8101 Huaguan

Release Date: August 13, 115 Statement Date: August 12, 115 Statement Time: 18:22:38 Company Code: 8101 Company Name: Huaguan Subject: Announcement of Auditor's Review Report Indicating Significant Uncertainty Regarding Going Concern Ability for the Second Quarter of Year 115 Applicable Clause: Clause 30 Factual Date: August 12, 115 Explanation: 1. Factual Date: 8/12/115

2. Full Text of Auditor's Review Opinion:

Introduction The consolidated balance sheets of Huaguan Communications Co., Ltd. and its subsidiaries as of June 30, Years 115 and 114, the consolidated statements of comprehensive income for the periods from April 1 to June 30, Years 115 and 114, the consolidated statements of changes in equity and consolidated cash flow statements for the periods from January 1 to June 30, Years 115 and 114, and the notes to the consolidated financial statements (including summary of significant accounting policies), have been reviewed by this auditor. The preparation of consolidated financial statements that fairly present in accordance with the 'Securities Issuers Financial Reporting Standards' and the International Accounting Standard No. 34 'Interim Financial Reporting' recognized and promulgated by the Financial Supervisory Commission is the responsibility of management. The auditor's responsibility is to express a conclusion on the consolidated financial statements based on the review results.

Scope Except as described in the Basis for Qualified Conclusion section, the auditor conducted the review in accordance with Review Standard No. 2410, 'Review of Financial Statements.' Procedures performed during the review of the consolidated financial statements include inquiries (primarily of personnel responsible for financial and accounting matters), analytical procedures, and other review procedures. The scope of a review is substantially less than that of an audit, and consequently, the auditor may not detect all material matters that might be identified through an audit, and therefore cannot express an audit opinion.

Basis for Qualified Conclusion As stated in Note 4(3) to the consolidated financial report, the financial statements as of June 30, Years 115 and 114, of non-material subsidiaries included in the above consolidated financial report and related information disclosed in Note 13 to the consolidated financial statements have not been reviewed by auditors. The total assets of these subsidiaries as of June 30, Years 115 and 114, were NT$17,605 thousand and NT$22,258 thousand, representing 3% and 4% of consolidated total assets, respectively. Total liabilities were NT$102,371 thousand and NT$94,061 thousand, representing 30% and 23% of consolidated total liabilities, respectively. The total comprehensive loss for the period from April 1 to June 30, Year 115, and from January 1 to June 30, Year 115, was NT$1,123 thousand and NT$1,583 thousand, representing 4% and 2% of consolidated total comprehensive loss, respectively. For the same periods in Year 114, the total comprehensive loss was NT$2,315 thousand and NT$3,495 thousand, representing 8% and 5% of consolidated total comprehensive loss, respectively.

Furthermore, as stated in Note 6(6) to the consolidated financial statements, the investments accounted for using the equity method as of June 30, Years 115 and 114, included in the above consolidated financial report, were NT$301,645 thousand and NT$321,912 thousand, respectively. The share of profits or losses from associates recognized using the equity method for the periods from April 1 to June 30, Year 115, and from January 1 to June 30, Year 115, were NT$1,706 thousand profit and NT$3,433 thousand loss, respectively. For the same periods in Year 114, the shares were NT$8,432 thousand profit and NT$10,511 thousand loss, respectively. The related information included in the above consolidated report is based on financial statements for the same periods that have not been reviewed by auditors.

Qualified Conclusion Based on the auditor's review results, except for the possible adjustments to the consolidated financial statements that might arise if the financial statements of the non-material subsidiaries and equity-method investments described in the Basis for Qualified Conclusion section were reviewed by auditors, no instances were found where the above consolidated financial statements were not prepared in all material respects in accordance with the 'Securities Issuers Financial Reporting Standards' and the International Accounting Standard No. 34 'Interim Financial Reporting' recognized and promulgated by the Financial Supervisory Commission, resulting in a failure to fairly present the consolidated financial position of Huaguan Communications Co., Ltd. and its subsidiaries as of June 30, Years 115 and 114, the consolidated financial performance for the periods from April 1 to June 30, Years 115 and 114, and from January 1 to June 30, Years 115 and 114, and the consolidated cash flows for the periods from January 1 to June 30, Years 115 and 114.

Material Uncertainty Related to Going Concern As stated in Note 12(1) to the consolidated financial report, Huaguan Communications Co., Ltd. and its subsidiaries had accumulated losses of NT$425,323 thousand as of June 30, Year 115, amounting to 82% of paid-in capital. Current liabilities exceeded current assets by NT$126,327 thousand, and the debt ratio reached 58%. These conditions indicate significant uncertainty regarding the ability of Huaguan Communications Co., Ltd. and its subsidiaries to continue as a going concern. The auditor did not modify the review conclusion as a result.

3. Auditor Firm Name: BDO Taiwan 4. Auditor Name and Approval Document No. 1: (108) FSC Audit No. 1080305189 5. Auditor Name and Approval Document No. 2: (107) FSC Audit No. 1070345892 6. Auditor Review (Review) Report Date: August 12, 115 7. Response Measures: None 8. Other Matters to be Disclosed: None