory period. is subject to
V
financial reports of the first, second, and third quarters, as well as the monthly evaluation based
operation reports? on actual need.
8. If the Company had other important information to facilitate better understanding of 1. Employees’ remuneration policy is regulated the distribution ratio in the Company’s Articles of
the Company’s corporate governance practices (including but not limited to employee Incorporation and is handled according to the “Remuneration Guidelines”, “the Employee Performance
rights, employee wellness, investor relations, supplier relations, rights of stakeholders, Regulations”, and “the Employee Remuneration Distribution and Stock Option Regulations”. Operation
V None
directors’ and supervisors’ training records, the implementation of risk management profits are shared with employees according to the fulfillment rate of business target, performance, and
policies and risk evaluation measures, the implementation of customer relations contribution.
policies, and purchasing insurance for directors and supervisors)? 2. The Company has an Employee Welfare Committee with steady funds coming from the Company holding
25
(1) Employee rights events and providing benefit programs for employees.
3. Besides having employees covered by Labor Insurance and National Health Insurance as required by law so
that they can be assured safety while at work, the Company also offers the group insurance for extra
protection to employees and their family.
(2) Employee care employee wellness The Company was certified by OHSAS18001 (Occupation Health and Safety Assessment Series Certification) in
December 2003 and received the “health promotion symbol for spontaneous healthy workplace certification”.
Besides periodical employee health examinations, the Company has a employee clinic, nursing room, various
health‐related tests, workshops, and training from time to time, there are also diversified society events and
V employees are provided with related consultation services and help solutions on issues such as career, None
workplace inter‐person relationship, emotions at work, work management, physical and mental stress,
communications between husband and wife, child care and education, gender relations, laws in life, wealth
management, and tax reduction so that the health of employees in all aspects, physical, mental, and spiritual,
is taken well care of.
(3) Investor relations The Company discloses information from time to time through the Market Observation Post System and the
No
V Company’s website, and has the “Investor Relations Contact Window” available for the shareholders to
Deviation
contact by phone or through email in order to maintain the investor relationship.
(4) Supplier Relations 1. In order to protect the rights of suppliers, as long as not against regulatory requirements and damage to our
shareholders’ rights, financial information required by the suppliers for the Company’s creditline evaluation
will be provided.
2. In order to accomplish sustainable management for the Company and for all suppliers, suppliers continue to
V None
be asked to promise compliance with regulations concerning health and safety, the environment, labor,
and ethics as well as guidelines for the management system and risk control and suppliers will receive
educational training and periodic audits, among other related auxiliary measures, to help them keep
enforcing and improving the said regulations and guidelines.
(5) Stakeholder rights 1. The Company discloses on its website information on corporate governance, finance, sustainability, and
products and also related information on the Market Observation Post System for the stakeholders’
reference.
V None
2. The Company has a section “Contact MSI” on website. If stakeholders have issues about economy,
environment, and society, they can communicate the issues with the Company through the said channel;
this helps protect the rights of respective stakeholders.
(6) Further education status of directors and supervisors The Company’s directors, supervisors, and high‐ranking managers receive continuing education as required by
V “the Directions for the Implementation of Continuing Education for Directors and Supervisors” of TWSE Listed None
and TPEx Listed Companies on a yearly basis. The continuing education programs are listed below.
(7) Risk management policy and risk measurement measures The Company’s policy towards risk management is to set various rules and regulations in order to weigh and
evaluate possible impacts of the various risk matters on the profits and losses of the Company and to stipulate
V respective response policies accordingly. None
For the analysis and evaluation of risk matters, other important risks and response measures, please refer to
Page90~97
(8) Implementation of customer policy Regulations to be followed are established in the Company’s internal control system to ensure fulfillment of
V customer service and product protection and the responsible unit is available for real‐time communication None
during transaction with customers in order to ensure that customers’ rights are protected.
(9) Purchase of liability insurance for directors and supervisors Directors are covered by the Company’s D&O insurance. (And disclosed in the Market Observation Post System
V None
http://mops.twse.com.tw)
26
9. Please describe the improvements of the corporate governance evaluation results released by the corporate governance center of the Taiwan Stock Exchange Corporation in the last year, and propose priority matters or
measures to strengthen areas yet unimproved.
Reasons for failure to get scores during corporate governance rating:
(1) To improve information disclosure of the English version materials, the English version meeting notice and meeting handbook were produced for the 2018 shareholders meeting and English version meeting notice, meeting
handbook and annual report were produced in the 2018 shareholders meeting, both of which were required to be uploaded within a specified period.
(2)The Company set up the Audit Committees to replace the responsibilities of the supervisors.
(3)To follow the instructions of the competent authority in conducting to promote corporate governance, the Company implements position adjustment on January 1, 2019, with Mr. Hsu, Hsiang as Chairman of the Company,
Mr. Chiang, Sheng‐Chang as the Company's President and CEO, (Mr. Chiang, Sheng‐Chang was dismissed since his death on July 7, 2020). On July 8, 2020, the Board of Directors appointed one of the founders, Mr. Huang,
Chin‐Ching, as the President, fulfilling the goal that the Chairman and President positions not being held by the same person.
(4) In compliance with the competent authority's promotion of corporate governance, it is expected that a full re‐election will be carried out upon the expiration of the term of office of Directors, adding one female Director.
27
Continuing Education/Training of Directors、Supervisors and Managements
Year Training Course Host by Duration Attendees
2003 Corporate Governance Fu Jen Catholic University 3 hours All Directors、Supervisors and Managements
2004 Corporate Governance and Risk Management The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2005 Use financial statements to analyze and improve business performance Securities & Futures Institute 3 hours Directors、Supervisors and Managements
2006 Directors, Supervisors and Senior Managers' Responsibilities for Financial Reporting Securities & Futures Institute 3 hours All Directors、Supervisors and Managements
2007 Audit Strategy of Corporate Governance and Enterprise Tax Planning The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2008 Business Transformation and Change Management The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2009 Brand Management and Innovation The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2010 Corporate Governance under International Taxation The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2011 Financial statements and analysis of trends in the industry The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2012 Disputes and Risks Caused by Taiwan Enterprises' Investment in China The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
2013 Financial thinking of business transformation The Taiwan Corporate Governance Association 3 hours All Directors、Supervisors and Managements
New Trend of Internal Control Practice ‐ Corporate Social Responsibility and Risk 3 hours All Directors、Supervisors and Managements
2014 The Taiwan Corporate Governance Association
Management
2015 Comprehensively improve adaptability ‐ Enterprise crisis management The Taiwan Corporate Governance Association 6 hours All Directors、Hsu,Fen‐Lan、Hsu,Gau‐Shan and Managements
6 hours Hsu,Jun‐Shyan (National Association of Certified Public
2015 In 2015, the latest tax update issued the latest information analysis Taiwan CPA Association, ROC
Accountants lecturer)
The reform and sustainable management of the board of directors; the key strategies and 6 hours All Directors、Supervisors and Managements
practices of breakthroughs in business innovation
3 hours All Directors(except Tsai,Rong‐Fong)、Supervisors and
2017 Big Data Analysis and Corporate Fraud Detection The Taiwan Corporate Governance Association
Managements
3 hours All Directors(except Tsai,Rong‐Fong)、Supervisors and
2017 Reconstruction of IT Security Strategy from Cyber Crime View The Taiwan Corporate Governance Association
Managements
2017 Corporate Governance Forum series‐sustainable operation Taiwan academy of Banking and Finance 3 hours Tsai,Rong‐Fong
2017 2017 Insider Trading and Corporate Social Responsibility Forum Securities & Futures Institute 3 hours Tsai,Rong‐Fong
The introduction for the latest income tax or value‐added tax reforms in China and the 3 hours All Directors、Managements and Corporate overnance Officer
United States and the trend and impact of global anti‐tax avoidance regulations.
2018 Global Economic Outlook The Taiwan Corporate Governance Association 3 hours All Directors、Managements and Corporate overnance Officer
th
2018 The 12 Taipei Corporate Governance Forum Financial Supervisory Commission 6 hours Liao,Chun‐Keng
th
2018 The 12 Taipei Corporate Governance Forum Financial Supervisory Commission 3 hours Hung,Yu‐Sheng
2018 2018 Forbid Insider Trading Promotion Meeting Taiwan Stock Exchange Corporation 3 hours Hung,Yu‐Sheng、Kuo,Hsu‐Kuang
2018 Discussion on fraud cases of corporate financial statements Securities & Futures Institute 3 hours Kuo,Hsu‐Kuang
How could directors and supervisors supervising t the business risk and crisis 3 hours All Directors、Managements and Corporate Governance Officer
2019 Taiwan Corporate Governance Association
management of the Company?
2019 Impact from the U.S.‐China Trade War to the industry in Taiwan and the reaction planning Taiwan Corporate Governance Association 3 hours All Directors、Managements and Corporate Governance Officer
2019 2019 Corporate Governance Practices Seminar Corporate Governance Professionals Association 3 hours Corporate Governance Officer
2019 Corporate Governance and Business Operational Sustainability Course Taiwan academy of Banking and Finance 3 hours Corporate Governance Officer
Task Force on Climate‐related Financial Disclosures (TCFD) Forum (educational program 3 hours Corporate Governance Officer
2019 Taiwan Stock Exchange Corporation
for corporate governance)
2020 Case analysis of the Company Act Taiwan Corporate Governance Association 3 hours All Directors、Managements and Corporate Governance Officer
2020 Disconnected ICT Supply Chains: New Power Plays Unfolding Taiwan Corporate Governance Association 3 hours All Directors、Managements and Corporate Governance Officer
2020 2020 Seminar on Legal System for Beneficial Owners Corporate Governance Professionals Association 3 hours Corporate Governance Officer
2020 Annual Session on the Promotion of Insider Trading and Insider Equity Trading 3 hours Corporate Governance Officer
2020 Securities & Futures Institute
Prevention
28
4.Professional Qualifications and Independence Analysis of Remuneration Committee Members
(1)Established：The Borad of directors of the company set up the Remuneration Committee on December 18, 2011.
A.Remuneration Committee members information：
Meets one of the following professional qualification requirements, together with at Number of other public
least five years’ work experience companies in which the
Criteria Independence Criteria
individual is concurrently Remarks
（Note）
serving as an Compensation
Committee member
Title An instructor of higher position in a A judge, public prosecutor, attorney, Have work experience in the
department of commerce, law, CPA, or other professional or technical areas of commerce, law, finance,
finance, accounting, or other specialist who has passed a national accounting, or otherwise
academic department related to the examination and been awarded a necessary for the business of the 1 2 3 4 5 6 7 8 9 10
Name business needs of the company in a certificate in a profession necessary for company
public or private junior college, the business of the company
college or university
Independent Hsu,Kao‐Shan             0
Director
Independent Wang,Sung‐Chou             0
Director
Independent Liu,Cheng‐Yi            0
Director
Note: If any member meets any of the following descriptions within two years prior to the appointment and during the term of office, please check the box of the corresponding number.
(1) Not an employee of the company or its affiliate.
(2) Not a director or supervisor of the company or its affiliate (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its
parent company, subsidiaries, or a subsidiary under the same parent company).
(3) Not the person himself, spouse or minor child, or individual shareholder holding more than 1% of the company’s outstanding shares in the name of a third party, or top 10 shareholder.
(4) Not the spouse, relative within the second degree of consanguinity, or direct blood relative within the third degree of consanguinity of a manager, a person under (2) or (3).
(5) Not directly holding more than 5% of the company’s outstanding shares, top 5 shareholder, or a director, supervisor or employee of a corporate shareholder appointing its representative as the director or
supervisor of the company pursuant to Article 27 paragraphs 1 or 2 of the Company Act (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as
such at, the company, its parent company, subsidiaries, or a subsidiary under the same parent company).
(6) Not a director, supervisor, or employee of a company controlled by the same person holding the majority of the Board or the voting shares of the company and the other company (except for independent
directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company, subsidiaries, or a subsidiary under the same parent company).
(7) Not a director (governor), supervisor, or employee of a company or institution whose chairman, president, or a person holding an equivalent position is the same person or the spouse of the chairman,
president, or a person holding an equivalent position at the company (except for independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the
company, its parent company, subsidiaries, or a subsidiary under the same parent company).
(8) Not a director (governor), supervisor, manager, or shareholder with more than 5% shareholding of a specific company or institution having financial or business relationship with the company (except for
independent directors appointed in accordance with the Act or the local laws by, and concurrently serving as such at, the company, its parent company, subsidiaries, or a subsidiary under the same parent
company).
(9) Not a professional individual, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution, or their spouses, who 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 has received cumulative
compensation exceeding NT$500,000 in the past 2 years; provided however that 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.
(10) No such situation under Article 30 of the Company Act.
29
B. Attendance of Members at Remuneration Committee Meetings
① There are 3 members in the Remuneration Committee.
② Tenure of the current of Remuneration committee is from June 15, 2018 to June14, 2021. A total of 6 (A) meetings in 2020 and up to date till the Annual Report printed, The attendance record of the
Remuneration Committee members was as follows:
Attendance in
Attendance Rate (%)
Title Name Person By Proxy Remarks
B/A
(B)
Convener Hsu,Kao‐Shan 6 0 100%
Member Wang,Sung‐Chou 6 0 100%
Member Liu,Cheng‐Yi 6 0 100%
Other mentionable items:
1. If the board of directors declines to adopt or modifies a recommendation of the remuneration committee, it should specify the date of the meeting,
session, content of the motion, resolution by the board of directors, and the Company’s response to the remuneration committee’s opinion (eg., the
remuneration passed by the Board of Directors exceeds the recommendation of the remuneration committee, the circumstances and cause for the
difference shall be specified): None.
2. Resolutions of the remuneration committee objected to by members or subject to a qualified opinion and recorded or declared in writing, the date of
the meeting, session, content of the motion, all members’ opinions and the response to members’ opinion should be specified: None.
(2) Scope of duties and Excution in the most recent year:

A. Scope of duties
① Establishing and periodically reviewing the annual and long‐term performance goals for the directors, supervisors, and managerial officers of this Corporation and the policies, systems, standards, and structure for
their compensation.
② Periodically assessing the degree to which performance goals for the directors, supervisors, and managerial officers of this Corporation have been achieved, and setting the types and amounts of their individual
compensation.
B. Execution in 2020 and up to date till the Annual Report printed
Remuneration Committee Agenda Remuneration Committee Corporation’s responses to the comments
Session
Meeting Date Resolution Results of the Remuneration Committee
(1) Promotion of managers and review of their salary structure. Proposal approved None
2020.01.17 2020/1
(2) Distribution of year‐end bonus of the Company's managers. Proposal approved None
(1) Proposed distribution of 2019 compensation of employees and directors. Proposal approved None
2020.03.20 2020/2 (2) Adjustment of the salary of the Company’s managers and distribution of Proposal approved None
their performance bonus.
(1) Amendment of “the Employee Remuneration Distribution and Stock Option Proposal aproved None
2020.08.07 2020/3 Regulations”
(2) Distribution of 2019 compensation for the Company’s managers, directors. Proposal approved None
(1) Review the Company's Directors and managers' salary and remuneration Proposal approved None
standards and structure, and proposal for the new version of the "Promotion
2020.10.06 2020/4 Management Measures".
(2) Proposal for the salary structure of the Company's new President and the Proposal approved None
issuance of managers' performance bonus.
2021.01.29 2021/1 (1) Distribution of year‐end bonus of the Company's managers. Proposal approved None
(1) Proposed distribution of 2020 compensation of employees and directors. Proposal approved None
2021.03.22 2021/2 (2) Adjustment of the salary of the Company’s managers and distribution of Proposal approved None
their performance bonus.
30
5.Differences between CSR enforcement and Corporate Social Responsibility Best Practice Principles for TWSE/GTSM Listed Companies, and the
reasons:
Different from
Implementation Status “the CSR best
practice
Item principles”
Y N Summary issued by
TWSE and its
reason(s)
1. Does the company conduct risk evaluation for the environmental, social, and corporate MSI risk management policy is to evaluate the impact of various risk issues (including
governance topics related to the company’s operation based on the materiality principle, and environmental、social and corporate governance issues) on the company's profit and loss.
specify relevant risk management policy or strategy? Based on the significance (responsibility、influence) of the contents to the company, various
response policies has been formulated , report its operation and implementation status to the
Board of Directors at least once a year.
V None
The scope of risk management includes the main risks faced during the operation, including
financial risk、legal risk、strategy and operational risk、information security risk, and climate
risk.Our company continues to monitor and invest resources for risk control and response
preparation through the Business Continuity Plan (BCP) irregularly. For related management
policies and strategies, please refer to MSI's annual report or ESG report.
2.If the Company set up a unit exclusively or concurrently to execute CSR policies and if the Board With regard to the framework of corporate social responsibilities promoted by the Company,
appointed member(s) of management team to supervise and report its implementation status to the Board of Directors authorizes the general manager to command respective full‐time
the Board? (part‐time) units to establish and discuss corporate social responsibilities‐related policies and
the enforcement of systems. Meanwhile, the sustainable development office is available to
V None
take charge of organizing related matters on corporate social responsibilities and to
periodically report to the Board of Directors.
For the operation and implementation status, refer to the Company’s ESG Report for details
http://tw.msi.com.
3. Environmental Topics We establish related environmental management methods according to the operating and
(1)If the Company established proper environment management system based on the V production characteristics. MSI have passed the certifications of ISO 14001、IECQ/QC None
characteristics of the industry where the Company belongs to? 080000、ISO14064‐1 & 2、ISO 14006 and ISO 14072.
(2)If the Company endeavored to utilize resources more efficiently and utilized renewable Based on the requirements of international regulations, customer requests and eco‐labels, we
materials which have a lower impact on the environment? identify related environmental aspects and impacts according to the standard process to
discover significant influences as priorities for improvement. With technology and cost
feasibility, we establish rigorous requirements for design management and implement them
on product life cycle by considering resource conservation, recycling and reuse, energy saving,
pollution prevention and other environmental impacts.
V 1. The packaging materials are designed in a way that they can be decomposed by hand None
without using tools for reduced consumption of composite materials.
2. The instruction manuals are electronized to realize paperless product publications for
reduced use of pulp.
3. Modular design is adopted for products to improve recycling efficiency.
4.Soy ink is used for packaging and printing pigments to improve the recycling rate of
packaging materials when discarded.
31
(3) Does the company evaluate the current and future potential risks and opportunities due to The probability and severity of natural disasters (including drought, mites, snowstorms, high
climate change, and take measures in response to climate change topics? temperature/heat waves, typhoons/strong rainfall) brought about by extreme weathers may
affect the Company's production and operations. The risks may include production constraints,
operations, equipment, and investment cost rise and inefficiency, etc.
By including the issue of climate change in the risk management of sustainable business
operations. MSI aims to implement climate change management mechanism through
“mitigation” and “adaption” for reduction of the magnitude of impact of climate change on
businesses. The Company also strengthens its resilience through the risk through adoption of
the carbonation measures of feasibility assessment through the management mechanism of
V climate change in the two directions of “mitigation” and “adjustment”. Continue to pay None
attention to changes in relevant domestic and international regulations after the Paris Climate
Agreement and evaluate the internal response of the company. The Company strengthens its
resilience through appropriate regulatory measures with the specific mehods as follows:
(1) Periodically check and update the organization’s carbon emission investigation to achieve
the goal of reducing the greenhouse gas.
(2)Evaluate feasible technologies and materials for product design and reduce energy loss of
products.
(3)Save water, improve the reuse rate of rainwater and wastewater, and establish emergency
measures for water resources.
(4) Does the company calculate the emissions of greenhouse gas, water usage, and total weight MSI has set the environmental protection and energy saving goals for various forms of
of wastes in the past two years, and specify the policies for energy saving, carbon reduction, energy/resourceof use, emissions and reductions through the environmental management
greenhouse gas emission reduction, water‐saving, or other waste management? V system, and MSI has also set management guidelines for audits and improvements. For details, None
please refer to MSI's ESG report.
https://storage‐asset.msi.com/html/popup/csr_tw/index.html
4. Social Topics MSI is a melting pot of talents from different ethnic groups all from over the world. Therefore,
(1)If the Company followed relevant labor laws, and internationally recognized human rights we treat employees in the same way without distinction of any kind, such as race, color, sex,
principal, and established appropriate management policies and procedures? age, religion, political or other opinions, national or social origins, or other status. All the
V None
employees are treated equally with regard to their opportunities in employment, appraisal,
promotion, salary, benefits and training to ensure equality of their rights.
We ensure to respect labor rights and the implementation of equal treatment.
(2) Does the company specify and implement reasonable employee welfare measures (including The Company has remuneration policies in place. Reasonable salaries and remunerations are
compensation, leave, and other benefits), and properly reflect the management performance given to employees according to their responsibilities and contribution at work as determined
or achievements in the employee compensation? by the performance evaluation. Various remuneration regulations are approved by the
V None
Remuneration Committee. Meanwhile, the “Work Rules” of the Company clearly specify
employee behavior and discipline, award/punishment are given according to employee
performance.
32
(3)If the Company provided safe and healthy working environment to employees and conducted The company has set up the Occupational Safety and Health management entities, Occupational
relevant training on safety and health management to employees periodically? Safety and Health committee, Meal Committee and medical care office, conducted regular safety and
health training for employees and contractors to provide a safe workplace and ensure employee’s
physical and mental health.The company has received the ISO 45001 Occupational Safety and Health
Management System Certification and the “Healthy Workplace Self‐certified Health Promotion Label”.
In order to promote the safety of the working environment and physical protection of employees, the
company continues to carry out related equipment maintenance and safety testing.
Equipment Maintenance
Item
(Safety Test)
Firefighting (fire extinguisher, smoke detector、
Once/Monthly, quarterly,yearly
Evacuation equipment)
Air conditioning (heat dissipation, blower, ice water
host)
Electricity (generator, power outage maintenance、
power supply equipment)
Carbon dioxide Once/Biannually (Test)
Noise Once/Biannually (Test)
V Illuminance Once/Annually (Test) None
Wind speed control (laboratory local exhaust) Once/ Annually (Test)
Organic solvent (isopropyl alcohol, methanol,
Once/Biannually (Test)
n‐hexane)
Lead, tin Once/Biannually (Test)
Drinking water Once/Monthly(Test)
Employee cafeteria food ingredients and tableware Bimonthly (Sampling test)
In order to provide employees with a safer and healthier working environment, the Company
continues to strengthen and improve various facilities, including the replacement of new water
dispensers and pipelines, toilet repairs, anti-skid parking lot floors and ramps, and the
installation of weatherproof corridors.
In addition, a pandemic prevention team was established during the pandemic, in addition to
advocating for colleagues to perform business trip and travel control, working from home trials,
cloud extensions, adopt flexible working hours, cooperate with wearing masks and temperature
measurement, elevator by-floor control, and different meal pick-up times in employee canteen,
it also distributes masks and hypochlorous acid sterilizing disinfectant, and strengthens the
cleaning and disinfection of the air-conditioning and public areas such as meeting rooms,
restaurants, elevators, and dormitories, to jointly keep tabs on the pandemic prevention and the
health of colleagues.
(4)If the Company provided career planning, relevant training and skill development for The Company highly values training and career developments for its employees. In order to
employees? continue promoting quality talent cultivation and key skills management, there are the
Regulations Governing Educational Training that address continuing education and training for
employees. Meanwhile, budget is appropriated on a yearly basis to facilitate organization of
V None
various types of educational training. Lecturers are hired periodically or from time to time to
hold workshops. Reflective of the different rankings and levels of professionalism, internal or
external educational training is provided to help employees form complete professional skills
and inspire them to seek self‐growth.
33
(5) Does the company comply with the laws and international standards regarding customer Besides purchasing appropriate product liability insurance in order to protect the rights of
health and safety, client privacy, marketing and labeling of products and services, and specify customers and consumers, global service systems are created in countries and regions such as
the policy of consumer rights and complaint procedures? Taiwan, Europe, America, Japan, Korea, and China, including self‐operated or outsourced
maintenance sites and customer service centers and websites that have multiple language
options. Downloading and updates online, after‐sales service, product maintenance and
V repairs, technical support, and complaint procedures are available for consumers as well. None
Products by Micro‐Star are marketed and labeled in compliance with applicable laws and
regulations and industrial standards and there are dedicated departments to make sure that
requirements are fulfilled according to internal operating and regulatory documents. Product
verification, quality control, and third‐party testing help ensure that products are marketed
and labeled in compliance of applicable standards.
(6) Does the company specify any supplier management policy to request the suppliers to The Company has established the Supplier Management Guidelines. New suppliers go through
comply with the regulations regarding environmental protection, occupational health and evaluation that covers human rights, the environmental and social responsibilities. For existing
safety, or worker’ rights, and how is the enforcement status? suppliers, there are also supplier evaluations from time to time in order to ensure that
suppliers comply with corporate social responsibilities. It also reduces losses in bilateral
transactions or good will because of the environmental or social responsibilities.
V None
The Company specifies in the supplier procurement contract that if suppliers violate its
corporate social responsibility policy and the violation has a significant influence on the
environment and the society, Micro‐Star may terminate or dismiss the terms and conditions in
the contract at any time. The Company also enforces the policy that requires all suppliers to
sign its custom procurement contract.
5. Does the company prepare the corporate social responsibility reports according to the The content structure of MSI's ESG report is prepared in accordance with GRI Standards of the
internationally accepted guidelines or instructions to disclose the company’s non‐financial Global Reporting Initiative (GRI) and the Taiwan Stock Exchange Corporation Rules Governing
information? Has any third‐party verification agency provided affirmed or certified opinion for the Preparation and Filing of Corporate Social Responsibility Reports by TWSE Listed
such report? Companies, and certified by an independent third party (BSI Pacific Limited, Taiwan Branch) in
V None
accordance with the AA1000AP (AA1000 AccountAbility Principles) guarantee standard, and
obtain the GRI Standard verification statement.
MSI's ESG report will be uploaded to the Market Observation Post System (MOPS) on
2021.06.30.
6. If the Company established any guideline of corporate social responsibility in accordance with “Corporate Social Responsibility Best‐Practice Principles for TWSE/GTSM‐Listed Companies” and please state the
implementation status of the guideline and any reasons for non‐implementation: None.
Pursuant to the "Listed Company Corporate Governance Best Practice Principles" and passed by the Board of Directors, the Company has established the "MSI Corporate Governance Best Practice Principles", of which the
Board of Directors.
34
VII. Other material information that helps to understand the operation of corporate social responsibility:
MSI continues to engage the community and participate in education, charity auction and environmental protection activities through sponsorship and employee volunteers. In Taiwan, we not only get involved in public
services through investment of our internal resources, but also joined in the activities of charity groups. Through the process of service to and in the communities, we expand our love and care into the world and unify
our employees' values and commitment towards MSI's corporate social responsibilities. MSI will continue to make its presence in services for the rural areas and disadvantaged groups.
(1) Education and care
1. School lunch: This year, we sponsored the school lunch at remote schools in New Taipei City. 62 schools and about 6,480 disadvantage students benefited.
2. After‐school programs: We launched the after‐school program “MSI Guide Student Aspire” for disadvantaged students to raise their basic learning ability, their confidence despite of an inferior family background,
develop their potential, and build a caring, warm society with mutual support. We opened 121 after‐school programs at 34 elementary and junior high schools in New Taipei City, and about 1,830 students
benefited.
We introduce social resources to hold the cross-field English only reading and learning program of "MSI Spreading Love ~ Embracing the World" to plan long-term and continuous English learning for disadvantaged
students, in order to shorten English learning gap phenomenon caused by rural-urban disparity, different amount of resources, cultural stimulation, and differences in family social and economic conditions. A total of
20 remote schools and 480 students in Hsinchu County were benefited.
3. Technological creation: We sponsored the summer camps in elementary and junior high schools in New Taipei City, established the on‐campus PowerTech club and participated in the New Taipei City contests and
national competition. We promoted the PowerTech Youth Technological Creation Contest to every school, increased students’ craft skills and general science knowledge. 25 elementary and junior high schools in
New Taipei City, and about 1,290 students benefited.
4. Special ed student family field trip: We sponsored the students of centralized special education classes in the third to sixth grade in elementary schools in New Taipei City, and their families to spend a day at Leo Foo
Village. The special ed students were introduced to and have experienced a wide variety of animal and plant ecology through the outdoor explorations with their families. Special ed students and their families spent
time in nature together, and learned things from these leisure activities. The field trip offered the opportunity to let the families with challenged children learn together, and relieve the parents’ nerve and burden of
providing care. 80 special needs families and 320 students benefited.
5. Sistema Taiwan sponsorship: We sponsored Sistema Taiwan, a charitable program for music education, and supported the music education for disadvantaged kids to expand the possibility of life by learning music.
(2) Support for disadvantaged groups
1. Dream‐Come‐True fund: We supported diligent and hardworking students who come from underprivileged families or experience family crisis to complete school education through the "Implementation Plan for
Educational Aid to Realize Dream Fund" We hope that these kids can commit themselves to learning without worrying about their family or personal hardship with the support from the DCT fund, and 320 students
benefited, a total of 80 outstanding students under poverty line were benefited.
2. High‐risk caregiver support program: We sponsored Hondao Senior Citizen’s Welfare Foundation MSI Program – providing the all‐in‐one services, family care services, respite care, and value‐added services to
high‐risk families，A total of 775 people were served.
3.Department of Social Welfare of Taoyuan City's Small Satellite Training Program: Implements "Guarding with Heart, Guarding by MSI, and Making Society and Neighbors feel at ease" to strengthen preventive
measures of the social safety net. Local community development associations or registered groups are supported by the Department of Social Welfare to set up small satellite bases in the jurisdiction of the unit to
provide a safe space for children and youth's after-school activities, and then care for the families of the children and youth. There are a total of 500 disadvantaged families, about 1,000 children and youth and
200,000 person-time preventive care measures.
(3) Corporate Volunteering
1. Donation with love: The Horticultural Club initiated the activity of donating electronic receipts to do charity even during the pandemic and made donations to the Mennonite Social Welfare Foundation and the
Genesis Social Welfare Foundation, not falling behind when spreading love.
The Horticultural Club held activities of Sweet Macaron and Travel Following the Windmill, and the activity registration fees were donated to the Taiwan Fund for Children and Families and the Society of
Wilderness
Proceeds from the Photography Club's charity badge making activity were donated to the Andrew Charity Association.
The Yoga Club sponsored the booth and fair vouchers for the 2020 New Year's End Thanksgiving Activity of the Taiwan Fund for Children and Families, and will donate all the proceeds.
2. Charity sale: Pet Love Club launched a charity sale of table calendars for public welfare donations.
35
(4) Medical Support
1. Blood donation: MSI invites the blood donation center to hold the blood donation event “Spread the Love Blood Donation Event” at the company every year. Department managers and colleagues join the blood
donation, show care, and help patients to survive. This is a kind behavior with mutual benefits. 178 people donated 276 bags in 2020.
(5) Giving Back to the Community
1. Earth God Cultural Festival: Supported and sponsored the Earth God Cultural Festival held by Zhonghe District Office in New Taipei City.
2. Donation of police service equipment: Donated police service equipment to the Zhonghe Precinct of the New Taipei City Police Department.
3. New Taipei City Fire Department: Donated residential alarms for disaster prevention to the New Taipei City Fire Department.
(6) Computer Donation
1. Social Welfare Department, New Taipei City: Donated 30 desktop PCs for kids and 14 AIO PCs to the Good Day Platform for Underprivileged Families run by the Social Welfare Department of New Taipei City
Government. Underprivileged kids can learn how to use the computers, enhance their basic skills, and increase their confidence in themselves.
2. Social Welfare Bureau of Taoyuan County Donated 20 laptops to the after-school care bases of the Social Welfare Bureau of Taoyuan County.
3. Luzhou Junior High School: Donated 20 laptops to the digital learning charity program for senior citizen, new immigrants, indigenous people, and children in the community of Luzhou Junior High School.
4. Kuangfu Elementary School: Donated one laptop to the Kuangfu Elementary School's after-school program for vulnerable children.
(7) Environmental Protection Activities
1. Protection of wetland ecosystem: MSI sponsored Taiwan Society of Wilderness (SOW) to fund Wugu wetlands conservation project to conduct ecological census, wading birds tidal flat construction, volunteering, and
advocate environmental protection education.
2. Good Rice Action sponsorship: Sponsored the rice growing on 0.5 Jia agricultural land in Nan’ao. The harvested rice will be donated to the Good Day Platform for Underprivileged Families run by the Social Welfare
Department of New Taipei City Government so that the underprivileged people can also enjoy delicious rice.
3. Tea sponsoring: We care about the concept of sustainable global environment and ecological conservation, protect water resources in Pinglin area, maintain the Feitsui Reservoir and take care of the health and life of
tea growers in Pinglin area. We sponsor the New Taipei City Organic Agricultural Products Marketing Cooperative to promote organic tea cultivation and promotion project in Pinglin area. After the harvest, the tea
will be donated to the Good Day platform of the New Taipei City Social Welfare Department, so that the elderly from vulnerable groups can gather and enjoy good tea.
VIII. If the company’s CSR report passes the inspection standards of any verification institution, please describe such situation: <MSI 2020 ESG Report> is based on the GRI Standard published by the Global Reporting Initiative
(GRI), and verified by British Standards Institution (BSI) Taiwan Branch in accordance with AccountAbility1000 (AA1000) Guarantee Standards, and receives the GRI Standard: Core Option Verification Statement.
36
6. Difference between implementation of ethical corporate management and Ethical Corporate Management Best Practice Principles for TWSE/GTSM
Listed Companies, and the reasons:
Implementation of ethical corporate management
Operation Variation from Corporate
Indicator Governance Best Practice
Yes No Summary Principles and Reason
1. Codify Ethical Management Policies and Plans The Board of Directors and senior management diligently perform their commitment to ethical
(1)Does the company specify the ethical management policy, which has been passed by the Board management. Since we introduced the “Electronic Industry Citizenship Coalition (EICC) in 2008,
of Directors, and specify the policy and measures of ethical management in its regulations and we and our suppliers follow the highest moral and ethical standards. The requirements of honest
external documents? Do the Board of Directors and Senior Management proactively perform the business and prohibition of illegal profit are specified in the supplier agreements.
commitment to ethical management? In order to prevent unethical conduct during the business activities, our “Procedures of Board of
V Directors Meetings” and “Responsibilities of Independent Directors” ask directors to recuse from None
any motion in the Board meeting with which they have conflict of interest without being asked
to. The Board of Directors also passed the “Corporate Governance Guidelines,” “Ethical
Management Guidelines,” “Code of Ethics” and “Work Rules” to specify and implement the
ethical conduct of directors, managers, employees and suppliers, punishment of perpetrators,
and complaint system.
(2)Does the company establish the evaluation mechanism of risk of unethical management, The company’s “Ethical Management Guidelines” specified the measures of preventing unethical
periodically analyze and evaluate the business activities with higher risk of unethical conducts set forth in Article 7, paragraph 2 of the Ethical Corporate Management Best Practice
management in its course of business, and specify the plans of preventing unethical conduct V Principles for TWSE/GTSM Listed Companies, including prohibition on giving and receiving None
accordingly, which at least cover the preventions of conduct set forth in Article 7, paragraph 2 of bribes, offering illegal political contribution, and engaging in improper charitable donation or
the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies? sponsorship, providing or accepting unreasonable gifts, treatments, or other improper profits.
(3)Does the company specify and implement the procedures, behavioral guidelines, punishment of The company complies with the rule of conflict of interest and anti‐corruption. In addition to
perpetrators, and complaint system in the plans of preventing unethical conduct, and asking all employees and suppliers to sign the moral ethics statements, providing internal and
periodically review and modify such plans? external training to new employees and suppliers, we also prohibit improper profits, or
V treatment from interested parties and other unethical conduct in the course of business None
activities. We specify the anti‐corruption policy, reward and punishment procedures. The
internal audit office develops the periodic audit scheme, accepts report of violation, and reports
to the Board to prevent corruption incidents.
2.Implementing ethical management The Company has articles about honest behavior in its business contract and avoids doing
(1)Does the Company evaluate the ethical record of its transaction parties and explicitly include V business with people with records of dishonest behavior. None
clauses on ethical behavior in contracts？
(2)Does the company set up a dedicated division of promoting ethical management under the In order to prevent against conflicts of interest and to offer channels for proper statements,
Board of Directors, and periodically (at least annually) report the ethical management policy and independent directors form the part‐time unit in charge of ethical management at the Company
V None
plans of preventing unethical conduct to the Board, and supervise the enforcement? in order to promote and consolidate honest operations and the unit reports to the Board of
Directors periodically.
(3)Does the Company have a conflict‐of‐interest prevention policy with suitable channels for In case of any illegal condition in violation of honest operation, complaints may be filed with or
V None
reporting such conflicts, and enforces such a policy？ the condition may be reported to the Company’s supervisors or the Internal Audit Office.
(4)Does the company have an effective accounting system and internal control system in place in The Internal Audit Office audits the Company’s accounting system, internal control system, and
order to implement ethical management, and request the internal audit division to prepare the fulfillment of honest operations on a yearly basis according to the Regulations Governing
V None
audit plans based on the risk evaluation of unethical conduct in order to inspect non‐compliance Establishment of Internal Control Systems by Public Companies and the Ethical Management
with the unethical conduct prevention plan, or hire an accounting firm to do so? Principles Prepare relevant audit plans and conduct the inspection accordingly
37
(5)Does the Company regularly host internal and external training on ethical management? The company advertises the concept of ethical management on its website, and provides
internal and external training to the employees.
Substantive measures for implementing ethical management policy in 2020 include the new
V None
employee consensus training program. The program covers the introduction to internal control
and audit, prevention of unethical conduct, and how to report a violation. There were 279
people who participated in the 139.5‐hour training session.
3.Operation of the corporate whistleblower system In the event that stakeholders discover that the Company’s directors and Independent directors,
(1)Does the Company have an explicit whistleblower and incentive scheme in place that protects managers, and employees are engaged in illegal behavior in violation of ethical management
whistleblowers and assigns appropriate personnel for investigating the target of the V (including corruption and immoral behavior), they may file a complaint with or report to the None
whistleblower complaint？ Company’s supervisors or Internal Audit Office. If it is found to be true, punishment will be
imposed according to the internal rules and applicable laws and regulations.
(2)Does the company specify the standard investigation process for reported violation, subsequent The company’s “Procedures of Reporting Violation to Audit Office and Subsequent Measures”
measures upon the completion of investigation, and relevant confidentiality mechanism? V specify the standard investigation process, subsequent measures upon the completion of None
investigation, and relevant confidentiality mechanism
(3)Does the Company have measures to protect whistleblowers against retaliation？ The reporter and the receiving head shall assist the audit unit in conducting an investigation. No
unilateral investigation, comments, transcribing the case and the reporter is allowed. No inquiry
V None
about or release of the true identity of the reporter or disciplining the reporter and the
reported party is allowed, either.
4.Greater disclosure Besides in the Market Observation Post System, the contents of the Company’s Ethical
(1)Does the Company disclose is ethical management principles and progress on its promotion V Management Principles and the promotion efficacy are disclosed on the Company's website None
through its website or the Market Observation Post System website？ http://tw.msi.com/.
5.If the Company has drafted an ethical management principle according to “Ethical Corporate Management Best Practice Principles for TWSE/GTSM‐Listed Companies,” the operation of the principle and the deviation from the principle
should be clearly stated:
The Company has established “Code of Ethical” based on TWSE/GTSM’s “Ethical Corporate Management Principles”.
6.Other material information that helps to understand the operation of the Company’s ethical management (such as the Company’s declaration of its resolve and policies to its business partners; the Company’s invitation of training to its
partners; and the Company’s revision of its ethical management principles)：None
7. How to search for the Corporate Governance Principles and applicable rules:
In order to create a corporate culture of ethical management and normalize its development, the Company has established the Ethical Management Principles, Code of Moral
Conduct, and also the Board of Directors Rules of Procedure, Scope of Responsibilities of Independent Directors, and Corporate Governance Principles in compliance with the
Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies (all are disclosed on the Market Observation Post System website http://mops.twse.com.tw) in
order to promote the operating efficiency, decision‐making ability of the Board of Directors and the moral standards.
8. Other Information:
(1)Continuing education for directors: The Company holds seminars on topics relating corporate governance from time to time for directors to attend. The status of continuing
education is disclosed on the Market Observation Post System website as required.
For detailed continuing education received by directors and high‐ranking managers of the Company over the past few years, refer to Page 28.
(2)Coverage of directors by liability insurance: The Company revised its Articles of Incorporation on June 9, 2004 that the Board of Directors may be authorized to decide to
purchase liability insurance for all directors and supervisors to cover liability risk within the scope of their operation when duty. The Company purchases liability insurance for
directors every year and disclose the information on the Market Observation Post System website.
(3)Presence of absence of an operating procedure for handling significant information: The Company has an operating procedure for handling information in place as part of its
internal control system and periodically audits it.
38
(4)The selection and remuneration of the company's senior executives were approved by the board of directors and the remuneration committee. In order to implement the
succession plan of key management and cooperate with the competent authorities to promote corporate governance. The succession plan was drafted several years ago,
including assessment of current high‐ranking managers based on their professionalism, performance, and personality traits, Continuous cultivation of successors at all levels
within the organization and recruitment of excellent talents when needed to achieve internal benign competition and succession through the Leadership College, Sales and
Marketing College, R&D College, Technical Skills College, E‐School of the MSI University and other comprehensive training courses.continuous cultivation of successors at all
levels within the organization (including Director and senior management) and recruitment of excellent talents when needed to achieve internal benign competition and
succession.
On June 16, 2009, Mr. Chiang Shengchang, an excellent manager, was recruited into the board of directors and was promoted to be the executive vice president and general
manager of the Desktop Platform Division in March 2010 so that he can have a complete experience. With the internal organization adjustment on Jan.1, 2019, the
succession plan was formally launched as Mr. Hsu Hsiang becoming the chairman of the company and Mr. Chiang Shengchang the general manager and CEO of the Company，
(Mr. Chiang, Sheng‐Chang was dismissed on July 7, 2020), on July 8, 2020, the Board of Directors appointed one of the founders, Mr. Huang, Chin‐Ching, as the President,
adhering to the practice that the chairman and general manager of the Company are not the same person in the corporate governance goal. In addition, on June 15, 2018,
outstanding managers Mr. Kuo, Hsu‐Kuang, Mr. Liao, Chun‐Keng, and Mr. Hung, Yu‐Sheng were nominated to join the Board of Directors. On January 1, 2019, the three of
them were promoted to Executive Vice Presidents and General Managers of various business units, In the future, the board of directors and management committee will
continue to advance the succession plan, implement corporate governance and realize sustainable operation.
(5)Annual work focuses and operational situation of the Audit Committee:

Annual work focuses Operational situation
1. Main items reviewed by the audit committee: Frequency The first audit committee of the Company was established on June 15, 2018. It consists of
(1)Adoption or amendment of an internal control system pursuant to Article 14‐1 of the Depends on actual needs three independent directors and Mr. Wang, Sung‐Chou was elected as the convener. The
Securities and Exchange Act. current audit committee has held 13 meetings in 2020 and up to date till the Annual Report
(2)Assessment of the effectiveness of the internal control system. Once per year printed and operates smoothly.
(3)Adoption or amendment, pursuant to Article 36‐1 of the Securities and Exchange Act., of Depends on actual needs
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, or endorsements or guarantees for others.
(4)A matter bearing on the personal interest of a director. Depends on actual needs
(5)A material asset or derivatives transaction. Depends on actual needs
(6)A material monetary loan, endorsement, or provision of guarantee. Depends on actual needs
(7)The offering, issuance, or private placement of any equity‐type securities. Depends on actual needs
(8)The hiring or dismissal of an attesting CPA, or the compensation given thereto. Once per year
(9)The appointment or discharge of a financial, accounting, or internal auditing officer. Personnel change
(10)Annual and semi‐annual financial reports. Once per quarter
(11)Any other material matter so required by the company or the Competent Authority. Depends on the situation
2. Independent Directors with internal audit supervisors Once per quarter Communicate with the audit supervisor on the following matters: the annual audit plan, the
implementation of the audit plan for the previous year, internal control deficiencies and the
improvement of anomalies, the audit report and the follow‐up report, etc.
Independent Directors with CPA At least once per year We communicate with our CPAs in writing or face‐to‐face about the following topics: Fair
presentation of the financial statements, annual financial statement audit plan, individual entity
of group audit, and Key Audit Matters.
39
9. Internal Control System
(1)Statement of Internal Control System
Micro Star International Co., Ltd.

