[Translation]

Annual Securities Report(The 16th Business Term)
From April 1, 2019 to March 31, 2020

CYBERDYNE, INC.

－ 1 －This is an English translation of part of the Annual Securities Report (有価証券報告書).
Of the pages of Annual Securities Report translated in this document, "Part I Informationon the Company V. Consolidated Financial Statements and Other Information 1.
Consolidated Financial Statements" were audited by Deloitte Touche Tohmatsu LLC.
Annual Securities Report was filed to the Director of the Kanto Local Finance Bureau
via Electronic Disclosure for Investor's NETwork ("EDINET") pursuant to the Financial
Instruments and Exchange Act of Japan.

－ 2 －Chapter 1【Information of the company】
1 【Status of the company】
1【Changes in major management indicators】(1) Consolidated management indicators
International Financial Standards (IFRS)
Order

Date of settlement

Transition
date

Term 13

Term 14

Term 15

Term 16

April 1,
2016

March
2017

March
2018

March
2019

March
2020

Revenue

Millions of yen

−

1,660

1,728

1,709

1,792

Operating profit (loss)

Millions of yen

−

(697)

(659)

(830)

(1,039)Profit (loss) before tax

Millions of yen

−

(648)

(672)

(569)

91

Profit (loss) attributable toowner of the parent

Millions of yen

−

(676)

(673)

(632)

(152)

Comprehensive profit(loss)
attributable to owners of theparentMillions of yen

−

(256)

(1,076)(1,480)42

Equity attributable to owners of
the parent

Millions of yen

27,151

46,76845,69844,21744,268

Total assets

Millions of yen

47,74347,712

46,59845,74647,808Equity attributable to owners of
the parent per share

Yen

130.98217.56212.53205.50205.71

Basic earnings (loss) per share

Yen−(3.16)(3.13)(2.94)(0.71)

Diluted earnings (loss) per share

Yen−(3.16)(3.13)(2.94)(0.71)

Ratio of equity attributable toowners of the parent

%

56.9

98.0

98.1

96.7

92.6

Return of equity attributable toowners of the parent

%

−

−

−

−

−

Price-to-earnings ratio

Ratio

−

−

−

−

−

Cash flow from operating
activities

Millions of yen

−

575

(53)

(775)

(215)

Cash flow from investing
activities

Millions of yen−(5,548)(2,484)(1,917)(244)

Millions of yen

−

(110)

(23)

670

1,304

Millions of yen

18,462

13,378

10,820

8,796

9,636

Cash flow from financing
activities
Balance of cash and cash
equivalents at the end of the
fiscal year

Numbers of employee
65
71
75
84
95
persons(Average number of non-regular
(93)
(94)
(63)
(47)
(56)
employees)
Note 1. Revenue does not include consumption tax etc.
2.Consolidated financial statement have been prepared in accordance with International Accounting Standards since the14th business term.
3.Price-to-earnings ratio is not stated because CYBERDYNE, INC. recorded a loss attributable to owners of the parent
4.Return of equity attributable to the owners of the parent is not stated because CYBERDYNE, INC. recorded a loss
attributable to the owners of the parent
5.Rounded down to the closest millions of yen (same for the following)－ 3 －Japanese GAAP (IFRS)
Order

Date of settlement

Term 12

Term 13

Term 14

March 2016

March
2017

March
2018

Net sales

Millions of yen

1,265

1,650

1,727

Ordinary profit (loss)

Millions of yen

(710)

(783)

(689)

Net profit attributable to owners of
the parent

Millions of yen

(718)

(789)

(591)

Comprehensive income

Millions of yen

(719)

(778)

(614)

Net assets

Millions of yen

27,064

46,22645,630Total assets

Millions of yen

47,534

46,84846,339Net assets per share

Yen

130.50214.90212.04

Net profit (loss) per share

Yen(3.53)(3.69)(2.75)

Diluted net income per share

Yen

−

−

−

Capital ratio

%

55.8

98.6

98.4

Return of equity

%

−

−

−

Ratio

−

−

−

Cash flow from operating activities

Millions of yen

(258)

575

(53)

Cash flow from investing activities

Millions of yen(483)(5,548)(2,483)

Cash flow from financing activities

Millions of yen

(21)

(110)

(23)

Balance of cash and cash
equivalents at the end of the fiscal
year

Millions of yen

18,45913,376

10,820Price-to-earnings ratio

Numbers of employee
65
71
75
persons(Average number of non-regular
(93)
(94)
(63)
employees)
Note 1.Net sales does not include consumption tax etc.
2.Diluted net income per share is not stated because, while there are diluted shares, CYBERDYNE, INC. recorded net
loss per share.
3.Return of equity is net is not stated as CYBERDYNE, INC. recorded net loss attributable to owners of the parent.
4.Price-to-earnings ratio is not stated as CYBERDYNE, INC. recorded net loss per share.
5.CYBERDYNE, INC. conduced a two-for-one stock split for both Common Shares and Class B Shares on August 1,
2015.The net loss per share is computed based on the assumption that the stock split took place at the beginning of 12th
business term.
6.Due to a change in the method of calculating the number of employees in 13th business term, CYBERDYNE, INC.
applies the changed method of calculating the number of employees in 12th business term.
7.Figures based on Japanese GAAP for the 14th business term has not been audited in accordance with Article 163 item
2-1 of the Financial Instruments and Exchange Law.