Statement of Internal Control System
March. 22, 2021
Based on the findings of self‐assessment, the company states the following with regard to its internal control system in
2020:
1. The company is fully aware that establishing, operating and maintaining an internal control system are the
responsibilities of its Board of Directors and management. The aim of the internal control system is to provide
reasonable assurance to effectiveness and efficiency of operations (including profitability, performance and
safeguarding of assets), reliability, timeliness, transparency, and regulatory compliance of reporting and compliance
with applicable laws, regulations, and bylaws.
2. An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control
system can only provide reasonable assurance of accomplishing the aforementioned three objectives. Moreover, the
effectiveness of an internal control system may be subject to changes of environmental or circumstances.
Nevertheless, the internal control system of the company contains self‐monitoring mechanism and the company
takes corrective actions whenever a deficiency is identified.
3. 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 components of internal control based on the
process of management control: (A) control environment, (2) risk assessment, (3) control activities, (4) information
and communication, and (5) monitoring activities. Each component further contains several items. Please refer to the
Regulations for details.
4. The company has evaluated the design and operating effectiveness of its internal control system according to the
aforesaid criteria.
5. Based on the findings of the assessment mentioned in the preceding paragraph, the company believes that, as of
December 31, 2020, its internal control system (including its supervision and management of subsidiaries), as well as
its internal controls to monitor the achievement of its objectives concerning effectiveness and efficiency of
operations, reliability, timeliness, transparency, and regulatory compliance of reporting, and compliance with
applicable laws, regulations, and bylaws, were effective in design and operation, and reasonably assured the
achievement of the above‐stated objectives.
6. This Statement will be 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.
7. This Statement has been passed by the Board of Directors in their meeting held on March. 22, 2021 with neither one
of Ten attending directors expressing dissenting opinions, and the remainder all affirming the content of this
Statement.
Chairman：HSU,HSIANG
President：Huang,Chin‐Ching
(2)If the Company is requested by the SEC to retain CPA’S service for examining internal control system, the
Independent Auditor’s Report must be disclosed:None
40
10. The penalties delivered to the Company and the staffs of the Company, or the penalties delivered by the Company to
the staffs for violations of internal control system, the major nonconformity, and the corrective action in the most
recent year and up to the date of the annual report: None.
11. The Major Resolutions of Shareholders’ Meeting and Board Meetings in the most recent year and up to the date of
the annual report:
(1)Major Resolutions of Shareholders’ Meeting
Meeting Abstract of important proposals Execution situation
date
2020.06.10 1. Report Item： 1. The 2020 shareholders’ meeting minutes were
(1)Business report of 2019. disclosed on the Market Observation Post System
(2)Supervisors' review report of 2019. website on June 16, 2020.
(3)Report of Employees’ Compensation and 2. Remunerations for employees and directors were issued on August 14, 2020.
Directors’ Compensation for 2019. 3. Distribution of 2019 earnings: Shareholders’ bonus ‐ dividend in the value of $5.0
(4)The 2019 Earnings Distribution of cash per share; August 30, 2020 was set to be the record date and the dividends were
dividends. issued on September 18, 2020.
2. Adoption Items： 4. To amend the articles of incorporation:The Ministry of Economic Affairs approved
(1)To adopt 2019 Business Report and the registration change at on June 15, 2020.
Financial Statements.
(2)To adopt the proposal for distribution of
2019 profits.
3. Discussion Items：
(1)Amendment to the ‟Articles of
Incorporation”
(2)Major Resolutions of Board Meetings
Board of Opinion of independent director The
Directors Independent Director company’s
Meeting handling of
Session Contents proposed
independen
Wang,Sung‐Chou Liu ,Cheng‐Yi Hsu,Kao‐Shan t director’s
opinion
2020.01.17 2020/1 1.Report Items:
(1)Derivative financial transactions report.
2.Adoption and Discussion Items：
(1)Approved Salary Compensation Committee’s proposal None None None None
(2)Approved the Business Plan of 2020.
(3)Investment in preferred shares of BlueStack Systems,
Inc. in the United States.
2020.03.20 2020/2 1.Report Items：
(1)Internal Audit reports
(3)Board of Directors self‐evaluation or peer‐evaluation
report.
(4)The company is able to prepare the financial
statements on its own.
(1)Approved the 2019 Financial Statement.
(2)Approved the Statement on Internal Control System of
2019.
(3)Approved Salary Compensation Committee’s proposal
(4)Approved matters related to the convening of the None None None None
2020 shareholders’ meeting.
(5)Approved matters related to the shareholders’
general meeting acceptance of shareholders’
proposals.
(6)Approved the amendments to the Articles of
Incorporation.
(7)Approved amendments to Procedure for the Rules of
Procedure for Board of Directors Meetings
(8)Approved amendments to Remuneration Committee
Charter
(9)Approved amendments to Audit Committee Charter
(10)Approved current Bank credit line and incremental
credit line application.
2020.04.30 2020/3 1.Report Items:
(1)Business Performance Report ‐ First Quarter 2020
(2)Internal Audit reports None None None None
41
(1)Approved matters related to the convening of the
(2)2019 Earnings Distribution and cash dividends plan
(3)Approved the incorporation of Canadian subsidiary.
2020.07.08 2020/4 1.Report Items:N/A
(1)Approve the appointment of President of the
Company.
2020.08.07 2020/5 1.Report Items:
(1)Report Items: Financial Report of second quarter,
2020.
(2)Whether or not are the Company's overdue accounts
receivable in an evaluation report of financing in
disguised form
(4)Derivative financial transactions report. None None None None
(5)Liability insurance for Directors.
(1)Approved the proposition to determine the base date
for the distribution of cash dividend to shareholders.
(2)Approved Salary Compensation Committee’s proposal.
(3)Approved the evaluation of the independence ofCPA
engagement.
2020.10.06 2020/6 1.Report Items:
None None None None
2020.11.10 2020/7 1.Report Items:
(1)Financial Report of third quarter, 2019.
(4)Corporate governance report
(5)Report on the enforcement of intellectual property
rights.
(6)Corporate ethical management report. None None None None
(7)Corporate Social Responsibility report.
(8)Communication with each stakeholder report.
(9)Risk management report.
(1)Approved the 2020 audit plan.
(2)Approved the dissolution of a subsidiary‐ MSI
Computer Trading (Shen Zhen) Co., Ltd.
2021.01.29 2021/1 1.Report Items:
(2)Board of Directors self‐evaluation or peer‐evaluation
report. None None None None
(2)Approved the Business Plan of 2021.
2021.03.22 2021/2 1.Report Items：
(1)Approved the 2020 Financial Statement.
(2)Approved the Statement on Internal Control System of
2020.
(3)Approved amendments to”Internal Control
System” , ”Implementation Rules for Internal
Auditing”.
(4)Approved the proposal for the change of the None None None None
Company's custodian for the endorsement and
guarantees' seal.
(5)Approved amendments to Procedure for the Rules of
Procedure for Board of Directors Meetings
(6)Approved amendments to Audit Committee Charter
(7)Approved amendments to Remuneration Committee
Charter.
(9)Approved amendments to ”Shareholders Meeting
Rules of the Company”
42
(10)Approved matters related to the convening of the
(11)Approved matters related to the shareholders’
general meeting acceptance of shareholders’
proposals.
(12)Approved the Election of directors. and Matters
related to the shareholders’ general meeting
acceptance of directors (independent directors)
candidates nominated by shareholders.
(13)Approved current Bank credit line and incremental
credit line application.
(14)2020 Earnings Distribution and cash dividends plan.
2021.04.29 2021/3 1.Report Items:
(1)Financial Reportof First Quarter 2020
None None None None
12.Major Issues of Record or Written Statement Made by Any Director Dissenting to Important Resolutions Passed by
the Board of Directors in most recent year and up to date of the annual report: None.
13.In the most recent year and as of the print and publication date of the annual report, is there any
resignation or removal of the company’s chairman, president, controller, financial officer, internal audit
office, corporate governance officer, or research and development officer
Occupational Title Name Date Assumed Date Dismissed Reason of Resignation or
Dismissal
President & Chief Executive Officer Chiang,Sheng‐Chang 2019.01.01 2020.07.07 Death
(Ⅴ)CPAs Fees
Accounting Firm Name of CPA Period Covered by CPAs’ Audit Remarks
PricewaterhouseCoopers, Taiwan Liang, Hua‐Ling Lai, Chung‐Hsi 2020
Unit: NT$ thousands
Fee Items Auditing Non‐Auditing Fees
Fee Range Fees Amount Items
1 Below 2,000 thousand 550 Transfer pricing study consultant fee
2 2,000 thousand (included) ~4,000 thousand
3 4,000 thousand (included) ~6,000 thousand 4,262
6 Over 10,000 thousand (included)
1. In case the non‐auditing fees paid to CPAs, CPA firm and the CPA firm’s related party account for over a quarter of
the total auditing fees, the auditing amount and non‐auditing amount; also, the non‐auditing service must be
disclosed: None (voluntary disclosure).
2. In case the auditing fee paid in the year retaining service from another CPA firm is less than the auditing fee paid
in the year before, the amount of auditing fee before / after the change of CPA Firm and the reasons for the said
change must be disclosed: None.
3. Reduction of auditing fees by more than 10% compared to the previous year: None.
(Ⅵ)Change of CPA’s Information:None.
(VII)MSI’s chairman, president, and managers in charge of its finance and accounting operations did not hold any positions
within MSI’s independent audit firm or its affiliates in the most recent year.
43
(Ⅷ)Information on Net Change in Shareholding and Net Change in Shares Pledged by Directors, Supervisors, Department
Heads, and Shareholders of 10% shareholding or more
1.Changes in Shareholding of Directors, Supervisors, Managers and Major Shareholders:
Unit: shares
2020 (Note) 2021/1/1~2021/04/13 (Note)
Title Name Holding Increase Pledged Holding Holding Increase Pledged Holding
(Decrease) Increase (Decrease) (Decrease) Increase (Decrease)
Chairman Hsu,Hsiang 0 0 0 0
Vice Chairman & President Huang,Chin‐Ching 0 0 0 0
Director & Senior Vice President of Management Committee Lin,Wen‐Tung 0 0 0 0
Director & Senior Vice President of Management Committee Yu, Hsien‐Neng 0 0 0 0
Director & Executive Vice President & NB BU GM Kuo,Hsu‐Kuang 25,000 0 0 0
Director & Executive Vice President & GNP BU GM Liao,Chun‐Keng 20,000 0 0 0
Director & Executive Vice President & CND BU GM Hung,Yu‐Sheng 0 0 0 0
Independent Director Wang,Sung‐Chou 0 0 0 0
Independent Director Liu ,Cheng‐Yi 0 0 0 0
Independent Director Hsu,Kao‐Shan 0 0 0 0
Senior Vice President of Management Committee Lu,Chi‐Long 0 0 0 0
EPS BU GM Tsai,Rong‐Fong 5,000 0 (60,000) 0
(119,000)
ACS BU GM Huang,Wen‐Shan 0 0 0 0
Vice President & CPS BU GM Wu,Ta‐Hsin 0 0 0 0
Vice President of Corp. R&D Teng,Chi‐Hung 0 0 0 0
Vice President of Corp.Manufacture & Quality Assurance Li,Chao‐Ming 0 0 0 0
Vice President of Corp. Sales & Marketing Chiu,Chih‐Keng 0 0 0 0
Vice President of Corp. Sales & Marketing Tung,Ti‐Chun 0 0 0 0
Vice President of Corp. Supply Chain Chen,Te‐Ling 0 0 0 0
Vice President of NB BU R&D Division Lin,Chin‐Kuan 0 0 (7,000) 0
Vice President of NB BU R&D Division Lu,Kuo‐Huang 0 0 0 0
Vice President of NB Product Mgt. Division Peng,Jen‐Fang 0 0 0 0
Vice President of NB Operations Mgt. Division Pan,Tsai‐Yu 0 0 0 0
Vice President of NB OEM sales Division(Note1) Huang,Wen‐Hui 0 0 0 0
Vice President of CND BU(Note2) Yeh,Chun‐Te 0 0 0 0
Vice President of EPS BU Sales & Marketing Division Lu,Cheng‐Lung 0 0 0 0
Vice President of Corp. Marketing Division Cheng,Hui‐Cheng 0 0 0 0
Vice President of Global Management Center Tsai,Wei‐Hsin 0 0 0 0
Vice President of Finance Center Hung,Pao‐Yu 0 0 0 0
Assistant Vice President of Internal Auditing Office Liu,Chu‐Hao 0 0 0 0
President & Chief Executive Officer(Note3) Chiang,Sheng‐Chang (413,000) 0 0 0
Note1:April 1,2021 Newly appointed.
Note2: April 1,2020 Newly appointed.
Note3: Dismissed on July 7, 2020.
2.Information of Shares Transferred: Not transferred to related parties.

3.Information of Equity Pledged: None.
44
(Ⅸ)Relationship among the Top Ten Shareholders
As of APR 13,2021 Unit：Share；％
Shareholding by Name and Relationship Between Remark
the Company’s Top Ten
Shareholding Spouse and Minor Nominee Shareholders, or Spouses or
Name Arrangement Relatives Within Two Degrees
% % % Relation
Shares Shares Shares Name
s
Hsu,Hsiang 51,983,151 6.15% 13,408,517 1.59% 9,376,328 1.11% Hsu,Fen‐Lan Spouse
Vontobel Fund‐MTX sustainable
39,924,000 4.73% ‐ ‐ ‐ ‐
emerging Markets Leaders
Cathay Life Insurance Co.,Ltd. 29,626,000 3.51% ‐ ‐ ‐ ‐
Cathay Life Insurance
‐ ‐ ‐ ‐ ‐ ‐
Co.,Ltd.(HUANG,TIAO‐KUEI)
Lin,Wen‐Tung 25,672,499 3.04% 62,895 0.01% ‐ ‐ ‐ ‐
New Labor Pension Fund 21,131,000 2.50% ‐ ‐ ‐ ‐
Huang,Chin‐Ching 20,937,377 2.48% 2,148,564 0.25% 7,521,761 0.89% ‐ ‐
Lu,Chi‐Lung 18,650,835 2.21% 1,965,350 0.23% ‐ ‐ ‐ ‐
Yu,Hsien‐Neng 17,892,824 2.12% 184,922 0.02% ‐ ‐ ‐ ‐
Yuanta/P‐shares Taiwan Dividend Plus
14,081,910 1.67% ‐ ‐ ‐ ‐
ETF
Hsu,Fen‐Lan 13,408,517 1.59% 51,983,151 6.15% 9,376,328 1.11% Hsu,Hsiang Spouse
45
(Ⅹ)Ownership of Shares in Affiliated Enterprises：
As of Dec. 31, 2020 Unit：Share；％
Ownership by MSI Ownership by Directors, Total
Management or Direct/Indirect
Long‐Term Investment（Note）
affiliates
Shares % Shares % Shares %
MICRO‐STAR INTERNATIONAL (B.V.I.) HOLDING CO., LTD. 0 0% 47,465,071 100% 47,465,071 100%
MSI COMPUTER CORP. 575,458 100% 0 0% 575,458 100%
MYSTAR COMPUTER B.V. 0 0% 0 100% 0 100%
MSI COMPUTER (AUSTRALIA) PTY. LTD. 221,836 100% 0 0% 221,836 100%
MICRO‐STAR NETHERLANDS HOLDING B.V. 424,000 100% 0 0% 424,000 100%
MSI COMPUTER JAPAN CO., LTD. 1,400 100% 0 0% 1,400 100%
MSI COMPUTER SARL 0 0% 0 100% 0 100%
MSI COMPUTER (SHENZHEN) CO., LTD. 0 0% 0 100% 0 100%
MSI COMPUTER (CAYMAN) CO., LTD. 50,000 100% 0 0% 50,000 100%
MSI COMPUTER (UK) LTD. 0 0% 0 100% 0 100%
MSI ELECTRONICS (KUNGSHAN) CO., LTD. 0 0% 0 100% 0 100%
MSI COMPUTER EUROPE B.V. 0 0% 0 100% 0 100%
STAR INFORMATION HOLDING CO., LTD. 0 0% 4,502,601 100% 4,502,601 100%
MICRO ELECTRONICS HOLDING CO., LTD. 0 0% 33,315,472 100% 33,315,472 100%
MSI PACIFIC INTERNATIONAL HOLDING CO., LTD. 30,204,118 100% 0 0% 30,204,118 100%
MSI KOREA CO., LTD. 0 0% 80,000 100% 80,000 100%
SHENZHEN MEGA INFORMATION CO., LTD. 0 0% 0 100% 0 100%
MSI POLSKA SP. Z O.O. 0 0% 0 100% 0 100%
MEGA TECHNOLOGY HOLDING CO., LTD. 0 0% 3,050,000 100% 3,050,000 100%
MEGA COMPUTER CO., LTD. 0 0% 1 100% 1 100%
LLC“ MSI COMPUTER” 0 0% 0 100% 0 100%
MSI COMPUTER TECHNOLOGIES LIMITED COMPANY 0 0% 0 100% 0 100%
MSI ITALY S.R.L. 0 0% 0 100% 0 100%
MHK INTERNATIONAL CO., LTD. 0 0% 1 100% 1 100%
MSI (SHENZHEN) CO., LTD. 0 0% 0 100% 0 100%
MSI (SHANGHAI) CO., LTD. 0 0% 0 100% 0 100%
RAIDEALS INC. 0 0% 0 100% 0 100%
MSI IBERIA S.L. 0 0% 0 100% 0 100%
MICRO‐STAR CANADA LTD. 100,000 100% 0 0% 100,000 100%
Note: Long‐term investment accounted for using equity method.
46
Ⅳ. Capital Overview
(Ⅰ)Capital and Shares
1.Capital and Shares
Unit:1,000 Shares；NT$ thousands
Authorized Capital Paid‐in Capital Remark
Capital
Par Increased
Month Sources of Capital
Value Amount Amount by Assets
/Year Shares Shares Other
(NT$) (NT$1,000) (NT$1,000) Other
than
Cash
1986.08 － 500 5,000 500 5,000 Incorporation None －
1990.06 10 3,000 30,000 3,000 30,000 Issuance of Shares for cash 25,000 None －
1996.10 16 60,000 600,000 40,750 407,500 Issuance of Shares for cash137,500 and None JUL 10,1996
Capitalization of retained earnings 90,000 Taiwan‐Finance‐Securit
ies‐I‐NO.41320
1997.06 30 100,000 1,000,000 70,800 708,000 Issuance of Shares for cash 48,280 and None APR 28,1997
Capitalization of retained earnings 244,500 Taiwan‐Finance‐Securit
and Capitalization of employees’ bonuses ies‐I‐No.32301
7,720
1998.04 － 126,000 1,260,000 109,200 1,092,000 Capitalization of retained earnings 283,200, None MAR 9, 1998
Capitalization of reserves 70,800 and Taiwan‐Finance‐Securit
Capitalization of employees’ bonuses 30,000 ies‐I‐ No.23751
1999.03 108 126,000 1,260,000 136,800 1,368,000 Issuance of Shares for cash 276,000 None DEC 17,1998
Taiwan‐Finance‐Securit
ies‐I‐ No.98986
1999.07 － 320,000 3,200,000 196,376 1,963,760 Capitalization of retained earnings 547,200 None JUN 10,1999
and Capitalization of employees’ bonuses Taiwan‐Finance‐Securit
48,560 ies‐I‐ No. 54332
2000.07 － 320,000 3,200,000 291,000 2,910,000 Capitalization of retained earnings 883,692 None MAY 26,2000
62,548 ies‐I‐ No.45969
2001.01 － 320,000 3,200,000 291,914 2,919,136 Conversion of bonds 9,136 None －
2001.05 － 680,000 6,800,000 376,582 3,765,818 Capitalization of retained earnings 729,784 None MAY 23,2001
116,898 ies‐I‐No.132149
2002.07 － 680,000 6,800,000 555,632 5,556,326 Capitalization of retained earnings 1,383,492 None MAY 28,2002
220,000 ies‐I‐No.129029
2003.09 － 960,000 9,600,000 660,477 6,604,775 Capitalization of retained earnings 833,448 None JUL 17,2003
215,000 ies‐I‐No.0920132258
2004.09 － 960,000 9,600,000 756,435 7,564,351 Capitalization of retained earnings 670,395 None JUN 28 ,2004
190,000 ies‐I‐ No.0930128388
2005.07 － 1,020,000 10,200,000 782,128 7,821,282 Capitalization of retained earnings 226,931 None JUL 11,2005
30,000 ies‐I‐ No.0940127923
and Capitalization of employees’ bonuses Financial‐Supervisory‐S
124,000 ecurities‐I
No.0950132069
2007.07 － 1,500,000 15,000,000 882,447 8,824,474 Employee stock option exercise 18,850 None －
47
and Capitalization of employees’ bonuses Financial‐Superviso
125,000 ry‐Securities‐I
No.0960035165
2008.10 － 1,500,000 15,000,000 1,007,696 10,076,965 Capitalization of retained earnings 380,374 None JUL 1,2008
182,000 ry‐Securities‐I
No. 0970032658
2008.10 － 1,500,000 15,000,000 1,008,028 10,080,285 Employee stock option exercise 3,320 None －
2009.02 － 1,500,000 15,000,000 1,008,074 10,080,745 Employee stock option exercise 460 None －
2009.09 － 1,500,000 15,000,000 1,067,626 10,676,262 Capitalization of retained earnings 504,123 None JUL 1,2009
79,533 ry‐Securities‐I No.
Employee stock option exercise 5,190 0980032766
2011.09 － 1,500,000 15,000,000 996,157 9,961,572 Treasury stock cancellation 750,660 None JUL 4,2011
Financial‐Supervisory‐S
ecurities‐I
No.1000031682
AUG 26,2011
ecurities‐I No.
1000040409
2011.11 － 1,500,000 15,000,000 964,157 9,641,572 Treasury stock cancellation 320,000 None OCT 28,2011
ecurities‐I
No.1000052520
2012.02 － 1,500,000 15,000,000 924,856 9,248,562 Treasury stock cancellation 393,010 None FEB 13,2012
ecurities‐I No.
1010004861
2012.04 － 1,500,000 15,000,000 884,856 8,848,562 Treasury stock cancellation 400,000 None APR 18,2012
ecurities‐I
No.1010016081
2012.07 － 1,500,000 15,000,000 844,856 8,448,562 Treasury stock cancellation 400,000 None JUL 18,2012
ecurities‐I
No.1010033145
48
(1)Type of shares
As of APR 13,2021 Unit：Shares
Authorized Capital
Type of shares Issued Shares Remarks
Un‐issued Shares Total Shares
(Note)
Authorized capital stock, of which, 150,000
thousand shares are reserved for exercising Conversion of
Common stock 844,856,199 655,143,801 1,500,000,000
bonds and 80,000 thousand shares are reserved for
employee stock options.
Note：Listed stock.
(2)Information for Shelf Registration: None.
2.Status of Shareholders
Status of Government Financial Other Juridical Domestic Natural Foreign Total
Shareholders Agencies Institutions Persons Persons Institutions &
QTY Natural Persons
Number of Shareholders 0 42 228 36,441 877 37,588
Shareholding (shares) 0 88,325,139 100,423,293 302,285,711 353,822,056 844,856,199
% 0.00% 10.45% 11.89% 35.78% 41.88% 100.00%
3.Shareholding Distribution Status
(1)Common Shares
Number of
Class of Shareholding Shareholders Shareholding (Shares) %
1～ 999 20,585 3,211,680 0.38%
1,000～ 5,000 13,389 25,439,125 3.01%
5,001～ 10,000 1,561 11,546,410 1.37%
10,001～ 15,000 519 6,458,917 0.76%
15,001～ 20,000 232 4,226,253 0.50%
20,001～ 30,000 278 6,989,208 0.83%
30,001～ 40,000 152 5,405,383 0.64%
40,001～ 50,000 96 4,420,360 0.52%
50,001～ 100,000 259 18,894,009 2.24%
100,001～ 200,000 152 21,548,243 2.55%
200,001～ 400,000 119 33,580,946 3.97%
400,001～ 600,000 66 32,678,144 3.87%
600,001～ 800,000 29 20,120,283 2.38%
800,001～1,000,000 23 21,061,336 2.49%
1,000,001 or over 128 629,275,902 74.49%
Total 37,588 844,856,199 100.00%
(2)Preferred share：The company did not issue any preferred share.
4.List of Major Shareholders

Share holding
Shares ％
Holder's Name
Hsu,Hsiang 51,983,151 6.15%
Vontobel Fund‐MTX sustainable emerging Markets Leaders 39,924,000 4.73%
Cathay Life Insurance Co.,Ltd. 29,626,000 3.51%
Lin,Wen‐Tung 25,672,499 3.04%
New Labor Pension Fund 21,131,000 2.50%
Huang,Chin‐Ching 20,937,377 2.48%
Lu,Chi‐Lung 18,650,835 2.21%
Yu,Hsien‐Neng 17,892,824 2.12%
Yuanta/P‐shares Taiwan Dividend Plus ETF 14,081,910 1.67%
Hsu,Fen‐Lan 13,408,517 1.59%
49
5. Market Price, Net Worth, Earnings, and Dividends per Share
Unit: Shares; NT$
Year 2020 2019 As of April 30, 2021
Items
Highest Market Price
158.00 94.70 186.00
Market price per Lowest Market Price
68.50 71.80 127.00
Share
Average Market Price
116.90 84.2 154.12
Before Distribution
42.07 36.71 46.86(Note2)
Net worth per share
After Distribution (Note1) 32.51 (Note1)
Basic 844,856,199
844,856,199 844,856,199
(Note2)
Weighted average shares
Diluted 851,580,230
852,081,369 852,233,958
(Note2)
Basic 6.61 4.94
Earnings per share 9.42
(Note2)
Before adjustment
Earnings per Diluted 6.56 4.9
9.34
share (Note2)
Basic (Note1) 6.61 ‐
After adjustment
Diluted (Note1) 6.56 ‐
Dividends from Retained earnings (Note1) NT$4.2/Share ‐
Cash dividends
Dividends from Capital Surplus (Note1) ‐ ‐
Dividends per share Dividends from Retained earnings ‐ ‐ ‐
Stock dividends
Dividends from Capital Surplus ‐ ‐ ‐
Accumulated undistributed dividends ‐ ‐ ‐
Basic 11.95 12.83 ‐

Price/Earning Ratio
Diluted 12.05 12.92 ‐
Analysis of return on
investment
Price/Dividend Ratio (Note1) 20.19 ‐
Cash dividends yield rate (Note1) 4.95% ‐

Note1: Subject to the approval of 2021 annual shareholders’ meeting.
Note2: 2021Q1 financial report was reviewed by CPA.
6.Dividend policy of the company and its implementation

(1)Dividend Policy
The Company is in a highly changeable industry. Many high‐end lucrative products are in growth. The distribution
of dividends shall be made taking into consideration the needs of Company future development and operation, and
the interests of shareholders. If the annual results shall have profit, such profits should first pay all taxes and
reimburse accumulative loss, then take 10% legal reserve and special reserve according to the Company Act. After
previous deductions and reserves, the Company can take 10% to 90% of the distributable earnings plus
undistributed retained earnings as bonus. The Board of Directors shall propose profit distribution plan to be
approved by the shareholders’ meeting.
Shareholders’ bonus shall be distributed in accordance with the percentage of the shares owned among the total
outstanding shares of the Company. Shareholders’ bonus will be distributed through the forms of both cash and
stock dividends. In such distribution combination, cash dividends shall take no less than 30% of the total distributed
bonus.
50
In the event there are deductions under the account of shareholders' equity which cannot be allocated from
after‐tax profits of the current fiscal year, whether accumulated from previous year or occurred in the current year,
the Company shall allocate sufficient special reserves from the beginning aggregate balance of undistributed
earnings and subtract such shareholders’ equity deductions before profits distribution.
(2)Proposed Distribution of Dividend：
2020
Cash dividend from retain earnings NT$6.1(per Share)
Total NT$6.1(per Share)
(3)Any expected major changes in the dividend policy: None
7.Impact to the company's business performance and earnings per share (EPS) for free shares allotment proposed by this
shareholders' meeting: Not applicable.
8.Compensation for employees and directors

(1)Quantity or scope of compensation for employees, directors as prescribed by the articles of association (Article
19‐1)
The pre‐tax income of the current fiscal year shall first offset the accumulated deficits. If the balance is positive,
then the Company shall allocate the remuneration to be distributed to employees and directors in accordance with
the following ratio.
A. Employee remuneration in the percentage of 6% to 10%. Individuals eligible for employee remuneration include
the Company’s employees and the employees of the Company’s subsidiaries meeting certain requirements. Such
requirements are to be set by the Board of Directors.
B. Remuneration to be distributed to directors shall not exceed 1%.
The decision of the percentage of remuneration to be distributed to employees, directors set forth in the preceding
Paragraph, the forms of distribution (cash or stock dividends) and the amounts and shares thereof shall be made
through the special resolutions of the Board of Directors and reported to the shareholders’ meeting.
(2) Accouting methods for the differences between the remunerations’ provision amount and actual distribution
amount:
The remunerations provision for employees, directors in 2020 is according to contemporary profits and with
reference to the distribution ratio from the year before and the percentage specified in the Articles of
Incorporation. In case of any difference between the actual distributed value decided by the Board of Directors, it
will be handled as changes in accounting estimates.
(3)Situation of the Board of Directors’ passing remuneration distribution：
A. The amount of employee, director remuneration in cash or stock distribution. If it differs from the estimated
amount in the recognized expense year, the balance, reason, and handling situation shall be disclosed:
The Board of Directirs passed a resolution, determining that the remuneration of employees in 2020 is
NTD725,000,000, and the remuneration of directors in 2020 is NTD 71,500,000, which are the same as the
recognized expense amount in 2020.
51
B. The proportion of employee remuneration amount in stock distribution based on the net profit after tax from
stand alone financial statements of this period and the total employee remuneration: None
(4)For the actual distribution situation of employees, directors and supervisors remuneration last year (including
distributed shares, amount, and stock price), if it differs from the recognized employees, directors and supervisors
remuneration, the balance, reason, and handling situation shall be specified:
In 2019, the relevant information on the employees, directors and supervisors remuneration is summarized below:
Employees bonus distribution:NTD 505,000,000; directors remuneration distribution:NTD49,500,000. It is the same
as the recognized expense amount in 2019.
9.Repurchase by the company of its own shares: None.
(Ⅱ)Corporate bond: None.

(Ⅲ)Preferred shares: None.
(Ⅳ)Overseas depositary receipt: None.
(Ⅴ)Employee stock warrant: None.
(Ⅵ)Restricted Employee Shares: None.
(Ⅶ)The section on issuance of new shares in connection with mergers or acquisitions or with acquisitions of shares of other
companies shall specify the following matters:
1.If, during the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report,
the company has completed any issuance of new shares in connection with a merger or acquisition or with acquisition
of shares of any other company：None.
2. Where the board of directors has, during the most recent fiscal year or during the current fiscal year up to the date of
publication of the annual report, adopted a resolution approving any issuance of shares in connection with a merger or
acquisition or with acquisition of shares of any other company：None.
(Ⅷ)The status of implementation of capital allocation plans：
1. A description of the plan
Where various issuance or private placement of securities have yet to be completed, or have been completed in the
most recent 3 years but where the benefits of the plan have yet to be realized：
All securities of the Company have been issued and no unrealized benefits.
2.Status of implementation: Not Applicable
52
Ⅴ. Operation summary
(Ⅰ)Business content
1.Scope of business
(1)The purpose for which the Company is formed shall be as follows:

1. Design of various computer hardware and software and manufacture, sale and purchase of
computer products, parts and components;
2. Manufacture and sale of electronic components and parts;
3. Import‐export trading business in relation of the foregoing businesses;
4. Agency business for quotation, bid and distribution of related products;
5. CC01030 Manufacturing business of electric appliances;
6. CC01060 Manufacturing business of wired communications equipments;
7. CC01070 Manufacturing business of wireless communications equipments;
8. CE01030 Manufacturing business of optical devices;
9. CH01040 Manufacturing business of toys;
10. F109040 Wholesale business of toys and entertainment products;
11. F113020 Wholesale business of electric appliances;
12. F113050 Wholesale business of office machines and equipments;
13. F113070 Wholesale business of telecommunications equipments and materials;
14. F209030 Retail business of toys and entertainment products;
15. F213030 Retail business of office machines and equipments;
16. F213060 Retail business of telecommunications equipments and materials;
17. F213010 Retail business of electric appliances;
18. CC01101 Manufacturing business of regulated RF telecommunications equipments and
materials;
19. F401021 Import business of regulated RF telecommunications equipments and materials;
20. CF01011 Manufacturing business of medical equipments;
21. F108031 Wholesale business of medical equipments;
22. F208031 Retail business of medical equipments;
23. CE01010 Manufacturing business of general equipments; and
24. ZZ99999 All other businesses not prohibited or restricted by laws and regulations except
businesses requiring special permits.
(2)Proportion of each business

2020
Unit: NT$ thousands
Major product Sales revenue %
Computer and peripherals 146,502,789 100%
53
(3) Current products and services of the Company
A. Motherboard: Intel® and AMD® platform Gaming, Content Creation and Business Professional
motherboards.
B. Professional Graphics Card: NVIDIA® and AMD® platform graphics cards；Professional Gaming Gears: Keyboard,
Mouse, Headset, Control Devices.
C. Server: Server system, GPGPU system, Workstation, Storage system, Edge computing system, Network application
system, Intrusion prevention system (IPS) & Unified threat management (UTM), Telecom next generation firewall
(NGFW), Facial recognition system, POS, and IoT gateway.
D. Desktop computer: Gaming Desktops, Mini Desktops, Desktops, All‐in‐One, Gaming ALL‐in‐One
E. Telematics and Automotive Electronics: Vehicle‐mounted rugged telematics system, Cloud based fleet
management solutions, Entertainment and advertisement system for public transportation vehicles.
F. Laptop: MSI Flagship High‐Performance laptop, Ultra‐Thin Gaming laptops, High‐Performance Multi‐Media laptops,
Content Creation laptops, Portable Workstation laptops, Ultra‐Portable Business laptops.
G. Monitors: Gaming Monitors for high‐end Gamers.
H. Case (Others): Gaming Cases, Liquid Cooler, Power Supply and Gaming Chair.
I. AMR (Autonomous Mobile Robot)
(4) New products (services) planned to be developed

A. Motherboard:
 Development of motherboard with multi‐core processors for better performance.
 Development of motherboard utilizing the latest AI and human‐computer interaction technology, for better
user experience
 Development of motherboard with better thermal solution and more durable components.
 Improvement of the RGB LED effects and better synchronization with other peripherals.
B. Professional Graphics Cards:

 Development of graphics card and thermal modules with better performance and lower energy
consumption.
 Development of overclocking graphics card with the latest technology and components.
 Development of fans with better heat dissipation and lower noise.
 Development of graphics card with improved RGB lighting effects and functions.
 Continuous improvement and integration of graphics card S/W applications.
 Development of graphics card with “Real‐Time Ray Tracing” and “AI deep learning” technologies.
 Development of Creator Series graphics card solution.
Professional Gaming Gears:

 Catering to the users’ needs, we plan to develop professional Gaming and Creator Series products such as:
“Keyboard”, “Mouse”, “Headset” and “Wireless Devices” with innovative functions and effects.
54
 Development of Professional Gaming peripherals, like “Gaming Control Devices”, “Gaming Mouse Pad”, etc.
 Development of Professional Creator Series peripherals, like “Wireless Bluetooth thin and light Keyboard”,
“Silent Wireless Mouse”, “Wireless Headset”, etc.
C. Server:
 Development of the new generation Server and GPGPU system with Intel® Eagle Stream and AMD® Genoa
platform.
 Development of the new generation Network application system with Intel® Catlow & Tanner Ridge &
Elkhart Lake platform.
 Development of the Telecom next generation firewall (NGFW) 16U chassis‐based system
 Development of the next generation firewall (NGFW) with Intel® Whitley platform and switch fabric PAM4
400G enhancement.
 Development of the next generation firewall (NGFW) with AMD® Rome platform and switch fabric 100G
enhancement.
 Development of the new generation Facial Recognition System with Intel® Tiger Lake‐UP3 platform.
 Development of the new generation POS with Intel® Elkhart Lake platform.
D. Desktop computer:
 Continue to develop high‐end Gaming Desktop computer series.
 Develop streaming Gaming Desktop product line.
 Continue to develop compact Content Creation Desktop series.
 Develop a PRO series Desktop product line.
 Continue to develop Mini PC series.
 Expand the All in one PC product line.
 Develop a Gaming system that combines AI and HMI technology.
 Continue to develop the exclusive thermal design‐Silent Storm Cooling.
 Continue to develop software application that meets customer needs‐MSI Center.
E. Telematics and Automotive Electronics:

 Vehicle‐mounted rugged tablet with AI computing capability and Vehicle telematic gateway system, which
provides networking and AI intelligent edge computing functions for trucks, agriculture vehicles, and heavy
vehicles with enhanced waterproof, fall resistance, and shock resistance to ensure reliability in various
extreme environments.
 Connected facial recognition with temperature measurement solutions for vehicle driver behavior monitor
and passenger detection.
 Rugged UVC LED Purifier for public transportation vehicles.
 Cloud based content publishing and management system for public transportation vehicles, commercial
buildings and stadium solutions.
55
 Next‐generation high‐resolution wireless projection system provides a complete customized solution based
on video compression and streaming technology to enable local wireless screen projection and remote
screen sharing.
F. Laptop:
 Develop World’s first full range of Gaming laptops with NVIDIA® RTX™ 30 series graphics.
 Develop all new “Business & Productivity” laptops with enterprise security and business needs.
 Continuing to promote ultra‐thin Gaming laptop with the reduction of the size and weight of the body, while
still maintaining both high performance and high heat dissipation capabilities, giving users the best
experience and mobility.
 Keep on researching gamers’ habits to provide the optimal gaming experience.
 The continuous development and optimization of Mystic Light effects and the use of Gaming Mode,
combining the keyboard and lighting effects to create the ultimate gaming immersion for any gamers.
 With Ambient link deeply integrated in games, information is displayed in real time through the per‐key RGB
keyboard and light modules which can present gamers a more engaging participation.
 Continue to optimize the S/W experience for Gaming laptops. In addition to the exisiting Gaming Mode, also
developed an OSD interface that can aid gamers without interrupting their gaming experience.
Simultaneously, the addition of automatic screen recording function gives the ability for players to share
their experience to the community.
 Continue too optimize the quality and sound of built‐in speakers in laptops.
 The use of different methods and materials to provide a much distinctive appearances of Gaming or Creator
laptops, to cater different types of users.
 Develop exclusive laptops for all types of Creators, using AI technology to help detect editing and drawing
software used, and optimally allocates the best system resources for them.
 Develop a dedicated cooling module for Creator’s laptop to maximize the performance of creative video
editing software.
 Dedication to improving the panel specifications to achieve Creator’s high expectation in terms of resolution,
color accuracy and color gamut.
G. Monitors:
 Development of the high‐end curved Gaming monitors with features such as wide screen size, 4K and WQHD
high resolution.
 Continuing the development of the Gaming monitors that adhere to the standard of eSports tournaments.
 Continuing the development of Gaming monitors that can show game‐related status and information on the
monitor panel
 Applying AI technology to Gaming monitors.
 Innovating monitors that are suitable for Professionals within the Multimedia and Content Creation industry.
 Continuing the development of Professional monitor that features eye‐care and ergonomic design.
56
H. Case (Others):
 Develop ITX mini gaming cases in response to the growing trend of DIY PC and work from home/learn from
home.
 Develop silence themed products, including silent fans, silent liquid coolers, silent cases, and silent power
supplies, to provide comfortable and quiet gaming at home experience.
 Develop a case that can be fully self‐assembled, allowing users to adjust the configuration of the case
according to their needs.
 Add AI smart functions through MSI Center and integrated with MSI products. Starting from user experience,
create a new AI gaming experience with three major themes: temperature control and heat dissipation,
lighting experience, and smart monitoring.
 Develop a new liquid cooler fan control technology, with AI that can help automatically detect the
temperature and independently adjust the speed of each fan to achieve the best performance and silence.
 Continue to invest in MSI elements to provide different user needs in the three product segments of MEG /
MPG / MAG. MAG provides high‐performance, stable and reliable products. In addition to MAG features,
MEG and MPG also focus on AI integration and MSI's exclusive functions.
 Develop high wattage power supplies to meet the high‐performance needs of future processors and graphics
cards.
 Develop mid‐tier non‐modular power supplies in response to the demand for Commercial systems in the
commercial market this year, with stability and easy installation as the main focus.
 I. AMR (Autonomous Mobile Robot):
 AMR Factory Automation related products.
 AMR Hospital Care related products.
 AMR Long Care related products.
2.Industry Overview
(1) Current Status and Development of the Industry
In 2020, the global PC market had a double-digit growth due to the demand for home office, distance learning, etc.
driven by the pandemic.For the PC industry, upstream semiconductor companies keep developing new technology,
gaming companies continuously launch major projects, competitions and livestreaming services prompt, content
creators and other customers’ demand for high‐end PCs increases, and various applications deriving from AIoT.
Sales of related products are given more opportunities.
The company’s current development of related businesses is summarized as below:
A. Parts and components:
As the pandemic drove the demand for home office and distance learning, the global motherboard market
experienced a double-digit growth in 2020. At the same time, with the vigorous development of the global
e-sports-related industries, users' demand for high-end computing power is increasing, driving the demand for
mid-to-high-end e-sports-specific motherboards and graphics cards.Looking forward to 2021, Intel, AMD and
NVIDIA will all have new products launched, and the innovation of many game masterpieces is believed to
57
stimulate PC platform users to upgrade or complete system replacement, the segmentation of demand will
continue to be the trend. This will also drive users to choose products that better suit their needs. Considering
these two factors, it is expected that MSI motherboards and display cards will have further growth in the middle
and high‐end computer market in 2021.
B. Systematic products:
The current global PC market has reached saturation point. The global PC market is becoming more and more
saturated, but it has grown further due to the demand for home office and distance learning driven by the
pandemic, High‐end PCs such as e‐sports ones have become the way out for manufacturers to seek
transformation and growth, whether they produce desktops or notebooks. Moreover, the booming development
of e‐sports‐related industries, the engagement of many operators and the continuous launch of various PC
games are conducive to the expansion of the gaming and e‐sports market. MSI has been deeply involved in the
field of e‐sports for many years with the system product development centered around users and software and
hardware highly integrated as it continues to develop more user‐friendly new functions. In the high‐end PC
markets such as e‐sports, MSI has become the first choice for players. In addition, MSI has also created a new
high‐performance thin and light notebook for the creators, which adheres to the Company’s tradition of basing
the design on the needs of creators with an aim , we look forward to becoming the best partner of every user.
C. Servers, industrial computers, and automobile electronics:
Industrial PCs are mainly applied in different industries and in a variety of special purposes; their design and
functions are mostly tailored to different customer needs, which belongs to a business model of diverse
products in small quantities. Customization and specialty also bring higher gross profits, and the average gross
profit margin of global industrial computer manufacturers can reach as high as 30% to 40%.
IDC statistics show that global server shipments in 2020 are expected to grow by 3%, totaling 12.11 million units,
and in 2021, shipments are expected to grow by 6%, totaling 12.89 million units. According to the analysis of the
US "Commercial Vehicle Telematics Market" report, the global commercial vehicle telematics market size is
US$8.49 billion in 2020, and it is expected that it will reach US$14.56 billion by 2026, with a compound annual
growth rate of 9.4% from 2020 to 2026.
ITRI Industrial Economics and Knowledge Center (IEK) estimates that in 2030, global in-vehicle-related services
will generate US$3 trillion in revenue, and the passenger economy will reach US$7 trillion in output value by
2050. The opportunities for in-vehicle Internet connection and safety auxiliary devices to become standard
equipment are greatly increased. Vehicles with Internet connection provide information perceived by existing or
autonomous vehicles collected through the sensor and the integration of multiple sensors, and thereby achieving
decision-making and control functions.
The telematics system is the future trend. It has become a trend that the governments worldwide make laws to
require all commercial vehicles to install Electronic Logging Devices (ELD). The increase of 5G connectivity plans
and maturity of cloud technical application will further drive the growth of the global telematics system market.
By combining the smart transportation system in the future, driver and vehicle safety will improve. Fleet owners
can also enjoy more efficiency and opportunities for their commercial decisions.
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(2)Correlation of the upstream, midstream, and downstream of the industry:
Upstream Mid‐Stream Dowmstream
Semiconductor
Special IC Motherboard
CPU
Network server
Static memory
Monitor
Logic circuit pinch
Programmable (ROM) Work station
Interface cards
Diode
PSU Desktop
Metallic plastic
PCB Computer case Notebook

CPU socket
Connectors Computer keyboard
Sockets
Software Soft/Hard Drives
Basic I/O Systems

OS Other I/O
(3)Product development trends：

A. Parts and components:
Intel, AMD, and NVIDIA are the main chip suppliers for components and they all have new products that will be
launched in 2021.The specifications and performance will exceed the existing products on the market. In
particular, NVIDIA's new generation of graphics cards is in short supply, and it can be expected that a new wave
of high-end computer market will have more significant growth with the launch of more gaming masterpieces.
As for the manufacturing of PC components, Taiwanese manufacturers such as MSI are still in a leading
position.
B.Systematic products:
The computer industry enters into a diverse and changeable stage. Product development is not limited to the
hardware, but includes the integration of software and hardware platforms. MSI’s systematic products including
laptop and desktop PCs are based on the fundamental needs of users. We upgrade the hardware, and
emphasize on the progression of software functionality. We are devoted to the integration of software and
hardware, and enhancement of users’ audiovisual experience, making it easier and more user‐friendly to
operate the products. In addition to the original e-sports and Content Creation series, our product line develops
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the latest business and productivity laptops and screens to meet the needs of business persons.
C. Servers, industrial computers, and automobile electronics:
The era of AIoT has arrived, and industrial computers have always been the core operating platform of various
industries. In recent years, the industry has continued to face digital transformation, and the importance of
industrial computers has increased day by day,Industrial computers are developing toward total solutions from
hardware to software and from the front end to the back end. Vertical integration of services and applications
requires the capability to develop the firmware and the technicality for vertical integration so that
high‐performance, integrative, expansive, and highly compatible system platforms may be applied to a variety
of sectors. Therefore, individual manufacturers are developing the vertical integration application market and
expediting their technicality required for a high level of integration. A flexible operational pattern and cost
leadership will be the new wave of challenges.
Cloud computing brings the structural change to the server market. Although the deployment of large data
centers can increase the shipment and revenue of server business, the demand of new servers will decrease
since the business world utilizes the server applications through virtualization, or receives the services directly
from the cloud service providers. ODM model and SI management stand side by side for MSI’s server business.
The conversion to the new platform Whitley is supported by our strength, the mainstream x86 structure. AMD
structure starts to attract more customers, and increase the market share since it has a value per cost higher
than Intel. Therefore, we also join the development of the AMD platform, while joining power structure and
maintaining minimum shipments. We also deploy the ODM business in the global UTM market to provide
comprehensive solutions for information security. In the future, AIoT will gradually complete its ecosystem
through the combination of artificial intelligence + 5G + edge computing and other technologies. We have also
stepped into the application of GPGPU/Edge Server to advance with the times and strengthen the multiple
application fields of the servers.
In the development of automobile electronics, smart safety is the mainstream, including telematics, self‐driving
cars, and the Internet of vehicles, among others. With foreign heavyweight manufacturers putting in resources,
Taiwan telematics suppliers are following suit and entering the automobile electronic field. MSI is a long‐term
investigator of telematics systems and has built a deep and solid R&D foundation. Certified by related
international standards, it will continue to apply its robust capabilities in integrating software and hardware to
contribute to total solutions such as FMS.
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3. Overview of Technology and Research and Development
Research and development expenses and technologies or products successfully developed in the most recent year and
up to the date the annual report was printed
Unit: NT$thousands
Annual research and Research and development outcome
development
expenditure
2020.1.1~2020.12.31 A. Motherboard
3,724,340  Intel® 400 series motherboards support the 10th and 11th generation core processors.
 Intel® 500 series motherboards support the 10th and 11th generation core processors.
2021.1.1~2021.3.31  AMD® 500 series motherboards supports the 3rd generation Ryzen™ processors
1,309,884  Utilizing server grade PCB, 2oz thickened copper PCB and optimizing circuit to ensure high speed
signal such as PCIe 4.0 running stable in long time.
 To improve the CPU performance by adopting Frozr Heatsink design, which is powered by double
ball bearings fan. The exclusive Zero Frozr achieves the perfect balance between noise and
performance.
 The heat dissipation design of FROZR HEATSINK adopts a double ball bearing design to provide the
best performance for hardcore players. With the ZERO FROZR stop function, players can achieve a
perfect balance between noise and performance.
 The OLED Dynamic Dashboard II has been upgraded to color panel, which is an on‐board panel for
Gamer to monitor all the status. It even allows Gamers to put customized logo by themselves.
 The pre‐installed I/O Shielding gives end users a better DIY experience via pre‐installed
components and prevents users from damaging their motherboard while building the desktop,
thereby decreasing RMA issue.
 The Audio Boost 5 HD is the latest sound technology, which enhances the bass effect with
powerful sound experience. The Audio Boost 5 HD also received the Hi‐Res Audio certification for
its perfect sound performance.
 Exclusive CPU Cooler Tuning enhances CPU performance based on the system cooling condition.
 Next generation of M.2 Shield Frozr adopts the new improved “sandwich structure” to ensure the
M.2 SSD is always in a good temperature environment even under full loading.
 The latest Wi‐Fi 6E solution and LAN Manager provides the best online experience.
 The brand new MSI Center integrates all exclusive functions in one app to provide convenience to
users.
B. Professional Graphics Cards

 Developed new graphics card with the MSI exclusive patented “TriFrozr” thermal design. This
design is equipped with 3 fans and utilized the latest Torx fan, a huge heatsink and numerous heat
pipes to provide maximum thermal efficiency.
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 Developed graphics card with “Real‐Time Ray Tracing” , “AI deep learning” and “graphic
acceleration” technologies, for a new gaming experience.
 Developed a total S/W and H/W solution which utilized the latest GPU and visualization software
for accelerated operation, to provide stunning images.
 Developed professional graphics cards dedicated for block chain application.
 Developed high‐end graphics card with both water‐cooling and fan‐cooling based thermal
solution. The new water‐cooling architecture helps improved overall thermal efficiency for the
chipset, memory and power module, to provide a more stable platform.
 MSI exclusive design of square thermal conduction surface, combined with large super heat pipes,
to greatly improve thermal conductivity.
 MSI exclusive patented “Zero Frozr” energy‐saving low‐noise technology with temperature
monitoring function, which automatically adjusts fan speed based on actual usage, to provide low
temperature, silent and highly efficient cooling solution.
 Developed the new generation of MSI exclusive patented “Torx Fan 4.0” technology, with a further
performance breakthrough. The exclusive drainage fan blade design creates a more concentrated
wind current and wind pressure which makes the the second generation “TRI FROZR” dissipate
heat faster
 Utilized high quality components: Hi‐c Cap, SFC and Solid CAP, which passed MIL‐STD‐810G
military standards. Solid and reliable materials make MSI synonymous with the highest quality and
stability.
 Continuous improvement of MSI exclusive “Afterburner” application, which can accurately monitor
and adjust clock, voltage and related parameters.
 Developed “MSI Center” which combines a variety of MSI calibration software and uses an
integrated interface. The built‐in AI intelligent engine can prioritize the allocation of system
resources based on the most commonly used software by users, allowing users to optimize
software applications, bringing superior experience and higher work efficiency.
 Exclusive cooperation between MSI and BlueStacks® to develop the MSI APP Player, allowing
mobile games to seamlessly integrate with PCs, enjoying the large screen view and game control,
and experiencing the high‐performance PC gaming experience.
 Develop a variety of Gaming mouse designed for the needs of gamers, using the latest
gaming‐grade induction engine and special highly durable Japanese gaming microswitches. Light
and balanced weight distribution and excellent ergonomic appearance provide gamers with the
most comfortable experience.
C. Servers
 Develop the new architecture of High‐speed computing.
 Develop the thermal solution of Server & GPGPU system with liquid cooling.
 Develop the new architecture of new generation Network application system
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 Develop the new architecture of next generation firewall (NGFW) & Unified threat management
(UTM) & Intrusion prevention system (IPS).
 Develop the new generation Facial Recognition System.
 Develop the new generation POS.
D. Desktop computers
 Launched the Intel® and AMD® platform high‐end gaming desktop series, and the latest NVIDIA®
GeForce™ RTX™ 30 series gaming desktops.
 Expanded the Mini gaming desktop market and launched the latest Intel® series of Mini Gaming
desktops such as Trident X, Trident AS, Trident A, and Trident 3.
 Launched the first AMD® platform Gaming desktop: MAG META series.
 Launched the MEG Aegis Ti5, the first Gaming desktop equipped with HMI technology.
 Continue to develop an exclusive heat dissipation technology ‐ Silent Storm Cooling.
 The entire Gaming desktop series adopts 2.5G Ethernet and WiFi6 wireless network technology to
provide players a smooth online gaming experience.
 Launched the Mini Business desktops Cubi series, and launched desktop computer products that
meet the needs of the business market.
 Launched the All in One product line ‐ PRO 22X/PRO 24X.
 Continue to develop the MSI Center, which contains cross‐platform concept apps such as Duet
Display (iOS) and MSI App (Android®).
E. Telematics and Automotive Electronics

 Vehicle‐mounted rugged AI smart tablet and telematics gateway system, enable AI intelligent edge
computing capabilities, provide networking and driver recognition and behavior monitoring AI
functions for heavy industrial vehicles to improve vehicle safety and efficiency with further
strengthen waterproof, fall resistance, and shock resistance to ensure system reliability in various
applications.
 Connected entertainment systems for vehicles, including wired and wireless movie on‐demand
systems and two‐zone independent audio and video systems, providing on‐demand audio and
video playback, Internet browsing, driving information, navigation, advertising, LBS application,
and cloud background management.
 Hybrid Stadium & Arena Solution: wired and wireless hybrid video streaming solutions, providing
real‐time video, on‐line ordering, audience voting and instant messaging, and other innovative
services for stadium and arena environments.
 Next‐generation high‐resolution wireless projection system with 8K resolution multi‐screen local
and remote projection capability.
F. Laptops
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 MSI has penetrated the field of Gaming laptops for over 10 years. It currently has the most
thorough laptops product line in the world, ranging from its large‐scale flagship models, extreme
thin and light, to the mid‐level mainstream Gaming laptops. By covering this broad range, it allows
consumers to choose the best suitable Gaming laptops base of their needs.
 MSI stayed ahead of the industry to bring a comprehensive product line based on the latest
NVIDIA® RTX™ 30 graphics, and fully implemented new technology from the platform through
collaboration with key partners to bring the best performance among the competition.
 Designed all new “Business & Productivity” laptops with enterprise security and business needs.
 The development and integration of “Passive Radiator” technology in speakers, using the
double‐sided Duo Wave driver design to greatly enhance the high and low frequency of the sound
quality and volume of the speakers.
 Continue to cooperate with one of the top brands in the game industry “Steel Series®”, and the
use of MSI Mystic Light effect to create a personal and exclusive keyboard lighting with specific
games.
 With the intense development of various social media & self‐created media, the needs of editing
audio, video, and pictures have grown to all time high. For the need of various Creators, MSI has
precisely created an exclusive series of Creator laptops. using AI technology to help detect editing
and drawing software used, and optimally allocates the best system resources for them, whether it
is 3D modeling, dynamic images or even static picture editing.
 The newly developed “MSI Center” integrates different software tools across various product lines.
By utilizing AI technology through Microsoft® Azure Cloud, MSI center can optimize gaming
experience and speed up creative workflow. The innovative modular design allows users to install
only the desired features, greatly improving user experience.
 MSI Design Center successfully implemented “etching” technology to the product’s exterior
design, bringing special edition design to life with 3D texture which greatly surpasses traditional
print method.
 MSI Design Center conducts big amount of research on the design craftsmanship and the color
trends to help determine the development direction. Picking the most popular representative
colors to infuse into MSI laptops and customize the MSI’s color plan.
 Continue to strengthen the laptop market for high‐end professional mobile workstations,
combining the product design and high‐performance dedicated graphics cards to create more
professional, efficient, and highly portable professional graphics laptops.
G. Monitors
 Development of the high‐end curved Gaming monitor with features such as wide screen size, and
4K and WQHD high resolution.
 Continuing the development of the Gaming monitors that adhere to the standard of eSports
tournaments and expanding the product coverage to the flat screen market.
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 Development of a technology that can deeply integrate Gaming monitors with Gaming desktops
and achieve the best gaming experience.
 Continuing the development of Gaming monitors that can show game‐related status and
information on the monitor panel. Cooperating with multiple gaming companies to promote the
interactivity between the user and monitor, making the monitor more than just a display.
 Applying AI technology to Gaming monitors. With the information captured in big data, Gaming
monitors now offers more personalized and user‐friendly applications.
 Innovating monitors that are suitable for professionals within the Multimedia and Content
Creation industry. Fine tuning the wide color gamut element that all the artists and creators care
about.
 Continuing the development of Professional monitors that can help enhance the productivity for
users with MSI eye‐care technology & ergonomic design, both in the hardware and software
aspect.
 A technological breakthrough, the world's leading 1000R curved display.
H. Case (Others)
 Develop high‐end Gaming cases that are compatible with the latest Intel® / AMD® / NVIDIA®
products, to support the Gaming needs of the DIY market.
 Develop case products used by Professional Designers and Content Creators to further support
their high requirement needs.
 Develop liquid coolers to meet the high core heat dissipation requirements of current Intel® and
AMD® processors, and match MSI gaming cases to provide a complete user experience.
 Introduce a power supply that can meet the wattage requirements of current Intel® and AMD®
processors and high‐end graphics cards, with MSI gaming cases to provide a complete user
experience.
I. AMR (Autonomouse Mobile Robot)

 Develop AMR intelligent mobile robot based on AIOT.
 Develop several applications and field verifications of AMR‐based compound assistive robots,
including intelligent epidemic prevention and disinfection fleets and intelligent transportation
fleets.
4.Short‐term and long‐term development plan

(1)Short‐term development plan：
Brand marketing: We continue to deepen the channel management with the self-expectation to be the first choice for
e-sports products. After the success of the e-sports market, we have extended to the fields of
content creators and business and productivity, pursuing laptops. At this stage, the main
development direction of business marketing is to pursue the overall stable growth of various
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products such as laptops, desktops, motherboards, graphics cards, industrial computers, servers,
and automotive electronics.
OEM: The Company works closely with international heavyweights in order to find out profitable commercial
models. The economics of scale approach is adopted to continue bring down the production cost and to
enhance the overall profits for the customers and the company.
Research and development, manufacturing, and service: From research and development of products to
manufacturing, and mass production, customers are provided with high‐quality products and after‐sales services.
(2)Long‐term development plan：
The Company builds on its solid R&D capabilities and has been well received among customers and users with its
outstanding quality of products and optimal services. In the future, it will continue to be devoted to creating instant
competitive advantages for its core capabilities and seeking opportunities to diversify its operations. Besides
motherboards, display cards, laptops, servers, and desktop computers that it specializes in, it will also work hard to
gradually become a profitable leader in other products such as industrial computers and automobile electronics.
(Ⅱ) Market Analysis and The Conditions of Sales and Production:

1. Market Analysis
(1)Sales Regions:
Unit: NT$ thousands
Year 2020 2019
Sales Region Net Sales % Net Sales %
Europe 43,454,599 29.66% 32,331,545 26.83%
Asia 50,153,441 34.23% 49,677,491 41.23%
Export sales
America 45,972,863 31.38% 33,122,365 27.49%
Others 3,276,899 2.24% 2,099,064 1.74%
Subtotal 142,857,802 97.51% 117,230,465 97.29%
Domestic sales 3,644,987 2.49% 3,260,952 2.71%
Total 146,502,789 100.00% 120,491,417 100.00%
(2) Market share and market demand and supply and market growth
A. Market Share
The Company is one of the heavyweight PC manufacturers in the world, with product lines including
motherboards, display cards, desktop computers, laptops, and other commercial products. Because of its
continuous devotion to increasing investment in research and development and brand management and
focus on high‐end markets with high gross profits such as that for Gaming, the Company is able to secure a
steady leading position in terms of the sales and market shares of laptops and display cards. The
motherboards, on the other hand, remain steady as one of the Top 3 on the market.
B. Supply
PCs are a mature sector. In 2021, approximately 357.4 million PCs will be shipped globally, which is an
increase from 2020;, growly declined comparing with 2020. On emerging markets, however, business
opportunities keep growing for Gaming. Multiple brands continue to invest in the research and
development as well as marketing of Gaming‐related products. Despite the competition, the Company will
continue listening to the users in order to know their needs and will create products that meet users’ needs
with its professional R&D capabilities and production technology so as to become the No. 1 high‐end brand
referred by users.
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C. Demand
As the gaming industry develops, players ask for enhanced audio and lighting effects in the games. The
performance of regular low‐priced computers cannot satisfy the players’ need due to the rise of gaming
competitions and livestream platforms. Therefore, the pursuit of performance directly increases the players’
demand of mid‐ to high‐end PCs, motherboards and display cards. In recent years, the significant growth of
NVIDIA in gaming marketing also shows the shift of PC demand towards mid‐ and high‐end products. The
demand from content creators is not completely satisfied yet. According to the data published by the major
software manufacturer Adobe, Such Company's creative platform has 25 million members, The demand of
various content creation is high and complicated. MSI will also develop the products that tailor the users’
need and become an indispensable partner for creators.
D. Competitive niche and advantageous and disadvantageous factors for future developments as well as response
measures
① Competitive niche and advantageous factors for future developments
a. Outstanding product development capabilities
The Company has a management team with more than 20 years of experiences in research and
development and technical experiences. The members are heads of respective business groups and
supervisors at the main office. As such, they have a deep understanding of promising technologies and
are efficient in making decisions. Meanwhile, they can combine numerous technical trends to make the
best of teamwork. Research and development staff, on the other hand, are highly experienced
professionals; they contribute to the outstanding R&D accomplishments of the Company and the
award‐winning stream of its products over the past years. The excellent rating with regard to its
performance by professional media and user referral on respective major markets are the best proof.
b. Productivity featuring high quality and flexibility
From design, development, to mass production, the Company is known for its quality mass production
technology and highly efficient productivity. Meanwhile, the Company constantly introduces and
updates automatic and smart equipment in order to improve production quality and to bring down the
cost. In addition, the Company has a systematic management process and complete educational
training programs for operators so that the product yield rate exceeds 99%, which contributes
significantly to both improved quality and product image.
c. Outstanding management capability
Information technology products are known for their short life cycle and fast changing prices. Potential
competitors do not necessarily come from the same sector. In response to the quick changes in
competition on the market, the Company pays attention to market dynamics at all times in order to
respond quickly and to reduce the inventory stress. Risk management is concerned, the Company
adheres to its credit policy for the security of outstanding accounts recevibable to keep the actual bad
debt amount low. Therefore, its management capability demonstrated through both its management of
the inventory and accounts receivable is highly recognized.
d. Sound management system and outstanding product quality
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The Company is certified by ISO9001 Quality Management Systems, ISO14001 Environmental
Management Systems, OHSAS18001 Occupational Health and Safety Assessment Series, IECQ QC
080000 Hazardous Substance Process Management System Requirements, IATF Automotive Quality
Management System, and TL 9000 Telecommunications Quality Management System.
Order processing, material preparation, production control, field management, shipment and
environmental protection, safety and health, risk management, and quality assurance are all included
as part of standard and specification management. Engineering staff for research and development and
manufacturing, among others, are also constantly devoted to the improvement of reasonable and
automatic processes and reducing impacts on the environment as well as investigating alternative
materials in order to improve the yield rate while at the same time bringing down the cost.
e. Pursuit of satisfying services for customers
Customers have increased demand for technical support and after‐sales service. In order to increase
customer satisfaction, the Company has after‐sales service centers and online customer service
available on major markets so that real‐time assistance can be provided to customers and customers
are entitled to convenient and quick services and technical support. The Company can also quickly
keep track of market and user dynamics and investigate customer satisfaction to be the basis for
quality advancement.
f. Flourishing developments of the Gaming and gaming sectors
According to Newzoo, a market research agency, global game players will reach 2.8 billion in 2021, and
the overall output value of the gaming market will reach US$189.3 billion;
Furthermore, Digi Capital estimated that in 2023, the total revenue of software and hardware in the
global gaming industry will exceed US$200 billion. Every government is getting serious about the
gaming industry, and society has grown a higher recognition of it. There are large gaming competitions
and livestreams domestically and overseas. The gaming industry market has been expanding. The
company may land our products on the tremendous business opportunities brought by online gaming.
g.Rise of self‐media
Nowadays, audiovisual and design content creation platforms are rising alongside the increase of
communication bandwidth and speed. Each content creator’s requirements for hardware equipment
vary, ranging from document, music creation, video shooting and editing. The requirements in common
are stability and performance that tailor the scenario setting of the user. And MSI is inherently strong in
such field.
② Disadvantageous factors for future developments
a. Short life span of information technology products. Spearheaded by main suppliers that have an effect
on product development, downstream manufacturers can only follow market trends or the footsteps of
international heavyweights in producing homogeneous products, which tends to result in price cut
competition on the market and the difficulty to maintain reasonable profits. Many manufacturers in the
industry try to secure their market share by reducing their prices, which, however, also squeezes the
room for profitability.
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b. Sectors accounting for a higher ratio in exportation is more easily affected by the volatility of exchange
rate. Drastic changes in the exchange rate will affect their profitability.
C.Information communication continues to innovate. 5G, automotive electronics, and AIoT continue to
increase demand for semiconductors. As the global wafer production capacity cannot be expanded
immediately, it will crowd out the supply of semiconductors for PCs.
③ Countermeasures
a. Reinforced collaboration with key part suppliers in the upstream to develop competitive new products
early on; devotion to R&D to help improve product efficacy and create high value‐added and touching
products for strengthened brand value and for creating reasonable profits for the Company;
maintaining sufficient throughput to be capable of accepting ODM/OEM orders from international
heavyweight clients and to improve income; and introduction of automatic and smart manufacturing to
deal with diversification of products in small quantities and to more flexibly meet customers’ demand
by adjusting the production lines.
b. Increased ratio of paying in foreign currencies to bring up the natural hedging ratio to counterbalance
assets and liabilities in foreign currencies and continued adoption of hedging measures such as foreign
exchange hedging transactions to reduce risks associated with the volatility in exchange rate along with
close attention paid to impacts of various policies of major countries, including tax reform and balance
sheet reduction in the US and the changes in regional political and economic situations as a result of
emerging trade protectionism and cautious response to impacts caused by capital flows in Asian and
Central American countries, global exchange rates, and financial credit.
c.Fully grasp the needs of channel customers, and work closely with upstream suppliers to flexibly adjust
production capacity to respond to changes in supply and demand in a timely manner and fulfill order
shipments.
2. Important purposes and production/preparation processes of primary products

(1) Purposes of main products
The Company mainly manufactures and sells computers, motherboards, and interface cards. Motherboards are
important components of computers that are responsible for output and input features, including sending
images, controlling the network, sound effects, and other multi‐media features; they are indispensable for
computers.
Name of product Purpose
Motherboard Important component of personal computers, taking care of internal computing, output, and input features of a
computer system, the backbone of a computer
Laptop A mobile PC with high‐performance calculation.
Interface card One of the important components of a PC, which converts the display information required by the computer
system, drives and controls the display to present correct information, and an important component for
human‐machine dialogue.
(2) Production processes
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3. Supply of Major Raw Materials:
Major Products Major Raw Materials Suppliers Supply Status
Integrated Circuit B Stable supply available
C Stable supply available
Motherboard
Printed Circuit Board Global Brands Manufacture Ltd. Stable supply available
Palwonn Electronics (Suzhou) co., Ltd. Stable supply available
Note: Due to confidential business information and nondisclosure agreement concerns, some real vendors’ names are substituted with codes.
4. Major Customers with over 10% Net Sales and Suppliers with over 10% total Purchases of the Last Two Fiscal Years:
(1) Purchases
Major Suppliers of the Last Two Fiscal Years
Unit: NT$ thousands
Year 2020 2019 2021Q1
Item Name Amount Percentage of Relation Name Amount Percentage Relation with Name Amount Percentage Relation
net annual with issuer of net issuer of net with
purchase〔%〕 annual purchase of issuer
purchase Q1〔%〕
〔%〕
1 B 27,881,168 22.45 None B 23,226,957 23.17 None B 7,853,316 23.30 None
Others 96,289,780 77.55 Others 77,018,531 76.83 Others 25,846,485 76.70
Net 124,170,948 100.00 Net 100,245,488 100.00 Net 33,699,801 100.00
purchase purchase purchase
amount amount amount
Note1: Due to confidential business information and nondisclosure agreement concerns, some real vendors’ names are substituted with codes.
Note2: Causes of increase and decrease－Supply chain diversification.
(2) Sales: Not Applicable.
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5. Production Quantities and Values of the Last Two Fiscal Years:
Unit: 1000 pieces; NT$ thousands
Year 2020 2019
Product Capacity Output Amount Capacity Output Amount
Computer and peripherals 32,780 25,971 114,469,514 29,568 23,169 97,073,813
6. Sales Quantities and Values of the Last Two Fiscal Years:

Unit: 1000 pieces; NT$ thousands
Year 2020 2019
Domestic Sales Export Sales Domestic Sales Export Sales
Product QTY Amount QTY Amount QTY Amount QTY Amount
Computer and peripherals 440 3,644,987 25,441 142,857,802 372 3,260,952 20,546 117,230,465
(Ⅲ)Employees
Status of employees over the past two years and up to the date of the report printed
Year As of
2020 2019
Item April 30,2021
Sales & Management 1,023 1,013 1,042
Employee Technician 1,814 1,731 1,834
Total 2,837 2,744 2,876
Average age(years) 37.97 37.82 37.99
Average years of service(years) 8.37 7.94 8.45
Ph.D 0.18 0.15 0.18
Masters 21.94 20.30 22.43
Education College/University 69.55 68.81 69.44
(%) Senior High School 7.01 8.97 6.68
Junior High School and below 1.32 1.77 1.27
Total 100.00 100.00 100.00
(Ⅳ)Environmental expenditures information

The company's operating activities are mainly about the production, assembly, research and development, sales of
electronic products and related administrative operations as it belongs to the non‐high pollution and high energy
consumption industry, but the MSI is still committed to improving environmental protection and green product
management. The relevant performance is as follows:
1. In the most recent year and as of the print and publication date of the annual report, is there any loss due to
environmental contamination? Disclose the estimated amount now and possibly occurring in the future and responsive
measures: None.
2. The management performance of the green products:
(1) The total amount of fines or derivative losses incurred in the most recent year due to product violations of international
environmental laws or clients’ requirements on hazardous substances: None.
(2) Issued “Green Product Control Regulations” and regularly revises them according to the latest international
environmental protection laws and clients’ requirements as the basis for the management of hazardous substances in
the supply chain, as well as the internal green product design and selection criteria.
(3)More than160,000 components have been certified by Green Products since 2010.
71
3.Environmental Management Performance:
The MSI operating activities are based on compliance with environmental laws 、continuous improvement of
processes、work environment and equipment to reduce pollutant emissions、energy consumption and safety and
health risks. Each environmental performance has a dedicated unit responsible for management and regular
monitoring. The following will describe the status of various environmental performances during the reporting period.
(1) Passed the ISO 14001 environmental management system certification.
(2) Passed the 14064‐1 Greenhouse Gas Accounting and Verification Certification for continuous improvement of
greenhouse gas reduction.
(3) Our facilities and products’ waste disposal management meet environmental protection requirements.
(4) The air/noise/sewage test results meet the requirements of the regional regulatory authorities.
4. Greenhouse Gas Management:

(1)The Company has carried out verification of greenhouse gas emission data since 2008 and has continually and
actively implemented energy conservation practices.
(2)In 2010, the Company began to be surveyed for the Carbon Disclosure Project (CDP).
(3)MSI is committed to managing carbon emission and greenhouse gas emission. We pledge to achieve the following
before 2030: 10% reduction in greenhouse gas emissions (2020 base),In 2020, in response to market demand, the
Taoyuan plant has been added as a production base, and a new version of the greenhouse gas inventory standard
(ISO‐14064:2018) was introduced, resulting in changes in the scope and calculation method of the greenhouse gas
emissions; and we will conduct continuous annual review on a rolling basis, Greenhouse Gas Emission of the
reporting period(2020) : 61,345 tons CO2e.
(4)Environmental related emissions data for the past two years are as follows:
Item / Year 2020 2019 Change(+/‐) Third‐party verification status
Amount of greenhouse gas 61,345 59,092 2,253 Verification has been conducted by Bureau Veritas Certification
(Taiwan) Co., Ltd. (BVC) in accordance with ISO14064‐1
emissions
‧ The verification statement is expected to be obtained on May 20,
(Metric Tons CO2e) 2020 (ISO14064‐1:2018)
Total water consumption 1,005.840 942.829 63,011 Disclosed in the Corporate Social Responsibility Report (CSR), and
verified by the British Standards Institution (BSI) Taiwan branch
(Megalitre)
‧ The CSR verification statement is expected to be obtained on June 4,
2020
Amount of waste 6,977,645 6,047,637 930,008 Disclosed in the Corporate Social Responsibility Report (CSR), and
verified by the British Standards Institution (BSI) Taiwan branch
generated
‧ The CSR verification statement is expected to be obtained on June 4,
(Kilogram) 2020
Note: The increase in the amount of greenhouse gas emissions, total water consumption, and waste generated in 2020 compared to 2019 is
due to the inclusion into operation of the Taoyuan plant.
5. The electricity saving measures management:

Since the Company deals mainly with factory assemblies and office R&D processes, there are no highly
energy‐consuming operations at all. Water and electricity account for the majority of our consumption. As such, we
are promoting water conservation, electricity saving, and improved power efficiency as part of our energy‐saving
efforts. Related measures are described below:
(1) Opening hours of boilers in the factory regulated living areas: Hot water usage is controlled by the IC card to
reduce the use of fuels.
72
(2) Use of the air‐compressor residual heat recycle system: Heat generated by the air compressor is recycled and
re‐heated to reduce the use of fuels.
(3) Air‐cooling efficiency regulation: By means of regular inspections, hot spots for air‐conditioning and areas with
relatively few people go through proper temperature regulation to reduce the use of electricity resources.
(4) Zoned electricity consumption control: Electricity meters are installed in respective segments of production lines
throughout the factory to control the electricity consumed for air‐conditioning, lighting, and power. This is also
enforced for the public cold‐water machine room and nitrogen air compressor machine room.
(5) Lighting modification: Office spaces of Micro‐Star have all been switched to use LED lights, which does not only increase
the required lighting intensity in workplaces but also is more effective in terms of energy‐saving.
(6) Water resource management: MSI adopts a water‐free environmental production process. The primary water source is tap
water to supply employee’s daily life. The main water resource management in respective plants promotes water‐saving.
The strategy is to improve the water usage facilities, such as installing water‐saving valves, and water‐saving faucets to save
water in daily activities. With respect to wastewater treatment, the operational and production plants all meet the
standards of sewage discharge prescribed by local government, and have reclaimed water systems in the factories. The
recycled water is used for plant irrigation and toilet flushing.
6. Waste Electrical and Electronic Equipment Management:

(1)EU zone: entered into recycling system or undertaken waste product recycling plans according to EU's Waste
Electrical and Electronic Equipment (WEEE) Directive and legal requirements in various EU nations. Products sold in
EU zones should be entered into local recycling systems, and products need to be labeled with WEEE recycle bin to
clearly ensure that we are in full compliance with WEEE Directive's regulations.
(2)Taiwan: recycling process of waste IT products is primarily handled by the Environmental Protection
Administration (EPA) in Taiwan. The Company pays fees pertaining to recycle processing according to regulations
for imported products, and these fees will be used toward recycling, issuing subsidies, audit approval for
quantities processed, management of recycling firms, and administration duties by the EPA.
(3)Other zones: the Company undertakes relevant procedures and registers at qualified recycling systems according
to local governmental requirements at different regions.
7. Corporate environmental protection expenditure and investments in 2020 are described as follows:
Amount (NTD)
Item 2020 2019 The goal and benefits
Includes waste disposal, sewage control and
The total expenditure on
23,914,457 20,629,333 inspection, external environment management
environmental protection
services, management system verification etc.
The total amount of The company's environmental equipment
investments in 307,703,000 247,474,000 operation and maintenance cost ensure that the
environmental protection equipment is working properly.
8. The Company has been certified by ISO and the certificates can be found from below link.
https://storage‐asset.msi.com/html/popup/csr_tw/about_management.html
73
(V) Employer‐employee relations
1. The various employee benefits, continuing education, training, retirement system available at the Company and their
implementation and the agreement between the employer and employees as well as protection of the various rights
of employees
(1)Employee benefits:
The Company believes in sharing its operational accomplishments with its employees. We have the Employee
Welfare Committee in place and we plan benefits for employees according to the Employee Welfare Guidelines so
that our employees have a steady life and their rights are protected. The various benefits we offer to employees
include group insurance, birthday giftfund, child birth and wedding giftfund, funeral and illness consolationfund,
gifts (vouchers) on Labor Day and Mid‐autumn Festival, arts and cultural events, society activities, periodic health
examinations, travel subsidies, employee restaurants, cafeteria, dormitory, subsidies for gatherings, library, medical
assistance room, nursery room, outstanding performance reward, year‐end bonus, employee rewards, and other
preferred solutions from time to time.
(2) Employee health management:
The Company cares about the health of its employees. There are professional medical assistance rooms available
on respective premises and health examinations are organized periodically in order to keep track of and care about
employees with abnormal health conditions. During flue seasons, there are reminders for employees so that they
reduce visiting public areas and pay closer attention to personal hygiene. The Company also reinforce cleaning and
disinfection of office areas and pay for the French trivalent Pasteur flu vaccine that it arranges for staff to receive. If
a rapid screen is determined by the physician that finds a positive flu result, the employee will be entitled to 3
consecutive days off on official leave so that he/she can stay home and get well soon.
(3)Employee Assistance Program (EAP)：
The Employee Assistance Project (EAP) was initiated on 1 November, 2011. By dialing 8585 (help me, help me in
Taiwanese), employees can get help for the following issues: work stress, emotional problems, tax, legal affairs,
medical care, and others. By combing internal and external services, EAP helps employees to solve related problems
and release work stress and emotions to regain mental health, so that their family will not need to worry about
their physical and mental condition.
(4)Employee Development:
Employee development is our focus. Given employees are indispensable from the future development of MSI;
therefore, we begin with the selection, education, and retention of employees. As for employee education, we
start from plan and implement internal and external training for employees. We have also established the Training
and Education Management Regulations as the reference of continuing education and internal training of
employees. Employees at MSI can receive continuing education and seek self‐development through comprehensive
learning channels and resources, such as internal training, external training, and expatriation.
A.Newcomer general education
Regularly held newcomer consensus trainings with contents including work rules, employees' rights and related
channels, the introduction to the MSI management system, green product concept, and corporate laws, general
education of hazardous substance, business continuity management, first‐aid knowledge, introduction of
74
infirmary, fire safety, labor safety and health education, IT Center, and other trainings with basic concepts and
case studies of current events. The training ratio for newcomers is 100%.
B.MSI University
We began planning the MSI University (MSIU) in 2009 to cope with the highly competitive business environment
in the electronics industry with talent cultivation. By improving the R&D and innovation capacity in key
technology and with the improvement of managerial competency and efficiency, we aim to enhance MSI
employees' competitiveness in the electronics industry.
① Leadership College
With the planning focus of strengthening the awareness of the supervisors' role, understanding the Company's internal
systems and operating procedures, and providing supervisors with leadership/management skills/employee care as the
planning focus, a complete and fast compulsory management course has been designed, so that supervisors can have
further training targeting their inadequate abilities, review what have been learned and learn something new, and the
new supervisors can also quickly get the hang of the job. In 2020, we focused on leadership courses in aspects such as
development of supervisory management skills, employee care and labor act practice, self-management and
communication.
② Sales and Marketing College This series of courses include semi‐annually skill development activities aimed at
reinforcing the sales and management skills of overseas managers. A series of courses is also planned for sales
executives overseas and at the head office to reinforce their abilities in market information surveying, selling
and management and marketing. These courses simulate actual market scenarios in Europe and the US, and
cover product knowledge, surveying customer needs, and actual selling at different stages. They focus on
hands‐on skills that can be directly applied to everyday operations.
③ R & D College：Focuses on helping the staff expand their research and development vision and think about
breakthrough methods. At the same time, the Company will study the application and development of artificial
intelligence (AI), and continue to strengthen R&D management capabilities such as market analysis and
product planning and problem analysis and resolution. At the same time, our internal R&D Technology
Committee hosts R&D Managers’ Conference quarterly to enable sharing and discussion of technology
resources and applications through a cross‐division information exchange platform for new technologies
④ Technical Skills College Technical skills courses are designed to enable continuous development of
manufacturing technology and mapping out of future directions.
⑤ E-School
In response to the sweeping wave of digital transformation, companies' business models, business strategies,
and marketing tactics are all facing the challenges of digital transformation. In view of this, the newly
established "E-School" under MSI University will focus on the development of digital thinking, professional
knowledge and key skills required by digital talents, and establish a complete set of training courses from
various aspects such as digital trends, digital technology and digital management to cultivate cross-field digital
transformation talents.
2020 Educational training Expenditures (NT$) Headcounts Total hours
External training Professional technical training 563,281 93 645

Internal training Management skills training, 1,780,201 3,808 8,513.5
professional training, general
education
75
(5)Pension plan:
The wage and pension system at MSI complies with local laws and regulations. The employee pension benefit plans are
constituted precisely and apply to the length of service for all formal employees before the implementation of Labor
Pension Act in July 1, in 2005. The plans are also applied to the seniority of those who choose to fall under the Labor
Standards Act after the implementation of Labor Pension Act. In the name of Supervisory Committee of Business
Entities Labor Retirement Reserve, retirement accounts are opened in Bank of Taiwan. In accordance with the old‐age
insurance system in the P.R.C., the MSIS and MSIK allocate pension premium for local workers based on a certain
proportions of their payroll every month. The pensions of all staff would be made overall arrangements by the
government. Please refer to page147~151 & 217~221.
(6)Since MSI was first established, in addition to constructing a positive, fair work environment and planning
comprehensive employee benefits, we have also established the "Work Protocols" as the basic set of behavioral guide
for employees to comply with. This is to clearly state the rights and obligations of both that the employees and the
management, as well as employee behavior and ethics. The content of which is as follows:
A. Employees should abide by the law and the Articles of Association and to abide by the supervision of their
supervisors.
B. Employees should not harm the good name and reputation of the Company, nor should employees use their
positions to receive gifts.
C. Employees shall not disclose the company's business, technical, and other confidential information.
D. Establish the standards of employee salaries, cash rewards, bonuses, retirement, leaves, and standards of incentives
and disincentives.
E. Sexual harassment prevention.
2.Losses borne due to employer‐employee conflicts in the most recent year and up to the date the annual report was
printed, possible estimated values at present and in the future, and countermeasures: There were no major
employer‐employee conflicts in the most recent year and up to the date the annual report was printed.
76
(Ⅵ)Material Contracts
Important contracts that remained effective as of the date the annual report was printed and expired in the most recent
year on supply and distribution, technical collaboration, engineering projects, long‐term loans and that are sufficient to
impact shareholders’ equities:
Nature of Contracting Party Term of Agreement Main contents Restrictions
contract
Large Microsoft Corporation From Aug.1, 2018 till GLOBAL PARTNER Non‐negotiable
authorization termination by either AGREEMENT
contract party Windows, Office,
Apps & DSB
software licensing
77
Ⅵ. Financial Information
(Ⅰ) Five‐Year Financial Summary
1. Condensed Balance Sheet
(1) Condensed Balances Sheet (Consolidated)
Unit: NT$ thousands
Financial Summary for The Last As of March
Year
Five Years (Note1) 31,2021
Item 2020 2019 2018 2017 2016 (Note2)
Current assets 71,361,468 53,761,821 49,356,897 43,185,288 44,556,225 74,645,575
Property, plant and equipment (Note3) 5,130,094 4,893,433 4,738,544 5,087,802 5,092,392 5,421,003
Intangible assets ‐ ‐ ‐ ‐ ‐ ‐
Other assets 1,905,953 1,693,454 1,078,732 880,299 819,167 1,967,521
Total assets 78,397,515 60,348,708 55,174,173 49,153,389 50,467,784 82,034,099
Before
distribution 42,192,490 28,625,273 24,765,061 20,920,657 23,193,111 41,754,597
Current After
liabilities distribution (Note4) 32,173,669 28,989,343 24,722,509 26,994,964 (Note4)
Non‐current liabilities 665,173 710,970 463,251 429,462 384,175 688,685
Before
distribution 42,857,663 29,336,243 25,228,312 21,350,119 23,577,286 42,443,282
Total After
liabilities distribution (Note4) 32,884,639 29,452,594 25,151,971 27,379,139 (Note4)
Equity attributable to shareholders
of the parent 35,539,852 31,012,465 29,945,861 27,803,270 26,890,498 39,590,817
Share capital 8,448,562 8,448,562 8,448,562 8,448,562 8,448,562 8,448,562
Before
distribution 804,214 803,918 1,226,049 1,225,615 2,070,471 804,214
Capital surplus After
distribution (Note4) 803,918 803,620 1,225,615 1,225,615 (Note4)
Before
distribution 26,961,534 22,554,510 20,777,216 18,550,908 16,601,625 31,131,375
Retained After
earnings distribution (Note4) 19,006,114 16,975,363 14,749,056 13,644,628 (Note4)
Other equity interest (674,458) (794,525) (505,966) (421,815) (230,160) (793,334)
Treasury shares ‐ ‐ ‐ ‐ ‐ 0
Non‐controlling interests ‐ ‐ ‐ ‐ ‐ 0
Before
distribution 35,539,852 31,012,465 29,945,861 27,803,270 26,890,498 39,590,817
After
Total equity distribution (Note4) 27,464,069 25,721,579 24,001,418 23,088,645 (Note4)
Note1: The above financial information for each year was audited by CPA.
Note3: MSI did not carry out asset revaluation from 2016 to 2021Q1.
Note4: Subject to the approval of annual shareholders’ meeting 2021.
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(2) Condensed Balance Sheet (Stand alone)
Unit: NT$ thousands
Financial Summary for The Last
Year
Five Years (Note1)
Item 2020 2019 2018 2017 2016
Current assets 68,862,669 51,885,809 47,717,145 41,279,986 42,260,743
Property, plant and equipment (Note2) 2,660,668 2,567,030 2,363,138 2,373,408 2,399,128
Intangible assets ‐ ‐ ‐ ‐ ‐
Other assets 9,335,885 8,254,456 7,497,489 7,685,025 8,724,428
Total assets 80,859,222 62,707,295 57,577,772 51,338,419 53,384,299
Before distribution 44,922,050 31,246,204 27,296,657 23,228,722 26,262,842
Current liabilities
After distribution (Note3) 34,794,600 31,520,939 27,030,574 30,064,695
Non‐current liabilities 397,320 448,626 335,254 306,427 230,959
Total liabilities
Equity attributable to shareholders of the parent 35,539,852 31,012,465 29,945,861 27,803,270 26,890,498
Share capital 8,448,562 8,448,562 8,448,562 8,448,562 8,448,562
Before distribution 804,214 803,918 1,226,049 1,225,615 2,070,471
Capital surplus
After distribution (Note3) 803,918 803,620 1,225,615 1,225,615
Retained earnings
Other equity interest (674,458) (794,525) (505,966) (421,815) (230,160)
Treasury shares ‐ ‐ ‐ ‐ ‐
Non‐controlling interests ‐ ‐ ‐ ‐ ‐
Total equity
Note1：The above financial information for each year was audited by CPA.
Note2：MSI did not carry out asset revaluation from 2016 to 2020.
Note3：Subject to the approval of annual shareholders’ meeting 2021.
79
2. Condensed Statement of Comprehensive Income
(1) Condensed Statement of Comprehensive Income (Consolidated)
Unit: NT$ thousands
Financial Summary for The
Year As of March
Last Five Years (Note1)
Item 2020 2019 2018 2017 2016 31,2021 (Note2)
Sales revenue 146,502,789 120,491,417 118,527,273 106,419,905 102,190,503 48,004,960
Net operating margin 21,302,840 15,862,156 16,129,686 15,031,293 14,951,670 9,152,661
Operating profit 9,187,828 5,952,406 6,691,950 5,613,660 5,518,939 4,995,637
Non‐opera ng income and expenses 409,065 566,027 459,184 364,892 303,233 156,560
Profit before income tax 9,596,893 6,518,433 7,151,134 5,978,552 5,822,172 5,152,197
Income (Losses) from continuing operations
7,959,505 5,587,210 6,041,129 4,937,422 4,887,942 4,169,841
for the year
Losses from discontinued operations ‐ ‐ ‐ ‐ ‐ ‐
Profit for the year 7,959,505 5,587,210 6,041,129 4,937,422 4,887,942 4,169,841
Other comprehensive income for the year (Net of
115,982 (296,622) (97,120) (222,797) (777,650) (118,876)
income tax)
Total comprehensive income for the year 8,075,487 5,290,588 5,944,009 4,714,625 4,110,292 4,050,965
Profit attributable to shareholders of the parent 7,959,505 5,587,210 6,041,129 4,937,422 4,887,942 4,169,841
Profit attributalbe to non‐controlling interests ‐ ‐ ‐ ‐ ‐ ‐
Total comprehensive income attributable to
8,075,487 5,290,588 5,944,009 4,714,625 4,110,292 4,050,965
shareholders of the parent
‐ ‐ ‐ ‐ ‐ ‐
non‐controlling interests
Earnings per share (NT$) 9.42 6.61 7.15 5.84 5.79 4.94
Note3: MSI did not capitalize its annual interest expense from 2016 to 2021Q1.
80
(2) Condensed Statement of Comprehensive Income (Stand alone)
Unit: NT$ thousands
Year Financial Summary for The Last Five Years (Note1)
Item 2020 2019 2018 2017 2016
Sales revenue 144,805,966 118,740,373 116,988,422 105,404,563 100,749,878
Net operating margin 18,928,040 13,642,788 14,232,111 13,374,882 13,342,413
Operating profit 8,654,445 5,485,208 6,340,116 5,302,969 5,191,871
Non‐operating income and expenses 773,635 919,011 689,118 549,147 542,204
Profit before income tax 9,428,080 6,404,219 7,029,234 5,852,116 5,734,075
Income (Losses) from continuting operations
for the year 7,959,505 5,587,210 6,041,129 4,937,422 4,887,942
Losses from discontinued operations ‐ ‐ ‐ ‐ ‐
Profit for the year 7,959,505 5,587,210 6,041,129 4,937,422 4,887,942
Other comprehensive income for the year (Net of
income tax) 115,982 (296,622) (97,120) (222,797) (777,650)
Total Comprehensive income for the year 8,075,487 5,290,588 5,944,009 4,714,625 4,110,292
Profit attributable to shareholders of the parent 7,959,505 5,587,210 6,041,129 4,937,422 4,887,942
Profit attributalbe to non‐controlling interests ‐ ‐ ‐ ‐ ‐
shareholders of the parent 8,075,487 5,290,588 5,944,009 4,714,625 4,110,292
Total comprehensive income attributable to non‐
controlling interests ‐ ‐ ‐ ‐ ‐
Earnings per share (NT$) 9.42 6.61 7.15 5.84 5.79
Note2: MSI did not capitalize its annual interest expense from 2016 to 2020.
3. Auditors’ Opinions from 2016 to 2020

Auditing Year Accounting Firm CPAs Audit Opinion
2016 PricewaterhouseCoopers Chou, Hsiao‐Tzu Unqualified opinion with other matters

Lai,Chung‐Hsi paragraphs
2017 PricewaterhouseCoopers Liang, Hua‐Ling Unqualified opinion with other matters




Note: CPA changed in 2017 due to PricewaterhouseCoopers’ internal organization change.
81
(Ⅱ) Five‐Year Financial Analysis
1. Financial Analysis for Consolidated Report
Financial Analysis for Consolidated Report
Year Financial Analysis in the past Five Years (Note1) As of March

31,2021
2020 2019 2018 2017 2016
Item (Note2)
Financial Ratio of liabilities to assets 54.67 48.61 45.72 43.44 46.72 51.74
structure % Ratio of long‐term capital to
property, plant and equipment 705.74 648.29 641.74 554.91 535.60 743.03
Current ratio 169.13 188.25 199.30 206.42 192.11 178.77
Solvency
Quick ratio 99.71 103.70 104.68 122.23 115.93 111.70
%
Times interest earned 30,141.93 27,783.82 49,733.08 178,404.56 226,291.61 110,283.85
Accounts receivable turnover (times) 7.46 7.22 7.59 7.24 7.66 7.84
Average collection period 49 51 48 50 48 47
Inventory turnover (times) 4.91 4.56 5.19 5.45 5.42 5.68
Operating Accounts payable turnover (times) 5.26 5.92 6.61 5.36 5.10 5.67
performance Average days in sales 74 80 70 67 67 64
Property, plant and equipment
turnover (times) 29.23 25.02 24.12 20.91 19.42 36.40
Total assets turnover (times) 2.11 2.09 2.27 2.14 2.11 2.39
Ratio of return on total assets (%) 11.51 9.71 11.60 9.92 10.08 20.81
Ratio of return on equity (%) 23.92 18.33 20.92 18.05 18.57 44.40
Ratio of Profit before tax to paid‐in
Profitability
capital (%) 113.59 77.15 84.64 70.76 68.91 243.93
Profit ratio (%) 5.43 4.64 5.10 4.64 4.78 8.69
Earnings per share (NT$) 9.42 6.61 7.15 5.84 5.79 4.94
Cash flow ratio (%) 25.66 32.40 0.34 11.68 21.72 8.28
Cash flow Cash flow adequacy ratio (%) 79.89 80.93 49.76 83.34 94.93 91.93
Cash reinvestment ratio (%) 17.54 13.84 (10.00) (3.80) 5.97 7.52
Operating leverage 1.55 1.74 1.64 1.73 1.76 1.35
Leverage
Financial leverage 1.00 1.00 1.00 1.00 1.00 1.00
Analysis of financial ratio differences over 20% for the last two years:
Ratio of return on equity Profit for the year increased, causing the increase in ratio of return on equity.
Ratio of Profit before tax to Profit before income tax this year increased, causing the increase in ratio of profit before tax to paid‐in capital.
paid‐in capital
Earnings per share Profit for the year increased, causing the increase in earnings per share.
Cash flow ratio The increase in current libilities caused the decrease in cash flow ratio.
The net cash flow from operating activities this year increased while the cash dividend decreased, causing the
Cash reinvestment ratio
increase in cash reinvestment ratio.
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2.Financial Analysis for separate report
Financial Analysis for Stand Alone Report

Financial Analysis in the past Five
Year Years(Note)
Item 2020 2019 2018 2017 2016

Ratio of liabilities to assets 56.05 50.54 47.99 45.84 49.63
Financial
structure % Ratio of long‐term capital to
property, plant and equipment 1,350.68 1,225.58 1,281.39 1,184.36 1,130.47
Solvency Current ratio 153.29 166.05 174.81 177.71 160.91
Quick ratio 89.86 88.90 89.52 102.11 94.49
%
Times interest earned 44,061.95 47,524.61 77,951.74 796,306.26 731,487.12
Accounts receivable turnover
(times) 7.10 6.96 7.32 7.03 7.31
Average collection period 51 52 50 52 50
Inventory turnover (times) 4.97 4.58 5.20 5.49 5.48
Operating Accounts payable turnover
performance (times) 5.45 6.11 6.73 5.40 5.15
Average days in sales 73 80 70 66 67
Property, plant and equipment
turnover (times) 55.40 48.17 49.40 44.17 41.81
Total assets turnover (times) 2.02 1.97 2.15 2.01 1.96
Ratio of return on total assets (%) 11.11 9.31 11.11 9.43 9.50
Ratio of return on equity (%) 23.92 18.33 20.92 18.05 18.57
Ratio of Profit before tax to paid‐in
Profitability
capital (%) 111.59 75.80 83.20 69.27 67.87
Profit ratio (%) 5.50 4.71 5.16 4.68 4.85
Earnings per share (NT$) 9.42 6.61 7.15 5.84 5.79
Cash flow ratio (%) 20.28 26.24 (3.62) 4.05 15.42
Cash flow Cash flow adequacy ratio (%) 67.52 70.28 37.15 69.60 84.70
Cash reinvestment ratio (%) 15.36 12.49 (15.44) (9.91) 3.93
Operating leverage 1.48 1.63 1.54 1.62 1.65
Leverage
Financial leverage 1.00 1.00 1.00 1.00 1.00
Note: The above financial information for each year was audited by CPA.
Analysis of financial ratio differences over 20% for the last two years:
Ratio of return on equity Profit for the year increased, causing the increase in ratio of return on equity.
Ratio of Profit before tax to
Profit before income tax this year increased, causing the increase in ratio of profit before tax to paid‐in capital.
paid‐in capital
Earnings per share Profit for the year increased, causing the increase in earnings per share.
Cash flow ratio The increase in current libilities caused the decrease in cash flow ratio.
Cash reinvestment ratio
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Glossary:
1. Financial structure
(1) Ratio of liabilities to assets = Total liabilities / Total assets
(2) Ratio of long‐term capital to property, plant, and equipment = (Total 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) Times interest earned = Net income before tax and interest expense/ Interest expense of the year
3. Operating ability
(1) Accounts receivable turnover (including accounts receivable and notes receivable derived from business operation) =
Net sales / Average accounts receivable (including accounts receivable and notes receivable derived from business
operation).
(2) Average collection period = 365 / Accounts receivable turnover
(3) Inventory turnover = Cost of goods sold / Average inventory amount
(4) Accounts payable turnover (including accounts payable and notes payable derived from business operation) = Cost of
goods sold / Average accounts payable (including accounts payable and notes payable derived from business operation)
(5) Average days in sales = 365 / Inventory turnover
(6) Property, plant, and equipment turnover = Net sales / Average net property, plant, and equipment
(7) Total assets turnover = Net sales / Average total assets
4. Profitability
(1) Ratio of return on total assets= [Net income (loss) + Interest expense x (1 ‐ tax rate)] / Average total assets
(2) Ratio of return on Equity = Net income (loss) / Average total equity
(3) Profit ratio = Net income (loss) / Net sales
(4) Earnings per share = (Profit attributable to shareholders of the parent – preferred stock dividend) / Weighted average
stock shares issued
5. Cash flow
(1) Cash flow ratio = Net cash flow from operating activity / Current liabilities
(2) Net cash flow adequacy ratio = Net cash flow from operating activity in the past five years / (Capital expenditure +
Inventory increase + Cash dividend) in the past five years
(3) Cash reinvestment ratio = (Net cash flow from operating activity ‐ Cash dividend) / (Gross property, plant, and
equipment + Long‐term investment + Other non‐current assets + working capital)
6. Leverage
(1) Operating leverage = (Net Sales revenue – Variable operating cost and expense) / Operating profit
(2) Financial leverage = Operating profit / (Operating profit ‐ interest expense)
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(Ⅲ) Audit Committee's Review Report of 2020.
Audit Committee's Review Report
The Board of Directors has prepared the Company's 2020 Business Report, Financial Statements, and
proposal for allocation of earnings. The CPA firm of PWC was retained to audit MSI's Financial Statements and
has issued an audit report relating to the Financial Statements. The Business Report, Financial Statements, and
earnings allocation proposal have been reviewed and determined to be correct and accurate by the Audit
Committee members of Micro‐Star International Co., Ltd. According to relevant requirements of the Securities
and Exchange Act and the Company Law, we hereby submit this report.
Micro‐Star International Co., Ltd.
Chairman of the Audit Committee:

Mr. Wang,Sung‐Chou
March 22, 2021
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(Ⅳ)Financial statements in the most recent years : Please refer to page108～181
(Ⅴ) Corporation‐only financial report audited and attested by a CPA from the most recent year: Please refer to
page 182～242
(Ⅵ)State the financial position of the Company if any insolvency occurs in the Company or affiliates in the most
recent year until the date this report is printed：None
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Ⅶ. Review of Financial Conditions, Financial Performance, and Risk Management
(Ⅰ) Analysis of Financial Status

Comparison and Analysis of Financial Status
Unit: NT$ thousands
Year Difference
2020 2019
Item Amount %
Current Assets 71,361,468 53,761,821 17,599,647 32.74%
Property, plant, and equipment 5,130,094 4,893,433 236,661 4.84%
Intangible assets ‐ ‐ ‐ ‐
Other Assets 1,905,953 1,693,454 212,499 12.55%
Total Assets 78,397,515 60,348,708 18,048,807 29.91%
Current Liabilities 42,192,490 28,625,273 13,567,217 47.40%
Non‐current liabilities 665,173 710,970 (45,797) (6.44%)
Total Liabilities 42,857,663 29,336,243 13,521,420 46.09%
Equity attributable to shareholders 35,539,852 31,012,465 4,527,387 14.60%
of the parent
Share capital 8,448,562 8,448,562 0 0.00%

Capital surplus 804,214 803,918 296 0.04%
Retained Earnings 26,961,534 22,554,510 4,407,024 19.54%
Other equity interest (674,458) (794,525) 120,067 15.11%
Treasury shares ‐ ‐ ‐ ‐
Non‐controlling interests ‐ ‐ ‐ ‐
Total Equity 35,539,852 31,012,465 4,527,387 14.60%
(1) Analysis of significant changes in assets, liabilities and equity for the last two years:
Current assets: The increase was mainly due to increase in cash, accounts receivable and inventory.
Total assets: The increase was mainly due to increase in current assets.
Current liabilities: The increase was mainly due to increase in short‐term borrowings, accounts payable, other payables, tax
liabilities and refund liabilities.
Total liabilities: The increase was mainly due to increase in current liabilities.
(2) Future plans for the major impact on financial position：The above deviations were caused by general business operations, having
no major impact on MSI’s financial position.
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(Ⅱ) Analysis of Financial Performance
Comparison and Analysis of Financial Performance

Unit: NT$ thousands
Year
2020 2019 Amount %
Item
Sales revenue 146,502,789 120,491,417 26,011,372 21.59%
Net operating margin 21,302,840 15,862,156 5,440,684 34.30%
Operating profit 9,187,828 5,952,406 3,235,422 54.35%
Non‐operating income and expenses 409,065 566,027 (156,962) (27.73%)
Profit before income tax 9,596,893 6,518,433 3,078,460 47.23%
Income (Losses) from continuting 7,959,505 5,587,210 2,372,295 42.46%
operations
Losses from discontinued operations ‐ ‐ ‐ ‐
Profit for the year 7,959,505 5,587,210 2,372,295 42.46%
Other comprehensive income for the year 115,982 (296,622) 412,604 139.10%
(Net of income tax)
Total comprehensive income for the year 8,075,487 5,290,588 2,784,899 52.64%
Profit attributable to sharholders of the 7,959,505 5,587,210 2,372,295 42.46%
parent
Profit attributable to non‐controlling ‐ ‐ ‐ ‐
interests
Total comprehensive income attributable 8,075,487 5,290,588 2,784,899 52.64%
to shareholders of the parent
Total comprehensive income attributable ‐ ‐ ‐ ‐

to Non‐controlling interests
Earnings per share 9.42 6.61 2.81 42.51%
1. Analysis of significant changes in sales revenue, operating profit, and profit before income tax for the last 2
years:
Sales revenue: The increase was mainly due to increase in shipments of computers and peripherals.
Net operating margin: The increase was mainly due to increase in shipments and gross margin of computers
and peripherals.
Operating profit: The increase was mainly due to increase in net operating margin.
Non‐operating income and expenses: The decrease was mainly due to increase in other losses.
Profit before income tax: The increase was mainly due to increase in net operating income.
Income from continuting operations: The increase was mainly due to increase in net operating income.
Profit for the year: The increase was mainly due to increase in net operating income.
Other comprehensive income for the year: The increase was mainly due to increase of financial statements
translation differences from foreign entities.
Total comprehensive income for the year: The increase was mainly due to increase in profit for the year.
Earnings per share: The increase was mainly due to increase in profit for the year.
2.Possible impact on financial performance and future plans:

There is no disadvantage on future finance and business.
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(Ⅲ)Analysis of Cash Flow
Unit：NT$ thousands
Remedial measures for the
Net cash flow from Cash Cash surplus
Beginning cash expected insufficient cash
operating activities inflow(outflow) (deficit)
balance Investment
(B) (C) (A)+(B)+(C) Financing plan
(A) plan
10,709,045 10,824,668 (2,947,758) 18,585,955 ‐ ‐
1. Analysis of Cash flow change:
(1) Operating activities: cash inflow 10,824,668
(2) Investing activities: cash outflow 792,535
(3) Financing activities: cash outflow 2,274,801
(4) Exchange rate changes: cash inflow 119,578
2. Remedial actions for liquidity shortfall: Not Applicable.