－ 4 －(2) Non-consolidated management indicators
Order

Term 12

Term 13

Term 14

Term 15

Term 16

Date of settlement

March 2016

March 2017

March 2018

March 2019

March 2020

Net sales

Millions of
yen

1,012

1,454

1,543

1,530

1,595

Operating profit (loss)

Millions of
yen

(685)

(702)

(625)

(734)

(615)

Net profit (loss)

Millions of
yen

(689)

(707)

(529)

(1,906)(849)

Share capitalMillions ofyen

16,512

26,744

26,744

26,77826,778

Common Share
125,576,000

Common Share
137,347,609

Common Share
137,347,609

Common Share
137,445,809

Common Share
137,445,809

Class B ShareClass B ShareClass B ShareClass B ShareClass B Share

77,700,000

77,700,000

77,700,000

77,700,000

77,700,000

Total number of issued shares

SharesNet assets

Millions ofyen

27,133

46,37445,84444,02043,167

Total assets

Millions ofyen

47,53346,922

46,45944,74043,899Net assets per share

Yen

130.84215.59213.09204.52200.56

Dividend per share(Interim dividend per share)

Yen

−

−

（−）

（−）

Net profit (loss) per share

Yen(3.39)(3.31)

Diluted net income per share

Yen

−

−

Capital ratio

%

55.7

98.8

Return on equity

%

−

−

−

−

−

Price-to-earnings ratio

Ratio

−

−

−

−

−

Payout ratio

%

−

−

−

−

−

55

61

62

65

78

(59)

(61)

(44)

(41)

(47)

137.2

102.0

96.1

43.7

38.6

(117.8)(123.5)(139.2)(110.3)(71.5)

Numbers of employee(Average number of non-regular
employees)
Total shareholder return(Comparative index: Tokyo Stock
Exchange Mothers Index)

Persons
%
%

−

−

−

（−）

（−）

（−）

(2.46)(8.86)−
98.6(3.95)

−
98.4

−
98.3

Highest share price

Yen

2,185

2,629

2,150

1,538

753

Lowest share price

Yen

1,212

1,281

1,380

449

320

Note 1.Net sales does not include consumption tax etc.
2.Diluted net income per share is not stated because, while there are diluted shares, CYBERDYNE, INC. recorded net
loss per share.
3.Return of equity is net is not stated as CYBERDYNE, INC. recorded net loss attributable to owners of the parent.
4.Price-to-earnings ratio is not stated as CYBERDYNE, INC. recorded net loss per share.
5.CYBERDYNE, INC. conduced a two-for-one stock split for both Common Shares and Class B Shares on August 1,
2015.The net loss per share is computed based on the assumption that the stock split took place at the beginning of 12th
business term.
6.Due to a change in the method of calculating the number of employees in 13th business term, CYBERDYNE, INC.
applies the changed method of calculating the number of employees in 12th business term.
7.The highest and lowest share prices are based on share price at Tokyo Stock Exchange (Mothers)－ 5 －Chapter 5【Status of Accounting】
1 Basis of preparation of consolidated financial statement and non-consolidated financial statement(1) The consolidated financial statements of CYBERDYNE, INC. (the “Company”) have been
prepared in accordance with International Accounting Standards (hereafter referred to as“IFRS”) pursuant to Article 93 of the “Ordinance on Terminology, Forms, and Preparation
Methods of Consolidated Financial Statements” (Ordinance of the Ministry of Finance No. 28
of 1976)(2) The non-consolidated financial statements of the Company have been prepared in accordancewith “Ordinance on Terminology, Forms, and Preparation Methods of Financial Statements,etc.” (Ordinance of the Ministry of Finance No. 59 of 1963. Hereinafter referred to as“Ordinance on Financial Statements”).
From the previous fiscal year (from April 1, 2018 to March 31, 2019), pursuant to the proviso
of Article 2 of the Supplementary Provisions of the revised Ordinance, financial statements havebeen prepared in accordance with the revised Ordinance on Financial Statements.
The Company is a special company submitting financial statements and prepares financial
statements pursuant to the provisions of Article 127 of the Ordinance on Financial Statements.
2 Audit Certification
Pursuant to the provisions of Article 193 item 1 of the Financial Instruments and Exchange Law, theCompany has undergone an audit by Deloitte Touche Tohmatsu LLC of the consolidated financial
statements for the consolidated fiscal year (from April 1, 2019 to March 31, 2020) and the financial
statements for the business year (from April 1, 2019 to March 31, 2020).
3 Special efforts to ensure the appropriateness of consolidated financial statements, etc. and theestablishment of a system that enables the proper preparation of consolidated financial statements,
etc. based on IFRSThe Company makes special efforts to ensure the appropriateness of its consolidated financial
statements and maintains a system that enables it to appropriately prepare consolidated financial
statements in accordance with IFRS. The contents are as follows.
(1) In order to appropriately understand the content of accounting standards, etc. and to develop asystem that can appropriately respond to changes, etc. in accounting stands, etc., the Company
have joined Financial Accounting Standards Foundation and participated in seminars, etc.
sponsored by the foundation and auditing firms, etc.
(2) In applying IFRS, the Company obtained press releases and statements issued by theInternational Accounting Standards Board from time to time to keep track of the latest standards.
In order to prepare the appropriate consolidated financial statements in accordance with IFRS,
the Group has prepared its accounting policies and guidelines in accordance with IFRS andapplies them to accounts processing.