Year 2020 2019 Variance
Item
Cash flow ratio 25.66% 32.40% (20.80%)
Cash flow adequacy ratio 79.89% 80.93% (1.29%)
Cash reinvestment ratio 17.54% 13.84% 26.73%
Analysis of financial ratio change:
The increase in current libilities caused the decrease in cash flow ratio.
3. Cash flow analysis for the coming year:

Unit：NT$ thousands
Beginning Estimated net cash Estimated cash Estimated Cash Remedial measures for the
cash balance flow from operating inflow(outflow) surplus (deficit) expected insufficient cash
activities Investment
Financing plan
plan
18,585,955 14,600,000 (9,600,000) 23,585,955 ‐ ‐
(1) Analysis of cash flow change in current period:
A. Operating activities: Cash inflow this year is expected to be due to profit and working capital changes.
B. Investing and financing activities：Cash outflow this year is expected to be due to the issuance of cash dividend
and equipments and short‐term loans replacement.
(2) Remedial actions for liquidity shortfall: Not Applicable.
(Ⅳ) Recent years major capital expenditures and impact on financial and business: The Company had no
capital expenditures that have a significant impact on the financial and business in 2020.
(Ⅴ)Reinvestment in recent years:

1.The company's reinvestment policy for the most recent fiscal year:
The re‐investment policy of the Company is meant mainly to explore overseas markets and provide
in‐depth services in major countries so that the revenue and worldwide market shares can be increased.
2.The main reasons for the profits/losses generated thereby, the plan for improving re‐investment
profitability: Income from reinvested businesses of the Company in 2020 totaled NT$667,569 thousand
mainly due to COVID 19 pandamic economy, work from home, learn from home, increased consumer
demand, growths in sales of overseas subsidiaries, and stable profits.
3.Investment plans for the coming year: Currently, no significant investment plans will be processed this
year.
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(Ⅵ)Risk analysis and evaluation in recent years and up to the date of the annual report printed
1.The impact of interest rate, exchange rate, and inflation on the Company’s income and expense and the
responsive measures:
(1) Interest rate
The changing interest rate can impact the Company in two parts. As far as assets are concerned, income
for the Company from cash and cash equivalents increases or decreases as the interest rate changes. For
liabilities, expenditure on interest charged for short‐term loans also increases or decreases as the
interest rate changes. The impacts on the assets and liabilities from the changing interest rate as
described above can be counterbalancing. If it is expected that the interest rate will significantly change,
the Company can reduce its impact on the Company’s profits and losses by adjusting durations of
deposits and borrowings or through interest rate swap.
(2) Exchange rate
Sales of the Company are mainly export‐oriented. Among them, more than 70% are priced in USD.
Among the materials purchased, also more than 90% are paid in USD. The natural hedging ratio is high.
Plus the current exchange rate hedging that is adopted to reduce risks associated with the changing
exchange rate, the impacts of changing exchange rate on the Company are not too huge. The Company
will continue to reduce the impacts that the changing exchange rate has on profits and losses by
undertaking hedging transactions.
(3) Inflation
Generally speaking, inflation affects the purchasing power and willingness of consumers and reduces
the demand for consumer products; it will have a negative influence on the overall revenue and profits
and losses of the Company. Impacts of inflation, however, are comprehensive; that is, not only individual
companies are affected. In other words, the government financial departments shall stipulate related
measures with macroeconomics in mind. Nevertheless, the Company will devoted to bringing down its
production cost in order to keep its revenue by introducing products at a price that can better inspire
consumers to buy and to accordingly reduce the negative impacts that inflation has on the Company's
profits and losses.
2.Conducting high‐risk and high‐leverage investment, granting loans to others, endorsement & guarantee
and directives policy, root cause of profit and loss, and the responsive measures:
The Company’s policy is not to undertake high‐risk, high‐leverage investments and not to lend funds to
others or serve as endorser or guarantor. In terms of its policy on derivatives, it only engages itself in
hedging transactions. The exchange rate hedging transactions the Company undertook in the most recent
year accordingly reduced the impacts of the changing exchange rate on the Company’s profits and losses.
In the future, such undertaking will keep going in order to reduce the impacts that the volatility in
exchange rate on the Company's profitability.
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3.R&D plans and budgeted R&D expense：
Products development planned in 2021
(1)Products development
A. Motherboards
 Development of the next generation of Intel® Gaming, Content Creation and Business Professional
motherboards.
 Development of the new AMD® 500 Series Gaming and Business Professional motherboards for the Ryzen™
5000 series processors.
 Development of the new AMD® TRX40 Series business professional motherboards for the new Ryzen™
Threadripper series processors.
 Development of high performance and more reliable motherboards that can support more core processors
 Development of high‐specs motherboards with latest technology and better heat dissipation.
 Development of better thermal solution and coating for the heatsink on motherboard.
 Development of new RGB effect and materials for a better gamer experience.
 Development of more expansion cards for different functions and applications.
 Improvement of S/W applications to provide better performance and experience.
B. Professional Graphics Card

 Development of graphics card and thermal modules with better performance and lower energy
consumption.
 Development of overclocking graphics card with the latest technology and components.
 Development of fans with better heat dissipation and lower noise.
 Development of graphics card with improved RGB lighting effects and functions.
 Continuous improvement and integration of graphics card S/W applications.
 Development of more professional Gaming peripherals
 Development of Creator Series graphics card solution.
C. Servers
 Development of the new generation Server and GPGPU system with Intel® Eagle Stream and AMD® Genoa
platform.
 Development of the new generation Network application system with Intel® Catlow & Tanner Ridge & Elkhart
Lake platform.
 Development of the Telecom next generation firewall (NGFW) 16U chassis‐based system
 Development of the next generation firewall (NGFW) with Intel® Whitley platform and switch fabric PAM4
400G enhancement.
 Development of the next generation firewall (NGFW) with AMD® Rome platform and switch fabric 100G
enhancement.
 Development of the new generation Facial Recognition System with Intel® Tiger Lake‐UP3 platform.
 Development of the new generation POS with Intel® Elkhart Lake platform.
D. Desktop Computers
 Develop Intel® latest desktop computers on Rocket Lake and Alder Lake platforms.
 Develop a series of desktop computers with the latest AMD® platform.
 Develop Gaming desktops suitable for the use of games streaming.
 Develop compact Creator series desktops.
 Develop a series of desktops for Business professionals.
 Develop a series of All‐in‐one desktops for High‐end Business applications.
 Continue to develop an exclusive heat dissipation technology ‐ Silent Storm Cooling.
 Continue to develop software application ‐ MSI Center that meets the needs of customers.
 Develop Gaming desktops that combine AI technologies to provide players with products that are more
intuitive to use.
E. Telematics and Automotive Electronics

 Rugged tablet with AI computing capability for next‐generation heavy vehicles.
 Rugged vehicle‐mounted intelligent data communication gateway.
 8K multi‐screen wireless projection system.
 New generation MOD server.
 Face recognition and temperature measurement system.
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 UVC sterilization system for vehicles.
F. Laptops
 Designed Gaming laptops with more immersive gaming experience.
 Incorporated AI applications into laptops.
 All new “Business & Productivity” laptops with enterprise security and business needs.
 Designed Professional laptops targeting at Content Creators, aimed to improve work efficiency.
 Devoted efforts to develop Professional Workstations with more linkage to professional ISVs.
G. Monitors
 Development of the high‐end curved Gaming monitors with features such as wide screen size, 4K and WQHD
high resolution.
 Continuing the development of the Gaming monitors that adhere to the standard of eSports tournaments.
 Continuing the development of Gaming monitors that can show game‐related status and information on the
monitor panel
 Applying AI technology to Gaming monitors.
 Innovating monitors that are suitable for professionals within the Multimedia and Content Creation industry.
 Innovating Professional monitors with high refresh rate that bring a more confortable viewing experience for
users.
 Innovating Professional monitors with Smart Sensor and Active Noise Cancellation (ANC) Technology that
bring the best viewing experience & enhanced productivity for users.
 Innovating curved professional monitor that bring the most comfortable environment for users while working
for a long time.
H. Case (Others)
 Develop an AI control device to provide a better experience for the AI environment setting.
 Enhance the MSI Center software connection for all MSI products.
 Added liquid coolers around case products to provide a complete user experience.
 Provide peripheral wire accessories for ITX cases or vertical graphics card installations.
 Continue to conduct research and development on silence themed products, with the Silent Gale fan
developed by MSI as the key player and apply it to MSI cases, liquid coolers, and power supply products.
 Enhanced fan stop technology for liquid coolers, cases, and power supplies. Users can save on power bills
and have a quieter experience in low loading situations.
I. AMR (Autonomous Mobile Robot)

 AMR Factory Automation related products.
 AMR Hospital Care related products.
 AMR Long Care related products.
(2) Progress of unaccomplished R&D plans: Product design and development stage.
(3) Current progress of R&D projects yet to be completed: The overall progress is about 20% to 80% at present,
depending on respective products involved.
(4) Major factors that affect the future success of R&D：A. Market factor B. Delayed key parts and components C.
Shortage of parts and components.
(5)R&D budget in 2021：NT$3.75 billion
(6)Projection on mass production:2021～2022。
4.The impact of domestic and international policies and law change on the Company’s finance and the
responsive measures：None
5.The impact of technology change and industrial change on the Company’s finance and the responsive
measures：None
6.The impact of industrial image change on business risk management and the responsive measures：None
7.The expected effect, potential risk, and responsive measures of merger：None
8.The expected effect, potential risk. and responsive measures of plant expansion：None
9.The risk relating to excessive concentration on procurement and customer：None
10.The impact of massive stock transfer or change by directors, supervisors, and shareholders with over 10%
shareholding, the risk, and the responsive measures：None
11.The impact of right to operate change on the Company. The risk, and the responsive measures：None
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12.Legal and non‐legal events：
(1)As of the publication date of annual report, whether the directors, supervisors, President, and
shareholders with shareholding ratio over ten percent of the Company are involved in any significant
litigation, non‐litigation or administrative litigation cases, such cases have been sentenced or are
currently pending, and the results there of have a significant impact on shareholders’ equity or securities
price：None
(2) Significant litigation, non‐litigation or administrative litigation cases of the Company in the most recent
years and up to the date, such cases that have been sentenced or are currently pending, and the results
thereof that have a significant impact on shareholders’ equity or securities price：None
13.Other significant risks and responsive measure：
(1) Risk management policy: The Company’s policy towards risk management is to evaluate possible impacts
of the various risk matters on the profits and losses of the Company and to stipulate respective response
policies accordingly.
Risk assessment Impacts on profits and losses Countermeasure
1. Financial risk The Company has an optimal financial Continue with the optimal financial
structure; its debt ratio is 55% and structure in order to reduce financial risk
net worth reaches 35.5 billion.
Financial risk is hence not high.
(1) Market risk (including Major products of the Company are Continue to diversify areas of distribution in
exchange rate and sold to Europe, Asia, and America; order to reduce market risk
interest rate) they are not overly focused on a
specific single market. Therefore,
market risk is not high.
(2 ) Credit risk The primary credit risk of the Company Continue to have accounts receivable
comes from accounts receivable from covered by insurance as safety measure to
its customers. Insurance has been reduce credit risk
purchased for the accounts receivable
as safety measure to reduce such risk.
Therefore, credit risk is not high.
(3) Liquidity risk The current ratio of the Company is Continue with the optimal current ratio in
up to 169%; the liquidity risk is not order to reduce liquidity risk
high.
(4) For the nature and extent of significant financial risks, refer to Pages 161～167 , 233～239 for details.
2. Legal risk ‐ domestic laws The Labor Standards Act was revised With the implementation of the new
and regulations on December 21, 2016. (One fixed system under the Labor Standards Act,
day off and one flexible rest day) companies follow the Labor Standards Act
while calculating the service hours, days
available for leave, and overtime for their
employees and calculation of overtime for
working on days off is added to the revised
Act. In addition, service on days off is
under strict control in order to meet
regulatory requirements.
Labor Incident Act implemented from To comply with the Act, the Company
Jan. 1, 2020 holds seminars for managers in order to
have better communication between
supervisors and staffs and minimize the
laber cases. Meanwhile, employees and
his/her supervisors may receive emails
from the Company when employees work
overtime. The email is indicating the
Compnay’s care and willing to assist.
Supervisors of employees may evaluate if
any adjustment needed for the job
loading.
93
3. Evaluation of strategic and The Company successfully extended (1) Periodically review the growths in core
operational risks its scope of business from core sectors
products, such as computer Set goals for growth, market share, and
motherboards, display cards, and profitability that are higher than
laptops to servers and automobile industrial averages
electronics, among other diversified (2) Set reasonable return on investment
fields. As far as operation is based on the careful evaluation in
concerned, as the management advance and the management plan for a
complexity increases, daily response new business and demand that profits
mechanisms need to be developed for and losses reach a balance within a
the evaluation of strategic and given period of time. Set phased
operational risks. strategic goals reflective of the nature of
In terms of management, the strategy the sector involved, such as obtaining
is to extend core specialties and purchase orders from prospective
combine the many technologies customers, timely mass production, and
researched and developed over the securing a certain market share on the
years and to keep track of demand on strategic target market.
the market for the industry. The hope (3) Related departments meet on a monthly
is to create another wave of growths basis to review the operational efficacy
for the Company and to bring about and examine and adjust the strategies
maximum benefits for the Company’s on a quarterly basis; related
shareholders. organizational adjustment is made right
In order for strategic goals to be away for unachievable ones in order to
precisely fulfilled, the Company control risk.
operates by connecting the value (4) Keep timely track of daily operations
chain through its business around the world through the real‐time
departments and the functional main information system, including
part when it comes to organization shipment, stock, purchase order,
and operation. Annual goals are set operating fund, among others, and set
according to the competition in the the alert criteria.
industry facing product business (5) Gather managers around the world
departments and managerial periodically to discuss management
meetings are called for periodically to strategies that concern where the
discuss the strategy and operational Company will go next. High‐raking
efficacy in order to adopt immediate management is to adjust strategies
countermeasures that help bring taking into consideration resources
down operational risk. available throughout the Company and
the operational status.
In light of the rapidly changing operating
environment for the high‐tech industry,
the Company proactively invests in
information technology and the required
talent internally and keeps track of
changes in customers, products, and
techniques externally. It will constantly
review strategic and operational risks and
adjust the Company resources in order to
continue bringing about accomplishments
and profits.
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4. Information security risk
The Company introduced ISO27001 in 2020 to establish relevant systems and documents in accordance with the
specification content for compliance, after verification by a third party, the Company obtained the certificate on April
12, 2021
Item Policy Document Name Content
1 Information security policy Guidelines for information security, covering information security policy,
review and evaluation
2 Information security organization Structure and responsibilities of the information security organization,
including:
1. Basic information security structure
2. Stakeholder group
3 Information asset classification Asset classification and management measures, including:
and management 1. Asset attributability
2. Information classification method
4 Personnel safety management Explanations about safety management processes before, during, and
after the employment, or change of employment, including:
1. Word descriptions and safety of resource allocation
2. User training
3. Safety and failure event reactions
5 Physical and environmental safety 1. Safe areas
management 2. Equipment safety
3. General control measures
6 Communication and operation 1. Operating process and responsibility
management 2. System planning and acceptance inspection
3. Malicious software prevention
4. Daily routine management
5. Internet management
6. Storage media processing and security
7. Information and software exchange
8. Subcontract processes
7 Access control regulation and 1. Operational requirements of access control
management 2. User access management
3. User responsibility
4. Internet access control
5. Operating system access control measures
6. Application system access control
7. Monitoring system access and use
8. Mobile computer process, and remote work access control
9. Third party access security
8 System development and 1. System security requirements
maintenance 2. Application system security
3. Password control measures
4. System documentation security
5. Development and support process security
9 Business Continuity Management 1. BCM planning and framework
(BCM) 2. Business impact analysis
3. Business Continuity Plans (BCP) preparation and implementation
4. BCP testing, maintenance, and revaluation
10 Information security breach 1. Information security breach management procedures
management 2. Information security breach handling and follow‐up
3. Information security breach analysis and statistics
11 Information security audit 1. Security policy and technical conformity review
2. System and operation management audit considerations
12 Risk evaluation management 1. Asset authentication
2. Risk analysis
3. Risk handling
4. Legal compliance
13 Management review Procedures and guidance for management review
95
5. Climate risks The probability and severity of natural Climate change and potential disasters
disasters (including drought, mites, have made risk analysis and extremity
snowstorms, high temperature/heat forecast two very critical issues for the
waves, typhoons/strong rainfall) electronics industry. At MSI, we have
brought about by extreme weathers performed impact analysis and risk
may affect the Company's production assessment on areas we consider to be
and operations. The risks may include vulnerable given the prevailing climate and
production constraints, operations, environmental changes. These
equipment, and investment cost rise assessments provide us with a general
and inefficiency, etc. There is no idea of our existing protections and risk
significant impact at present. exposure, which we may exploit to explore
potential opportunities. Despite the fact
that MSI is not an energy‐intensive
manufacturer, the Company has made
pro‐active statements about its control
over GHG emission, signed various
commitments and taken action to reduce
GHG in living as well as operational
activities. Meanwhile, strategies have been
developed in response to environmental
and operational impacts.
(1) Management Strategy
 Resilience to climate change:
Implement risk identification,
response and prevention measures in
relation to climate change and avoid
impact to operations.
 Promote low‐carbon production:
Adopt optimized technologies to
reduce greenhouse gas emission, and
set reduction goals.
 Incorporate green energy equipment:
Acquire and utilize renewable energy
equipment such as solar‐powered
heaters to reduce dependency on
power grid.
 Improve energy efficiency: Devise
energy and carbon reduction
measures and enforce action plans
for improved energy efficiency.
(2)Control Measures
 Identification、evaluation and
analysis of impacts and risks
associated with future climate.
 Adaptation planning and review.
 Energy/resource coordination.
 New protection facilities or improved
disaster prevention equipment.
 Regular examination of asset and
commercial insurance coverage to
determine whether they are
adequate for compensating losses
caused by climate change.
96
(2) Organizational structure of risk management
The Company has the “Continued Operational Management Procedure” in place to help reduce impacts and
damages derived from emergency events facing the organization and to ensure normal operations of the
Company for the sake of sustainable management, according to the three aspects of economy, environment,
and society, risk policies are divided into financial, business management, ethical integrity, information
security, climate change, suppliers, human resources, occupational safety and health, and other areas and legal
compliances. Risk control measures include the Code of Corporate Governance, Code of Corporate Social
Responsibility, Code of Integrity Management, and Code of Ethical Conduct have all been approved by the
Company's Board of Directors.
The organization structure of the Company's risk management is implemented and operated by the
President who coordinates and directs the risk management plan. The businesses and units responsible for
management under the President are responsible for assessing the operational risks, production risks,
environmental safety risks, information security risks, climate change risks, etc. and executes daily risk
management. The President reports to the board of directors at least once a year.
Risk controlled management by functions:
A. Board of Directors: The Board is the top decision management of the whole Group’s risk controlled. To
cope with the whole operational risk and business environment, the Board rules the risk management
policy and supervise the operational risk can be controlled effectively and improve the management
efficiency.
B. Internal Audit office: Responsible for the internal control system’s establishment and implement, Internal
Audit procedures’ planning and execution, strengthen internal control function and make sure the effect
contributes continuously to achieve the Group’s operation performance effective and efficiency and
business result is reliable,on time, disclousure in line with Authority’s regulations.
C. Finance: Responsible for the Group’s financial operation, cash management and risk management to
minimize the financial risk. Plan for the short, mid, long term finance and investment strategy.
D. Legal: Responsible not only documentation’s legal compliance, but also legal risk management, to comply
with government’s supervision and hadle contracts and law suits dispute to minimize the Group’s legal
risk.
E. Information: Responsible for the Group’s IT hardware and software’s planning, establishment, operation
and maintanence.Evaluate each kind of information risks and take necessary actions to make sure the
safty and minimize the risk.
F.Business: Responsible for marketing strategy, products promotion and control the market trend to
minimize the operation risk.
(Ⅶ)Other material events：None
97
Ⅷ.Special disclosures
(Ⅰ)Related party
1、Organizational structure of related party:
MICRO STAR INTERNATIONAL CO., LTD.

2020 Consolidated financial statements of the related party
MICRO STAR INTERNATIONAL CO., LTD.
100% 100% 100% 100% 100% 100% 100%
MSI MSI COMPUTER MICRO‐STAR MSI COMPUTER

MICRO-STAR MSI PACIFIC MSI COMPUTER
COMPUTER(CAYMAN) CORP
CANADA LTD. INTERNATIONAL CO.,LTD. (AUSTRALIA) NETHERLANDS JAPAN CO., LTD.
HOLDING CO., LT D. PTY. LTD. HOLDING B.V.
99% 99% 99%
MSI ITALY MSI LLC “MSI MSI COMPUTER MSI MSI

MYSTAR MSI MSI
COMPUTER TECHNOLOGIES POLSKA IBERIA
S.R.L COMPUTER COMPUTER COMPUTER ”. LIMITED COMPUTER SP. Z.O.O. S.L.
SARL B.V. (UK) LTD. COMPANY EUROPE B.V.
1% 1% 1%
MSI (SHANGHAI) SHENZHEN MEGA MICRO-STAR MICRO STAR MEGA MHK MEGA MSI KOREA
CO., LTD. INFORMATION CO., INTERNATIONAL ELECTRONICS INFORMATION TECHNOLOGY INTERNATIONAL COMPUTER CO., LTD.
HOLDING CO.,
LTD. (B.V.I.) HOLDING HOLDING CO., LTD. HOLDING CO., CO., LTD. CO., LTD.
LTD.
CO., LTD. LTD.
MSI COMPUTER MSI ELECTRONICS MSI (SHENZHEN) RAIDEALS INC.

CO., LTD.
(SHENZHEN) CO., (KUNSHAN) CO., LTD.
LTD.
98
2.Company profile of related party
(Unit: thousands)
Name of corporation Date of Establishment Address Capital Major Business Scope
MICRO‐STAR INTERNATIONAL 1998.02.04 TORTOLA,BRITISH VIRGIN ISLANDS USD 47,521 Holding company
(B.V.I.) HOLDING CO., LTD.
MSI COMPUTER CORP. 1998.03.25 CA,U.S.A. USD 460 Sales and maintenance of computers and electronic
components
MYSTAR COMPUTER B.V. 1998.05.28 EINDHOVEN,THE NETHERLANDS EUR 2,027 Sales support of computers and electronic components
MSI COMPUTER (AUSTRALIA) PTY. LTD. 1998.07.31 NSW,AUSTRALIA AUD 222 Sales support and maintenance of computers and electronic
components
MICRO‐STAR NETHERLANDS HOLDING B.V. 1998.12.21 EINDHOVEN,THE NETHERLANDS EUR 1,102 Holding company
MSI COMPUTER JAPAN CO., LTD. 1999.01.21 TOKYO,JAPAN JPY 20,000 Sales support and maintenance of computers and electronic
components
MSI COMPUTER SARL 1993.10.01 BUSSY SAINT GEORGES,FRANCE EUR 730 Sales support of computers and electronic components
(1999.6.30purchase)
MSI COMPUTER (SHENZHEN) CO., LTD. 2000.04.12 SHENZHEN,CHINA USD 51,800 Sales and manufacture of computers and electronic
components
MSI COMPUTER (CAYMAN) CO., LTD. 2001.02.13 GEORGE TOWN,CAYMAN ISLANDS USD 3,040 Holding company
MSI COMPUTER (UK) LTD. 2000.10.12 STAINES,UK EUR 1,130 Sales support of computers and electronic components
MSI ELECTRONICS (KUNSHAN) CO., LTD. 2001.12.18 KUNSHAN,CHINA USD 51,000 Sales and manufacture of computers and electronic
components
MSI COMPUTER EUROPE B.V. 2002.04.09 EINDHOVEN,THE NETHERLANDS EUR 1,149 Logistic
STAR INFORMATION HOLDING CO., LTD. 2002.06.14 TORTOLA,BRITISH VIRGIN ISLANDS USD 4,503 Holding company
99
MICRO ELECTRONICS HOLDING CO., LTD. 2002.06.14 TORTOLA,BRITISH VIRGIN ISLANDS USD 33,315 Holding company
MSI PACIFIC INTERNATIONAL HOLDING CO., LTD. 2002.06.18 GEORGE TOWN,CAYMAN ISLANDS USD 30,204 Holding company
MSI KOREA CO., LTD. 2002.12.27 SEOUL,KOREA KRW800,000 Sales and maintenance of computers and electronic
components
SHENZHEN MEGA INFORMATION CO., LTD. 2003.11.19 SHENZHEN,CHINA USD 700 Examines and maintenance of computers and electronic
components
MSI POLSKA SP. Z O.O. 2006.04.24 WROCLAWSKIE,POLAND EUR1,171 Sales support and maintenance of computers and electronic
components
MEGA TECHNOLOGY HOLDING CO., LTD. 2008.04.01 TORTOLA,BRITISH VIRGIN ISLANDS USD3,050 Holding company
MSI COMPUTER TRADING (SHENZHEN) CO., 2008.04.01 SHENZHEN,CHINA USD‐ Deregistration in June 2020.
LTD.
MEGA COMPUTER CO., LTD. 2008.02.25 HONG KONG HKD ‐ Sales support of computers and electronic components
LLC “MSI COMPUTER” 2009.10.09 MOSCOW,RUSSIA EUR1,647 Sales support and maintenance of computers and electronic
components
MSI COMPUTER TECHNOLOGIES LIMITED 2010.11.04 ISTANBUL,TURKEY EUR77 under liquidation
COMPANY
MSI ITALY S.R.L. 2010.11.12 MILANO,ITALY EUR50 Sales support of computers and electronic components
MHK INTERNATIONAL CO., LTD. 2008.02.25 HONG KONG HKD ‐ Sales support of computers and electronic components
MSI (SHENZHEN) CO., LTD. 2013.09.02 SHENZHEN,CHINA USD1,000 Sales and maintenance of computers and electronic
components
MSI (SHANGHAI) CO., LTD. 2017.12.12 SHANGHAI, CHINA USD 1,000 Sales and maintenance of computers and electronic
components
100
RAIDEALS INC. 2018.03.23 CA, U.S.A. USD 50 Sales and maintenance of computers and electronic
components
MSI IBERIA S.L. 2019.05.06 BARCELONA, SPAIN EUR 150 Sales support of computers and electronic components
MICRO‐STAR CANADA LTD. 2020.01.30 CANADA CAD100 Sales support and maintenance of computers and electronic
components
3.A controlling and hierarchical relationship according to Article 369.3 of Company Law：None
4.Business scope of MSI Group:
MICRO‐STAR NETHERLANDS HOLDING B.V.、MICRO‐STAR INTERNATIONAL（B.V.I.）HOLDING CO.,LTD.、MSI COMPUTER (CAYMAN)CO.,LTD.、STAR INFORMATION HOLDING CO., LTD.、MICRO
ELECTRONICS HOLDING CO., LTD.、MSI PACIFIC INTERNATIONAL HOLDING CO., LTD.、MEGA TECHNOLOGY HOLDING CO., LTD. are holding and investment company. MSI
headquarter and rest of affiliated companies are focused in IT industry. MSI Headquarter is focused on manufacturing and sales, MSI COMPUTER (SHENZHEN) CO., LTD. and MSI
ELECTRONICS (KUNSHAN) CO., LTD. are MSI’s contract manufacture, SHENZHEN MEGA INFORMATION CO., LTD. is worldwide repair center, rest overseas companies are focus on
sales and marketing, selling MSI own brand products.
101
5.Directors, Supervisors and Presidents of related party
Unit：shares
Name of corporation Title Name of representative Shareholding
Shares %
MICRO STAR INTERNATIONAL (B.V.I.) HOLDING CO., LTD. Director & President MICRO STAR INTERNATIONAL CO., LTD. 0 0%
Representative：Yu,Hsien‐Neng 0 0%
MSI COMPUTER CORP. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 575,458 100%
Representative：Tung,Ti‐Chun 0 0%
Director Huang,Chin‐Ching 0 0%
Director Yu,Hsien‐Neng 0 0%
MYSTAR COMPUTER B.V. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Representative：Chiu, Chih‐Chien 0 0%
Director Wang,Ming‐Jung 0 0%
MSI COMPUTER (AUSTRALIA) PTY. LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 221,836 100%
Representative：Huang,Chin‐Ching 0 0%
Director Lin,Wen‐Tung 0 0%
Director Chen,Yuan‐Kang 0 0%
MICRO‐STAR NETHERLANDS HOLDING B.V. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 424,000 100%
Representative：Hsu,Hsiang 0 0%
MSI COMPUTER JAPAN CO., LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 1,400 100%
Representative：Lin,Wen‐Tung 0 0%
Supervisor Liu, Chu‐Hao 0 0%
MSI COMPUTER SARL Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI COMPUTER (SHENZHEN) CO., LTD. Executive Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Supervisor Hung, Pao‐Yu 0 0%
President Li, Chao‐Ming
MSI COMPUTER (CAYMAN) CO., LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 50,000 100%
MSI COMPUTER (UK) LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI ELECTRONICS (KUNSHAN) CO., LTD. Executive Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Supervisor Liu,Chu‐Hao 0 0%
President Li, Chao‐Ming
MSI COMPUTER EUROPE B.V. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
102
STAR INFORMATION HOLDING CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Representative：Hung, Pao‐Yu 0 0%
MICRO ELECTRONICS HOLDING CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI PACIFIC INTERNATIONAL HOLDING CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 30,204,118 100%
MSI KOREA CO., LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Representative：Kung,Fan‐Shu 0 0%
Supervisor Liu, Chu‐Hao 0 0%
SHENZHEN MEGA INFORMATION CO., LTD. Executive Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI POLSKA SP. Z O.O. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MEGA TECHNOLOGY HOLDING CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI COMPUTER TRADING (SHENZHEN) CO., LTD. Deregistration
MEGA COMPUTER CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%

LLC “MSI COMPUTER” Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI COMPUTER TECHNOLOGIES LIMITED COMPANY liquidator Cevat Binici 0 0%
MSI ITALY S.R.L. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MHK INTERNATIONAL CO., LTD. Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MSI (SHENZHEN) CO., LTD. Executive Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Representative：Hung,Yu‐Sheng 0 0%
MSI (SHANGHAI) CO., LTD. Executive Director MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
Representative：Wang, Yu‐Pao 0 0%
Supervisor Hung,Pao‐Yu 0 0%
RAIDEALS INC. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
103
MSI IBERIA S.L. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 0 0%
MICRO‐STAR CANADA LTD. Director & President MICRO STAR INTERNATIONAL CO.,LTD. 100,000 100%
Representative：Tung,Ti‐Chun 0 0%
Director Liu,Yu‐Hsien 0 0%
104
6.Business operation of the related party
Expressed in thousands of NTD
(Except as otherwise indicated)
Name of corporation Capital Total Assets Total Net Worth Revenue Operating Income Net Income Earning(Loss)
(unit: thousands) Liabilities (Loss) (Loss) Per Share (NTD)
(after tax)
MICRO‐STAR INTERNATIONAL USD 47,521 4,342,436 0 4,342,436 0 (53) 315,470 0.23
(B.V.I.) HOLDING CO., LTD. (Rate 28.48) (NOTE 2)
MSI COMPUTER CORP. USD 460 17,079,726 17,007,121 72,605 29,200,713 47,395 39,396 3.01
(Rate 28.48) (NOTE 2)
MYSTAR COMPUTER B.V. EUR 2,027 460,864 291,633 169,231 2,452,990 26,148 16,019 0.23
(NOTE 1) (NOTE 2)
(Rate 35.02)
MSI COMPUTER (AUSTRALIA) PTY.LTD. AUD 222 29,600 20,956 8,644 43,861 903 1,321 0.27
(Rate 21.95) (NOTE 2)
MICRO‐STAR NETHERLANDS HOLDING B.V. EUR 1,102 722,005 36,148 685,857 41,468 (22,464) 41,428 1.07
(NOTE 1) (NOTE 2)
(Rate 35.02)
MSI COMPUTER JAPAN CO., LTD. JPY 20,000 86,136 66,898 19,238 130,056 4,185 4,692 0.85
(Rate 0.2763) (NOTE 2
MSI COMPUTER SARL EUR 730 93,433 33,478 59,955 115,493 5,386 5,072 0.20
(NOTE 1) (NOTE 2)
(Rate 35.02)
MSI COMPUTER (SHENZHEN) CO., LTD. USD 51,800 5,598,277 1,406,141 4,192,136 3,091,619 215,422 315,391 0.21
(Rate 28.48) (NOTE 2)
MSI COMPUTER (CAYMAN) CO., LTD. USD 3,040 132,820 15,271 117,549 9,930 792 175 (0.00)
(Rate 28.48) (NOTE 2)
MSI COMPUTER (UK) LTD. EUR 1,130 34,549 15,208 19,341 80,222 3,820 3,826 0.10
(NOTE 1) (NOTE 2)
(Rate 35.02)
MSI ELECTRONIC (KUNSHAN) CO., LTD. USD 51,000 3,570,943 963,791 2,607,152 1,594,965 187,312 247,199 0.17
(Rate 28.48) (NOTE 2)
MSI COMPUTER EUROPE B.V. EUR 1,149 207,644 154,162 53,482 290,859 8,063 6,159 0.15
(Rate 35.02) (NOTE 2)
STAR INFORMATION HOLDING CO., LTD. USD 4,503 20,826 0 20,826 0 (53) (5,931) (0.05)
(Rate 28.48) (NOTE 2)
MICRO ELECTRONICS HOLDING CO., LTD. USD 33,315 2,707,503 0 2,707,503 0 (104) 247,401 0.26
(Rate 28.48) (NOTE 2)
MSI PACIFIC INTERNATIONAL HOLDING CO., LTD. USD 30,204 13,247,165 5,840,441 7,406,724 0 (510) 579,510 0.67
(Rate 28.48) (NOTE 2)
MSI KOREA CO., LTD. KRW 800,000 518,382 193,810 324,572 4,702,111 40,960 38,835 1.85
(Rate 0.0262) (NOTE 2)
105
SHENZHEN MEGA INFORMATION CO., LTD. USD 700 42,075 19,111 22,964 33,784 0 1,071 0.05
(Rate 28.48) (NOTE 2)
MSI POLSKA SP. Z O.O. EUR1,171 78,877 43,678 35,199 161,833 4,494 3,232 0.08
(NOTE 1) (NOTE 2)
(Rate 35.02)
MEGA TECHNOLOGY HOLDING CO., LTD. USD 3,050 5,545 0 5,545 0 (8) 6,786 0.08
(Rate 28.48) (NOTE 2)
MSI COMPUTER TRADING (SHENZHEN) CO., LTD. USD ‐ 0 0 0 0 (30) 11,688 ‐
(Rate 28.48) (NOTE 3)
MEGA COMPUTER CO., LTD. HKD ‐ 1,815,079 1,810,131 4,948 6,865,605 (899) (1,190) ‐
(Rate 3.673) (NOTE 2)
LLC “MSI COMPUTER” EUR 1,647 42,023 7,715 34,308 73,583 3,337 1,928 0.03
(Rate 35.02) (NOTE 2)
MSI COMPUTER TECHNOLOGIES LIMITED COMPANY EUR 77 9 51 (42) 0 0 0 0
(Rate 35.02) (NOTE 4)
MSI ITALY S.R.L. EUR 50 32,432 28,032 4,400 49,117 2,585 1,673 0.96
(Rate 35.02) (NOTE 2)
MHK INTERNATIONAL CO., LTD. HKD ‐ 79,555 54,782 24,773 164,745 7,104 2,942 ‐
(Rate 3.673) (NOTE 2)
MSI (SHENZHEN) Co., LTD. USD 1,000 8,345 518 7,827 0 (7,031) (5,986) (0.21)
(Rate 28.48) (NOTE2)
MSI (SHANGHAI) Co., LTD. USD 1,000 2,057,459 2,073,249 (15,790) 7,616,178 9,582 11,397 0.40
RAIDEALS INC. USD 50 9,160 7,285 1,875 257,336 370 280 0.20
MSI IBERIA S.L. EUR150 36,291 28,699 7,592 46,908 2,234 1,483 0.28
Micro‐Star Canada Ltd. CAD 100 11,670 8,373 3,297 31,162 1,415 1,047 0.47
Note 1：Capital includes surplus.
Note 2：Earnings per share was calculated based on each NTD of capital instead of each share.
Note 3: In June 2020, MSI COMPUTER TRADING (SHENZHEN) CO., LTD. has completed the deregistration process.
Note 4: MSI COMPUTER TECHNOLOGIES LIMITED COMPANY is under liquidation.
106
7.Consolidated Financial Statements of the parent company and subsidiaries：Please refer to page 108～181
8.Related Party Report：Not Applicable
9. Affiliated companies’ transaction on guarantee, endorsement, loans to others and derivatives: please
refer to page 169~170.
(Ⅱ)Subscription of marketable securities privately in the most recent years and up to the date of the report
printed：None
(Ⅲ)Status of MSI Common Shares Acquired, Disposed of, and Held by Subsidiaries: None
(Ⅳ)Other Necessary Supplement: None.
(Ⅴ)Occurrence of events defined in Securities Transaction Law Article 36.2.2 that has great impact on
shareholders’ equity or security price in the most recent years and up to the date of the repost printed：
None
107
MICRO-STAR INTERNATIONAL CO., LTD.
AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS AND
INDEPENDENT AUDITORS’ REPORT
DECEMBER 31, 2020 AND 2019
------------------------------------------------------------------------------------------------------------------------------------
For the convenience of readers and for information purpose only, the 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. In the event of any discrepancy between the English version and the original Chinese
version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and
financial statements shall prevail.
~108~
Representation Letter
In connection with the Consolidated Financial Statements of Affiliated Enterprises of MICRO-STAR

INTERNATIONAL CO., LTD. and its subsidiaries (the “Consolidated FS of the Affiliates”), we
represent to you that, the entities required to be included in the Consolidated FS of the Affiliates as of
and for the year ended December 31, 2020 in accordance with the “Criteria Governing Preparation of
Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of
Affiliated Enterprises” are the same as those required to be included in the Consolidated Financial
Statements of MICRO-STAR INTERNATIONAL CO., LTD. and its subsidiaries (the “Consolidated
FS of the Group”) in accordance with International Financial Reporting Standard 10. Additionally, the
information required to be disclosed in the Consolidated FS of Affiliates is disclosed in the
Consolidated FS of the Group. Consequently, MICRO-STAR INTERNATIONAL CO., LTD. and its
subsidiaries do not prepare a separate set of Consolidated FS of Affiliates.
Very truly yours,

By
Hsu Hsiang, Chairman

March 22, 2021
~109~
INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE
To the Board of Directors and Shareholders of MICRO‐STAR INTERNATIONAL CO., LTD. AND
SUBSIDIARIES
Opinion
We have audited the accompanying consolidated balance sheets of MICRO-STAR
INTERNATIONAL CO., LTD. AND SUBSIDIARIES (the “Group”) as of December 31, 2020 and
2019, and the related consolidated statements of comprehensive income, of changes in equity and
of cash flows for the years then ended, and notes to the consolidated financial statements,
including a summary of significant accounting policies.
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, International Accounting Standards,
IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory
Commission.
Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of
Financial Statements by Certified Public Accountants and generally accepted auditing standards in
the Republic of China (ROC GAAS). Our responsibilities under those standards are further
described in the Auditor’s 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 Accountants in the Republic of China (the “Norm”), and we have
fulfilled our ethical responsibilities in accordance with the Norm. Based on our audits and the audit
reports of other independent auditors, we believe that the audit evidences we have obtained are
sufficient and appropriate to provide a basis for our opinion.
Key audit matters

Key audit matters are those matters that, in our professional judgement, 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, we do not provide a separate opinion on these matters.
Key audit matters for the Group’s consolidated financial statements for the year ended December 31,
2020 are stated as follows:
~110~
Recognition of sales revenue generated from own-brand products
Description
Please refer to Note 4(26) for accounting policies on revenue recognition. The sales revenue from
own-brand products for the year ended December 31, 2020 is higher than previous year due to the
substantial increase in demand for notebook computers and peripherals. The recognition of sales
revenue generated from own-brand products is critical to the Group’s consolidated financial
statements. Therefore, it was identified as a key audit matter.
How our audit addressed the matter
We performed the following audit procedures in respect of the above key audit matter:
A. Obtained an understanding of and assessed internal controls in relation to sales revenue, and
validated the operating effectiveness of those above-mentioned internal controls.
B. Obtained detailed listing of sales revenue from own-brand products in the current year, and
validated supporting documents, including sales invoices, customer purchase orders and
delivery documents to ensure the appropriateness of recognition.
C. Inspected contents and relevant evidences in relation to sales returns and discounts occurring
subsequent to the reporting period.
D. Performed accounts receivable confirmation procedure to significant customers.
Estimation of allowance for inventory valuation losses

Description
Please refer to Note 4(13) for accounting policies on inventory valuation, Note 5(2) for the
uncertainty of accounting estimates and assumptions applied on inventory valuation, and Note 6(6)
for details of inventories. As of December 31, 2020, the balances of inventories and allowance for
inventory valuation losses are NT$27,966,905 thousand and NT$484,368 thousand, respectively.
The Group is primarily engaged in manufacturing and sales of motherboards, interface cards,
notebook computers and other electronic products. Due to the rapid technological innovations and
competition within the industry as well as frequent releases of new products resulting in potential
price fluctuations, there is a higher risk of inventory losses due from market value decline or
obsolescence. The Group recognises inventories at the lower of cost and net realisable value. As the
monetary values of allowance for inventory valuation losses is critical to the financial statements as
of December 31, 2020. Therefore, it was identified as a key audit matter.
A. Inquired with management, and assessed the reasonableness in relation to the provision of
allowance for inventory valuation losses.
B. Validated the accuracy of the system logic in calculating the ageing of inventories, and
confirmed the consistency with the Group’s policies.
~111~
C. Validated the appropriateness of system logic of the report of individually identified obsolete
inventory prepared by management and confirmed the consistency with the Group’s policies.
D. Sampled and tested the net realisable value basis of the individual inventory and validated the
appropriateness.
Other matter –Reference to audits of other independent auditors

We did not audit the financial statements of certain consolidated subsidiaries and investments
accounted for under the equity method that are included in the consolidated financial statements.
Those financial statements were audited by other independent auditors, whose reports thereon have
been furnished to us, and our opinion expressed herein is based solely on reports of the other
independent auditors. Total assets of the above-mentioned entities (including investments accounted
for under the equity method) amounted to NT$18,755,869 thousand and NT$11,727,830 thousand
as of December 31, 2020 and 2019, constituting 24% and 19% of consolidated total assets,
respectively. Sales revenue of the above-mentioned entities amounted to NT$35,899,397 thousand
and NT$23,178,240 thousand for the years ended December 31, 2020 and 2019, constituting 25%
and 19% of consolidated total sales revenue, respectively.
Other matter – Parent company only financial reports

We have audited and expressed an unmodified opinion with other matter section on the parent
company only financial statements of MICRO-STAR INTERNATIONAL CO., LTD. as of and for
the years ended December 31, 2020 and 2019.
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 International Financial Reporting Standards, International Accounting
Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory
Commission, 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 supervisors, are responsible for overseeing the Group’s
financial reporting process.
~112~
Independent 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 ROC GAAS 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 ROC GAAS, we exercise professional judgement 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 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
~113~
audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the consolidated financial statements of the current
period 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.
Liang, Hua-Ling Lai, Chung-Hsi

For and on behalf of PricewaterhouseCoopers, Taiwan
March 22, 2021
-------------------------------------------------------------------------------------------------------------------------------------------------
The accompanying consolidated financial statements are not intended to present the financial position and results of
operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other
than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such
financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of
China. Accordingly, the accompanying consolidated financial statements and report of independent accountants are not
intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in
the Republic of China, and their applications in practice.
As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability
for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the
translation.
~114~
MICRO-STAR INTERNATIONAL CO., LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of New Taiwan dollars)
December 31, 2020 December 31, 2019

Assets Notes AMOUNT % AMOUNT %
Current assets
1100 Cash and cash equivalents 6(1) $ 18,585,955 24 $ 10,709,045 18
1110 Financial assets at fair value through 6(2)
profit or loss - current 203,737 - 152,805 -
1136 Current financial assets at amortised 6(4)
cost 1,000,447 1 1,200,000 2
1150 Notes receivable, net 6(5) 113,287 - 47,114 -
1170 Accounts receivable, net 6(5) 21,867,246 28 17,205,783 29
1200 Other receivables 265,987 - 227,116 -
1220 Current income tax assets 34,759 - 16,417 -
130X Inventories, net 6(6) 27,482,537 35 22,527,840 37
1410 Prepayments 6(7) 1,807,513 3 1,675,701 3
11XX Total current assets 71,361,468 91 53,761,821 89
Non-current assets
1517 Non-current financial assets at fair 6(3)
value through other comprehensive
income 124,338 - 151,975 -
1535 Non-current financial assets at 6(4) and 8
amortised cost 226,937 - 227,848 -
1600 Property, plant and equipment 6(8) and 8 5,130,094 7 4,893,433 8
1755 Right-of-use assets 6(9) 502,400 1 474,897 1
1760 Investment property - net 6(11) 207,637 - 300,559 1
1840 Deferred income tax assets 6(26) 769,613 1 471,523 1
1900 Other non-current assets 75,028 - 66,652 -
15XX Total non-current assets 7,036,047 9 6,586,887 11
1XXX Total assets $ 78,397,515 100 $ 60,348,708 100
(Continued)
~115~
CONSOLIDATED BALANCE SHEETS

Liabilities and Equity Notes AMOUNT % AMOUNT %
Current liabilities
2100 Short-term borrowings 6(12) $ 3,000,000 4 $ 1,500,000 3
2120 Financial liabilities at fair value 6(2)
through profit or loss - current 103,885 - 24,943 -
2170 Accounts payable 27,177,751 35 20,391,520 34
2200 Other payables 6(13) 5,344,410 7 3,844,835 6
2230 Current income tax liabilities 1,604,500 2 402,714 1
2250 Provision for liabilities - current 6(16) 850,435 1 556,720 1
2280 Current lease liabilities 218,182 - 159,081 -
2365 Refund liabilities- current 3,555,792 5 1,636,499 3
2399 Other current liabilities, others 337,535 - 108,961 -
21XX Total current liabilities 42,192,490 54 28,625,273 48
Non-current liabilities
2540 Long-term borrowings 6(14) and 8 - - 15,095 -
2570 Deferred income tax liabilities 6(26) 6,928 - 27,214 -
2580 Non-current lease liabilities 225,548 1 247,767 1
2640 Net defined benefit liability, 6(15)
non-current 220,314 - 221,974 -
2670 Other non-current liabilities, others 212,383 - 198,920 -
25XX Total non-current liabilities 665,173 1 710,970 1
2XXX Total liabilities 42,857,663 55 29,336,243 49
Equity attributable to owners of
parent
Share capital 6(17)
3110 Share capital - common stock 8,448,562 11 8,448,562 14
Capital surplus 6(18)
3200 Capital surplus 804,214 1 803,918 1
Retained earnings 6(19)
3310 Legal reserve 5,541,298 7 4,982,577 8
3320 Special reserve 794,525 1 505,966 1
3350 Unappropriated retained earnings 20,625,711 26 17,065,967 28
Other equity interest
3400 Other equity interest ( 674,458) ( 1) ( 794,525) ( 1)
31XX Equity attributable to owners of
the parent 35,539,852 45 31,012,465 51
3XXX Total equity 35,539,852 45 31,012,465 51
3X2X Total liabilities and equity $ 78,397,515 100 $ 60,348,708 100
The accompanying notes are an integral part of these consolidated financial statements.
~116~
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
YEARS ENDED DECEMBER 31, 2020 AND 2019
(Expressed in thousands of New Taiwan dollars, except earnings per share)
Year ended December 31

2020 2019
Items Notes AMOUNT % AMOUNT %
4000 Sales revenue 6(20) $ 146,502,789 100 $ 120,491,417 100
5000 Operating costs 6(6)(24) ( 125,199,949) ( 85) ( 104,629,261) ( 87)
5900 Net operating margin 21,302,840 15 15,862,156 13
Operating expenses 6(24)
6100 Selling expenses ( 7,053,359) ( 5) ( 5,508,321) ( 4)
6200 General and administrative expenses ( 1,345,054) ( 1) ( 1,070,509) ( 1)
6300 Research and development expenses ( 3,724,340) ( 3) ( 3,315,224) ( 3)
6450 Expected credit gain(loss) 7,741 - ( 15,696) -
6000 Total operating expenses ( 12,115,012) ( 9) ( 9,909,750) ( 8)
6900 Operating profit 9,187,828 6 5,952,406 5
Non-operating income and expenses
7100 Interest income 6(21) 88,822 - 82,368 -
7010 Other income 6(22) 576,975 - 632,915 -
7020 Other gains and losses 6(23) ( 224,787) - ( 125,710) -
7050 Finance costs ( 31,945) - ( 23,546) -
7000 Total non-operating income and
expenses 409,065 - 566,027 -
7900 Profit before income tax 9,596,893 6 6,518,433 5
7950 Income tax expense 6(26) ( 1,637,388) ( 1) ( 931,223) ( 1)
8200 Profit for the period $ 7,959,505 5 $ 5,587,210 4
Other comprehensive income
Components of other
comprehensive loss that will not be
reclassified to profit or loss
8311 Actuarial loss on defined benefit plan 6(15) ($ 5,106) - ($ 10,079) -
8316 Unrealised losses from investments 6(3)
in equity instruments measured at
fair value through other
comprehensive income ( 27,637) - - -
8349 Income tax related to components of 6(26)
other comprehensive income that
will not be reclassified to profit or
loss 1,021 - 2,016 -
8310 Components of other
reclassified to profit or loss ( 31,722) - ( 8,063) -
Components of other
comprehensive income (loss) that
will be reclassified to profit or loss
8361 Financial statements translation
differences of foreign operations 147,704 - ( 288,559) -
will be reclassified to profit or loss 147,704 - ( 288,559) -
8300 Total other comprehensive income
(loss) for the period $ 115,982 - ($ 296,622) -
8500 Total comprehensive income for the
period $ 8,075,487 5 $ 5,290,588 4
Profit attributable to:
8610 Owners of the parent $ 7,959,505 5 $ 5,587,210 4
Comprehensive income attributable to:
8710 Owners of the parent $ 8,075,487 5 $ 5,290,588 4
Earnings per share (in dollars) 6(27)

9750 Basic earnings per share $ 9.42 $ 6.61
9850 Diluted earnings per share $ 9.34 $ 6.56
~117~
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
YEARS ENDED DECEMBER 31, 2020 AND 2019
Equity attributable to owners of the parent

Capital Surplus Retained Earnings Other Equity Interest
Unrealized
losses from
financial
assets measured
Financial statements at fair value
Unappropriated translation through other
Share capital - Additional Treasury stock Donated assets Employee stock Special retained differences of comprehensive
Notes common stock paid-in capital transactions received warrants Legal reserve reserve earnings foreign operations income Total equity
2019
Balance at January 1, 2019 $ 8,448,562 $ 1,050,563 $ 130,592 $ 434 $ 44,460 $ 4,378,464 $ 421,815 $ 15,976,937 ($ 505,966 ) $ - $ 29,945,861
Profit for the year - - - - - - - 5,587,210 - - 5,587,210
Other comprehensive loss for the
year - - - - - - - ( 8,063 ) ( 288,559 ) - ( 296,622 )
Total comprehensive income (loss) - - - - - - - 5,579,147 ( 288,559 ) - 5,290,588
Appropriation of 2018 earnings 6(19)
Legal reserve - - - - - 604,113 - ( 604,113 ) - - -
Special reserve - - - - - - 84,151 ( 84,151 ) - - -
Cash dividends - - - - - - - ( 3,801,853 ) - - ( 3,801,853 )
Cash distribution from capital
surplus - ( 422,429 ) - - - - - - - - ( 422,429 )
Due to donated assets received 6(19) - - - 298 - - - - - - 298
Balance at December 31, 2019 $ 8,448,562 $ 628,134 $ 130,592 $ 732 $ 44,460 $ 4,982,577 $ 505,966 $ 17,065,967 ($ 794,525 ) $ - $ 31,012,465
2020
Balance at January 1, 2020 $ 8,448,562 $ 628,134 $ 130,592 $ 732 $ 44,460 $ 4,982,577 $ 505,966 $ 17,065,967 ($ 794,525 ) $ - $ 31,012,465
Other comprehensive income (loss)
for the year - - - - - - - ( 4,085 ) 147,704 ( 27,637 ) 115,982
Total comprehensive income (loss) - - - - - - - 7,955,420 147,704 ( 27,637 ) 8,075,487
Legal reserve - - - - - 558,721 - ( 558,721 ) - - -
Special reserve - - - - - - 288,559 ( 288,559 ) - - -
Cash dividends - - - - - - - ( 3,548,396 ) - - ( 3,548,396 )
Due to donated assets received - - - 296 - - - - - - 296
Balance at December 31, 2020 $ 8,448,562 $ 628,134 $ 130,592 $ 1,028 $ 44,460 $ 5,541,298 $ 794,525 $ 20,625,711 ($ 646,821 ) ($ 27,637 ) $ 35,539,852
~118~
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

Notes 2020 2019
CASH FLOWS FROM OPERATING ACTIVITIES

Profit before tax $ 9,596,893 $ 6,518,433
Adjustments
Adjustments to reconcile profit (loss)
Depreciation (including right-of-use assets and 6(24)
investment properties) 1,095,818 890,056
Amortization 6(24) 200 224
Expected credit (gain) loss ( 7,741 ) 15,696
Net loss (gain) on financial assets and liabilities
at fair value through profit or loss 31,850 ( 39,222 )
Interest expense 31,945 23,546
Interest income 6(21) ( 88,822 ) ( 82,368 )
Loss (gain) on disposal of property, plant and 6(23)
equipment 540 ( 2,906 )
Gain on lease modification 6(9) ( 366 ) ( 214 )
Changes in operating assets and liabilities
Changes in operating assets
Financial assets at fair value through profit or
loss 900 -
Notes receivable, net ( 66,173 ) ( 11,931 )
Accounts receivable ( 4,652,441 ) ( 1,179,668 )
Other receivables ( 37,322 ) ( 70,951 )
Inventories, net ( 4,954,697 ) ( 474,978 )
Prepayments ( 131,812 ) ( 294,679 )
Other non-current assets 18,207 97,176
Changes in operating liabilities
Notes payable - ( 200 )
Accounts payable 6,786,231 5,457,896
Other payables 1,497,850 427,104
Provision for liabilities - current 293,715 55,625
Refund liabilities- current 1,919,293 ( 160,406 )
Other current liabilities, others 215,321 16,728
Net defined benefit liability ( 6,766 ) ( 5,714 )
Cash inflow generated from operations 11,542,623 11,179,247
Interest received 86,784 84,991
Interest paid ( 29,945 ) ( 23,559 )
Income tax paid ( 774,794 ) ( 1,520,287 )
Net cash flows from operating activities 10,824,668 9,720,392
(Continued)
~119~
CONSOLIDATED STATEMENTS OF CASH FLOWS

Notes 2020 2019
CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of financial assets at fair value through 6(3)
other comprehensive income $ - ($ 151,975 )
Acquisition of financial assets at amortised cost - ( 616,024 )
Proceeds from disposal of financial assets at
amortised cost 200,464 -
Acquisition of property, plant and equipment 6(8) ( 970,766 ) ( 982,667 )
Proceeds from disposal of property, plant and
equipment 557 57,700
Acquisition of investment properties 6(11) ( 316 ) ( 3,602 )
Increase in refundable deposits ( 22,474 ) ( 15,894 )
Net cash flows used in investing activities ( 792,535 ) ( 1,712,462 )
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings 1,500,000 ( 1,500,000 )
Repayment of the principal portion of lease liabilities ( 239,125 ) ( 152,916 )
Payment of long-term borrowings ( 1,039 ) ( 843 )
Increase (decrease) in guarantee deposits received 13,463 ( 27,983 )
Cash dividends paid 6(19) ( 3,548,396 ) ( 3,801,853 )
Cash distribution from capital surplus 6(19) - ( 422,429 )
Due to donated assets received 296 298
Net cash flows used in financing activities ( 2,274,801 ) ( 5,905,726 )
Effect of exchange rate 119,578 ( 208,839 )
Net increase in cash and cash equivalents 7,876,910 1,893,365
Cash and cash equivalents at beginning of year 6(1) 10,709,045 8,815,680
Cash and cash equivalents at end of year 6(1) $ 18,585,955 $ 10,709,045
~120~
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)
1. HISTORY AND ORGANISATION

MICRO-STAR INTERNATIONAL CO., LTD. (the “Company”) was incorporated as a company
limited by shares under the laws of the Republic of China (R.O.C.) in August 1986 and started its
operations in the same year. The Company and its subsidiaries (collectively referred herein as the
“Group”) are primarily engaged in the manufacture and sale of motherboards and computer
hardware. The shares of the Company have been listed on the Taiwan Stock Exchange since
October 1998. The Company is the Group’s ultimate parent company.
2. THE DATE OF AUTHORISATION FOR ISSUANCE OF THE CONSOLIDATED
FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORISATION
These consolidated financial statements were authorised for issuance by the Board of Directors on
March 22, 2021.
3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS
(1) Effect of the adoption of new standards and amendments to International Financial Reporting
Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)
New standards, interpretations and amendments endorsed by the FSC effective from 2020 are
as follows:
Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
Amendments to IAS 1 and IAS 8, ‘Disclosure initiative-definition of January 1, 2020
material’
Amendments to IFRS 3, ‘Definition of a business’ January 1, 2020
Amendments to IFRS 9, IAS 39 and IFRS7 ,‘Interest rate benchmark January 1, 2020
reform’
Amendment to IFRS 16, ‘Covid-19-related rent concessions’ June 1, 2020 (Note)
Note：Earlier application from January 1, 2020 is allowed by FSC.
The above standards and interpretations have no significant impact to the Group’s financial
condition and financial performance based on the Group’s assessment.
A. Amendment to IFRS 16, ‘Covid-19-related rent concessions’
This amendment provides a practical expedient for lessees from assessing whether a rent
concession related to COVID-19, and that meets all of the following conditions, is a lease
modification:
(a) Changes in lease payments result in the revised consideration for the lease that is
substantially the same as, or less than, the consideration for the lease immediately
preceding the change;
(b) Any reduction in lease payments affects only payments originally due on or before June
30 2021; and
(c) There is no substantive change to other terms and conditions of the lease.
121
(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted
by the Group
New standards, interpretations and amendments endorsed by the FSC effective from 2021 are
as follows:
Effective date by
Amendments to IFRS 4, ‘Extension of the temporary exemption from January 1, 2021
applying IFRS 9’
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘ January 1, 2021
Interest Rate Benchmark Reform— Phase 2’
(3) IFRSs issued by IASB but not yet endorsed by the FSC
New standards, interpretations and amendments issued by IASB but not yet included in the
IFRSs as endorsed by the FSC are as follows:
Effective date by
Amendments to IFRS 3, ‘Reference to the conceptual framework’ January 1, 2022
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets To be determined by
between an investor and its associate or joint venture’ International Accounting
Standards Board
IFRS 17, ‘Insurance contracts’ January 1, 2023
Amendments to IFRS 17, 'Insurance contracts' January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or non January 1, 2023
-current’
Amendments to IAS 1, ‘Disclosure of accounting policies’ January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’ January 1, 2023
Amendments to IAS 16, ‘Property, plant and equipment:proceeds before January 1, 2022
intended use’
Amendments to IAS 37, ‘Onerous contracts—cost of fulfilling a January 1, 2022
contract’
Annual improvements to IFRS Standards 2018–2020 January 1, 2022
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial
statements are set out below. These policies have been consistently applied to all the periods
presented, unless otherwise stated.
(1) Compliance statement
The consolidated financial statements of the Group have been prepared in accordance with the
122
“Regulations Governing the Preparation of Financial Reports by Securities Issuers’’,
International Financial Reporting Standards, International Accounting Standards, IFRIC
Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as
the “IFRSs＂).
(2) Basis of preparation
A. Except for the following items, the consolidated financial statements have been prepared
under the historical cost convention:
(a) Financial assets and financial liabilities (including derivative instruments) at fair value
through profit or loss.
(b) Financial assets at fair value through other comprehensive income.
(c) Defined benefit liabilities recognised based on the net amount of pension fund assets less
present value of defined benefit obligation.
B. The preparation of financial statements in conformity with IFRSs requires the use of certain
critical accounting estimates. It also requires management to exercise its judgement in the
process of applying the Group’s accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and estimates are significant to the
consolidated financial statements are disclosed in Note 5.
(3) Basis of consolidation
A. Basis for preparation of consolidated financial statements:
(a) All subsidiaries are included in the Group’s consolidated financial statements.
Subsidiaries are all entities (including structured entities) controlled by the Group. The
Group controls an entity when the Group is exposed, or has rights, to variable returns
from its involvement with the entity and has the ability to affect those returns through its
power over the entity. Consolidation of subsidiaries begins from the date the Group
obtains control of the subsidiaries and ceases when the Group loses control of the
subsidiaries.
(b) Inter-company transactions, balances and unrealized gains or losses on transactions
between companies within the Group are eliminated. Accounting policies of subsidiaries
have been adjusted where necessary to ensure consistency with the policies adopted by
the Group.
(c) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent
losing control of the subsidiary (transactions with non-controlling interests) are
accounted for as equity transactions, i.e. transactions with owners in their capacity as
owners. Any difference between the amount by which the non-controlling interests are
adjusted and the fair value of the consideration paid or received is recognised directly in
equity.
(d) When the Group loses control of a subsidiary, the Group remeasures any investment
retained in the former subsidiary at its fair value. That fair value is regarded as the fair
value on initial recognition of a financial asset or the cost on initial recognition of the
associate or joint venture. Any difference between fair value and carrying amount is
recognised in profit or loss. All amounts previously recognised in other comprehensive
income in relation to the subsidiary are reclassified to profit or loss on the same basis as
would be required if the related assets or liabilities were disposed of. That is, when the
Group loses control of a subsidiary, all gains or losses previously recognised in other
comprehensive income in relation to the subsidiary should be reclassified from equity to
profit or loss, if such gains or losses would be reclassified to profit or loss when the
123
related assets or liabilities are disposed of.
B. Subsidiaries included in the consolidated financial statements:
Main business Ownership(%)
Name of investor Name of subsidiaries activities 2020/12/31 2019/12/31 Note
MICRO-STAR MICRO-STAR Investment holding 100 100 B
INTERNATIONAL NETHERLANDS company
CO., LTD. HOLDING B.V.
[MSI (HOLDING)]
〃 MSI COMPUTER CORP. Sales and 100 100 〃
[MSI (LA)] maintenance of
computers and
electronic components
〃 MSI PACIFIC Investment holding 100 100 A
INTERNATIONAL company
HOLDING CO., LTD.
[MSI (PACIFIC)]
〃 MSI COMPUTER Sales support and 100 100 〃
JAPAN CO., LTD. maintenance of
[MSI (JAPAN)] computers and
〃 MSI COMPUTER 〃 100 100 〃
(AUSTRALIA) PTY.
LTD. [MSI
(AUSTRALIA)]
〃 MSI COMPUTER Investment holding 100 100 B
(CAYMAN) CO., LTD. company
[MSI COMPUTER
(CAYMAN)]
〃 MICRO-STAR CANADA Sales support of 100 - C and F
LTD. [MSI computers and
(CANADA)] electronic components
MSI (HOLDING) MYSTAR COMPUTER 〃 100 100 B
B.V. [MYSTAR]
124
MSI (HOLDING) MSI COMPUTER SARL Sales support of 100 100 B
[MSI (SARL)] computers and
〃 MSI COMPUTER (UK) 〃 100 100 〃
LTD. [MSI (UK)]
〃 MSI POLSKA SP. Z O. O. Sales support and 99 99 〃
[MSI (POLSKA)] maintenance and
after-sales services of
computers and
〃 MSI COMPUTER Logistics services of 100 100 〃
EUROPE B.V. computers and
[MSI (EUROPE)] electronic components
〃 LLC MSI COMPUTER Sales support and 99 99 〃
[MSI (RUSSIA)] maintenance of
computers and
〃 MSI COMPUTER Sales support of 99 99 B and D
TECHNOLOGIES computers and
LIMITED COMPANY electronic components
[MSI (TURKEY)]
〃 MSI ITALY S.R.L. 〃 100 100 B
[MSI (ITALY)]
〃 MSI IBERIA S.L. 〃 100 100 B and E
[MSI (IBERIA)]
MSI (EUROPE) MSI POLSKA SP. Z O. O. Sales support and 1 1 B
[MSI (POLSKA)] maintenance and
after-sales services of
computers and
〃 LLC MSI COMPUTER Sales support and 1 1 〃
[MSI (RUSSIA)] maintenance of
computers and
〃 MSI COMPUTER Sales support of 1 1 B and D
TECHNOLOGIES computers and
LIMITED COMPANY electronic components
[MSI (TURKEY)]
MSI (PACIFIC) MSI KOREA CO., Sales and 100 100 B
LTD. [MSI (KOREA)] maintenance of
computers and
125
MSI (PACIFIC) STAR INFORMATION Investment holding 100 100 A
HOLDING CO., LTD. company
[STAR INFORMATION]
〃 MICRO-STAR 〃 100 100 〃
INTERNATIONAL
(B.V.I) HOLDING
CO., LTD. [MSI (B.V.I.)]
〃 MICRO ELECTRONICS 〃 100 100 〃
HOLDING CO., LTD.
[MICRO ELECTRONICS]
〃 MEGA TECHNOLOGY 〃 100 100 〃
HOLDING CO., LTD.
[MEGA TECHNOLOGY]
〃 MEGA COMPUTER CO., Sales support of 100 100 B
LTD. [MEGA computers and
COMPUTER] electronic components
〃 MHK INTERNATIONAL 〃 100 100 〃
CO., LTD. [MSI (MHK)]
〃 MSI (SHANGHAI) CO., Sales and 100 100 A
LTD. [MSI (SHANGHAI)] maintenance of
computers and
〃 SHENZHEN MEGA Examination and 100 100 〃
INFORMATION CO., maintenance of
LTD. [SHENZHEN computers, and
MEGA INFORMATION] electronic components
MICRO MSI ELECTRONICS Manufacture and 100 100 〃
ELECTRONICS (KUNSHAN) CO., LTD. maintenance of
[MSI ELECTRONICS computers, and
(KUNSHAN)] electronic components
STAR MSI (SHENZHEN) CO., Sales and 100 100 〃
INFORMATION LTD. [MSI SHENZHEN] maintenance
of computers and
MSI (B.V.I.) MSI COMPUTER Manufacture and 100 100 〃
(SHENZHEN) CO., LTD. maintenance of
[MSI COMPUTER computers, and
(SHENZHEN)] electronic components
MEGA MSI COMPUTER Sales and - 100 A and G
TECHNOLOGY TRADING (SHENZHEN) maintenance
CO., LTD. [MSI of computers and
TRADING (SHENZHEN)] electronic components
〃 RAIDEALS INC. Sales computers 100 100 A
[RAIDEALS] and electronic
components
126
Note A: These investee companies are included in the consolidated financial statement
based on their financial statements which were audited by the Group’s
independent auditors for the corresponding period.
Note B: There investee companies are included in the consolidated financial statement
based on their financial statements which were audited by other independent
auditors for the corresponding period.
Note C: As of December 31, 2020, these investee companies are included in the
consolidated financial statements based on their financial statements which were
audited by the Group’s independent auditors for the correponding period.
Note D: The subsidiary is in the process of liquidation.
Note E: Registration of MSI IBERIA was completed on May 6, 2019. Thus, it has been
included in the consolidated financial statements from that date.
Note F: MSI CANADA received capital infusion from MSI on April 8, 2020. Thus, it has
been included in the consolidated financial statements from that date.
Note G: On June 10, 2020, this subsidiary has cancelled the registration.
C. Subsidiaries not included in the consolidated financial statements: None.
D. Adjustments for subsidiaries with different balance sheet dates: None.
E. Significant restrictions: None.
F. Subsidiaries that have non-controlling interests that are material to the Group: None.
(4) Foreign currency translation
Items included in the financial statements of each of the Group’s entities are measured using
the currency of the primary economic environment in which the entity operates (the “functional
currency”). The consolidated financial statements are presented in New Taiwan Dollars, which
is the Company’s functional and the Group’s presentation currency.
A. Foreign currency transactions and balances
(a) Foreign currency transactions are translated into the functional currency using the
exchange rates prevailing at the dates of the transactions or valuation where items are
remeasured. Foreign exchange gains and losses resulting from the settlement of such
transactions are recognised in profit or loss in the period in which they arise.
(b) Monetary assets and liabilities denominated in foreign currencies at the period end are
re-translated at the exchange rates prevailing at the balance sheet date. Exchange
differences arising upon re-translation at the balance sheet date are recognised in profit
or loss.
(c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value
through profit or loss are re-translated at the exchange rates prevailing at the balance
sheet date; their translation differences are recognised in profit or loss. Non-monetary
assets and liabilities denominated in foreign currencies held at fair value through other
comprehensive income are re-translated at the exchange rates prevailing at the balance
sheet date; their translation differences are recognised in other comprehensive income.
However, non-monetary assets and liabilities denominated in foreign currencies that are
127
not measured at fair value are translated using the historical exchange rates at the dates
of the initial transactions.
(d) All foreign exchange gains and losses are presented in the statement of comprehensive
income within ‘other gains and losses’.
B. Translation of foreign operations
(a) The operating results and financial position of all the group entities, associates and joint
arrangements that have a functional currency different from the presentation currency
are translated into the presentation currency as follows:
i. Assets and liabilities for each balance sheet presented are translated at the closing
exchange rate at the date of that balance sheet;
ii. Income and expenses for each statement of comprehensive income are translated at
average exchange rates of that period; and
iii. All resulting exchange differences are recognised in other comprehensive income.
(b) When the foreign operation partially disposed of or sold is a subsidiary, cumulative
exchange differences that were recorded in other comprehensive income are
proportionately transferred to the non-controlling interest in this foreign operation. In
addition, even when the Group retains partial interest in the former foreign subsidiary
after losing control of the former foreign subsidiary, such transactions should be
accounted for as disposal of all interest in the foreign operation.
(5) Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets; otherwise they
are classified as non-current assets:
(a) Assets arising from operating activities that are expected to be realized, or are intended
to be sold or consumed within the normal operating cycle;
(b) Assets held mainly for trading purposes;
(c) Assets that are expected to be realized within twelve months from the balance sheet
date;
(d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that
are to be exchanged or used to settle liabilities more than twelve months after the
balance sheet date.
B. Liabilities that meet one of the following criteria are classified as current liabilities;
otherwise they are classified as non-current liabilities:
(a) Liabilities that are expected to be settle within the normal operating cycle;
(b) Liabilities arising mainly from trading activities;
(c) Liabilities that are to be settled within twelve months from the balance sheet date;
(d) Liabilities for which the repayment date cannot be extended unconditionally to more
128
than twelve months after the balance sheet date. Terms of a liability that could, at the
option of the counterparty, result in its settlement by the issue of equity instruments do
not affect its classification.
(6) Cash equivalents
Cash equivalents refer to short-term highly liquid investments that readily convert to known
amount of cash and subject to an insignificant effect of value of changes in rate. Time deposits
and money market fund that meet the definition above and are held for the purpose of meeting
short-term cash commitments in operations are classified as cash equivalents.
(7) Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not measured at
amortised cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are
recognised and derecognised using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value and recognises
the transaction costs in profit or loss. The Group subsequently measures the financial assets
at fair value, and recognises the gain or loss in profit or loss.
(8) Financial assets at fair value through other comprehensive income
A. Financial assets at fair value through other comprehensive income comprise equity
securities which are not held for trading, and for which the Group has made an irrevocable
election at initial recognition to recognize changes in fair value in other comprehensive
income and debt instruments which meet all of the following criteria:
(a) The objective of the Group’s business model is achieved both by collecting contractual
cash flows and selling financial assets; and
(b) The assets’ contractual cash flows represents solely payments of principal and interest.
B. On a regular way purchase or sale basis, financial assets at fair value through other
comprehensive income are recognised and derecognised using trade date accounting.
C. At initial recognition, the Group measures the financial assets at fair value plus transaction
costs. The Group subsequently measures the financial assets at fair value:
The changes in fair value of equity investments that were recognised in other
comprehensive income are reclassified to retained earnings and are not reclassified to profit
or loss following the derecognition of the investment. Dividends are recognised as revenue
when the right to receive payment is established, future economic benefits associated with
the dividend will flow to the Group and the amount of the dividend can be measured
reliably.
(9) Financial assets at amortised cost
A. Financial assets at amortised cost are those that meet all of the following criteria:
129
(a) The objective of the Group’s business model is achieved by collecting contractual cash
flows.
(b) The assets’ contractual cash flows represent solely payments of principal and interest.
B. On a regular way purchase or sale basis, financial assets at amortised cost are recognised and
derecognised using trade date accounting.
C. The Group’s time deposits which do not fall under cash equivalents are those with a short
maturity period and are measured at initial investment amount as the effect of discounting is
immaterial.
(10) Accounts and notes receivable
A. Accounts and notes receivable entitle the Group a legal right to receive consideration in
exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are subsequently
measured at initial invoice amount as the effect of discounting is immaterial.
(11) Impairment of financial assets
For financial assets measured at amortised cost including accounts receivable that have a
significant financing component, at each reporting date, the Group recognises the impairment
provision for 12 months expected credit losses if there has not been a significant increase in
credit risk since initial recognition or recognises the impairment provision for the lifetime
expected credit losses (ECLs) if such credit risk has increased since initial recognition after
taking into consideration all reasonable and verifiable information that includes forecasts. On
the other hand, for accounts receivable or contract assets that do not contain a significant
financing component, the Group recognises the impairment provision for lifetime ECLs.
(12) Leasing arrangements (lesser)－Operating leases
Payments made under an operating lease (net of any incentives received from the lessor) are
recognised in profit or loss on a straight-line basis over the lease term.
(13) Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined using
the weighted-average method. The cost of finished goods and work-in-process comprises raw
materials, direct labour, other direct costs and related production overheads. The item-by-item
approach is used in applying the lower of cost and net realizable value. Net realizable value is
the estimated selling price in the ordinary course of business, less the estimated cost of
completion and applicable variable selling expenses.
(14) Property, plant and equipment
A Property, plant and equipment are initially recorded at cost. Borrowing costs incurred
during the construction period are capitalised.
B. Subsequent costs are included in the asset’s carrying amount or recognised as a separate
130
asset, as appropriate, only when it is probable that future economic benefits associated
with the item will flow to the Group and the cost of the item can be measured reliably. The
carrying amount of the replaced part is derecognised. All other repairs and maintenance are
charged to profit or loss during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model and are
depreciated using the straight-line method to allocate their cost over their estimated useful
lives. Each part of an item of property, plant, and equipment with a cost that is significant
in relation to the total cost of the item must be depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed, and
adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual
values and useful lives differ from previous estimates or the patterns of consumption of the
assets’ future economic benefits embodied in the assets have changed significantly, any
change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies,
Changes in Accounting Estimates and Errors’, from the date of the change. The estimated
useful lives of property, plant and equipment are as follows:
Buildings and structures 3~55 years
Machinery and equipment 2~10 years
Other properties (includes transportation equipment, office equipment, 1.5~10 years
and leasehold improvements)
(15) Leasing arrangements (lessee)－right-of-use assets/ lease liabilities
A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date
at which the leased asset is available for use by the Group. For short-term leases or leases
of low-value assets, lease payments are recognised as an expense on a straight-line basis
over the lease term.
B. Lease liabilities include the net present value of the remaining lease payments at the
commencement date, discounted using the incremental borrowing interest rate. Lease
payments are mainly fixed payments, less any lease incentives that can be received.
The Group subsequently measures the lease liability at amortised cost using the interest
method and recognises interest expense over the lease term. The lease liability is
remeasured and the amount of remeasurement is recognised as an adjustment to the
right-of-use asset when there are changes in the lease term or lease payments and such
changes do not arise from contract modifications.
C. At the commencement date, the right-of-use asset is stated at cost mainly comprising the
amount of the initial measurement of lease liability.
The right-of-use asset is measured subsequently using the cost model and is depreciated
from the commencement date to the earlier of the end of the asset’s useful life or the end of
131
the lease term. When the lease liability is remeasured, the amount of remeasurement is
recognised as an adjustment to the right-of-use asset.
D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the
carrying amount of the right-of-use asset to reflect the partial or full termination of the
lease, and recognise the difference between remeasured lease liability in profit or loss.
(16) Investment property
An investment property is stated initially at its cost and measured subsequently using the cost
model. Except for land, investment property is depreciated on a straight-line basis over its
estimated useful life of 20 years.
(17)Impairment of non-financial assets
The Group assesses at each balance sheet date the recoverable amounts of those assets where
there is an indication that they are impaired. An impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount
is the higher of an asset’s fair value less costs to sell or value in use. When the circumstances
or reasons for recognizing impairment loss for an asset in prior years no longer exist or
diminish, the impairment loss is reversed. The increased carrying amount due to reversal
should not be more than what the depreciated or amortised historical cost would have been if
the impairment had not been recognised.
(18) Borrowings
Borrowings comprise long-term and short-term bank borrowings. Borrowings are recognised
initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at
amortised cost; any difference between the proceeds (net of transaction costs) and the
redemption value is recognised in profit or loss over the period of the borrowings using the
effective interest method.
(19) Notes and accounts payable
A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes
payable are those resulting from operating and non-operating activities.
B. The short-term notes and accounts payable without bearing interest are subsequently
measured at initial invoice amount as the effect of discounting is immaterial.
(20) Financial liabilities at fair value through profit or loss
A. Financial liabilities are classified in this category of held for trading if acquired principally
for the purpose of repurchasing in the short-term. Derivatives are also categorised as
financial liabilities held for trading unless they are designated as hedges.
B. At initial recognition, the Group measures the financial liabilities at fair value. All related
transaction costs are recognised in profit or loss. The Group subsequently measures these
financial liabilities at fair value with any gain or loss recognised in profit or loss.
132
(21) Provisions
Provisions of warranties are recognised when the Group has a present legal or constructive
obligation as a result of past events, and it is probable that an outflow of economic resources
will be required to settle the obligation and the amount of the obligation can be reliably
estimated. Provisions are measured at the present value of the expenditures expected to be
required to settle the obligation on the balance sheet date, which is discounted using a pre-tax
discount rate that reflects the current market assessments of the time value of money and the
risks specific to the obligation. When discounting is used, the increase in the provision due to
passage of time is recognised as interest expense. Provisions are not recognised for future
operating losses.
(22) Employee benefits
A. Short-term employee benefits
Short-term employee benefits are measured at the undiscounted amount of the benefits
expected to be paid in respect of service rendered by employees, and should be recognised
as expense in that period when the employees render service.
B. Pensions
(a) Defined contribution plans
For defined contribution plans, the contributions are recognised as pension expense
when they are due on an accrual basis. Prepaid contributions are recognised as an asset
to the extent of a cash refund or a reduction in the future payments.
(b) Defined benefit plans
i. Net obligation under a defined benefit plan is defined as the present value of an
amount of pension benefits that employees will receive on retirement for their
services with the Group in current period or prior periods. The liability recognised
in the balance sheet in respect of defined benefit pension plans is the present value
of the defined benefit obligation at the balance sheet date less the fair value of plan
assets, together with adjustments for unrecognised past service costs. The net
defined benefit obligation is calculated annually by independent actuaries using the
projected unit credit method. The rate used to discount is determined by using
interest rates of government bonds (at the balance sheet date).
ii. Remeasurement arising on defined benefit plans are recognised in other
comprehensive income in the period in which they arise and are recorded as
retained earnings.
iii. Past service costs are recognised immediately in profit or loss.
C. Termination benefits
Termination benefits are employee benefits provided in exchange for the termination of
133
employment as a result from either the Group’s decision to terminate an employee’s
employment before the normal retirement date, or an employee’s decision to accept an
offer of redundancy benefits in exchange for the termination of employment. The Group
recognises expense as it can no longer withdraw an offer of termination benefits or it
recognises relating restructuring costs, whichever is earlier. Benefits that are expected to be
due more than 12 months after balance sheet date shall be discounted to their present
value.
D. Employees’ compensation and directors’ and supervisors’ remuneration
Employees’ remuneration and directors’ and supervisors’ remuneration are recognised as
expense and liability, provided that such recognition is required under legal or constructive
obligation and those amounts can be reliably estimated. Any difference between the
resolved amounts and the subsequently actual distributed amounts is accounted for as
changes in estimates. If employee compensation is distributed by shares, the Group
calculates the number of shares based on the closing price at the previous day of the board
meeting resolution.
(23) Income tax
A. The tax expense for the period comprises current and deferred tax. Tax is recognised in
profit or loss, except to the extent that it relates to items recognised in other comprehensive
income or items recognised directly in equity, in which cases the tax is recognised in other
comprehensive income or equity.
B. The current income tax expense is calculated on the basis of the tax laws enacted or
substantively enacted at the balance sheet date in the countries where the Group and its
subsidiaries operate and generate taxable income. Management periodically evaluates
positions taken in tax returns with respect to situations in accordance with applicable tax
regulations. It establishes provisions where appropriate based on the amounts expected to
be paid to the tax authorities. An additional tax is levied on the unappropriated retained
earnings and is recorded as income tax expense in the year the stockholders resolve to
retain the earnings.
C. Deferred income tax is recognised, using the balance sheet liability method, on temporary
differences arising between the tax bases of assets and liabilities and their carrying
amounts in the consolidated balance sheet. However, the deferred income tax is not
accounted for if it arises from initial recognition of goodwill or of an asset or liability in a
transaction other than a business combination that at the time of the transaction affects
neither accounting nor taxable profit or loss. Deferred income tax is provided on temporary
differences arising on investments in subsidiaries, except where the timing of the reversal
of the temporary difference is controlled by the Group and it is probable that the temporary
134
difference will not reverse in the foreseeable future. Deferred income tax is determined
using tax rates (and laws) that have been enacted or substantially enacted by the balance
sheet date and are expected to apply when the related deferred income tax asset is realised
or the deferred income tax liability is settled.
D. Deferred income tax assets are recognised only to the extent that it is probable that future
taxable profit will be available against which the temporary differences can be utilised. At
each balance sheet date, unrecognised and recognised deferred income tax assets are
reassessed.
E. Current income tax assets and liabilities are offset and the net amount reported in the
balance sheet when there is a legally enforceable right to offset the recognised amounts
and there is an intention to settle on a net basis or realise the asset and settle the liability
simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet
when the entity has the legally enforceable right to offset current tax assets against current
tax liabilities and they are levied by the same taxation authority on either the same entity or
different entities that intend to settle on a net basis or realise the asset and settle the
liability simultaneously.
(24) Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.
(25) Dividends
Dividends are recorded in the Company’s financial statements in the period in which they are
approved by the Company’s shareholders. Cash dividends are recorded as liabilities.
(26) Revenue recognition
A. Sales of goods
(a) The Group manufactures and sells motherboards, graphic cards, a variety of computer
hardware, and electronic components. Sales are recognised when control of the
products has transferred, being when the products are delivered to the customer, the
customer has full discretion over the channel and price to sell the products, and there is
no unfulfilled obligation that could affect the customer’s acceptance of the products.
Delivery occurs when the products have been shipped to the specific location, the risks
of obsolescence and loss have been transferred to the customer, and either the customer
has accepted the products in accordance with the sales contract, or the Group has
objective evidence that all criteria for acceptance have been satisfied.
(b) Revenue from the products is recognised based on the price specified in the contract,
net of the estimated value added tax, returns and volume discounts and rebates. The
volume discounts to the customers are estimated based on the anticipated annual sales
135
quantities and the right of return for defective products is estimated on the basis of
historical experience. Revenue is only recognised to the extent that it is highly probable
that a significant reversal will not occur. The estimation is subject to an assessment at
each reporting date. A refund liability is recognised for expected volume discounts
payable to customers in relation to sales made until the end of the reporting period. The
period between the transfer of the promised goods or services to the customer and
payment by the customer does not exceed one year. As a result, the Group does not
adjust any of the transaction prices for the time value of money.
(c) The Group’s obligation to provide a refund for faulty products under the standard
warranty terms is recognised as a provision.
(d) A receivable is recognised when the goods are delivered as this is the point in time that
the consideration is unconditional because only the passage of time is required before
the payment is due.
B. Incremental costs of obtaining a contract
Given that the contractual period lasts less than one year, the Group recognises the
incremental costs of obtaining a contract as an expense when incurred although the Group
expects to recover those costs.
(27) Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision-maker. The chief operating decision-maker is responsible for
allocating resources and assessing performance of the operating segments.
5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF
ASSUMPTION UNCERTAINTY
The preparation of these consolidated financial statements requires management to make critical
judgements in applying the Group’s accounting policies and make critical assumptions and
estimates concerning future events. Assumptions and estimates may differ from the actual results
and are continually evaluated and adjusted based on historical experience and other factors. The
information is addressed below:
(1) Critical judgements in applying the Group’s accounting policies
None.
(2) Critical accounting estimates and assumptions
Evaluation of inventories
As inventories are stated at the lower of cost and net realisable value, the Group must
determine the net realisable value of inventories on balance sheet date using judgements and
estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal
inventory consumption, obsolete inventories or inventories without market selling value on
136
balance sheet date, and writes down the cost of inventories to the net realisable value. Such an
evaluation of inventories is principally based on the demand for the products within the
specified period in the future. Therefore, there might be material changes to the evaluation. As
of December 31, 2020, the carrying amount of inventories was $27,482,537.
6. DETAILS OF SIGNIFICANT ACCOUNTS
(1) Cash and cash equivalents
Cash on hand and petty cash $ 2,979 $ 4,210
Checking accounts and demand deposits 13,480,057 9,526,040
Time deposits 5,102,919 1,178,795
Total $ 18,585,955 $ 10,709,045
A. The Group transacts with a variety of financial institutions all with high credit quality to
disperse credit risk, so it expects that the probability of counterparty default is remote.
B. The Group’s time deposits with maturity periods over three months or pledged to others are
reclassified as “financial assets at amortised cost.” Details of financial assets at amortised
cost are provided in Notes 6(4) and 8.
(2) Financial assets and liabilities at fair value through profit or loss - current
Asset items December 31, 2020 December 31, 2019
Financial assets mandatorily measured at fair value
through profit or loss
Stock of publicly traded or listed companies $ 126,045 $ 119,571
Derivatives – Forward exchange contract 37 3,660
Derivatives – Foreign exchange swap 79,260 52,981
205,342 176,212
Evaluation adjustment ( 1,605) ( 23,407)
Total $ 203,737 $ 152,805
Liability items December 31, 2020 December 31, 2019

Financial liabilities held for trading
Derivatives – Forward exchange contract $ 103,885 $ 24,943
A. Amounts recognised in profit or loss in relation to financial assets and liabilities at fair value
through profit or loss are listed below:
137
2020 2019
Financial assets and liabilities mandatorily
measured at fair value through profit or loss
Equity instruments $ 24,436 $ 16,301
Derivatives ( 57,442) ( 21,390)
($ 33,006) ($ 5,089)
B. The Group entered into contracts related to derivative financial assets and liabilities which
were not accounted for under hedge accounting. The contract information are as follows:
December 31, 2020
Contract Amount
Notional Principal
Derivative Financial Assets (In thousands) Contract period
Forward exchange contracts CAD 1,000 2020.12.16～2021.03.24
Foreign exchange swap USD 80,000 2020.11.06～2021.02.09
〃 CNY 591,911 2020.08.13～2021.05.17
December 31, 2020
Contract Amount
Notional Principal
Derivative Financial Liabilities (In thousands) Contract period
Forward exchange contracts GBP 6,000 2020.10.22～2021.03.08
〃 AUD 8,200 2020.10.28～2021.02.24
〃 CAD 6,000 2020.11.06～2021.03.24
〃 KRW 6,576,400 2020.12.02～2021.01.28
〃 SEK 7,575 2020.11.20～2021.02.08
〃 EUR 68,000 2020.08.25～2021.03.16
December 31, 2019
Contract Amount
Notional Principal
Forward exchange contracts EUR 2,000 2019.10.21~2020.02.10
〃 GBP 500 2019.12.09~2020.02.18
〃 KRW 1,156,000 2019.12.30~2020.01.15
〃 SEK 4,650 2019.12.30~2020.02.10
〃 JPY 216,310 2019.12.04~2020.02.03
Foreign exchange swap USD 94,000 2019.11.07~2020.02.24
〃 CNY 473,584 2019.08.14~2020.05.18
138
December 31, 2019
Contract Amount
Notional Principal
Forward exchange contracts CAD 8,000 2019.10.21~2020.03.24
〃 RUB 224,291 2019.12.05~2020.01.16
〃 EUR 44,000 2019.10.15~2020.04.08
〃 SEK 2,852 2019.12.03~2020.01.08
〃 GBP 5,500 2019.10.17~2020.02.18
〃 AUD 6,500 2019.10.31~2020.02.24
The Group entered into forward foreign exchange contracts to hedge exchange risk.
However, these forward foreign exchange contracts are not accounted for under hedge
accounting.
C. The Group has no financial assets at fair value through profit or loss pledged to others.
D. Information relating to price risk and fair value of financial assets at fair value through profit
or loss is provided in Note 12(2)(3).
Items December 31, 2020 December 31, 2019
Non-current items:
Equity instruments
Unlisted stocks $ 151,975 $ 151,975
Valuation adjustment ( 27,637) -
Total $ 124,338 $ 151,975
A. The Group has elected to classify equity instruments that are considered to be strategic
investments as financial assets at fair value through other comprehensive income. The fair
value of such investments amounted to $124,338 and $151,975 as at December 31, 2020
and 2019, respectively.
B. As at December 31, 2020 and 2019 , without taking into account any collateral held or other
credit enhancements, the maximum exposure to credit risk in respect of the amount that best
represents the financial assets at fair value through other comprehensive income held by the
Group were $124,338 and $151,975, respectively.
C. The Group has no financial assets at fair value through other comprehensive income pledged
to others as collateral.
D. Information relating to price risk and fair value of financial assets at fair value through other
comprehensive income is provided in Note 12(2)(3).
139

Current items:
Time deposits over three months $ 1,000,447 $ 1,200,000
Non-current items:
Pledge bank deposits $ 225,844 $ 226,083
Others 1,093 1,765
Total $ 226,937 $ 227,848
A. Amounts recognised in profit or loss in relation to financial assets at amortised cost are
listed below:
2020 2019
Interest income $ 7,362 $ 8,310
B. As at December 31, 2020 and 2019, without taking into account any collateral held or other
represents the financial assets at amortised cost held by the Group were $1,227,384 and
$1,427,848, respectively.
C. Details of the Group’s financial assets at amortised cost pledged to others as collateral are
provided in Note 8.
D. Information relating to credit risk of financial assets at amortised cost is provided in Note
12(2).
(5) Notes and Accounts receivable

Notes receivable $ 113,287 $ 47,114
Accounts receivable $ 21,885,338 $ 17,237,493
Less: Allowance for doubtful accounts ( 18,092) ( 31,710)
$ 21,867,246 $ 17,205,783
A. The ageing analysis of accounts receivable and notes receivable:
140
Accounts Notes Accounts Notes
receivable receivable receivable receivable
Not past due $ 19,204,696 $ 113,287 $ 14,068,801 $ 47,114
1 to 75 days 2,633,841 - 3,044,781 -
76 to 365 days 45,859 - 120,008 -
Over 365 days 942 - 3,903 -
$ 21,885,338 $ 113,287 $ 17,237,493 $ 47,114
The above ageing analysis was based on past due date.
B. As of December 31, 2020 and 2019, accounts receivable and notes receivable were all from
contracts with customers. And as of January 1, 2019, the balance of receivables from
contracts with customers amounted to $16,075,372.
C. Most of the Group’s accounts receivable have been insured or have collateral as security,
and the Group will be able to obtain insurance claims or enforce a collateral in case these
accounts default.
D. As of December 31, 2020 and 2019, without taking into account any collateral held or other
represents the Group’s notes and accounts receivable were $113,287 and $47,114;
$21,867,246 and $17,205,783, respectively.
E. Information relating to credit risk of accounts receivable and notes receivable is provided in
Note 12(2).
(6) Inventories
December 31, 2020

Allowance for
Cost valuation loss Book value
Raw materials $ 8,292,346 ($ 154,873) $ 8,137,473
Work-in-process 1,502,072 ( 2,198) 1,499,874
Finished goods 18,172,487 ( 327,297) 17,845,190
$ 27,966,905 ($ 484,368) $ 27,482,537
December 31, 2019

Allowance for
Raw materials $ 6,579,127 ($ 130,049) $ 6,449,078
Work-in-process 1,378,828 ( 1,311) 1,377,517
Finished goods 15,104,505 ( 403,260) 14,701,245
$ 23,062,460 ($ 534,620) $ 22,527,840
The cost of inventories recognised as expense for the period:

141
2020 2019
Cost of inventories recognised as expense $ 125,199,949 $ 104,629,261
Gains on reversal of decline in market value ( 48,625) ( 191,805)
The Group reversed a previous inventory write-down and accounted for as reduction of cost of
goods sold because some inventories which were recognized as expense have been sold for the
years ended December 31, 2020 and 2019.
(7) Prepayments
Overpaid tax for offsetting the future tax payable $ 972,344 $ 922,464
Office supplies 539,955 490,408
Prepayment for goods 57,650 30,266
Others 237,564 232,563
$ 1,807,513 $ 1,675,701

2020
Land Buildings Machineries Others Total
At January 1
Cost $ 1,462,282 $ 5,251,609 $ 2,550,199 $ 1,776,223 $ 11,040,313
Accumulated depreciation - ( 3,387,842) ( 1,443,341) ( 1,315,697) ( 6,146,880)
$ 1,462,282 $ 1,863,767 $ 1,106,858 $ 460,526 $ 4,893,433
Balance at January 1 $ 1,462,282 $ 1,863,767 $ 1,106,858 $ 460,526 $ 4,893,433

Additions - 49,919 638,484 282,363 970,766
Reclassifications - 85,038 43,543 ( 84,090) 44,491
Disposals - ( 225) ( 106) ( 766) ( 1,097)
Depreciation charge - ( 267,855) ( 356,338) ( 173,271) ( 797,464)
Net exchange differences 525 9,187 8,870 1,383 19,965
Balance At December 31 $ 1,462,807 $ 1,739,831 $ 1,441,311 $ 486,145 $ 5,130,094
At December 31
Cost $ 1,462,807 $ 5,635,658 $ 3,239,657 $ 1,906,219 $ 12,244,341
$ 1,462,807 $ 1,739,831 $ 1,441,311 $ 486,145 $ 5,130,094
142
2019
At January 1
Cost $ 1,467,630 $ 5,368,187 $ 3,713,051 $ 1,715,434 $ 12,264,302
$ 1,467,630 $ 2,069,493 $ 824,000 $ 377,421 $ 4,738,544
Balance at January 1 $ 1,467,630 $ 2,069,493 $ 824,000 $ 377,421 $ 4,738,544

Additions - 59,515 636,031 287,121 982,667
Reclassifications - 25,963 800 ( 61,740) ( 34,977)
Disposals - - ( 53,085) ( 1,709) ( 54,794)
Net exchange differences ( 5,348) ( 36,133) ( 18,016) ( 7,489) ( 66,986)
Balance At December 31 $ 1,462,282 $ 1,863,767 $ 1,106,858 $ 460,526 $ 4,893,433
At December 31
Cost $ 1,462,282 $ 5,251,609 $ 2,550,199 $ 1,776,223 $ 11,040,313
$ 1,462,282 $ 1,863,767 $ 1,106,858 $ 460,526 $ 4,893,433
Information about the property, plant and equipment that were pledged to others as collaterals
is provided in Note 8.
(9) Leasing arrangements－lessee
A. The Group leases various assets including land, buildings, machinery and equipment, and
other equipment. Rental contracts are typically made for periods of 3 months to 9 years.
Lease terms are negotiated on an individual basis and contain a wide range of different
terms and conditions. The lease agreements do not impose covenants, but leased assets may
not be used as security for borrowing purposes.
B. The carrying amount of right-of-use assets and the depreciation charge are as follows:
0 December 31, 2020 December 31, 2019
Carrying amount Carrying amount
Land $ 62,903 $ 70,355
Buildings 387,566 361,312
Machinery and equipment 7,803 6,717
Other equipment 44,128 36,513
$ 502,400 $ 474,897
143
2020 2019
Depreciation charge Depreciation charge
Land $ 8,594 $ 8,809
Buildings 217,471 132,799
Machinery and equipment 2,760 2,433
Other equipment 21,127 20,153
$ 249,952 $ 164,194
C. For the years ended December 31, 2020 and 2019, the additions to right-of-use assets were
$301,039 and $290,570, respectively.
D. The information on profit and loss accounts relating to lease contracts is as follows:
2020 2019
Items affecting profit or loss
Interest expense on lease liabilities $ 10,050 $ 6,450
Expense on leases of low-value or short-term assets 58,122 52,040
Expense on variable lease payments 29,530 37,443
Gain on lease modification 366 214
E. For the years ended December 31, 2020 and 2019, the Group’s total cash outflow for leases
were $336,687 and $248,697, respectively.
F. The Group has applied the practical expedient to “Covid-19-related rent concessions”. The
amount is not significant, and the Group recognised changes in lease payments caused by
rent concessions as deductions for expenses.
(10) Leasing arrangements – lessor
A. The Group leases buildings. Rental contracts are typically made for periods of 1 to 5 years.
Lease terms are negotiated on an individual basis and contain a wide range of different
terms and conditions.
B. The Group recognised rental income of $102,153 and $116,675 based on operating lease
contracts for the years ended December 31, 2020 and 2019, respectively. None of these
included variable lease payments.
C. The maturity analysis of the undiscounted lease payments in the operating lease is as
follows:

Less than 1 year $ 83,885 $ 71,211
Between 1 and 5 years 105,775 61,051
Total $ 189,660 $ 132,262
144
(11) Investment property
2020 2019
Buildings Buildings
At January 1
Cost $ 1,167,190 $ 1,129,777
Accumulated depreciation ( 866,631) ( 788,536)
$ 300,559 $ 341,241
Balance at January 1 $ 300,559 $ 341,241

Additions 316 3,602
Reclassifications ( 48,800) 21,319
Depreciation charge ( 48,402) ( 54,841)
Net exchange differences 3,964 ( 10,762)
Balance At December 31 $ 207,637 $ 300,559
At December 31
Cost $ 950,590 $ 1,167,190
Accumulated depreciation ( 742,953) ( 866,631)
$ 207,637 $ 300,559
A. Rental income from the lease of the investment and direct operating expenses arising from
the investment property:
2020 2019
Rental income from the lease of the investment
property $ 102,153 $ 116,675
Direct operating expenses arising from the

investment property $ 67,220 $ 76,351
B. As of December 31, 2020 and 2019, the fair value of the Group’s investments in property
amounting to $2,437,773 and $3,403,426, respectively, as derived from market prices in the
nearby area, are included in Level 2.
145
(12) Short-term borrowings
Type of borrowings December 31, 2020 Interest rate range Collateral
Bank borrowings
Unsecured borrowings $ 3,000,000 0.73%~0.85% None

Bank borrowings
Unsecured borrowings $ 1,500,000 0.88%～0.90% None
(13) Other payables

Accrued salary and bonus $ 1,685,707 $ 1,303,131
Accrued freight 945,457 617,251
Directors’ remuneration and employees’ compensation 796,500 554,500
Advertising expenses payable 659,268 355,107
Accrued molding expense 333,861 217,077
Other accrued expenses 923,617 797,769
$ 5,344,410 $ 3,844,835
146
(14) Long-term borrowings
Borrowing period and
Type of borrowings repayment term Interest rate range Collateral December 31, 2020
Long-term bank
borrowings
Secured Starting from March 24, Three month Land and $ 14,184
borrowings 2016 to March 24, 2021, LIBOR plus Building
repayment of principal 1.75%
and interest of USD
4,307.77 monthly and
remaining principal on
the due date.
Less: current portion ( 14,184)
$ -
Borrowing period and
Type of borrowings repayment term Interest rate range Collateral December 31, 2019
Long-term bank
borrowings
Secured Starting from March 24, Three month Land and $ 16,026
borrowings 2016 to March 24, 2021, LIBOR plus Building
repayment of principal 1.75%
and interest of USD
4,307.77 monthly and
remaining principal on
the due date.
Less: current portion ( 931)
$ 15,095
(15) Pensions
A. (a) The Company has a defined benefit pension plan in accordance with the Labor
Standards Law, covering all regular employees’ service years prior to the enforcement
of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who
chose to continue to be subject to the pension mechanism under the Law. Under the
defined benefit pension plan, two units are accrued for each year of service for the first
15 years and one unit for each additional year thereafter, subject to a maximum of 45
units. Pension benefits are based on the number of units accrued and the average
monthly salaries and wages of the last 6 months prior to retirement. The Company and
its domestic subsidiaries contribute monthly an amount equal to 2% of the employees’
monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the
trustee, under the name of the independent retirement fund committee. Also, the
147
Company would assess the balance in the aforementioned labor pension reserve account
by December 31, every year. If the account balance is insufficient to pay the pension
calculated by the aforementioned method to the employees expected to qualify for
retirement in the following year, the Company will make contributions for the deficit by
next March.
(b) The amounts recognised in the balance sheet are as follows:
Present value of defined benefit obligations $ 535,344 $ 524,869
Fair value of plan assets ( 315,030) ( 302,895)
Net defined benefit liability $ 220,314 $ 221,974
(c) Movements in net defined benefit liabilities are as follows:
Present value of Fair value of
defined benefit plan Net defined
obligations assets benefit liability
2020
Balance at January 1 $ 524,869 ($ 302,895) $ 221,974
Current service cost 3,359 - 3,359
Interest expense (income) 3,674 ( 2,120) 1,554
531,902 ( 305,015) 226,887
Remeasurements:
Return on plan assets
(excluding amounts included in
interest income or expense) - ( 10,314) ( 10,314)
Change in financial assumptions 20,532 - 20,532
Experience adjustments ( 5,112) - ( 5,112)
15,420 ( 10,314) 5,106
Pension fund contribution - ( 11,679) ( 11,679)
Paid pension ( 11,978) 11,978 -
Balance at December 31 $ 535,344 ($ 315,030) $ 220,314
148
2019
511,222 ( 287,727) 223,495
Remeasurements:
(excluding amounts included in
interest income or expense) - ( 9,912) ( 9,912)
Experience adjustments 4,224 - 4,224
19,991 ( 9,912) 10,079
Paid pension ( 6,344) 6,344 -
(d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined
benefit pension plan in accordance with the Fund’s annual investment and utilisation
plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the
Labor Retirement Fund” (Article 6: The scope of utilisation for the Fund includes
deposit in domestic or foreign financial institutions, investment in domestic or foreign
listed, over-the-counter, or private placement equity securities, investment in domestic
or foreign real estate securitization products, etc.). With regard to the utilisation of the
Fund, its minimum earnings in the annual distributions on the final financial statements
shall be no less than the earnings attainable from the amounts accrued from two-year
time deposits with the interest rates offered by local banks. If the earnings is less than
aforementioned rates, government shall make payment for the deficit after being
authorized by the Regulator. The Company and its domestic subsidiaries have no right
to participate in managing and operating that fund and hence the Company and its
domestic subsidiaries are unable to disclose the classification of plan assets fair value
in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets
as of December 31, 2020 and 2019 is given in the Annual Labor Retirement Fund
Utilisation Report announced by the government.
(e) The principal actuarial assumptions used were as follows:
149
2020 2019
Discount rate 0.30% 0.70%
Future salary increases 2.75% 2.75%
Assumptions regarding future mortality experience are set based on the fifth round of
empirical life tables of the Taiwan life insurance industry.
Because the main actuarial assumption changed, the present value of defined benefit
obligation is affected. The analysis was as follows:
Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
December 31, 2020
Effect on present value of
defined benefit obligation ($ 12,970) $ 13,446 $ 11,756 ($ 11,422)
December 31, 2019
The sensitivity analysis above is based on one assumption which changed while the
other conditions remain unchanged. In practice, more than one assumption may change
all at once. The method of analysing sensitivity and the method of calculating net
pension liability in the balance sheet are the same.
The methods and types of assumptions used in preparing the sensitivity analysis did not
change compared to the previous period.
(f) Expected contributions to the defined benefit pension plans of the Group for the year
ending December 31, 2021 amount to $11,593.
(g) As of December 31, 2020, the weighted average duration of the retirement plan is 10
years. The analysis of timing of the future pension payment was as follows:
Within 1 year $ 40,867
1-2 year(s) 43,253
2-3 years 30,900
3-4 years 19,385
4-5 years 16,930
6-10 years 131,293
Over 10 years 268,910
$ 551,538
B. (a) Effective July 1, 2005, the Company has established a defined contribution pension
plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular
150
employees with R.O.C. nationality. Under the New Plan, the Company contributes
monthly an amount based on 6% of the employees’ monthly salaries and wages to the
employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits
accrued are paid monthly or in lump sum upon termination of employment.
(b) The Company’s mainland China subsidiaries have a defined contribution plan. Monthly
contributions to an independent fund administered by the government in accordance
with the pension regulations in the People’s Republic of China (PRC) are based on
certain percentage of employees’ monthly salaries and wages. Other than the monthly
contributions, the Group has no further obligations.
(c) The pension costs under defined contribution pension plans of the Group for the years
ended December 31, 2020 and 2019 were $247,872 and $279,412, respectively.
(16) Provisions for liabilities
Warranty 2020 2019
At January 1 $ 556,720 $ 501,095
Additional provisions 852,712 748,955
Used during the period ( 558,931) ( 693,294)
Exchange differences ( 66) ( 36)
At December 31 $ 850,435 $ 556,720
Analysis of total provisions:
Current $ 850,435 $ 556,720
The Group gives warranties on computer components and personal computers sold. Provision
for warranty is estimated based on historical warranty data.
(17)Share capital
As of December 31, 2020, the Company’s authorized capital was $15,000,000 (including
80,000 thousand shares reserved for employee stock options and 150,000 thousand shares
reserved for convertible bonds issued by the Company), and the paid-in capital was
$8,448,562 with a par value of $10 (in dollars) per share. All proceeds from shares issued
have been collected.
(18) Capital surplus
Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of
par value on issuance of common stocks and donations can be used to cover accumulated
deficit or to issue new stocks or cash to shareholders in proportion to their share ownership,
provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and
Exchange Law requires that the amount of capital surplus to be capitalised mentioned above
should not exceed 10% of the paid-in capital each year. Capital surplus should not be used to
151
cover accumulated deficit unless the legal reserve is insufficient.
(19) Retained earnings
A. Under the Company's Articles of Incorporation, the current year's earnings, if any, shall
first be used to pay all taxes and offset prior year's operating losses, then 10% of the
remaining amount shall be set aside or reversed as legal reserve. The balance plus
unappropriated retained earnings at the beginning of the period shall be appropriated
10%~90% as proposed by the Board of Directors and resolved by the stockholders during
their meeting.
B. The Company’s dividend policy is summarized below: as the Company operates in a
volatile business environment and is in the stable growth stage, except for the Company’s
future expansion plans, stockholders’ interest is taken into consideration. The Group
appropriated dividends in proportion to total number of shares, dividends could be
distributed in stock or cash, and cash dividends shall account for at least 30% of the total
dividends distributed.
C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in
proportion to their share ownership, the legal reserve shall not be used for any other
purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in
proportion to their share ownership is permitted, provided that the distribution of the
reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.
D. (a) In accordance with the regulations, the Company shall set aside special reserve from the
debit balance on other equity items at the balance sheet date before distributing earnings.
When debit balance on other equity items is reversed subsequently, the reversed amount
could be included in the distributable earnings.
(b) The amounts previously set aside by the Company as special reserve on initial
application of IFRSs in accordance with Jin-Guan-Zheng-Fa-Zi Letter No. 1010012865,
dated April 6, 2012, shall be reversed proportionately when the relevant assets are used,
disposed of or reclassified subsequently. Such amounts are reversed upon disposal or
reclassified if the assets are investment property of land, and reversed over the use
period if the assets are investment property other than land.
E. The appropriations of 2019 and 2018 earnings had been resolved at the stockholders’
meeting on June 10, 2020 and June 14, 2019, respectively, were as follows:
152
2019 2018
Dividends per Dividends per
Amount share (dollar) Amount share (dollar)
Legal reserve $ 558,721 $ 604,113
Special reserve 288,559 84,151
Cash dividend 3,548,396 $ 4.20 3,801,853 $ 4.50
The cash dividends of the Company from capital surplus that has been approved by the
stockholders on June 14, 2019 amounted to $422,429.
The appropriation of 2019 earnings as approved by the stockholders is the same as with the
appropriation resolved by the Board of Directors during its meeting on April 30, 2020.
Information about earnings appropriation of the Company as resolved by Board of
Directors will be posted in the “Market Observation Post System” at the website of the
Taiwan Stock Exchange.
(20) Operating revenue
The Group derives revenue from the transfer of goods at a point in time in the following
major segment:
Computer and
2020 peripherals segment Other Total
Total segment revenue $ 146,342,698 $ 160,091 $ 146,502,789
Timing of revenue recognition
At a point in time $ 146,342,698 $ 160,091 $ 146,502,789
Computer and
At a point in time $ 120,486,414 $ 5,003 $ 120,491,417
(21) Interest income

2020 2019
Interest income from bank deposits $ 81,460 $ 74,058
Interest income from financial assets measured at
amortised cost 7,362 8,310
$ 88,822 $ 82,368
153
(22) Other income
2020 2019
Rental revenue $ 102,153 $ 116,675
Others 474,822 516,240
$ 576,975 $ 632,915
(23) Other gains and losses
2020 2019
Net currency exchange losses ($ 77,078) ($ 34,836)
Losses on financial assets and liabilities at fair value
through profit or loss ( 33,006) ( 5,089)
Net (losses) gains on disposal of property, plant and ( 540) 2,906
equipment
Other losses ( 114,163) ( 88,691)
($ 224,787) ($ 125,710)
(24) Expenses by nature

2020 2019
Employee benefit expense $ 8,192,801 $ 7,247,568
Depreciation charges 1,095,818 890,056
Amortisation charges 200 224
$ 9,288,819 $ 8,137,848
(25) Employee benefit expense

2020 2019
Wages and salaries $ 7,229,216 $ 6,241,522
Labor and health insurance fees 415,089 396,369
Pension costs 252,785 285,297
Other personnel expenses 295,711 324,380
Total $ 8,192,801 $ 7,247,568
A. According to the Articles of Incorporation of the Company, a ratio of distributable profit of
the current year, after covering accumulated losses, shall be distributed as employees’
compensation and directors’ remuneration. The ratio shall be 6%~10% for employees’
compensation and shall not be higher than 1% for directors’ remuneration.
B. For the years ended December 31, 2020 and 2019, employees’ remuneration was accrued at
$725,000 and $505,000, respectively; while directors’ remuneration was accrued at
$71,500 and $49,500, respectively. The aforementioned amounts were recognized in salary
expenses respectively.
The employees’ compensation and directors’ remuneration were estimated and accrued
154
based on the historical distribution ratio and the profit of the current year for the year
ended December 31, 2020.
Employees’ compensation and directors’ remuneration of 2019 as resolved at the meeting
of Board of Directors were in agreement with those amounts recognized in the 2019
financial statements.
Information about employees’ compensation and directors’ remuneration of the Company
as resolved by the Board of Directors and shareholders will be posted in the “Market
Observation Post System” website of the Taiwan Stock Exchange.
(26)Income tax
A. Income tax expense
(a) Components of income tax expense:
2020 2019
Current tax:
Current tax on profits for the period $ 1,906,717 $ 999,237
Tax on undistributed earnings 52,357 76,902
Prior year income tax overestimation ( 4,331) ( 138,530)
Total current tax 1,954,743 937,609
Deferred tax:
Origination and reversal of temporary differences ( 317,355) ( 6,386)
Total deferred tax ( 317,355) ( 6,386)
Income tax expense $ 1,637,388 $ 931,223
(b) The income tax charge relating to components of other comprehensive income:
2020 2019
Remeasurement of defined benefit obligations $ 1,021 $ 2,016
(c) The income tax charged/(credited) to equity during the period: None.
B. Reconciliation between income tax expense and accounting profit
155
2020 2019
Tax calculated based on profit before tax and
statutory tax rate (Note) $ 2,063,059 $ 1,409,440
Effect from items disallowed by tax regulation 16,800 16,800
Temporary differences not recognised as deferred tax
liabilities ( 133,514) ( 137,196)
Effect from investment tax credits ( 302,078) ( 282,279)
Effect of different tax rates in countries in which the
group operates ( 54,499) ( 13,914)
Other (406) -
Note: The basis for computing the applicable tax rate are the rates applicable in the
respective countries where the Group entities operate.
C. Amounts of deferred tax assets or liabilities as a result of temporary differences, tax losses
and investment tax credits are as follows:
2020
Recognised
in other
Recognised in comprehensive
January 1 profit or loss income December 31
Temporary differences:
-Deferred tax assets:
Unrealized gross profit $ 203,265 $ 234,846 $ - $ 438,111
Loss on inventory 110,357 ( 13,816) - 96,541
Allowance for bad debts excess
tax limitation 7,258 ( 4,981) - 2,277
Unrealized losses on forward
exchange contract - 4,918 - 4,918
Remeasurement of defined
benefit obligations 34,135 - 1,021 35,156
Others 116,508 76,102 - 192,610
Subtotal 471,523 297,069 1,021 769,613
156
2020
Recognised
in other
-Deferred tax liabilities:

Unrealised exchange gain ( 20,490) 14,406 - ( 6,084)
Unrealized gains on
forward exchange contract ( 6,340) 6,340 - -
Others ( 384) ( 460) - ( 844)
Subtotal ( 27,214) 20,286 - ( 6,928)
Total $ 444,309 $ 317,355 $ 1,021 $ 762,685
2019
Recognised
in other
Unrealized gross profit $ 148,181 $ 55,084 $ - $ 203,265
Loss on inventory 147,632 ( 37,275) - 110,357
Allowance for bad debts excess
tax limitation 1,257 6,001 - 7,258
Unrealized exchange loss 3,462 ( 3,462) - -
Others 105,553 10,955 - 116,508
Subtotal 438,204 31,303 2,016 471,523
Unrealised exchange gain - ( 20,490) - ( 20,490)
Unrealized gains on
forward exchange contract ( 1,755) ( 4,585) - ( 6,340)
Others ( 542) 158 - ( 384)
Subtotal ( 2,297) ( 24,917) - ( 27,214)
Total $ 435,907 $ 6,386 $ 2,016 $ 444,309
D. The Company has not recognised taxable temporary differences associated with investment
in subsidiaries as deferred tax liabilities. As of December 31, 2020 and 2019, the amounts
of temporary difference unrecognised as deferred tax liabilities were $5,887,126 and
$5,042,672, respectively.
E. The Company’s income tax returns through 2017 have been assessed and approved by the
Tax Authority.
157
(27)Earnings per share
2020
Retroactively adjusted
weighted-average
outstanding ordinary Earnings per share
Amount after tax shares (in thousands) (in NT dollars)
Basic earnings per share
Profit attributable to ordinary
shareholders of the parent $ 7,959,505 844,856 $ 9.42
Diluted earnings per share
shareholders of the parent $ 7,959,505 844,856
Assumed conversion of all dilutive
potential ordinary shares
Employees’ compensation - 7,225
shareholders of the parent plus
assumed conversion of all
dilutive potential ordinary shares $ 7,959,505 852,081 $ 9.34
2019
weighted-average
Employees’ compensation - 7,378
7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship
None.
158
(2) Significant related party transactions
None.
(3) Key management compensation
2020 2019
Salaries and other employee benefits $ 464,093 $ 350,353
8. PLEDGED ASSETS
The Group’s assets pledged as collateral are as follows:
Book value
December 31, December 31,
Asset items 2020 2019 Purpose
Non-current financial assets at Performance security
amortised cost $ 225,844 $ 226,083 guarantee
For guarantee of
Property, plant and equipment 116,383 126,733 long-term loans
$ 342,227 $ 352,816
9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT

COMMITMENTS
(1) Contingencies：None.
(2) Commitments：None.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
None.
12. OTHERS
(1) Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to
continue as a going concern in order to provide returns for shareholders and to maintain an
optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital
structure, the Group may adjust the amount of dividends paid to shareholders, return capital to
shareholders, issue new shares or repurchase outstanding shares.
159
(2) Financial instruments
A. Financial instruments by category

Financial assets
Financial assets at fair value
Financial assets mandatorily
measured at fair value through
profit or loss $ 203,737 $ 152,805
Financial assets at fair value
through other comprehensive
income
Designation of equity instrument 124,338 151,975
Financial assets at amortised cost
Cash and cash equivalents 18,585,955 10,709,045
Financial assets at amortised cost 1,227,384 1,427,848
Notes receivable 113,287 47,114
Accounts receivable 21,867,246 17,205,783
Other receivables 265,987 227,116
Guarantee deposits paid 64,716 42,242
$ 42,452,650 $ 29,963,928
Financial liabilities
Financial liabilities at fair value
Financial liabilities held for
trading $ 103,885 $ 24,943
Financial liabilities at amortised
cost
Short-term borrowings 3,000,000 1,500,000
Other payables 5,344,410 3,844,835
Long-term borrowings
(including current portion) 14,184 16,026
Guarantee deposits received 212,383 198,920
$ 35,852,613 $ 25,976,244
Lease liabilities $ 443,730 $ 406,848
160
B. Risk management policies
The Group’s activities expose it to a variety of financial risks: including market risk
(including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity
risk. The Group’s overall risk management programme focuses on the unpredictability of
financial markets and seeks to minimise potential adverse effects on the Group’s financial
position and financial performance.
C. Significant financial risks and degrees of financial risks
(a) Market risk
Foreign exchange risk
i. The Group operates internationally and is exposed to foreign exchange risk arising
from various currency exposures, foreign exchange risk arises from future
commercial transactions, recognised assets and liabilities and net investments in
foreign operations.
ii. Management has set up a policy to require group companies to manage their
foreign exchange risk against their functional currency.
iii. The Group has certain investments in foreign operations, whose net assets are
exposed to foreign currency translation risk.
iv. The Group hedges foreign exchange rate by using forward exchange contracts.
However, the Group does not adopt hedging accounting. Details of financial assets
or liabilities at fair value through profit or loss are provided in Note 6(2).
v. The Group’s businesses involve some non-functional currency operations. The
information on assets and liabilities denominated in foreign currencies whose
values would be materially affected by the exchange rate fluctuations is as follows:
December 31, 2020
Foreign Currency
Book Value
(Foreign currency: Amount
functional currency) (In Thousands) Exchange rate (NTD)
Financial assets
Monetary items
USD: NTD $ 471,844 28.4800 $ 13,438,119
EUR: NTD 94,927 35.0200 3,324,351
RMB: NTD 142,167 4.3770 622,264
GBP: NTD 10,763 38.9000 418,664
Monetary items
USD: NTD 982,170 28.4800 27,972,190
EUR: NTD 25,630 35.0200 879,561
USD: RMB 23,215 6.5067 661,151
161
December 31, 2019
Foreign Currency
Book Value
Financial assets
Monetary items
USD: NTD $ 396,064 29.9800 $ 11,873,988
EUR: NTD 51,697 33.5900 1,736,500
RMB: NTD 162,475 4.3050 699,454
GBP: NTD 7,794 39.3600 306,785
CAD: NTD 10,468 22.9900 240,670
Monetary items
USD: NTD 673,526 29.9800 20,192,315
USD: RMB 16,433 6.9640 492,673
EUR: NTD 11,924 33.5900 400,520
vi. The exchange loss arising from significant foreign exchange variation on the
monetary items held by the Group for the years ended December 31, 2020 and 2019
amounted to $77,078 and $34,836, respectively.
vii. Analysis of foreign currency market risk arising from significant foreign exchange
variation:
2020
Sensitivity analysis
Effect on profit Effect on other
(Foreign currency: Degree of or loss comprehensive
functional currency) variation (before tax) income
Financial assets
Monetary items
USD: NTD 1% $ 134,381 $ -
EUR: NTD 1% 33,244 -
RMB: NTD 1% 6,223 -
GBP: NTD 1% 4,187 -
Monetary items
USD: NTD 1% 279,722 -
EUR: NTD 1% 8,976 -
USD: RMB 1% 6,612 -
162
2019
Financial assets
Monetary items
USD: NTD 1% $ 118,740 $ -
EUR: NTD 1% 17,365 -
RMB: NTD 1% 6,995 -
GBP: NTD 1% 3,068 -
CAD: NTD 1% 2,407 -
Monetary items
USD: NTD 1% 201,923 -
USD: RMB 1% 4,927 -
EUR: NTD 1% 4,005 -
Price risk
i. The Group’s equity securities, which are exposed to price risk, are the held financial
assets at fair value through profit or loss and financial assets at fair value through
other comprehensive income. To manage its price risk arising from investments in
equity securities, the Group diversifies its portfolio. Diversification of the portfolio is
done in accordance with the limits set by the Group.
ii. The Group has investments in equity securities. The prices of equity securities would
change due to the change in the future value of investee companies. If the prices of
these equity securities had increased/decreased by 1% with all other variables held
constant, post-tax profit for the years ended December 31, 2020 and 2019 would
have increased/decreased by $996 and $769, as a result of gain or loss of equity
instruments at fair value through profit or loss. Also, other components of equity
would have increased/decreased by $995 and $1,216, respectively, as a result of other
comprehensive income classified as equity investment at fair value through other
comprehensive income.
Cash flow and fair value interest rate risk
i. The Group’s interest rate risk arises from long-term borrowings. Borrowings issued
at variable rates expose the Group to cash flow interest rate risk which is partially
offset by cash and cash equivalents held at variable rates. For the years ended
December 31, 2020 and 2019, the Group borrowings are issued at variable rate
denominated in US dollars.
163
ii. The Group analyses its interest rate exposure on a dynamic basis. Various scenarios
are simulated taking into consideration refinancing, renewal of existing positions,
alternative financing and hedging. Based on these scenarios, the Group calculates
the impact on profit and loss of a defined interest rate shift. For each simulation, the
same interest rate shift is used for all currencies. The scenarios are run only for
liabilities that represent the major interest-bearing positions.
iii. As at December 31, 2020 and 2019, if interest rates on USD and NTD denominated
borrowings had been 1% higher/lower with all other variables held constant,
post-tax profit for the years ended December 31, 2020 and 2019 would have been
$113 and $128 lower/higher, respectively, mainly as a result of higher/lower interest
expense on floating rate borrowings.
(b) Credit risk
i. Credit risk refers to the risk of financial loss to the Group arising from default by
the clients or counterparties of financial instruments on the contract obligations.
The main factor is that counterparties could not repay in full the accounts
receivable, notes receivable and financial assets at amortised cost cash flow based
on the agreed terms.
ii. The Group manages their credit risk taking into consideration the entire group’s
concern. For banks and financial institutions, only parties with a rating of
investment grade are accepted. According to the Group’s credit policy, each local
entity in the Group is responsible for managing and analysing the credit risk for
each of their new clients before standard payment and delivery terms and
conditions are offered. Internal risk control assesses the credit quality of the
customers, taking into account their financial position, past experience and other
factors. Individual risk limits are set based on internal or external ratings in
accordance with limits set by the management. The utilisation of credit limits is
regularly monitored. Credit risk arises from credit exposures to wholesale and retail
customers, including outstanding receivables.
iii. The Group adopts assumptions, if the contract payments were past due over 90 days
based on the terms, there has been a significant increase in credit risk on that
instrument since initial recognition.
iv. The Group adopts the assumptions under IFRS 9, the default occurs when the
contract payments are past due over 150 days.
v. The following indicators are used to determine whether the credit impairment of
debt instruments has occurred:
(i) It becomes probable that the issuer will enter bankruptcy or other financial
164
reorganization due to their financial difficulties;
(ii) The disappearance of an active market for that financial asset because of
financial difficulties;
(iii) Default or delinquency in interest or principal repayments;
(iv) Adverse changes in national or regional economic conditions that are expected
to cause a default.
vi. The Group applies the modified approach using provision matrix, loss rate
methodology to estimate expected credit loss under the provision matrix basis.
vii. The Group wrote-off the financial assets, which cannot be reasonably expected to
be recovered, after initiating recourse procedures. However, the Group will
continue executing the recourse procedures to secure their rights.
viii. The Group used the forecastability to adjust historical and timely information to
assess the default possibility of debt instrument as at December 31, 2020 and 2019.
The expected credit loss rate of the Group’s overdue accounts receivable was not
material as of December 31, 2020 and 2019.
ix. The Group applies the simplified approach to provide loss allowance for accounts
receivable that have no significant impact. The Group had not recognized related
impact as at December 31, 2020 and 2019.
(c) Liquidity risk
i. Cash flow forecasting is performed in the operating entities of the Group and
aggregated by Group treasury. Group treasury monitors rolling forecasts of the
Group’s liquidity requirements to ensure it has sufficient cash to meet operational
needs. Such forecasting takes into consideration the Group’s internal balance sheet
ratio targets and external regulatory or legal requirements.
ii. The table below analyses the Group’s non-derivative financial liabilities and
net-settled or gross-settled derivative financial liabilities into relevant maturity
groupings based on the remaining period at the balance sheet date to the contractual
maturity date for non-derivative financial liabilities and to the expected maturity
date for derivative financial liabilities. The amounts disclosed in the table are the
contractual undiscounted cash flows.
Non-derivative financial liabilities:
165
Less than 1 Between 1 Between 2
December 31, 2020 year to 2 years to 3 years Over 3 years
Short-term borrowings $ 3,001,922 $ - $ - $ -
Accounts payable 27,177,751 - - -
Other payables 5,344,410 - - -
Lease liabilities 225,892 159,964 41,619 22,011
(including current portion) 13,552 - - -
Other financial liabilities 1,228 103,826 - 107,329
166
(including current portion) 1,550 14,266 - -
Other financial liabilities 605 106,506 - 91,809
Derivative financial liabilities
As of December 31, 2020 and 2019, the derivative financial liabilities mature
within 1 year.
iii. The Group does not expect the timing of occurrence of the cash flows estimated
through the maturity date analysis will be significantly earlier, nor expect the actual
cash flow amount will be significantly different.
(3) Fair value information
A. The different levels that the inputs to valuation techniques are used to measure fair value
of financial and non-financial instruments have been defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities
that the entity can access at the measurement date. A market is regarded as
active where a market in which transactions for the asset or liability takes place
with sufficient frequency and volume to provide pricing information on an on
going basis.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for
the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
B. The fair value information of the Group’s investments in property is provided in Note
6(11).
C. Financial instruments not measured at fair value
The Group’s cash and cash equivalents, financial assets at amortised cost, notes receivable,
accounts receivable, other receivables, guarantee deposits paid, short-term borrowings,
accounts payable, other payables, long-term borrowings and guarantee deposits received
are approximate to their fair values. The transaction value information is provided in Note
12(2)A.
D. The related information of financial and non-financial instruments measured at fair value
by level on the basis of the nature, characteristics and risks of the assets and liabilities is as
167
follows:
December 31, 2020 Level 1 Level 2 Level 3 Total
Assets:
Recurring fair value measurements
Financial assets at fair
value through profit or loss
-Equity security $ 124,440 $ - $ - $ 124,440
-Forward exchange contract - 37 - 37
-Foreign exchange swap - 79,260 - 79,260
Financial assets at fair value through
other comprehensive income
-Equity securities - - 124,338 124,338
Total $ 124,440 $ 79,297 $ 124,338 $ 328,075
Liabilities:
Financial liabilities at fair
-Forward exchange contract $ - $ 103,885 $ - $ 103,885

Assets:
-Equity security $ 96,164 $ - $ - $ 96,164
-Forward exchange contract - 3,660 - 3,660
Total $ 96,164 $ 56,641 $ 151,975 $ 304,780
Liabilities:
E. The methods and assumptions the Group used to measure fair value are as follows:
(a) The level 1 financial instruments-equity security held by the Group are listed shares,
and the market quoted price is determined by the closing price of the security.
(b) Except for financial instruments with active markets, the fair value of other financial
168
instruments is measured by using valuation techniques or by reference to counterparty
quotes.
(c) When assessing non-standard and low-complexity financial instruments, for example,
debt instruments without active market, interest rate swap contracts, foreign exchange
swap contracts and options, the Group adopts valuation technique that is widely used
by market participants. The inputs used in the valuation method to measure these
financial instruments are normally observable in the market.
(d) The valuation of derivative financial instruments is based on valuation model widely
accepted by market participants, such as present value techniques and option pricing
models. Forward exchange contracts are usually valued based on the current forward
exchange rate.
F. For the years ended December 31, 2020 and 2019, there was no transfer between Level 1
and Level 2.
G. For the years ended December 31, 2020 and 2019, there was no transfer in or out from
Level 3.
H. The Group entrusts an external evaluation agency to evaluate the fair value classified as
Level 3.
13. SUPPLEMENTARY DISCLOSURES
(1) Significant transactions information
A. Loans to others: None.
B. Provision of endorsements and guarantees to others: None.
C. Holding of marketable securities at the end of the period (not including subsidiaries,
associates and joint ventures): Please refer to table 1.
D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million
or 20% of the Company’s paid-in capital: None.
E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or more:
None.
F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or more: None.
G. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of
paid-in capital or more: Please refer to table 2.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or
more: Please refer to table 3.
I. Derivative financial instruments transactions: Please refer to Note 6(2) and 12(2).
J. Significant inter-company transactions during the reporting periods: Please refer to table 4.
(2) Information on investees
Names, locations and other information of investee companies (not including investees in
169
Mainland China): Please refer to table 5.
(3) Information on investments in Mainland China
A. Basic information: Please refer to table 6.
B. Significant transactions conducted with investees in Mainland China directly or indirectly
through other companies in the third areas: Please refer to table 7.
(4) Major shareholders information
Major shareholders information: Please refer to table 8.
170
14. SEGMENT INFORMATION
(1) General information and measurement of segment information
The Group operates business only in the manufacture and sale of motherboards and computer
hardware and peripherals. The chief operating decision-maker is the Board of Directors, who
considers the whole business as a single performance entity, and assesses performance, makes
decisions and allocates resources based on financial information. It has identified that the
Group has only one reportable operating segment.
(2) Information about segment profit or loss, assets and liabilities:
The Group's Board of Directors mainly evaluates the performance of the operating segments
based on the Group's quarterly financial statements.
(3) Reconciliation for segment income
The Group is a single reportable segment. The profit and loss, assets and liabilities of the
segment are the profit and loss, assets and liabilities shown in the financial statements, so
there is no reconciliation required.
(4) Information on products and services
Revenue from external customers is mainly from the sales of computer and peripherals and
related components. Details of revenue are as follows:
2020 2019
Computer and peripherals sale revenue $ 146,502,789 $ 120,491,417
(5) Geographical information
Geographical information for the years ended December 31, 2020 and 2019 is as follows:
2020 2019
Revenue Non-current assets Revenue Non-current assets
Asia $ 53,798,428 $ 5,443,118 $ 52,938,443 $ 5,395,625
Europe 43,454,599 262,533 32,331,545 283,179
America 45,972,863 191,987 33,122,365 154,501
Others 3,276,899 12,274 2,099,064 852
$ 146,502,789 $ 5,909,912 $ 120,491,417 $ 5,834,157
(6) Major customer information

The Group had no individual customer whose sales amount accounts for more than 10% of net
operating revenue in the consolidated statement of comprehensive income.
171
Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures)
December 31, 2020
Table 1 (Except as otherwise indicated)

As of December 31, 2020
Relationship with the
Securities held by Marketable securities General ledger account Ownership Footnote
securities issuer Number of shares Book value Fair value
(%)
MSI (HOLDING) Ahold Delhaize Kon - value through profit or 40,000 $32,373 - $32,373 -
loss - current
MSI (HOLDING) CVA ING Groep - value through profit or 130,000 34,782 - 34,782 -
loss - current
MSI (HOLDING) Danone - value through profit or 20,000 37,653 - 37,653 -
loss - current
MSI (HOLDING) Deutsche Boerse - value through profit or 4,000 19,632 - 19,632 -
loss - current
MICRO-STAR
value through other
INTERNATIONAL BLUESTACK SYSTEM, INC. - 516,052 124,338 - 124,338 -
comprehensive income
CO., LTD.
- non current
Table 1 Page 1
172
Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more
For the year ended December 31, 2020
Description and
reasons of difference
Description of the transaction in transaction terms Accounts or notes receivable (payable)
Name of the counter Relationship
Transaction company compared to third
party with the Footnote
(Note 4) party transactions
(Note 4) counterparty
% of total accounts
Amount % of total Balance
Purchases/(Sales) Credit terms Unit price Credit terms or notes
(Note 3) purchase (sale) (Note 3)
receivable/(payable)
MICRO-STAR
Insignificant
INTERNATIONAL CO., MSI (LA) Subsidiary Sales $(28,697,320) (20) 60-100 days Note 1 $8,887,796 38 -
difference
LTD.
MICRO-STAR
Second-tier Insignificant
INTERNATIONAL CO., MEGA COMPUTER Sales (6,899,121) (5) 40-70 days Note 1 1,007,998 4 -
Subsidiary difference
LTD.
MICRO-STAR
INTERNATIONAL CO., MYSTAR Sales (2,305,767) (2) 30-100 days Note 1 370,601 2 -
LTD.
MICRO-STAR
INTERNATIONAL CO., MSI (KOREA) Sales (4,481,153) (3) 50-70 days Note 1 21,356 - -
LTD.
MICRO-STAR
MSI COMPUTER Second-tier Processing Insignificant
INTERNATIONAL CO., 2,986,307 2 Note 2 Note 2 (3,141,850) (12) -
(SHENZHEN) Subsidiary overhead difference
LTD.
MICRO-STAR
MSI ELECTRONICS Second-tier Processing Insignificant
INTERNATIONAL CO., 1,191,748 1 Note 2 Note 2 (1,765,669) (7) -
(KUNSHAN) Subsidiary overhead difference
LTD.
Affiliated Insignificant
MEGA COMPUTER MSI (SHANGHAI) Sales 6,864,483) (100) 40-70 days Note 1 1,803,576 100 -
company difference
Affiliated Insignificant
MSI (LA) RAIDEALS Sales (249,448) (1) 40-70 days Note 1 6,244 - -
company difference
Note 1: The credit terms to third parties are approximately 30 to 120 days.
Note 2: Credit terms depend on the financial condition of the paying firm.
Note 3: Balances after elimination in conformity with regulations.
Note 4: Corresponding transactions are not disclosed.
Table 2 Page 1
173
Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more
December 31, 2020

Relationship Overdue receivables
Amount collected subsequent to the
Creditor Counterparty with the Balance as of December 31, 2020 Turnover rate Allowance for doubtful accounts
Amount Action taken balance sheet date
counterparty
MICRO-STAR
INTERNATIONAL MSI (LA) Subsidiary $8,887,796 4.06 $- - $4,063,318 $-
CO., LTD.
MICRO-STAR
MEGA Second-tier
INTERNATIONAL 1,007,998 6.57 - - 505,655 -
COMPUTER Subsidiary
CO., LTD.
MICRO-STAR
Second-tier
INTERNATIONAL MYSTAR 370,601 7.22 - - 337,834 -
Subsidiary
CO., LTD.
MSI (PACIFIC) MICRO-STAR Ultimate
(Note) INTERNATIONAL parent 5,129,249 - - - 778,929 -
CO., LTD. company
MSI COMPUTER MSI (PACIFIC)
Parent
(SHENZHEN) 3,141,850 - - - 513,676 -
Company
(Note)
MSI
ELECTRONICS Parent
MSI (PACIFIC) 1,765,669 - - - 265,253 -
(KUNSHAN) Company
(Note)
Parent
MSI (B.V.I.) MSI (PACIFIC) 133,094 - - - - -
Company
MEGA Affiliated
MSI (SHANGHAI) 1,803,576 3.68 - - 503,355 -
COMPUTER company
Note: Processing overhead receivable.
Table 3 Page 1
174
Significant inter-company transactions during the year ended December 31, 2020

Transaction
Company name Counterparty Percentage of
Number Relationship Amount consolidated total
(Note 4) (Note 4) General ledger account Transaction terms
(Note 1) operating revenues
or total assets
MICRO-STAR INTERNATIONAL Parent company to
0 MSI (KOREA) Sales $4,481,153 Note 2 3.06%
CO., LTD. second-tier subsidiary
0 MSI (LA) Sales 28,697,320 Note 2 19.59%
CO., LTD. subsidiary
0 MEGA COMPUTER Sales 6,899,121 Note 2 4.71%
0 MYSTAR Sales 2,305,767 Note 2 1.57%
0 MSI (LA) Accounts receivable 8,887,796 Note 2 11.34%
0 MEGA COMPUTER Accounts receivable 1,007,998 Note 2 1.29%
0 MYSTAR Accounts receivable 370,601 Note 2 0.47%
0 MSI ELECTRONICS (KUNSHAN) Processing overhead 1,191,748 Note 3 0.81%
0 MSI COMPUTER (SHENZHEN) Processing overhead 2,986,307 Note 3 2.04%
MICRO-STAR INTERNATIONAL Parent company to Manufacturing and
0 MSI ELECTRONICS (KUNSHAN) 101,223 Note 2 0.07%
CO., LTD. second-tier subsidiary operating expense
0 MSI COMPUTER (SHENZHEN) 91,305 Note 2 0.06%
0 MEGA COMPUTER 241,539 Note 2 0.16%
0 MSI (EUROPE) 275,315 Note 2 0.19%
0 MYSTAR 149,663 Note 2 0.10%
0 MSI (MHK) 163,720 Note 2 0.11%
0 MSI (POLSKA) 143,747 Note 2 0.10%
0 MSI (RUSSIA) 92,714 Note 2 0.06%
Table 4 Page 1
0 MICRO-STAR INTERNATIONAL MSI (LA) Parent company to Manufacturing and 303,511 Note 2 0.21%
175
CO., LTD. subsidiary operating expense
0 MSI (SARL) 101,380 Note 2 0.07%
0 MSI (JAPAN) 125,728 Note 2 0.09%
CO., LTD. subsidiary operating expense
0 MSI (KOREA) 85,106 Note 2 0.06%
0 MSI (UK) 79,073 Note 2 0.05%
0 MSI (LA) Other payables 81,708 Note 2 0.10%
Subsidiary to
1 MSI (PACIFIC) MICRO ELECTRONICS Other payables 88,636 Note 3 0.11%
second-tier subsidiary
Subsidiary to
1 MSI (PACIFIC) MSI (B.V.I.) Other payables 133,094 Note 3 0.17%
Subsidiary to
1 MSI (PACIFIC) MSI ELECTRONICS (KUNSHAN) Other payables 1,765,669 Note 3 2.25%
Subsidiary to
1 MSI (PACIFIC) MSI COMPUTER (SHENZHEN) Other payables 3,141,850 Note 3 4.01%
MICRO-STAR INTERNATIONAL
1 MSI (PACIFIC) Subsidiary to parent Other receivables 5,129,249 Note 3 6.54%
CO., LTD.
Second-tier subsidiary
2 MEGA COMPUTER MSI (SHANGHAI) Sales 6,864,483 Note 2 4.69%
to second-tier subsidiary
Second-tier subsidiary
2 MEGA COMPUTER MSI (SHANGHAI) Accounts receivable 1,803,576 Note 2 2.30%
to second-tier subsidiary
Subsidiary to
3 MSI (LA) RAIDEALS Sales 249,448 Note 2 0.17%
Note 1: Balances after elimination in conformity with regulations.
Note 2: Transaction terms were approximately the same as those to third parties.
Note 3: Processing overhead was determined based on the quantities, contract amount and delivery time.
Note 4: Individual transactions not exceeding $50,000 and their corresponding transactions are not disclosed.
Table 4Page 2
176
Information on investees (not including investees in Mainland China)
(Except as otherwise indicated)
Table5
Investment
Net profit
income (loss)
(loss) of the
recognised by the
investee for
Initial investment amount Shares held as at December 31, 2019 Company for the Footnote
the year ended
year ended
December 31,
Investor Investee Location Main business activities December 31,
2020
2020
Balance as at Balance as at
Number of Ownership
December 31, December 31, Book value
shares (%)
2020 2019
Sales and maintenance of
MICRO-STAR INTERNATIONAL Direct
MSI (LA) U.S.A computers and electronic $258,468 $258,468 575,458 100.00 $72,605 $39,396 $39,396
components
Sales support and maintenance of
MICRO-STAR INTERNATIONAL MSI Direct
Australia computers and electronic 57,420 57,420 221,836 100.00 8,644 1,321 1,321
CO., LTD. (AUSTRALIA) ubsidiary
components
MICRO-STAR INTERNATIONAL Direct
MSI (JAPAN) Japan computers and electronic 20,411 20,411 1,400 100.00 19,238 4,692 4,692
components
MICRO-STAR INTERNATIONAL Cayman Direct
MSI (PACIFIC) Holding company 1,511,382 1,511,382 30,204,118 100.00 7,406,724 579,510 579,510
CO., LTD. Islands subsidiary
MICRO-STAR INTERNATIONAL MSI Direct
Netherlands Holding company 45,724 45,724 424,000 100.00 685,857 41,428 41,428
CO., LTD. (HOLDING) subsidiary
MSI
MICRO-STAR INTERNATIONAL Cayman Direct
COMPUTER Holding company 99,093 99,093 50,000 100.00 117,549 175 175
CO., LTD. Islands subsidiary
(CAYMAN)
MICRO-STAR INTERNATIONAL MSI Sales support of computers and Direct
Canada 2,150 - 100,000 100.00 3,297 1,047 1,047
CO., LTD. (CANADA) electronic components subsidiary
Sales and maintenance of
Indirect
MSI (PACIFIC) MSI (KOREA) South Korea computers and electronic 24,374 24,374 80,000 100.00 324,572 38,835 -
subsidiary
components
British Virgin Indirect
MSI (PACIFIC) MSI (B.V.I.) Holding company 1,784,681 1,784,681 47,465,071 100.00 4,342,436 315,470 -
Island subsidiary
MICRO British Virgin Indirect
MSI (PACIFIC) Holding company 1,168,593 1,168,593 33,315,472 100.00 2,707,503 247,401 -
ELECTRONICS Island subsidiary
STAR British Virgin Indirect
MSI (PACIFIC) Holding company 144,721 144,721 4,502,601 100.00 20,826 (5,931) -
INFORMATION Island subsidiary
Table 5 Page 1
177
MEGA British Virgin Indirect
MSI (PACIFIC) Holding company 92,819 92,819 3,050,000 100.00 5,545 6,786 -
TECHNOLOGY Island subsidiary
MEGA Sales support of computers and Indirect
MSI (PACIFIC) Hong Kong - - 1 100.00 4,948 (1,190) -
COMPUTER electronic components subsidiary
Sales support of computers and Indirect
MSI (PACIFIC) MSI (MHK) Hong Kong - - 1 100.00 24,773 2,942 -
electronic components subsidiary
MSI (HOLDING) MYSTAR Netherlands 71,353 71,353 - 100.00 169,231 16,019 -
Indirect
MSI (HOLDING) MSI (RUSSIA) Russia computers and electronic 68,258 68,258 - 99.00 33,748 1,928 -
subsidiary
components
Sales support, maintenance and
Indirect
MSI (HOLDING) MSI (POLSKA) Poland after-sales service of computers and 46,077 46,077 - 99.00 35,020 3,232 -
subsidiary
MSI (HOLDING) MSI (SARL) France 26,646 26,646 - 100.00 59,955 5,072 -
MSI (HOLDING) MSI (UK) Britan 37,226 37,226 - 100.00 19,341 3,826 -
Indirect
Sales support of computers and
MSI (HOLDING) MSI (TURKEY) Turkey 3,229 3,229 - 99.00 (69) - - subsidiary
(Note 2)
MSI (HOLDING) MSI (ITALY) Italy 2,153 2,153 - 100.00 4,400 1,673 -
Logistics services of computers and Indirect
MSI (HOLDING) MSI (EUROPE) Netherlands 37,620 37,620 - 100.00 53,482 6,159 -
MSI (HOLDING) MSI (IBERIA) Spain 5,177 5,177 - 100.00 7,592 1,483 -
Indirect
MSI (EUROPE) MSI (RUSSIA) Russia computers and electronic 689 689 - 1.00 560 1,928 -
subsidiary
components
Sales support, maintenance and
Indirect
MSI (EUROPE) MSI (POLSKA) Poland after-sales service of computers and 467 467 - 1.00 179 3,232 -
subsidiary
Indirect
Sales support of computers and
MSI (EUROPE) MSI (TURKEY) Turkey 33 33 - 1.00 27 - - subsidiary (Note
2)
Sales of computers and electronic Indirect
MEGA TECHNOLOGY RAIDEALS U.S.A 1,523 1,523 - 100.00 1,875 280 -
components subsidiary
Note 1: The table is presented in New Taiwan dollars. Except for the initial investment amount is valued at historical exchange rate, the others are valued with exchange rate 1USD=28.48 NTD; 1EUR=35.02 NTD on December 31,
2020 and average rate with 1USD=29.5523 NTD; 1EUR=33.7135 NTD for the year ended December 31, 2020.
Note 2: As of December 31, 2020, the liquidation process has not been completed.
Table 5 Page 2
178
Information on investments in Mainland China - Basic information
Amount remitted from Accumulate
Investment
Accumulated Taiwan to Mainland Accumulated d amount of
income (loss)
amount of China/ Amount remitted amount of Book value of investment
Ownership recognised by
remittance back to Taiwan for the remittance Net income investments in income
held by the the Company
Paid-in Investment from Taiwan year ended December from Taiwan of investee as Mainland remitted Footnote
Investee in Mainland China Main business activities Company for the year
capital method to Mainland 31, 2020 to Mainland of December China as of back to
(direct or ended
China as of China as of 31, 2020 December 31, Taiwan as
Remitted to Remitted indirect) December 31,
January 1, December 31, 2020 of
Mainland back to 2020
2020 2020 December
China Taiwan (Note 2)
31, 2020
Manufacture and maintenance of
MSI COMPUTER (SHENZHEN) $1,726,857 Note 1 $1,726,857 $- $- $1,726,857 $315,391 100.00 $315,391 $4,192,136 $- -
computers, and electronic components
MSI ELECTRONICS Manufacture and maintenance of
1,772,675 Note 1 1,772,675 - - 1,772,675 247,199 100.00 247,199 2,607,152 - -
(KUNSHAN) computers, and electronic components
SHENZHEN MEGA Examination and maintenance of
23,940 Note 1 23,940 - - 23,940 1,071 100.00 1,071 22,964 - -
INFORMATION computers, and electronic components
MSI COMPUTER TRADING Sales and maintenance of computers
- Note 1 - - - - 11,688 - 11,688 - - Note 3
(SHENZHEN) and electronic components
Sales and maintenance of computers
MSI (SHENZHEN) 30,092 Note 1 - - - - (5,986) 100.00 (5,986) 7,827 - Note 4
and electronic components
Sales and maintenance of computers
MSI (SHANGHAI) 29,275 Note 1 - - - - 11,397 100.00 11,397 (15,790) - Note 5
and electronic components
Accumulated amount of
remittance from Taiwan to Investment amount approved by the Ceiling on investments in Mainland
Mainland China as of Investment Commission of the Ministry China imposed by the Investment
Company name December 31, 2020 of Economic Affairs (MOEA) Commission of MOEA
MICRO-STAR INTERNATIONAL CO., LTD. $3,602,547 $3,850,987 $21,323,911
Note 1: The investments were made indirectly through 100% owned subsidiary of the Company.
Note 2: Evaluated based on audited financial statements of the investee companies.
Note 3: The amount of US $3,000 thousand was remitted by the Company's subsidiary, MSI (Pacific), to MSI COMPUTER TRADING (SHENZHEN).
Note 4: The amount of US $1,000 thousand was remitted by the Company's subsidiary, MSI (Pacific), to MSI (SHENZHEN).
Note 5: The amount of US $1,000 thousand was remitted by the Company's subsidiary, MSI (Pacific), to MSI (SHANGHAI).
Note 6: In pursuance of Shen-Zi Letter No.09704604680 from the Ministry of Economic Affairs dated August 29, 2008. The amended "Regulations for examination of investments and technical cooperation in Mainland Area" sets the
limitation for investments in Mainland China to be higher of net book value or 60% of consolidated net book value.
Note 7: The table is presented in New Taiwan dollars. Except for the initial investment amount is valued at historical exchange rate, the others are valued with exchange rate 1USD=28.48 NTD on December 31, 2020 and average rate with
1USD=29.5523 NTD for the year ended December 31, 2020.
Table 6 Page 1
179
Information on investments in Mainland China - Significant transactions conducted with investees in Mainland China directly or indirectly through other companies in third areas
Amount of endorsements/guarantees
Sales/ (Purchase) Property transaction Accounts receivable/ (payable) secured with collaterals Accommodation of funds
Balance as of Balance as of
Investee in Mainland Balance as of December 31, Ceiling December 31, Interest rate Interest
China Amount % Amount % December 31, 2020 % 2020 Purpose amount 2020 range expense Others (Note)
MSI COMPUTER $ - - $ - - $ (3,141,850) ( 12) $ - - $ - $ - - $ - $ 2,986,307
(SHENZHEN)
MSI - - - - (1,765,669) ( 7) - - - - - - 1,191,748
ELECTRONICS
(KUNSHAN)
MSI (SHANGHAI) 6,864,483 100 - - 1,803,576 100 - - - - - - -
Note: Processing overhead.
Table 7 Page 1
180
Major shareholders information
December 31, 2020
Table 8
Shares held as at December 31, 2020
Name of major shareholders Number of shares Ownership(%)
Hsu Hsiang 51,983,151 6.15%
Table 8 Page 1
181
PARENT COMPANY ONLY FINANCIAL
STATEMENTS AND INDEPENDENT AUDITORS’
REPORT
------------------------------------------------------------------------------------------------------------------------------------
For the convenience of readers and for information purpose only, the 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. In the event of any discrepancy between the English version and the original Chinese
version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and
financial statements shall prevail.
~182~
INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE
To the Board of Directors and Shareholders of MICRO-STAR INTERNATIONAL CO., LTD.
Opinion
We have audited the accompanying parent company only balance sheets of MICRO-STAR
INTERNATIONAL CO., LTD. (the “Company”) as at December 31, 2020 and 2019, and the related
parent company only statements of comprehensive income, of changes in equity and of cash flows for
the years then ended, and notes to the parent company only financial statements, including a summary
of significant accounting policies.
In our opinion, the accompanying parent company only financial statements present fairly, in all
material respects, the parent company only financial position of the Company as at December 31, 2020
and 2019, and its parent company only financial performance and its parent company only 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 generally accepted auditing standards in the
Republic of China (ROC GAAS). Our responsibilities under those standards are further described in
the Auditor’s Responsibilities for the Audit of the Parent Company Only Financial Statements section
of our report. We are independent of the Company in accordance with the Norm of Professional Ethics
for Certified Public Accountants in the Republic of China (the “Norm”), and we have fulfilled our
ethical responsibilities in accordance with the Norm. Based on our audits and the audit reports of other
independent auditors, we believe that the audit evidences we have obtained are 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 parent company only financial statements for the year ended December 31, 2020. These
matters were addressed in the context of our audit of the parent company only financial statements as a
whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.
Key audit matters for the Company’s parent company only financial statements for the year ended
December 31, 2020 are stated as follows:
~183~
Recognition of sales revenue generated from own-brand products
Description
Please refer to Note 4(24) for accounting policies on revenue recognition. The sales revenue from
own-brand products for the year ended December 31, 2020 is higher than previous year due to the
substantial increase in demand for notebook computers and peripherals. The recognition of sales
revenue generated from own-brand products is critical to the Company’s financial statements.
Therefore, it was identified as a key audit matter.
A. Obtained an understanding of and assessed internal controls in relation to sales revenue, and
validated the operating effectiveness of those above-mentioned internal controls.
B. Obtained detailed listing of sales revenue from own-brand products in the current year, and
validated supporting documents, including sales invoices, customer purchase orders and delivery
documents to ensure the appropriateness of recognition.
C. Inspected contents and relevant evidences in relation to sales returns and discounts occurring
subsequent to the reporting period.
D. Performed accounts receivable confirmation procedure to significant customers.
Estimation of allowance for inventory valuation losses

Description
Please refer to Note 4(11) for accounting policies on inventory valuation, Note 5(2) for the uncertainty
of accounting estimates and assumptions applied on inventory valuation, and Note 6(6) for details of
inventories. As of December 31, 2020, the balances of inventories and allowance for inventory
valuation losses are NT$27,539,446 thousand and NT$423,070 thousand, respectively.
The Company is primarily engaged in manufacturing and sales of motherboards, interface cards,
notebook computers and other electronic products. Due to the rapid technological innovations and
competition within the industry as well as frequent releases of new products resulting in potential price
fluctuations, there is a higher risk of inventory losses due from market value decline or obsolescence.
The Company recognises inventories at the lower of cost and net realisable value. As the monetary
values of allowance for inventory valuation losses is critical to the financial statements as of December
31, 2020. Therefore, it was identified as a key audit matter.
A. Inquired with management, and assessed the reasonableness in relation to the provision of
allowance for inventory valuation losses.
B. Validated the accuracy of the system logic in calculating the ageing of inventories, and confirmed
the consistency with the Company’s policies.
~184~
C. Validated the appropriateness of system logic of the report of individually identified obsolete
inventory prepared by management and confirmed the consistency with the Company’s policies.
D. Sampled and tested the net realisable value basis of the individual inventory and validated the
appropriateness.
Other matter-Reference to audits of other independent auditors

We did not audit the financial statements of certain investments accounted for under the equity method
that are included in the parent company only financial statements. Those financial statements were
audited by other independent auditors, whose reports thereon have been furnished to us, and our
opinion expressed herein is based solely on reports of the other independent auditors. Total assets of
the above-mentioned investees (including investments accounted for under the equity method)
amounted to NT$1,230,304 thousand and NT$1,097,458 thousand as at December 31, 2020 and 2019,
constituting 1.52% and 1.75% of total assets, respectively. Comprehensive income of the
above-mentioned investees amounted to NT$121,586 thousand and NT$88,436 thousand for the years
ended December 31, 2020 and 2019, constituting 1.51% and 1.67% of total comprehensive income,
respectively.
Responsibilities of management and those charged with governance for the parent
company only financial statements
Management is responsible for the preparation and fair presentation of the parent company only
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 parent company only financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the parent company only 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 the audit committee, are responsible for overseeing the
Company’s financial reporting process.
Independent auditors’ responsibilities for the audit of the parent company only
financial statements
Our objectives are to obtain reasonable assurance about whether the parent company only 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 ROC GAAS will always detect a material
~185~
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 parent company only financial statements.
As part of an audit in accordance with ROC GAAS, we exercise professional judgement and maintain
professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the parent company only 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 parent company only 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 parent company only financial
statements, including the disclosures, and whether the parent company only financial statements
represent the underlying transactions and events in a manner that achieves fair presentation.
6. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Company to express an opinion on the parent company only
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
~186~
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 parent company only financial statements of the current
period 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.
Liang, Hua-Ling Lai, Chung-Hsi

For and on behalf of PricewaterhouseCoopers, Taiwan
March 22, 2021
-------------------------------------------------------------------------------------------------------------------------------------------------
The accompanying parent company only financial statements are not intended to present the financial position and results
of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions
other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of
such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of
China. Accordingly, the accompanying parent company only financial statements and report of independent accountants are
not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted
in the Republic of China, and their applications in practice.
As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability
for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the
translation.
~187~
PARENT COMPANY ONLY BALANCE SHEETS

Assets Notes AMOUNT % AMOUNT %
Current assets
1100 Cash and cash equivalents 6(1) $ 15,776,634 20 $ 8,881,827 14
1110 Financial assets at fair value through 6(2)
profit or loss - current 79,297 - 56,641 -
1136 Current financial assets at amortised 6(4)
cost 1,000,000 1 1,200,000 2
1150 Notes receivable, net 6(5) 672 - 3,929 -
1170 Accounts receivable, net 6(5) 13,004,695 16 10,846,273 18
1180 Accounts receivable - related parties 7 10,287,629 13 6,632,030 11
1200 Other receivables 219,767 - 157,760 -
130X Inventories, net 6(6) 27,116,376 33 22,756,055 36
1410 Prepayments 1,377,599 2 1,351,294 2
11XX Total current assets 68,862,669 85 51,885,809 83
Non-current assets
1517 Non-current financial assets at fair 6(3)
value through other comprehensive
income 124,338 - 151,975 -
1550 Investments accounted for under 6(7)
equity method 8,313,914 11 7,496,491 12
1600 Property, plant and equipment 6(8) 2,660,668 3 2,567,030 4
1755 Right-of-use assets 6(9) 159,609 - 179,398 -
1840 Deferred income tax assets 6(22) 713,301 1 407,702 1
1900 Other non-current assets 24,723 - 18,890 -
15XX Total non-current assets 11,996,553 15 10,821,486 17
1XXX Total assets $ 80,859,222 100 $ 62,707,295 100
(Continued)
~188~
PARENT COMPANY ONLY BALANCE SHEETS

Liabilities and Equity Notes AMOUNT % AMOUNT %
Current liabilities
2100 Short-term borrowings 6(10) $ 3,000,000 4 $ 1,500,000 2
2120 Financial liabilities at fair value 6(2)
through profit or loss - current 103,885 - 24,943 -
2170 Accounts payable 26,409,577 33 19,764,458 32
2200 Other payables 6(11) 4,340,669 6 3,049,919 5
2220 Other payables - related parties 7 4,964,060 6 4,272,610 7
2230 Current income tax liabilities 1,499,604 2 362,183 1
2250 Provisions for liabilities - current 6(13) 873,229 1 579,337 1
2280 Current lease liabilities 97,029 - 71,892 -
2365 Refund liabilities-current 3,418,122 4 1,555,509 2
2399 Other current liabilities, others 215,875 - 65,353 -
21XX Total current Liabilities 44,922,050 56 31,246,204 50
Non-current liabilities
2570 Deferred income tax liabilities 6(22) 6,084 - 26,830 -
2580 Non-current lease liabilities 63,594 - 108,013 -
2640 Net defined benefit liability, 6(12)
non-current 220,314 - 221,974 1
2670 Other non-current liabilities, others 107,328 - 91,809 -
25XX Total non-current liabilities 397,320 - 448,626 1
2XXX Total Liabilities 45,319,370 56 31,694,830 51
Equity
Share capital 6(14)
3110 Share capital - common stock 8,448,562 10 8,448,562 13
Capital surplus 6(15)
3200 Capital surplus 804,214 1 803,918 1
Retained earnings 6(16)
3310 Legal reserve 5,541,298 7 4,982,577 8
3320 Special reserve 794,525 1 505,966 1
3350 Unappropriated retained earnings 20,625,711 26 17,065,967 27
Other equity interest
3400 Other equity interest ( 674,458) ( 1) ( 794,525) ( 1)
3XXX Total equity 35,539,852 44 31,012,465 49
3X2X Total liabilities and equity $ 80,859,222 100 $ 62,707,295 100
The accompanying notes are an integral part of these parent company only financial statements.
~189~
PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME
(Expressed in thousands of New Taiwan dollars, except earnings per share amounts)

2020 2019
Items Notes AMOUNT % AMOUNT %
4000 Sales revenue 6(17) and 7 $ 144,805,966 100 $ 118,740,373 100
5000 Operating costs 6(6)(20) and 7 ( 125,877,926) ( 87) ( 105,097,585) ( 89)
5900 Net operating margin 18,928,040 13 13,642,788 11
Operating expenses 6(20) and 7
6100 Selling expenses ( 6,079,422) ( 4) ( 4,689,816) ( 4)
6200 General and administrative expenses ( 842,682) ( 1) ( 526,354) -
6300 Research and development expenses ( 3,349,045) ( 2) ( 2,937,315) ( 2)
6450 Expected credit loss 6(5) ( 2,446) - ( 4,095) -
6000 Total operating expenses ( 10,273,595) ( 7) ( 8,157,580) ( 6)
6900 Operating profit 8,654,445 6 5,485,208 5
Non-operating income and expenses
7100 Interest income 6(18) 49,551 - 57,384 -
7010 Other income 216,357 - 240,016 -
7020 Other gains and losses 6(2)(19) ( 138,396) - ( 50,864) -
7050 Finance costs ( 21,446) - ( 13,504) -
7070 Share of profit of associates and joint 6(7)
ventures accounted for using equity
method, net 667,569 - 685,979 1
7000 Total non-operating income and
expenses 773,635 - 919,011 1
7900 Profit before income tax 9,428,080 6 6,404,219 6
7950 Income tax expense 6(22) ( 1,468,575) ( 1) ( 817,009) ( 1)
8200 Profit for the year $ 7,959,505 5 $ 5,587,210 5
Other comprehensive income
Components of other
reclassified to profit or loss
8311 Other comprehensive loss, before 6(12)
tax, actuarial losses on defined
benefit plans ($ 5,106) - ($ 10,079) -
8316 Unrealised losses from investments
in equity instruments measured at
fair value through other
comprehensive income ( 27,637) - - -
8349 Income tax related to components of 6(22)
other comprehensive income that
will not be reclassified to profit or
loss 1,021 - 2,016 -
reclassified to profit or loss ( 31,722) - ( 8,063) -
Components of other
will be reclassified to profit or loss
8361 Financial statements translation
differences of foreign operations 147,704 - ( 288,559) -
will be reclassified to profit or loss 147,704 - ( 288,559) -
8300 Total other comprehensive income
(loss) for the year $ 115,982 - ($ 296,622) -
8500 Total comprehensive income for the
year $ 8,075,487 5 $ 5,290,588 5
Earnings per share (in dollars) 6(23)

9750 Basic earnings per share $ 9.42 $ 6.61
9850 Diluted earnings per share $ 9.34 $ 6.56
~190~
PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY
Capital Surplus Retained Earnings Other Equity Interest

Unrealised
losses from
Financial financial
statements assets measured
translation at fair value
Unappropriated differences of through other
Share capital - Additional Treasury stock Donated assets Employee stock retained foreign comprehensive
Notes common stock paid-in capital transactions received warrants Legal reserve Special reserve earnings operations income Total equity
2019
Balance at January 1, 2019 $ 8,448,562 $ 1,050,563 $ 130,592 $ 434 $ 44,460 $ 4,378,464 $ 421,815 $ 15,976,937 ($ 505,966 ) $ - $ 29,945,861
Other comprehensive loss for the year - - - - - - - ( 8,063 ) ( 288,559 ) - ( 296,622 )
Total comprehensive income (loss) - - - - - - - 5,579,147 ( 288,559 ) - 5,290,588
Legal reserve - - - - - 604,113 - ( 604,113 ) - - -
Special reserve - - - - - - 84,151 ( 84,151 ) - - -
Cash dividends - - - - - - - ( 3,801,853 ) - - ( 3,801,853 )
Cash dividends from capital surplus 6(16) - ( 422,429 ) - - - - - - - - ( 422,429 )
Balance at December 31, 2019 $ 8,448,562 $ 628,134 $ 130,592 $ 732 $ 44,460 $ 4,982,577 $ 505,966 $ 17,065,967 ($ 794,525 ) $ - $ 31,012,465
2020
Balance at January 1, 2020 $ 8,448,562 $ 628,134 $ 130,592 $ 732 $ 44,460 $ 4,982,577 $ 505,966 $ 17,065,967 ($ 794,525 ) $ - $ 31,012,465
Other comprehensive income (loss)
for the year - - - - - - - ( 4,085 ) 147,704 ( 27,637 ) 115,982
Total comprehensive income (loss) - - - - - - - 7,955,420 147,704 ( 27,637 ) 8,075,487
Legal reserve - - - - - 558,721 - ( 558,721 ) - - -
Special reserve - - - - - - 288,559 ( 288,559 ) - - -
Cash dividends - - - - - - - ( 3,548,396 ) - - ( 3,548,396 )
Balance at December 31, 2020 $ 8,448,562 $ 628,134 $ 130,592 $ 1,028 $ 44,460 $ 5,541,298 $ 794,525 $ 20,625,711 ($ 646,821 ) ($ 27,637 ) $ 35,539,852
~191~
PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

Notes 2020 2019
CASH FLOWS FROM OPERATING ACTIVITIES

Profit before tax $ 9,428,080 $ 6,404,219
Adjustments
Adjustments to reconcile profit (loss)
Depreciation (including right-of-use assets) 6(8)(9)(20) 280,442 157,384
Amortization 6(20) 3 4
Expected credit loss 6(5) 2,446 4,095
Net loss (gain) on financial assets and liabilities
at fair value through profit or loss 56,286 ( 22,921 )
Interest expense 21,446 13,504
Interest income 6(18) ( 49,551 ) ( 57,384 )
Share of profit of associates and joint ventures
accounted for using equity method ( 667,569 ) ( 685,979 )
Gain on disposal of property, plant and 6(19)
equipment - ( 11 )
Gain on lease modification 6(9) ( 53 ) ( 163 )
Changes in operating assets and liabilities
Changes in operating assets
Notes receivable, net 3,257 ( 1,552 )
Accounts receivable ( 2,160,868 ) ( 113,958 )
Accounts receivable due from related parties ( 3,655,599 ) ( 750,153 )
Other receivables ( 60,584 ) ( 70,283 )
Inventories, net ( 4,360,321 ) ( 589,004 )
Prepayments ( 26,305 ) ( 235,903 )
Changes in operating liabilities
Notes payable - ( 200 )
Other payables 1,288,865 295,762
Other payables - related parties 691,450 600,849
Provisions for liabilities - current 293,892 64,736
Refund liabilities - current 1,862,613 ( 147,149 )
Other current liabilities, others 150,522 37,814
Net defined benefit liability ( 6,766 ) ( 5,714 )
Cash inflow generated from operations 9,736,805 10,003,646
Interest received 48,128 61,236
Interest paid ( 19,561 ) ( 13,859 )
Income tax paid ( 656,478 ) ( 1,403,648 )
Net cash flows from operating activities 9,108,894 8,647,375
(Continued)
~192~
PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

Notes 2020 2019
CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of financial assets at amortised cost $ - ($ 471,064 )
Proceeds from disposal of financial assets at
amortised cost 200,000 -
Acquisition of financial assets at fair value through 6(3)
other comprehensive income - ( 151,975 )
Acquisition of investment accounted for using equity
method ( 2,150 ) -
Acquisition of property, plant and equipment 6(8) ( 270,927 ) ( 298,543 )
Proceeds from disposal of property, plant and
equipment - 13
Increase in refundable deposits ( 5,836 ) ( 13,291 )
Net cash flows used in investing activities ( 78,913 ) ( 934,860 )
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in short-term borrowings 1,500,000 ( 1,500,000 )
Repayment of the principal portion of lease liabilities ( 102,593 ) ( 62,065 )
Increase (decrease) in guarantee deposits received 15,519 ( 24,081 )
Cash dividends paid 6(16) ( 3,548,396 ) ( 3,801,853 )
Cash distribution from capital surplus 6(16) - ( 422,429 )
Due to donated assets received 296 298
Net cash flows used in financing activities ( 2,135,174 ) ( 5,810,130 )
Net increase in cash and cash equivalents 6,894,807 1,902,385
Cash and cash equivalents at beginning of year 6(1) 8,881,827 6,979,442
Cash and cash equivalents at end of year 6(1) $ 15,776,634 $ 8,881,827
~193~
NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS
(Expressed in thousands of New Taiwan dollars, except as otherwise
indicated)
1. HISTORY AND ORGANISATION

MICRO-STAR INTERNATIONAL CO., LTD. (the “Company”) was
incorporated as a company limited by shares under the laws of the
Republic of China (R.O.C.) in August 1986 and started its operations in
the same year. The Company is primarily engaged in the manufacture
and sale of motherboards and computer hardware. The shares of the
Company have been listed on the Taiwan Stock Exchange since October
1998.
2. THE DATE OF AUTHORISATION FOR ISSUANCE OF THE PARENT
COMPANY ONLY FINANCIAL STATEMENTS AND PROCEDURES FOR
AUTHORISATION
These parent company only financial statements were authorised for
issuance by the Board of Directors on March 22, 2021.
3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND
INTERPRETATIONS
(1) Effect of the adoption of new standards and amendments to
International Financial Reporting Standards (“IFRS”) as endorsed by
the Financial Supervisory Commission (“FSC”)
New standards, interpretations and amendments endorsed by the
FSC effective from 2020 are as follows:
Effective date by
Amendments to IAS 1 and IAS 8, ‘Disclosure initiative-definition January 1, 2020
of material’
Amendments to IFRS 3, ‘Definition of a business’ January 1, 2020
Amendments to IFRS 9 IAS 39 and IFRS 7, ‘Interest rate January 1, 2020
benchmark reform’
Amendment to IFRS 16, ‘Covid-19-related rent concessions’ June 1, 2020 (Note)
Note : Earlier application from January 1, 2020 is allowed by FSC.
194
The above standards and interpretations have no significant impact
to the Group’s financial condition and financial performance based
on the Group’s assessment.
A. Amendment to IFRS 16, ‘Covid-19-related rent concessions’
This amendment provides a practical expedient for lessees from assessing whether
a rent concession related to COVID-19, and that meets all of the following
conditions, is a lease modification:
(a) Changes in lease payments result in the revised consideration for the lease that
is substantially the same as, or less than, the consideration for the lease
immediately preceding the change;
(b) Any reduction in lease payments affects only payments originally due on or
before June 30 2021; and
(c) There is no substantive change to other terms and conditions of the lease.
(2) Effect of new issuances of or amendments to IFRSs as endorsed by the
FSC but not yet adopted by the Company
New standards, interpretations and amendments endorsed by the
FSC effective from 2021 are as follows:
Effective date by
Amendments to IFRS 4, ‘Extension of the temporary exemption from January 1, 2021
applying IFRS 9’
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4, and IFRS 16, January 1, 2021
‘Interest rate benchmark reform - Phase 2’

to the Company’s financial condition and financial performance
based on the Company’s assessment.
(3) IFRSs issued by IASB but not yet endorsed by the FSC
New standards, interpretations and amendments issued by IASB but
not yet included in the IFRSs as endorsed by the FSC are as
follows:
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Effective date by
Amendments to IFRS 3, ‘Reference to the conceptual framework’ January 1, 2022
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets To be determined by
between an investor and its associate or joint venture’ International Accounting
Standards Board
IFRS 17, ‘Insurance contracts’ January 1, 2023
Amendments to IFRS 17, ‘Insurance contracts’ January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or non- January 1, 2023
current’
Amendments to IAS 1, ‘Disclosure of accounting policies’ January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’ January 1, 2023
Amendments to IAS 16, ‘Property, plant and equipment:proceeds before January 1, 2022
intended use’
Amendments to IAS 37, ‘Onerous contracts-cost of fulfilling a contract’ January 1, 2022
Annual improvements to IFRS Standers 2018-2020 January 1, 2022
to the Company’s financial condition and operating result based on
the Company’s assessment.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these
parent company only financial statements are set out below. These
policies have been consistently applied to all the periods presented,
unless otherwise stated.
(1) Compliance statement
The parent company only financial statements of the Company have
been prepared in accordance with the “Regulations Governing the
Preparation of Financial Reports by Securities Issuers”,
International Financial Reporting Standards, International
Accounting Standards, IFRIC Interpretations, and SIC
Interpretations as endorsed by the FSC (collectively referred herein
as the “IFRSs”).
(2) Basis of preparation
A. Except for the following items, the parent company only financial statements have
been prepared under the historical cost convention:
(a) Financial assets and financial liabilities (including derivative instruments) at
fair value through profit or loss.
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(b) Financial assets at fair value through other comprehensive income
(c) Defined benefit liabilities recognised based on the net amount of pension fund
assets less present value of defined benefit obligation.
B. The preparation of financial statements in conformity with “IFRSs” requires the
use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the Company’s accounting
policies. The areas involving a higher degree of judgement or complexity, or areas
where assumptions and estimates are significant to the parent company only
financial statements are disclosed in Note 5.
(3) Foreign currency translation
The parent company only financial statements are presented in New
Taiwan Dollars, which is the Company’s functional and
presentation currency.
A. Foreign currency transactions and balance
(a) Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions or valuation where
items are remeasured. Foreign exchange gains and losses resulting from the
settlement of such transactions are recognised in profit or loss in the period in
which they arise.
(b) Monetary assets and liabilities denominated in foreign currencies at the period
end are re-translated at the exchange rates prevailing at the balance sheet date.
Exchange differences arising upon re-translation at the balance sheet date are
recognised in profit or loss.
(c) Non-monetary assets and liabilities denominated in foreign currencies held at
fair value through profit or loss are re-translated at the exchange rates
prevailing at the balance sheet date; their translation differences are recognised
in profit or loss. Non-monetary assets and liabilities denominated in foreign
currencies held at fair value through other comprehensive income are
re-translated at the exchange rates prevailing at the balance sheet date; their
translation differences are recognised in other comprehensive income.
However, non-monetary assets and liabilities denominated in foreign
currencies that are not measured at fair value are translated using the historical
exchange rates at the dates of the initial transactions.
(d) All foreign exchange gains and losses are presented in the statement of
comprehensive income within ‘other gains and losses’.
B. Translation of foreign operations
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(a) The operating results and financial position of all the group entities that have a
functional currency different from the presentation currency are translated into
the presentation currency as follows:
i. Assets and liabilities for each balance sheet presented are translated at the
closing exchange rate at the date of that balance sheet;
ii. Income and expenses for each statement of comprehensive income are
translated at average exchange rates of that period; and
iii. All resulting exchange differences are recognised in other comprehensive
income.
(b) When the foreign operation partially disposed of or sold is a subsidiary,
cumulative exchange differences that were recorded in other comprehensive
income are proportionately transferred to the non-controlling interest in this
foreign operation. In addition, even when the Company retains partial interest
in the former foreign subsidiary after losing control of the former foreign
subsidiary, such transactions should be accounted for as disposal of all interest
in the foreign operation.
(4) Classification of current and non-current items
A. Assets that meet one of the following criteria are classified as current assets;
otherwise they are classified as non-current assets:
(a) Assets arising from operating activities that are expected to be realized, or are
intended to be sold or consumed within the normal operating cycle;
(b) Assets held mainly for trading purposes;
(c) Assets that are expected to be realized within twelve months from the balance
sheet date;
(d) Cash and cash equivalents, excluding restricted cash and cash equivalents and
those that are to be exchanged or used to settle liabilities more than twelve
months after the balance sheet date.
B. Liabilities that meet one of the following criteria are classified as current liabilities;
otherwise they are classified as non-current liabilities:
(a) Liabilities that are expected to be settle within the normal operating cycle;
(b) Liabilities arising mainly from trading activities;
(c) Liabilities that are to be settle within twelve months from the balance sheet
date;
(d) Liabilities for which the repayment date cannot be extended unconditionally to
more than twelve months after the balance sheet date. Terms of a liability that
could, at the option of the counterparty, result in its settlement by the issue of
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equity instruments do not affect its classification.
(5) Cash equivalents
Cash equivalents refer to short-term highly liquid investments that
readily convert to known amount of cash and subject to an
insignificant effect of value of changes in rate. Time deposits and
money market fund that meet the definition above and are held for
the purpose of meeting short-term cash commitments in operations
are classified as cash equivalents.
(6) Financial assets at fair value through profit or loss
A. Financial assets at fair value through profit or loss are financial assets that are not
measured at amortised cost or fair value through other comprehensive income.
B. On a regular way purchase or sale basis, financial assets at fair value through
profit or loss are recognized and derecognised using trade date accounting.
C. At initial recognition, the Company measures the financial assets at fair value and
recognises the transaction costs in profit or loss. The Company subsequently
measures the financial assets at fair value, and recognises the gain or loss in profit
or loss.
A. Financial assets at fair value through other comprehensive income comprise equity
securities which are not held for trading, and for which the Company has made an
irrevocable election at initial recognition to recognize changes in fair value in
other comprehensive income and debt instruments which meet all of the following
criteria:
(a) The objective of the Company’s business model is achieved both by collecting
contractual cash flows and selling financial assets; and
(b) The assets’ contractual cash flows represents solely payments of principal and
interest.
B. On a regular way purchase or sale basis, financial assets at fair value through other
comprehensive income are recognised and derecognised using trade date
accounting.
C. At initial recognition, the Company measures the financial assets at fair value plus
transaction costs. The Company subsequently measures the financial assets at fair
value:
The changes in fair value of equity investments that were recognised in other
comprehensive income are reclassified to retained earnings and are not reclassified
to profit or loss following the derecognition of the investment. Dividends are
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recognised as revenue when the right to receive payment is established, future
economic benefits associated with the dividend will flow to the Company and the
amount of the dividend can be measured reliably.
A. Financial assets at amortised cost are those that meet all of the following criteria:
(a) The objective of the Company’s business model is achieved by collecting
contractual cash flows.
(b) The assets’ contractual cash flows represent solely payments of principal and
interest.
B. On a regular way purchase or sale basis, financial assets at amortised cost are
recognised and derecognised using trade date accounting.
C. The Company’s time deposits which do not fall under cash equivalents are those
with a short maturity period and are measured at initial investment amount as the
effect of discounting is immaterial.
(9) Accounts and notes receivable
A. Accounts and notes receivable entitle the Company a legal right to receive
consideration in exchange for transferred goods or rendered services.
B. The short-term accounts and notes receivable without bearing interest are
subsequently measured at initial invoice amount as the effect of discounting is
immaterial.
(10) Impairment of financial assets
For financial assets measured at amortised cost including
accounts receivable that have a significant financing component,
at each reporting date, the Company recognises the impairment
provision for 12 months expected credit losses if there has not
been a significant increase in credit risk since initial recognition
or recognises the impairment provision for the lifetime expected
credit losses (ECLs) if such credit risk has increased since initial
recognition after taking into consideration all reasonable and
verifiable information that includes forecasts. On the other hand,
for accounts receivable or contract assets that do not contain a
significant financing component, the Company recognises the
impairment provision for lifetime ECLs.
(11) Inventories
Inventories are stated at the lower of cost and net realizable
value. Cost is determined using the weighted-average method.
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The cost of finished goods and work-in-progress comprises raw
materials, direct labour, other direct costs and related production
overheads. The item-by-item approach is used in applying the
lower of cost and net realizable value. Net realizable value is the
estimated selling price in the ordinary course of business, less
the estimated cost of completion and applicable variable selling
expenses.
(12) Investments accounted for using the equity method / Subsidiaries
A. Subsidiaries are all entities (including structured entities) controlled by the
Company. The Company controls an entity when the Company is exposed, or has
rights, to variable returns from its involvement with the entity and has the ability
to affect those returns through its power over the entity.
B. Inter-company transactions, balances and unrealised gains or losses on
transactions between the Company and its subsidiaries are eliminated.
Accounting policies of subsidiaries have been adjusted where necessary to ensure
consistency with the policies adopted by the Company.
C. The Company’s share of its subsidiaries’ post-acquisition profits or losses is
recognised in profit or loss, and its share of post-acquisition movements in other
comprehensive income is recognised in other comprehensive income. When the
Company’s share of losses in a subsidiary equals or exceeds its interest in the
subsidiary, the Company continues to recognise the losses in proportion to the
ownership.
D. Changes in a parent’s ownership interest in a subsidiary that do not result in the
parent losing control of the subsidiary (transactions with non-controlling interests)
are accounted for as equity transactions, i.e. transactions with owners in their
capacity as owners. Any difference between the amount by which the
non-controlling interests are adjusted and the fair value of the consideration paid
or received is recognised directly in equity.
E. When the Company loses control of a subsidiary, the Company remeasures any
investment retained in the former subsidiary at its fair value. That fair value is
regarded as the fair value on initial recognition of a financial asset or the cost on
initial recognition of the associate or joint venture. Any difference between fair
value and carrying amount is recognised in profit or loss. All amounts previously
recognised in other comprehensive income in relation to the subsidiary are
reclassified to profit or loss on the same basis as would be required if the related
assets or liabilities were disposed of. That is, when the Company loses control of
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a subsidiary, all gains or losses previously recognised in other comprehensive
income in relation to the subsidiary should be reclassified from equity to profit or
loss, if such gains or losses would be reclassified to profit or loss when the
related assets or liabilities are disposed of.
F. Pursuant to the “Regulations Governing the Preparation of Financial Reports by
Securities Issuers”, profit (loss) of the current period and other comprehensive
income in the parent company only financial statements shall equal to the amount
attributable to owners of the parent in the consolidated financial statements. Owners’
equity in the parent company only financial statements shall equal to equity
attributable to owners of the parent in the consolidated financial statements.
A Property, plant and equipment are initially recorded at cost. Borrowing costs
incurred during the construction period are capitalised.
B. Subsequent costs are included in the asset’s carrying amount or recognised as a
separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Company and the cost of the
item can be measured reliably. The carrying amount of the replaced part is
derecognised. All other repairs and maintenance are charged to profit or loss
during the financial period in which they are incurred.
C. Land is not depreciated. Other property, plant and equipment apply cost model
and are depreciated using the straight-line method to allocate their cost over their
estimated useful lives. Each part of an item of property, plant, and equipment
with a cost that is significant in relation to the total cost of the item must be
depreciated separately.
D. The assets’ residual values, useful lives and depreciation methods are reviewed,
and adjusted if appropriate, at each balance sheet date. If expectations for the
assets’ residual values and useful lives differ from previous estimates or the
patterns of consumption of the assets’ future economic benefits embodied in the
assets have changed significantly, any change is accounted for as a change in
estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates
and Errors’, from the date of the change. The estimated useful lives of property,
plant and equipment are as follows:
Buildings and structures 3~55 years
Machinery and equipment 2~10 years
Other properties (include transportation equipment, office equipment, 1.5~10 years
and leasehold improvements)
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(14) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities
A. Leases are recognised as a right-of-use asset and a corresponding lease liability at
the date at which the leased asset is available for use by the Company. For
short-term leases or leases of low-value assets, lease payments are recognised as
an expense on a straight-line basis over the lease term.
B. Lease liabilities include the net present value of the remaining lease payments at
the commencement date, discounted using the incremental borrowing interest rate.
Lease payments are mainly fixed payments, less any lease incentives that can be
received.
The Company subsequently measures the lease liability at amortised cost using
the interest method and recognises interest expense over the lease term. The lease
liability is remeasured and the amount of remeasurement is recognised as an
adjustment to the right-of-use asset when there are changes in the lease term or
lease payments and such changes do not arise from contract modifications.
C. At the commencement date, the right-of-use asset is stated at cost mainly
comprising the amount of the initial measurement of lease liability.
The right-of-use asset is measured subsequently using the cost model and is
depreciated from the commencement date to the earlier of the end of the asset’s
useful life or the end of the lease term. When the lease liability is remeasured, the
amount of remeasurement is recognised as an adjustment to the right-of-use asset.
D. For lease modifications that decrease the scope of the lease, the lessee shall
decrease the carrying amount of the right-of-use asset to reflect the partial or full
termination of the lease, and recognise the difference between remeasured lease
liability in profit or loss.
(15) Impairment of non-financial assets
The Company assesses at each balance sheet date the recoverable
amounts of those assets where there is an indication that they are
impaired. An impairment loss is recognised for the amount by
which the asset’s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s fair
value less costs to sell or value in use. When the circumstances
or reasons for recognizing impairment loss for an asset in prior
years no longer exist or diminish, the impairment loss is reversed.
The increased carrying amount due to reversal should not be
more than what the depreciated or amortised historical cost
would have been if the impairment had not been recognised.
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(16) Borrowings
Borrowings comprise long-term and short-term bank borrowings.
Borrowings are recognised initially at fair value, net of
transaction costs incurred. Borrowings are subsequently stated at
amortised cost; any difference between the proceeds (net of
transaction costs) and the redemption value is recognised in
profit or loss over the period of the borrowings using the
effective interest method.
(17) Notes and accounts payable
A. Accounts payable are liabilities for purchases of raw materials, goods or services
and notes payable are those resulting from operating and non-operating activities.
B. The short-term notes and accounts payable without bearing interest are
subsequently measured at initial invoice amount as the effect of discounting is
immaterial.
(18) Financial liabilities at fair value through profit or loss
A. Financial liabilities are classified in this category of held for trading if acquired
principally for the purpose of repurchasing in the short-term. Derivatives are also
categorised as financial liabilities held for trading unless they are designated as
hedges.
B. At initial recognition, the Company measures the financial liabilities at fair value.
All related transaction costs are recognised in profit or loss. The Company
subsequently measures these financial liabilities at fair value with any gain or
loss recognised in profit or loss.
(19) Provisions
Provisions of warranties are recognised when the Company has a
present legal or constructive obligation as a result of past events,
and it is probable that an outflow of economic resources will be
required to settle the obligation and the amount of the obligation
can be reliably estimated. Provisions are measured at the present
value of the expenditures expected to be required to settle the
obligation on the balance sheet date, which is discounted using a
pre-tax discount rate that reflects the current market assessments
of the time value of money and the risks specific to the
obligation. When discounting is used, the increase in the
provision due to passage of time is recognised as interest
expense. Provisions are not recognised for future operating
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losses.
(20) Employee benefits
A. Short-term employee benefits
Short-term employee benefits are measured at the undiscounted amount of the
benefits expected to be paid in respect of service rendered by employees, and
should be recognised as expense in that period when the employees render
service.
B. Pensions
(a) Defined contribution plans
For defined contribution plans, the contributions are recognised as pension
expense when they are due on an accrual basis. Prepaid contributions are
recognised as an asset to the extent of a cash refund or a reduction in the
future payments.
(b) Defined benefit plans
i. Net obligation under a defined benefit plan is defined as the present value
of an amount of pension benefits that employees will receive on retirement
for their services with the Company in current period or prior periods. The
liability recognised in the balance sheet in respect of defined benefit
pension plans is the present value of the defined benefit obligation at the
balance sheet date less the fair value of plan assets, together with
adjustments for unrecognised past service costs. The net defined benefit
obligation is calculated annually by independent actuaries using the
projected unit credit method. The rate used to discount is determined by
using interest rates of government bonds (at the balance sheet date).
ii. Remeasurement arising on defined benefit plans are recognised in other
comprehensive income in the period in which they arise and are recorded
as retained earnings.
iii. Past service costs are recognised immediately in profit or loss.
C. Termination benefits
Termination benefits are employee benefits provided in exchange for the
termination of employment as a result from either the Company’s decision to
terminate an employee’s employment before the normal retirement date, or an
employee’s decision to accept an offer of redundancy benefits in exchange for the
termination of employment. The Company recognises expense as it can no longer
withdraw an offer of termination benefits or it recognises relating restructuring
costs, whichever is earlier. Benefits that are expected to be due more than 12
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months after balance sheet date shall be discounted to their present value.
D. Employees’ bonus and directors’ and supervisors’ remuneration
Employees’ remuneration and directors’ and supervisors’ remuneration are
recognised as expense and liability, provided that such recognition is required
under legal or constructive obligation and those amounts can be reliably
estimated. Any difference between the resolved amounts and the subsequently
actual distributed amounts is accounted for as changes in estimates. If employee
compensation is distributed by shares, the Company calculates the number of
shares based on the closing price at the previous day of the board meeting
resolution.
(21) Income tax
A. The tax expense for the period comprises current and deferred tax. Tax is
recognised in profit or loss, except to the extent that it relates to items recognised
in other comprehensive income or items recognised directly in equity, in which
cases the tax is recognised in other comprehensive income or equity.
B. The current income tax expense is calculated on the basis of the tax laws enacted
or substantively enacted at the balance sheet date in the countries where the
Company and its subsidiaries operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect to situations in
accordance with applicable tax regulations. It establishes provisions where
appropriate based on the amounts expected to be paid to the tax authorities. An
additional tax is levied on the unappropriated retained earnings and is recorded as
income tax expense in the year the stockholders resolve to retain the earnings.
C. Deferred income tax is recognised, using the balance sheet liability method, on
temporary differences arising between the tax bases of assets and liabilities and
their carrying amounts in the parent company only balance sheet. However, the
deferred income tax is not accounted for if it arises from initial recognition of
goodwill or of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor
taxable profit or loss. Deferred income tax is provided on temporary differences
arising on investments in subsidiaries, except where the timing of the reversal of
the temporary difference is controlled by the Company and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred income
tax is determined using tax rates (and laws) that have been enacted or
substantially enacted by the balance sheet date and are expected to apply when
the related deferred income tax asset is realised or the deferred income tax
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liability is settled.
D. Deferred income tax assets are recognised only to the extent that it is probable
that future taxable profit will be available against which the temporary
differences can be utilised. At each balance sheet date, unrecognised and
recognised deferred income tax assets are reassessed.
E. Current income tax assets and liabilities are offset and the net amount reported in
the balance sheet when there is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a net basis or realise the asset and
settle the liability simultaneously. Deferred income tax assets and liabilities are
offset on the balance sheet when the entity has the legally enforceable right to
offset current tax assets against current tax liabilities and they are levied by the
same taxation authority on either the same entity or different entities that intend
to settle on a net basis or realise the asset and settle the liability simultaneously.
(22) Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or stock options
are shown in equity as a deduction, net of tax, from the proceeds.
(23) Dividends
Dividends are recorded in the Company’s financial statements in
the period in which they are approved by the Company’s
shareholders. Cash dividends are recorded as liabilities.
(24) Revenue recognition
A. Sales of goods
(a) The Company manufactures and sells motherboards, graphic cards, a variety
of computer hardware, and electronic components. Sales are recognised when
control of the products has transferred, being when the products are delivered
to the customer, the customer has full discretion over the channel and price to
sell the products, and there is no unfulfilled obligation that could affect the
customers’ acceptance of the products. Delivery occurs when the products
have been shipped to the specific location, the risks of obsolescence and loss
have been transferred to the customer, and the customer has accepted the
products in accordance with the sales contract, or the Company has objective
evidence that all criteria for acceptance have been satisfied.
(b) Revenue from the products is recognised based on the price specified in the
contract, net of the estimated value added tax, returns and volume discounts
and rebates. The volume discounts to the customers are estimated based on
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the anticipated annual sales quantities and the right of return for defective
products is estimated on the basis of historical experience. Revenue is only
recognised to the extent that it is highly probable that a significant reversal
will not occur. The estimation is subject to an assessment at each reporting
date. A refund liability is recognised for expected volume discounts payable
to customers in relation to sales made until the end of the reporting period.
The period between the transfer of the promised goods or services to the
customer and payment by the customer does not exceed one year. As a result,
the Company does not adjust any of the transaction prices for the time value
of money.
(c) The Company’s obligation to provide a refund for faulty products under the
standard warranty terms is recognised as a provision.
(d) A receivable is recognised when the goods are delivered as this is the point in
time that the consideration is unconditional because only the passage of time
is required before the payment is due.
B. Incremental costs of obtaining a contract
Given that the contractual period lasts less than one year, the Company
recognises the incremental costs of obtaining a contract as an expense when
incurred although the Company expects to recover those costs.
5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY
SOURCES OF ASSUMPTION UNCERTAINTY
The preparation of these parent company only financial statements
requires management to make critical judgements in applying the
Company’s accounting policies and make critical assumptions and
estimates concerning future events. Assumptions and estimates may
differ from the actual results and are continually evaluated and adjusted
based on historical experience and other factors. The information is
addressed below:
(1) Critical judgements in applying the Company’s accounting policies
None.
(2) Critical accounting estimates and assumptions
Evaluation of inventories
As inventories are stated at the lower of cost and net realisable
value, the Company must determine the net realisable value of
inventories on balance sheet date using judgements and estimates.
Due to the rapid technology innovation, the Company evaluates the
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amounts of normal inventory comsumption, obsolete inventories or
inventories without market selling value on balance sheet date, and
writes down the cost of inventories to the net realisable value. Such
an evaluation of inventories is principally based on the demand for
the products within the specified period in the future. Therefore,
there might be material changes to the evaluation. As of December
31, 2020, the carrying amount of inventories was $27,116,376.
6. DETAILS OF SIGNIFICANT ACCOUNTS
(1) Cash and cash equivalents
Cash on hand and petty cash $ 1,400 $ 1,828
Checking accounts and demand deposits 11,445,155 8,363,399
Time deposits 4,330,079 516,600
Total $ 15,776,634 $ 8,881,827
A. The Company transacts with a variety of financial institutions all with high credit
quality to disperse credit risk, so it expects that the probability of counterparty
default is remote.
B. The Company’s time deposits with maturity periods over three months are
reclassified as “financial assets at amortised cost.” Details of financial assets at
amortised cost are provided in Note 6(4).
(2) Financial assets and liabilities at fair value through profit or loss - current
Asset items December 31, 2020 December 31, 2019
Financial assets mandatorily measured at fair value through
profit or loss
Derivatives – Forward exchange contract $ 37 $ 3,660
Derivatives – Foreign exchange swap 79,260 52,981
$ 79,297 $ 56,641
Liability items December 31, 2020 December 31, 2019

Financial liabilities held for trading
Derivatives – Forward exchange contract $ 103,885 $ 24,943
A. The Company recognised net loss of $57,442 and $21,390 for the years ended
December 31, 2020 and 2019, respectively.
B. The Company entered into contracts related to derivative financial assets and
liabilities which were not accounted for under hedge accounting. The contract
information are as follows:
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December 31, 2020
Contract Amount
Notional Principal
〃 CNY 591,911 2020.08.13~2021.05.17
December 31, 2020
Contract Amount
Notional Principal
Forward exchange contracts GBP 6,000 2020.10.22~2021.03.08
〃 AUD 8,200 2020.10.28~2021.02.24
〃 CAD 6,000 2020.11.06~2021.03.24
〃 KRW 6,576,400 2020.12.02~2021.01.28
〃 SEK 7,575 2020.11.20~2021.02.08
〃 EUR 68,000 2020.08.25~2021.03.16
December 31, 2019

Contract Amount
Notional Principal
Forward exchange contracts EUR 2,000 2019.10.21~2020.02.10
〃 GBP 500 2019.12.09~2020.02.18
〃 KRW 1,156,000 2019.12.30~2020.01.15
〃 SEK 4,650 2019.12.30~2020.02.10
〃 JPY 216,310 2019.12.04~2020.02.03
〃 CNY 473,584 2019.08.14~2020.05.18
December 31, 2019
Contract Amount
Notional Principal
〃 RUB 224,291 2019.12.05~2020.01.16
〃 EUR 44,000 2019.10.15~2020.04.08
〃 SEK 2,852 2019.12.03~2020.01.08
〃 GBP 5,500 2019.10.17~2020.02.18
〃 AUD 6,500 2019.10.31~2020.02.24
The Company entered into forward foreign exchange contracts to hedge exchange
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risk. However, these forward foreign exchange contracts are not accounted under
Hedge Accounting.
C. The Company has no financial assets at fair value through profit or loss pledged to
others.
D. Information relating to fair value of financial assets at fair value through profit or
loss is provided in Note 12(3).

Non-current items:
Equity instruments
Unlisted stocks $ 151,975 $ 151,975
Valuation adjustment ( 27,637) -
Total $ 124,338 $ 151,975
A. The Company has elected to classify equity instruments that are considered to be
strategic investments as financial assets at fair value through other comprehensive
income. The fair value of such investments amounted to $124,338 and $151,975 as
at December 31, 2020 and 2019, respectively.
B. As at December 31, 2020 and 2019, without taking into account any collateral held
or other credit enhancements, the maximum exposure to credit risk in respect of
the amount that best represents the financial assets at fair value through other
comprehensive income held by the Company were $124,338 and $151,975,
respectively.
C. The Company has no financial assets at fair value through other comprehensive
income pledged to others as collateral.
D. Information relating to price risk and fair value of financial assets at fair value
through other comprehensive income is provided in Note 12(2)、(3).
Current items:
Time deposits over three months $ 1,000,000 $ 1,200,000
A. Amounts recognised in profit or loss in relation to financial assets at amortised
cost are listed below:
2020 2019
Interest income $ 7,362 $ 8,310
211
B. As at December 31, 2020 and 2019, without taking into account any collateral held
or other credit enhancements, the maximum exposure to credit risk in respect of
the amount that best represents the financial assets at amortised cost held by the
Company were $1,000,000 and $1,200,000, respectively.
C. Information relating to credit risk of financial assets at amortised cost is provided
in Note 12(2).
(5) Notes and accounts receivable
Notes receivable $ 672 $ 3,929
Accounts receivable $ 13,011,321 $ 10,850,453
Less: Allowance for doubtful accounts ( 6,626) ( 4,180)
$ 13,004,695 $ 10,846,273
A. The ageing analysis of accounts receivable and notes receivable :

Accounts receivable Notes receivable Accounts receivable Notes receivable
Not past due $ 11,855,269 $ 672 $ 9,415,881 $ 3,929
1 to 75 days 1,136,575 - 1,418,600 -
76 to 365 days 19,145 - 13,174 -
Over 365 days 332 - 2,798 -
$ 13,011,321 $ 672 $ 10,850,453 $ 3,929
The above ageing analysis was based on past due date.
B. As of December 31, 2020 and 2019, accounts receivable and notes receivable were
all from contracts with customers. And as of January 1, 2019, the balance of
receivables from contracts with customers amounted to $10,738,787.
C. Most of the Company’s accounts receivable have been insured, and the Company
will be able to obtain insurance claims.
D. The Company does not hold any collateral.
E. As of December 31, 2020 and 2019, without taking into account any collateral
held or other credit enhancements, the maximum exposure to credit risk in respect
of the amount that best represents the Company’s notes and accounts receivable
were $672 and $3,929; $13,004,695 and $10,846,273, respectively.
F. Information relating to credit risk of accounts receivable and notes receivable is
provided in Note 12(2).
212
(6) Inventories
December 31, 2020

Allowance for
Raw materials $ 8,292,346 ($ 154,873) $ 8,137,473
Work in progress 1,502,072 ( 2,198) 1,499,874
Finished goods 17,745,028 ( 265,999) 17,479,029
$ 27,539,446 ($ 423,070) $ 27,116,376
December 31, 2019

Allowance for
Raw materials $ 6,579,127 ($ 130,049) $ 6,449,078
Work in progress 1,378,828 ( 1,311) 1,377,517
Finished goods 15,179,947 ( 250,487) 14,929,460
$ 23,137,902 ($ 381,847) $ 22,756,055
The cost of inventories recognised as expense for the year:

2020 2019
Cost of inventories recognised as expense $ 125,877,926 $ 105,097,585
Losses on decline (gains on reversal of decline) in market
value 41,223 ( 245,353)
The Company reversed a previous inventory write-down and
accounted for as reduction of cost of goods sold because some
inventories which were recognised as expense have been sold in
2019.
(7) Investments accounted for using equity method
MSI PACIFIC INTERNATIONAL
HOLDING CO., LTD. $ 7,406,724 $ 6,686,248
MICRO-STAR NETHERLANDS
HOLDING B.V. 685,857 629,384
MSI COMPUTER (CAYMAN) CO., LTD. 117,549 123,564
MSI COMPUTER CORP. 72,605 36,011
MSI COMPUTER JAPAN CO., LTD. 19,238 14,531
MSI COMPUTER (AUSTRALIA) PTY. LTD. 8,644 6,753
MICRO-STAR CANADA LTD. 3,297 -
$ 8,313,914 $ 7,496,491
A. Details of the Company’s subsidiaries are provided in Note 4(3) of the Company’s
consolidated financial statements as of and for the year ended December 31, 2020.
213
B. For the years ended December 31, 2020 and 2019, certain investments accounted
for using equity method were MSI COMPUTER CORP., MICRO-STAR
NETHERLANDS HOLDING B.V., MSI COMPUTER (CAYMAN) CO., LTD.,
MSI KOREA CO., LTD., MEGA COMPUTER CO., LTD. and MHK
INTERNATIONAL CO., LTD., such investments were recognised based on the
investees’ financial statements audited by independent auditors and the portion of
above- mentioned subsidiaries accounted for using equity method was $121,586
and $88,436, respectively.
2020
At January 1
Cost $ 1,331,538 $ 1,487,824 $ 526,019 $ 341,693 $ 3,687,074
Accumulated depreciation - ( 586,296) ( 329,857) ( 203,891) ( 1,120,044)
$ 1,331,538 $ 901,528 $ 196,162 $ 137,802 $ 2,567,030
Balance at January 1 $ 1,331,538 $ 901,528 $ 196,162 $ 137,802 $ 2,567,030

Additions - 7,304 73,342 190,281 270,927
Reclassifications - 28,890 43,543 ( 72,433) -
Balance at December 31 $ 1,331,538 $ 900,785 $ 245,181 $ 183,164 $ 2,660,668
At December 31
Cost $ 1,331,538 $ 1,524,018 $ 640,751 $ 429,069 $ 3,925,376
$ 1,331,538 $ 900,785 $ 245,181 $ 183,164 $ 2,660,668
214
2019
At January 1
Cost $ 1,331,538 $ 1,445,791 $ 412,750 $ 300,924 $ 3,491,003
$ 1,331,538 $ 891,469 $ 69,307 $ 70,824 $ 2,363,138
Balance at January 1 $ 1,331,538 $ 891,469 $ 69,307 $ 70,824 $ 2,363,138

Additions - 20,028 148,435 130,080 298,543
Disposals - - - ( 2) ( 2)
Reclassifications - 22,005 800 ( 22,805) -
Balance at December 31 $ 1,331,538 $ 901,528 $ 196,162 $ 137,802 $ 2,567,030
At December 31
Cost $ 1,331,538 $ 1,487,824 $ 526,019 $ 341,693 $ 3,687,074
$ 1,331,538 $ 901,528 $ 196,162 $ 137,802 $ 2,567,030
215
(9) Leasing arrangements － lessee
A. The Company leases various assets including buildings and other equipment.
Rental contracts are typically made for periods of 3 months to 9 years. Lease
terms are negotiated on an individual basis and contain a wide range of different
terms and conditions. The lease agreements do not impose covenants, but leased
assets may not be used as security for borrowing purposes.
B. The carrying amount of right-of-use assets and the depreciation charge are as
follows:
Carrying amount Carrying amount
Buildings $ 150,121 $ 169,638
Transportation equipment (Business vehicles) 9,488 9,760
$ 159,609 $ 179,398
2020 2019
Depreciation charge Depreciation charge
Buildings $ 98,874 $ 58,568
Transportation equipment (Business vehicles) 4,279 4,167
$ 103,153 $ 62,735
C. For the years ended December 31, 2020 and 2019, the additions to right-of-use
assets were $83,729 and $188,292, respectively.
D. The information on profit and loss accounts relating to lease contracts is as
follows:
2020 2019
Items affecting profit or loss
Interest expense on lease liabilities $ 2,086 $ 1,603
Expense on leases of low-value and short-term assets 13,562 11,991
Expense on variable lease payments 29,530 37,443
Gain on lease modification 53 163
E. For the years ended December 31, 2020 and 2019, the Company’s total cash
outflow for leases were $147,771 and $113,102, respectively.
216
(10) Short-term borrowings
Bank borrowings

Bank borrowings
(11) Other payables

Accrued salary and bonus $ 1,186,226 $ 922,399
Directors' remuneration and employees' compensation 796,500 554,500
Accrued freight 945,457 617,251
Advertising expense payable 659,268 355,107
Accrued molding expense 333,861 217,077
Other accrued expenses 419,357 383,585
$ 4,340,669 $ 3,049,919
(12) Pensions
A. (a) The Company has a defined benefit pension plan in accordance with the
Labor Standards Law, covering all regular employees’ service years prior to
the enforcement of the Labor Pension Act on July 1, 2005 and service years
thereafter of employees who chose to continue to be subject to the pension
mechanism under the Law. Under the defined benefit pension plan, two units
are accrued for each year of service for the first 15 years and one unit for
each additional year thereafter, subject to a maximum of 45 units. Pension
benefits are based on the number of units accrued and the average monthly
salaries and wages of the last 6 months prior to retirement. The Company
contributes monthly an amount equal to 2% of the employees’ monthly
salaries and wages to the retirement fund deposited with Bank of Taiwan, the
trustee, under the name of the independent retirement fund committee. Also,
the Company would assess the balance in the aforementioned labor pension
reserve account by December 31, every year. If the account balance is
insufficient to pay the pension calculated by the aforementioned method to
the employees expected to qualify for retirement in the following year, the
Company will make contributions for the deficit by next March.
(b) The amounts recognised in the balance sheet are as follows:
217
Present value of defined benefit obligations $ 535,344 $ 524,869
Fair value of plan assets ( 315,030) ( 302,895)
Net defined benefit liability $ 220,314 $ 221,974
(c) Movements in net defined benefit liabilities are as follows:

2020
531,902 ( 305,015) 226,887
Remeasurements:
(excluding amounts included in interest
income or expense) - ( 10,314) ( 10,314)
Experience adjustments ( 5,112) - ( 5,112)
15,420 ( 10,314) 5,106
Paid pension ( 11,978) 11,978 -
218
2019
511,222 ( 287,727) 223,495
Remeasurements:
(excluding amounts included in interest
income or expense) - ( 9,912) ( 9,912)
Experience adjustments 4,224 - 4,224
19,991 ( 9,912) 10,079
Paid pension ( 6,344) 6,344 -
(d) The Bank of Taiwan was commissioned to manage the Fund of the
Company’s defined benefit pension plan in accordance with the Fund’s annual
investment and utilisation plan and the “Regulations for Revenues,
Expenditures, Safeguard and Utilisation of the Labor Retirement Fund”
(Article 6: The scope of utilisation for the Fund includes deposit in domestic
or foreign financial institutions, investment in domestic or foreign listed,
over-the-counter, or private placement equity securities, investment in
domestic or foreign real estate securitization products, etc.). With regard to
the utilisation of the Fund, its minimum earnings in the annual distributions
on the final financial statements shall be no less than the earnings attainable
from the amounts accrued from two-year time deposits with the interest rates
offered by local banks. If the earnings is less than aforementioned rates,
government shall make payment for the deficit after being authorized by the
Regulator. The Company has no right to participate in managing and
operating that fund and hence the Company is unable to disclose the
classification of plan assets fair value in accordance with IAS 19 paragraph
142. The composition of fair value of plan assets as of December 31, 2020
and 2019 is given in the Annual Labor Retirement Fund Utilisation Report
announced by the government.
219
(e) The principal actuarial assumptions used were as follows:
2020 2019
Discount rate 0.30% 0.70%
Future salary increases 2.75% 2.75%
Assumptions regarding future mortality experience are set based on the fifth
round of empirical life tables of the Taiwan life insurance industry.
Because the main actuarial assumption changed, the present value of defined
benefit obligation is affected. The analysis was as follows:
Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
December 31, 2020
December 31, 2019
The sensitivity analysis above is based on one assumption which changed
while the other conditions remain unchanged. In practice, more than one
assumption may change all at once. The method of analysing sensitivity and
the method of calculating net pension liability in the balance sheet are the
same.
The methods and types of assumptions used in preparing the sensitivity
analysis did not change compared to the previous period.
(f) Expected contributions to the defined benefit pension plans of the Company
for the year ending December 31, 2021 amount to $11,593.
220
(g) As of December 31, 2020, the weighted average duration of the retirement
plan is 10 years. The analysis of timing of the future pension payment was as
follows:
Within 1 year $ 40,867
1-2 year(s) 43,253
2-3 years 30,900
3-4 years 19,385
4-5 years 16,930
6-10 years 131,293
Over 10 years 268,910
$ 551,538
B. (a) Effective July 1, 2005, the Company has established a defined contribution
pension plan (the “New Plan”) under the Labor Pension Act (the “Act”),
covering all regular employees with R.O.C. nationality. Under the New Plan,
the Company contributes monthly an amount based on 6% of the employees’
monthly salaries and wages to the employees’ individual pension accounts at
the Bureau of Labor Insurance. The benefits accrued are paid monthly or in
lump sum upon termination of employment.
(b) The pension costs under defined contribution pension plans of the Company
for the years ended December 31, 2020 and 2019 were $117,062 and
$106,892, respectively.
(13) Provisions for liabilities
Warranty 2020 2019
At January 1 $ 579,337 $ 514,601
Additional provisions 852,890 758,066
Used during the period ( 558,932) ( 693,294)
Exchange differences ( 66) ( 36)
At December 31 $ 873,229 $ 579,337
Analysis of total provisions:

Current $ 873,229 $ 579,337
The Company gives warranties on computer components and
personal computers sold. Provision for warranty is estimated
based on historical warranty data.
(14) Share capital
As of December 31, 2020 , the Company’s authorized capital was
$15,000,000 (including 80,000 thousand shares reserved for
221
employee stock options and 150,000 thousand shares reserved
for convertible bonds issued by the Company), and the paid-in
capital was $8,448,562 with a par value of $10 (in dollars) per
share. All proceeds from shares issued have been collected.
(15) Capital surplus
Pursuant to the R.O.C. Company Act, capital surplus arising
from paid-in capital in excess of par value on issuance of
common stocks and donations can be used to cover accumulated
deficit or to issue new stocks or cash to shareholders in
proportion to their share ownership, provided that the Company
has no accumulated deficit. Further, the R.O.C. Securities and
Exchange Law requires that the amount of capital surplus to be
capitalised mentioned above should not exceed 10% of the
paid-in capital each year. Capital surplus should not be used to
cover accumulated deficit unless the legal reserve is insufficient.
(16) Retained earnings
A. Under the Company's Articles of Incorporation, the current year's earnings, if any,
shall first be used to pay all taxes and offset prior year's operating losses, then
10% of the remaining amount shall be set aside or reversed as legal reserve. The
balance plus unappropriated retained earnings at the beginning of the period shall
be appropriated 10%~90% as proposed by the Board of Directors and resolved by
the stockholders during their meeting.
B. The Company’s dividend policy is summarized below: as the Company operates
in a volatile business environment and is in the stable growth stage, except for the
Company’s future expansion plans, stockholders’ interest is taken into
consideration. The Company appropriated dividends in proportion to total
number of shares, dividends could be distributed in stock or cash, and cash
dividends shall account for at least 30% of the total dividends distributed.
C. Except for covering accumulated deficit or issuing new stocks or cash to
shareholders in proportion to their share ownership, the legal reserve shall not be
used for any other purpose. The use of legal reserve for the issuance of stocks or
cash to shareholders in proportion to their share ownership is permitted, provided
that the distribution of the reserve is limited to the portion in excess of 25% of
the Company’s paid-in capital.
D. (a) In accordance with the regulations, the Company shall set aside special
reserve from the debit
222
balance on other equity items at the balance sheet date before distributing
earnings. When debit balance on other equity items is reversed subsequently,
the reversed amount could be included in the distributable earnings.
(b) The amounts previously set aside by the Company as special reserve on initial
application of IFRSs in accordance with Jin-Guan-Zheng-Fa-Zi Letter No.
1010012865, dated April 6, 2012, shall be reversed proportionately when the
relevant assets are used, disposed of or reclassified subsequently. Such
amounts are reversed upon disposal or reclassified if the assets are investment
property of land, and reversed over the use period if the assets are investment
property other than land.
E. The appropriations of 2019 and 2018 earnings had been resolved at the
stockholders’ meeting on June 10, 2020 and June 14, 2019, respectively as
follows:
2019 2018
Dividends per Dividends per
Amount share (dollar) Amount share (dollar)
Legal reserve $ 558,721 $ 604,113
Special reserve 288,559 84,151
Cash dividend 3,548,396 $ 4.20 3,801,853 $ 4.50
The cash dividends of the Company from capital surplus that has been approved
by the stockholders on June 14, 2019 amounted to $422,429.
The appropriation of 2019 earnings as approved by the stockholders is the same
as with the appropriation resolved by the Board of Directors during its meeting
on April 30, 2020. Information about earnings appropriation of the Company as
resolved by Board of Directors will be posted in the “Market Observation Post
System” at the website of the Taiwan Stock Exchange.
F. For the information relating to employees’ compensation and directors’
remuneration, please refer to Note 6(21).
(17) Operating revenue
The Company derives revenue from the transfer of goods at a
point in time in the following major segment:
223
Computer and
At a point in time $ 144,645,875 $ 160,091 $ 144,805,966
Computer and
At a point in time $ 118,735,370 $ 5,003 $ 118,740,373
(18) Interest income

2020 2019
Interest income from bank deposits $ 42,189 $ 49,074
Interest income from financial assets measured at
amortised cost 7,362 8,310
Total $ 49,551 $ 57,384
(19) Other gains and losses

2020 2019
Losses on financial assets liabilities at fair value ($ 57,442) ($ 21,390)
Net currency exchange losses ( 79,460) ( 31,685)
Gains on disposal of property, plant and equipment - 11
Other (losses) gains ( 1,494) 2,200
($ 138,396) ($ 50,864)
(20) Expenses by nature

2020 2019
Employee benefit expense $ 4,910,328 $ 3,813,370
Depreciation charges 280,442 157,384
Amortisation charges 3 4
$ 5,190,773 $ 3,970,758
(21) Employee benefit expense
224
2020 2019
Wages and salaries $ 4,365,632 $ 3,346,942
Labor and health insurance fees 231,595 212,138
Pension costs 121,975 112,778
Directors’ remuneration 71,500 49,500
Other personnel expenses 119,626 92,012
Total $ 4,910,328 $ 3,813,370
A. According to the Articles of Incorporation of the Company, a ratio of distributable

profit of the current year, after covering accumulated losses, shall be distributed
as employees’ compensation and directors’ remuneration. The ratio shall be
6%~10% for employees’ compensation and shall not be higher than 1% for
directors’ remuneration.
B. For the years ended December 31, 2020 and 2019, employees’ compensation was
accrued at $725,000 and $505,000, respectively; while directors’ remuneration
was accrued at $71,500 and $49,500, respectively. The aforementioned amounts
were recognised in salary expenses respectively.
The employees’ compensation and directors’ remuneration were estimated and
accrued based on the historical distribution ratio and the profit of the current year
for the year ended December 31, 2020.
Employees’ compensation and directors’ remuneration of 2019 as resolved at the
meeting of Board of Directors were in agreement with those amounts recognised
in the 2019 financial statements.
Information about employees’ compensation and directors’ remuneration of the
Company as resolved by the Board of Directors and shareholders will be posted
in the “Market Observation Post System” website of the Taiwan Stock Exchange.
(22) Income tax
A. Income tax expense
(a) Components of income tax expense:
225
2020 2019
Current tax:
Current tax on profits for the period $ 1,751,542 $ 852,051
Total current tax 1,793,899 804,805
Deferred tax:
Origination and reversal of temporary differences ( 325,324) 12,204
Total deferred tax ( 325,324) 12,204
(b) The income tax (charge)/credit relating to components of other comprehensive
income:
2020 2019
Remeasurement of defined benefit obligations $ 1,021 $ 2,016
B. Reconciliation between income tax expense and accounting profit
2020 2019
Tax calculated based on profit before tax and $ 1,899,509 $ 1,280,844
statutory tax rate
Effect from items disallowed by tax regulation 16,800 16,800
Temporary differences not recognised as deferred tax
liabilities ( 133,514) ( 137,196)
Effect from investment tax credits ( 302,078) ( 282,279)
Effect of different tax rates in countries in which the
group operates ( 54,499) ( 13,914)
Prior year income tax overestimation (10,000) (124,148)
C. Amounts of deferred tax assets or liabilities as a result of temporary differences

are as follows:
226
2020
Recognised
in other
Unrealized losses on
inventory valuation $ 76,369 $ 8,245 $ - $ 84,614
Unrealized gross profit 203,265 234,846 - 438,111
forward exchange contract - 4,918 - 4,918
Others 93,933 56,569 - 150,502
Subtotal 407,702 304,578 1,021 713,301
Unrealized exchange gain ( 20,491) 14,407 - ( 6,084)
Unrealized gains on
forward exchange contract ( 6,339) 6,339 - -
Subtotal ( 26,830) 20,746 - ( 6,084)
Total $ 380,872 $ 325,324 $ 1,021 $ 707,217
2019
Recognised
in other
inventory valuation $ 125,440 ($ 49,071) $ - $ 76,369
Unrealized gross profit 148,181 55,084 - 203,265
Unrealized exchange loss 3,462 ( 3,462) - -
Others 83,613 10,320 - 93,933
Subtotal 392,815 12,871 2,016 407,702
Unrealized exchange gain - ( 20,491) - ( 20,491)
Unrealized gains on
forward exchange contract ( 1,755) ( 4,584) - ( 6,339)
Subtotal ( 1,755) ( 25,075) - ( 26,830)
Total $ 391,060 ($ 12,204) $ 2,016 $ 380,872
227
D. The Company has not recognised taxable temporary differences associated with
investment in subsidiaries as deferred tax liabilities. As of December 31, 2020
and 2019, the amounts of temporary difference unrecognized as deferred tax
liabilities were $5,887,126 and $5,042,672, respectively.
E. The Company’s income tax returns through 2017 have been assessed and
approved by the Tax Authority.
(23) Earnings per share
2020
weighted-average
Employees compensation - 7,225
228
2019
weighted-average
Employees compensation - 7,378
7. RELATED PARTY TRANSACTIONS
(1) Parent and ultimate controlling party
The Company’s shares are held by public, therefore there is no
ultimate parent and controlling party.
229
(2) Names of related parties and relationship
Names of related parties Relationship with the Company
MSI COMPUTER (AUSTRALIA) PTY. LTD. [MSI (AUSTRALIA)] Subsidiary
MSI COMPUTER CORP. [MSI (LA)] Subsidiary
MSI COMPUTER JAPAN CO., LTD. [MSI (JAPAN)] Subsidiary
MICRO-STAR NETHERLANDS HOLDING B.V. [MSI (HOLDING)] Subsidiary
MSI PACIFIC INTERNATIONAL HOLDING CO., LTD. [MSI(PACIFIC)] Subsidiary
MICRO-STAR CANADA LTD. [MSI (CANADA)] Subsidiary
MSI COMPUTER SARL [MSI (SARL)] Second-tier subsidiary
MYSTAR COMPUTER B.V. [MYSTAR] Second-tier subsidiary
MSI COMPUTER (UK) LTD. [MSI (UK)] Second-tier subsidiary
MSI KOREA CO., LTD. [MSI (KOREA)] Second-tier subsidiary
MSI POLSKA SP. Z O.O. [MSI (POLSKA)] Second-tier subsidiary
MSI ITALY S.R.L. [MSI (ITALY)] Second-tier subsidiary
MSI COMPUTER EUROPE B.V. [MSI (EUROPE)] Second-tier subsidiary
LLC MSI COMPUTER [MSI (RUSSIA)] Second-tier subsidiary
MHK INTERNATIONAL CO., LTD. [MSI (MHK)] Second-tier subsidiary
MEGA COMPUTER CO., LTD. [MEGA COMPUTER] Second-tier subsidiary
MSI IBERIA S.L. [MSI IBERIA] Second-tier subsidiary
SHENZHEN MEGA INFORMATION CO., LTD. [MSI SHENZHEN] Second-tier subsidiary
MSI ELECTRONICS (KUNSHAN) CO., LTD.[MSI ELECTRONICS (KUNSHAN)] Second-tier subsidiary
MSI COMPUTER (SHENZHEN) CO., LTD.[MSI COMPUTER (SHENZHEN)] Second-tier subsidiary
(3) Significant related party transactions
A. Sales revenue, net
2020 2019
Sales of goods:
MSI (LA) $ 28,697,320 $ 16,439,951
Others 13,689,041 11,828,366
Total $ 42,386,361 $ 28,268,317
The sales price and payment terms to related parties were not significantly
different from those sales to third parties.
B. Manufacturing expense - processing costs
2020 2019
Subsidiary：
MSI (PACIFIC) $ - $ 1,895,512
Second-tier Subsidiary：
MSI ELECTRONICS (KUNSHAN) 1,191,748 630,364
MSI COMPUTER (SHENZHEN) 2,986,307 1,627,044
Total $ 4,178,055 $ 4,152,920
The Company subcontracts manufacturing to a second-tier subsidiary through

230
first-tier subsidiaries. The transaction model is that the Company provides raw
materials, mutually agreed with the second-tier subsidiary to process the products
based on quantities, amounts and lead time of orders. The accounts payable would
be paid depending on the cash flow situation of each company. The manner of
carrying out the processing trade with the second-tier subsidiary is in accordance
with (1998) Tai-Cai-Zheng (6) Letter No. 00747 of Securities and Futures
Commission, Ministry of Finance, R.O.C. Starting July 1, 2019, the Company
agreed on manufacturing items with the second-tier subsidiary directly.
C. Operating expenses - after-sales service and advertisement expense
2020 2019
Purchases of services:
Others $ 2,166,466 $ 1,769,312
The Company recognised the operating expenses monthly based on the amount of
services provided by subsidiaries and second-tier subsidiaries, with the same credit
term available to third parties.
D. Receivables from related parties
Accounts receivable
MSI (LA) $ 8,887,796 $ 5,255,324
Others 1,399,833 1,376,706
Total $ 10,287,629 $ 6,632,030
Accounts receivable mainly arises from sales, with the same credit term available
to third parties.
E. Other payables
MSI (PACIFIC) $ 4,719,950 $ 4,095,703
Others 244,110 176,907
Total $ 4,964,060 $ 4,272,610
The abovementioned other payables mainly arises from processing costs and
purchases of services, with the same credit term available to third parties.
(4) Key management compensation
2020 2019
Salaries and other short-term employee benefits $ 429,341 $ 319,047
Post-employment benefits 2,052 1,944
Total $ 431,393 $ 320,991
231
8. PLEDGED ASSETS
None.
9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED
CONTRACT COMMITMENTS
(1) Contingencies ： None.
(2) Commitments ： None.
10. SIGNIFICANT DISASTER LOSS
None.
11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE
None.
12. OTHERS
(1) Capital management
The Company’s objectives when managing capital are to
safeguard the Company’s ability to continue as a going concern
in order to provide returns for shareholders and to maintain an
optimal capital structure to reduce the cost of capital. In order to
maintain or adjust the capital structure, the Company may adjust
the amount of dividends paid to shareholders, return capital to
shareholders, issue new shares or repurchase outstanding shares.
(2) Financial instruments
A. Financial instruments by category
Financial assets
Financial assets at fair value through profit or loss
Financial assets mandatorily measured at
fair value through profit or loss $ 79,297 $ 56,641
Financial assets at fair value through other
comprehensive income
Designation of equity instrument 124,338 151,975
Financial assets at amortised cost
Cash and cash equivalents 15,776,634 8,881,827
Financial assets at amortised cost 1,000,000 1,200,000
Notes receivable 672 3,929
Accounts receivable 23,292,324 17,478,303
Other receivables 219,767 157,760
Guarantee deposits paid 24,719 18,883
$ 40,517,751 $ 27,949,318
232
Financial liabilities at fair value through profit
or loss
Financial liabilities held for trading $ 103,885 $ 24,943
Financial liabilities at amortised cost
Short-term borrowings 3,000,000 1,500,000
Other accounts payables 9,304,729 7,322,529
Guarantee deposits received 107,328 91,809
$ 38,925,519 $ 28,703,739
Lease liabilities $ 160,623 $ 179,905
B. Risk management policies
The Company’s activities expose it to a variety of financial risks: market risk
(including foreign exchange risk, interest rate risk and price risk), credit risk and
liquidity risk. The Company’s overall risk management programme focuses on
the unpredictability of financial markets and seeks to minimise potential adverse
effects on the Company’s financial position and financial performance.
C. Significant financial risks and degrees of financial risks
(a) Market risk
Foreign exchange risk
i. The Company operates internationally and is exposed to foreign exchange
risk arising from various currency exposures, foreign exchange risk arises
from future commercial transactions, recognised assets and liabilities and
net investments in foreign operations.
ii. Management has set up a policy to manage their foreign exchange risk
against their functional currency.
iii. The Company has certain investments in foreign operations, whose net
assets are exposed to foreign currency translation risk.
iv. The Company hedges foreign exchange rate by using forward exchange
contracts. However, the Company does not adopt hedging accounting.
Details of financial assets or liabilities at fair value through profit or loss
are provided in Note 6(2).
v. The Company’s businesses involve some non-functional currency
operations. The information on assets and liabilities denominated in
foreign currencies whose values would be materially affected by the
exchange rate fluctuations is as follows:
233
December 31, 2020
Foreign Currency
Book Value
Financial assets
Monetary items
USD: NTD $ 1,058,405 28.4800 $ 30,143,386
EUR: NTD 110,096 35.0200 3,855,550
RMB:NTD 554,222 4.3770 2,425,829
KRW:NTD 17,763,543 0.0262 465,405
GBP: NTD 10,763 38.9000 418,664
Non-monetary items
USD: NTD 266,744 28.4800 7,596,878
EUR: NTD 19,585 35.0200 685,857
Monetary items
USD: NTD 1,007,071 28.4800 28,681,375
RMB:NTD 1,151,692 4.3770 5,040,956
EUR: NTD 27,089 35.0200 948,652
December 31, 2019
Foreign Currency
Book Value
Financial assets
Monetary items
USD: NTD $ 729,998 29.9800 $ 21,885,332
RMB:NTD 609,253 4.3050 2,622,835
EUR: NTD 58,210 33.5900 1,955,278
KRW:NTD 18,048,735 0.0260 469,267
GBP: NTD 7,794 39.3600 306,785
CAD:NTD 10,292 22.9900 236,603
RUB: NTD 444,494 0.4843 215,268
JPY:NTD 660,692 0.2760 182,351
AUD:NTD 8,157 21.0050 171,332
Non-monetary items
USD: NTD 228,346 29.9800 6,845,823
EUR: NTD 18,737 33.5900 629,384
Monetary items
USD: NTD 693,808 29.9800 20,800,378
RMB:NTD 1,003,591 4.3050 4,320,458
EUR: NTD 13,210 33.5900 443,723
JPY:NTD 412,320 0.2760 113,800
234
vi. The exchange loss arising from significant foreign exchange variation on
the monetary items held by the Company for the years ended December
31, 2020 and 2019 amounted to $79,460 and $31,685, respectively.
vii. Analysis of foreign currency market risk arising from significant foreign
exchange variation:
2020
Financial assets
Monetary items
USD: NTD 1% $ 301,434 $ -
EUR: NTD 1% 38,556 -
RMB:NTD 1% 24,258 -
KRW:NTD 1% 4,654 -
GBP: NTD 1% 4,187 -
Monetary items
USD: NTD 1% 286,814 -
RMB:NTD 1% 50,410 -
EUR: NTD 1% 9,487 -
235
2019
Financial assets
Monetary items
USD: NTD 1% $ 218,853 $ -
RMB:NTD 1% 26,228 -
EUR: NTD 1% 19,553 -
KRW:NTD 1% 4,693 -
GBP: NTD 1% 3,068 -
CAD:NTD 1% 2,366 -
RUB: NTD 1% 2,153 -
JPY:NTD 1% 1,824 -
AUD:NTD 1% 1,713 -
Monetary items
USD: NTD 1% 208,004 -
RMB:NTD 1% 43,205 -
EUR: NTD 1% 4,437 -
JPY:NTD 1% 1,138 -
Price risk
i. The Company’s equity securities, which are exposed to price risk, are the
held financial assets at fair value through other comprehensive income.
ii. The Company has investments in equity securities. The prices of equity
securities would change due to the change in the future value of investee
companies. If the prices of these equity securities had increased/decreased by
1% with all other variables held constant, other components of equity for the
years ended December 31, 2020 and 2019 would have increased/decreased by
$995 and $1,216, respectively, as a result of other comprehensive income
classified as equity investment at fair value through other comprehensive
income.
Cash flow and fair value interest rate risk
The Company analyses its interest rate exposure on a dynamic basis. Various
scenarios are simulated taking into consideration refinancing, renewal of
existing positions, alternative financing and hedging. Based on these
scenarios, the Company calculates the impact on profit and loss of a defined
236
interest rate shift. For each simulation, the same interest rate shift is used for
all currencies. The scenarios are run only for liabilities that represent the
major interest-bearing positions.
(b) Credit risk
i. Credit risk refers to the risk of financial loss to the Company arising from
default by the clients or counterparties of financial instruments on the
contract obligations. The main factor is that counterparties could not repay
in full the accounts receivable, notes receivable and financial assets at
amortised cost cash flow based on the agreed terms.
ii. The Company manages their credit risk taking into consideration the
entire company’s concern. For banks and financial institutions, only
parties with a rating of investment grade are accepted. According to the
Company’s credit policy, each local entity in the Company is responsible
for managing and analysing the credit risk for each of their new clients
before standard payment and delivery terms and conditions are offered.
Internal risk control assesses the credit quality of the customers, taking
into account their financial position, past experience and other factors.
Individual risk limits are set based on internal or external ratings in
accordance with limits set by the management. The utilisation of credit
limits is regularly monitored. Credit risk arises from credit exposures to
wholesale and retail customers, including outstanding receivables.
iii. The Company adopts assumptions, if the contract payments were past due
over 90 days based on the terms, there has been a significant increase in
credit risk on that instrument since initial recognition.
iv. The Company adopts the assumptions under IFRS 9, the default occurs
when the contract payments are past due over 150 days.
v. The following indicators are used to determine whether the credit
impairment of debt instruments has occurred:
(i) It becomes probable that the issuer will enter bankruptcy or other
financial reorganization due to their financial difficulties;
(ii) The disappearance of an active market for that financial asset because of
financial difficulties;
(iii) Default or delinquency in interest or principal repayments;
(iv) Adverse changes in national or regional economic conditions that are
expected to cause a default.
237
vi. The Company applies the modified approach using provision matrix, loss
rate methodology to estimate expected credit loss under the provision
matrix basis.
vii. The Company wrote-off the financial assets, which cannot be reasonably
expected to be recovered, after initiating recourse procedures. However,
the Company will continue executing the recourse procedures to secure
their rights.
viii. The Company used the forecastability to adjust historical and timely
information to assess the default possibility of debt instrument on
December 31, 2020 and 2019. The expected credit loss rate of the
Company’s overdue accounts receivable was not material as of December
31, 2020 and 2019.
ix. The Company applies the simplified approach to provide loss allowance
for accounts receivable that have no significant impact. The Company had
not recognized the related impact as at December 31, 2020 and 2019.
(c) Liquidity risk
i. Cash flow forecasting is performed in the operating entities of the
Company and aggregated by Company treasury. Company treasury
monitors rolling forecasts of the Company’s liquidity requirements to
ensure it has sufficient cash to meet operational needs. Such forecasting
takes into consideration the Company’s internal balance sheet ratio targets
and external regulatory or legal requirements.
ii. The table below analyses the Company’s non-derivative financial
liabilities and net-settled or gross-settled derivative financial liabilities
into relevant maturity groupings based on the remaining period at the
balance sheet date to the contractual maturity date for non-derivative
financial liabilities and to the expected maturity date for derivative
financial liabilities. The amounts disclosed in the table are the contractual
undiscounted cash flows.
238

Other financial liabilities - - - 107,328

Other financial liabilities - - - 91,809
Derivative financial liabilities
As of December 31, 2020 and 2019, the derivative financial liabilities
mature within 1 year.
iii. The Company does not expect the timing of occurrence of the cash flows
estimated through the maturity date analysis will be significantly earlier,
nor expect the actual cash flow amount will be significantly different.
(3) Fair value information
A. The different levels that the inputs to valuation techniques are used to measure
fair value of financial and non-financial instruments have been defined as
follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date. A market is
regarded as active where a market in which transactions for the asset or
liability takes place with sufficient frequency and volume to provide
pricing information on an on going basis.
Level 2: Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
B. Financial instruments not measured at fair value
The Group’s cash and cash equivalents, financial assets at amortised cost, notes
239
receivable, accounts receivable, other receivables, guarantee deposits paid,
short-term borrowings, notes payable, accounts payable, other payables,
long-term borrowings and guarantee deposits received are approximate to their
fair values. The transaction value information is provided in Note 12(2)A.
C. The related information of financial and non-financial instruments measured at
fair value by level on the basis of the nature, characteristics and risks of the assets
and liabilities is as follows:
Assets:
-Forward exchange contract $ - $ 37 $ - $ 37
Total $ - $ 79,297 $ 124,338 $ 203,635
Liabilities:
Assets:
Total $ - $ 56,641 $ 151,975 $ 208,616
Liabilities:
D. The methods and assumptions the Company used to measure fair value are as
240
follows:
(a) When assessing non-standard and low-complexity financial instruments, for
example, debt instruments without active market, interest rate swap contracts,
foreign exchange swap contracts and options, the Company adopts valuation
technique that is widely used by market participants. The inputs used in the
valuation method to measure these financial instruments are normally
observable in the market.
(b) Except for financial instruments with active markets, the fair value of other
financial instruments is measured by using valuation techniques or by
reference to counterparty quotes.
(c) The valuation of derivative financial instruments is based on valuation model
widely accepted by market participants, such as present value techniques and
option pricing models. Forward exchange contracts are usually valued based
on the current forward exchange rate.
E. For the years ended December, 2020 and 2019, there was no transfer between
Level 1 and Level 2.
F. For the years ended December 31, 2020 and 2019, there was no transfer in or out
from Level 3.
G. The Company entrusts an external evaluation agency to evaluate the fair value
classified as Level 3.
13. SUPPLEMENTARY DISCLOSURES
(1) Significant transactions information
A. Loans to others: None.
B. Provision of endorsements and guarantees to others: None.
C. Holding of marketable securities at the end of the period (not including
subsidiaries, associates and joint ventures): Please refer to table 1.
D. Acquisition or sale of the same security with the accumulated cost exceeding
$300 million or 20% of the Company’s paid-in capital: None.
E. Acquisition of real estate reaching NT$300 million or 20% of paid-in capital or
more: None.
F. Disposal of real estate reaching NT$300 million or 20% of paid-in capital or
more: None.
G. Purchases or sales of goods from or to related parties reaching NT$100 million or
20% of paid-in capital or more: Please refer to table 2.
H. Receivables from related parties reaching NT$100 million or 20% of paid-in
capital or more: Please refer to table 3.
241
I. Derivative financial instruments transactions: Please refer to Notes 6(2) and
12(2).
J. Significant inter-company transactions during the reporting periods: Please refer
to table 4.
(2) Information on investees
Names, locations and other information of investee companies
(not including investees in Mainland China): Please refer to
table 5.
(3) Information on investments in Mainland China
A. Basic information: Please refer to table 6.
B. Significant transactions conducted with investees in Mainland China directly or
indirectly through other companies in the third areas: Please refer to table 7.
(4) Minority shareholders information
Major shareholders information: Please refer to table 8.
14. SEGMENT INFORMATION
Not applicable.
Detailed tables are attached from Page 172 to 181.
242
Chairman: Hsu, Hsiang
243

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Stock Code:2377

MICRO‐STAR INTERNATIONAL CO., LTD.

2020 ANNUAL REPORT

MSI annual report is available at:

II. HEADQUARTERS AND PLANTS

Ⅲ.SECURITIES DEALING INSTITUTE

V. NAME OF TRADING SITE FOR LISTED SECURITIES OVERSEAS:

(Ⅰ) Operating Performance in 2020

(Ⅱ) Operating Plan for 2021

Chairman: Hsu, Hsiang

Finance Center EP & CSR Committee

Legal Affairs Office Info. Security Mgmt Committee

Director Kuo,Hsu‐Kuang Male 2018.06.15 3 2018.06.15 0 0.00% 75,000 0.01% 0 0.00% ─ ─ － － －

Independent Wang,Sung‐Chou Male 2018.06.15 3 2003.05.28 0 0.00% 0 0.00% 468 0.00% ─ ─ － － －

The sales manager of Magic Systech Inc

Vice President of Corp.Manufacture & Quality Assurance Li,Chao‐Ming

Other matters that require to be recorded:

Title Name Attendance in Person (B) Attendance Remarks

Audit Committees’ Execution process

2020.03.20 (1)2019 Financial Statement of this Company.

2020.08.07 (1)Financial Report of second quarter, 2020

(2) Scope of duties and Excution in the most recent year:

(5)Annual work focuses and operational situation of the Audit Committee:

Micro Star International Co., Ltd.

Micro Star International Co., Ltd.

(Ⅵ)Change of CPA’s Information:None.

2.Information of Shares Transferred: Not transferred to related parties.

2002.03 － 680,000 6,800,000 395,283 3,952,834 Conversion of bonds 92,564 None －

(2)Information for Shelf Registration: None.

3.Shareholding Distribution Status

4.List of Major Shareholders

Basic 11.95 12.83 ‐

Cash dividends yield rate (Note1) 4.95% ‐

6.Dividend policy of the company and its implementation

8.Compensation for employees and directors

(Ⅱ)Corporate bond: None.

(1)The purpose for which the Company is formed shall be as follows:

(2)Proportion of each business

(4) New products (services) planned to be developed

B. Professional Graphics Cards:

Professional Gaming Gears:

E. Telematics and Automotive Electronics:

Upstream Mid‐Stream Dowmstream

PCB Computer case Notebook

Software Soft/Hard Drives

Basic I/O Systems

(3)Product development trends：

B. Professional Graphics Cards

E. Telematics and Automotive Electronics

I. AMR (Autonomouse Mobile Robot)

4.Short‐term and long‐term development plan

(Ⅱ) Market Analysis and The Conditions of Sales and Production:

2. Important purposes and production/preparation processes of primary products

(2) Production processes

6. Sales Quantities and Values of the Last Two Fiscal Years:

(Ⅳ)Environmental expenditures information

4. Greenhouse Gas Management:

5. The electricity saving measures management:

6. Waste Electrical and Electronic Equipment Management:

External training Professional technical training 563,281 93 645

Director Kuo,Hsu‐Kuang Male 2018.06.15 3 2018.06.15 0 0.00% 75,000 0.01% 0 0.00% ─ ─ －－－

Independent Wang,Sung‐Chou Male 2018.06.15 3 2003.05.28 0 0.00% 0 0.00% 468 0.00% ─ ─ －－－