－ 6 －1 【Consolidated financial statements and Notes to consolidated financial statements】(1) Consolidated financial statements① Consolidated statement of financial position
Note

AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories
Other current assets
Total current assets
Non-current assets
Operating lease assets
Property, plant and equipment
Right of use assets
Goodwill
Intangible assets
Investment accounted for using equity method
Other financial assets
Other non-current assets

Previous consolidated fiscal year
(As of March 31, 2019)

Current consolidated fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

7, 32
8, 32
9, 32
10
11

12, 17
12
17
13
13
14
9, 32
11

Total non-current assets
Total assets

－ 7 －

8,796
257
20,505
901
169

9,636
263
19,004832
156

30,62729,891

463
11,624
－
－
70
456
2,431
74

481
11,553
361
57
53
472
4,872
68

15,11817,91745,74647,808

Note

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables

Previous consolidated fiscal year
(As of March 31, 2019)

Current consolidated fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

18, 32
16, 30,32
17,30,
32
20

284

247

－

37

－

61

370

464

654

810

－

51

544

1,714

－

313

91
254

93
568

889

2,739

1,543

3,549

26,74526,494(0)(1,048)(7,972)

26,75326,494(0)(854)(8,124)

Total equity attributable to owners of the parent
Non-controlling interests

44,217(15)

44,268(9)

Total equity

44,20344,25945,74647,808

Bonds and borrowings
Lease liabilities
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds and borrowings
Third-party interests in CEJ Fund
Lease liabilities
Provisions
Deferred tax liabilities

16, 3030, 32,
33
17, 30,32
15Total non-current liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Other components of equity
Retained earnings

22
22
22
31,32
22

Total liabilities and equity－ 8 －② 【Consolidated statement of profit or loss and consolidated statement of comprehensive income】【Consolidated statement of profit or loss】
Note

Revenue

Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

Millions of yen

Millions of yen

6, 24
10, 17,19, 25

1,709

1,792

(481)

(492)

1,227

1,300

(998)

(812)

(1,454)(1,646)(2,453)(2,459)

26
26

406
(11)

138
(18)

27, 3227, 32

(830)
239
(15)
61

(1,039)
1,184
(100)
75

14

(24)

(29)

15

(569)
(74)

91
(240)

Profit (loss)

(643)

(149)

Profit (loss) attributable to
Owners of parent
Non-controlling interests

(632)
(11)

(152)
3

(643)

(149)

(2.94)(2.94)(0.71)(0.71)

Cost of sales
Gross profit
Selling, general and administrative expenses
Research and development expenses
Other selling, general and administrative
expenses
Total selling, general and administrative
expenses
Other income
Other expenses
Operating profit (loss)
Finance income
Finance costs
Gains related to CEJ Fund
Share of profit (loss) of investments
accounted for using equity method
Profit (loss) before tax
Income tax expense

17, 19, 25
17, 19,25, 31

Profit (loss)
Earnings (loss) per share
Basic earnings (loss) per share (yen)Diluted earnings (loss) per share (yen)－ 9 －【Consolidated statement of comprehensive income】
Note

Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

Millions of yen

Millions of yen

Profit (loss)

(643)

(149)

(858)

191

(858)

191

14

4

Total of items that may be reclassified to
profit or loss

14

4

Total other comprehensive income, net of tax

(845)

195

Comprehensive income(1,487)

46

Comprehensive income attributable to
Owners of parent
Non-controlling interests(1,480)(7)42
4(1,487)46

Other comprehensive income
Items that will not be reclassified to
profit or loss
Financial assets measured at fair value
through other comprehensive income

28,32

Total of items that will not be reclassified to
profit or loss
Items that may be reclassified to profit or loss
Exchange differences on translation offoreign operation

28

Comprehensive income－ 10 －

③ 【Consolidated statement of changes in equity】
Equity attributable to owners of parent
Other components of equity
Note

April 1, 2018
Profit (loss)

Treasury shares

Millions of yen
26,744－

Millions of yen
26,495－

Millions of yen(0)－Millions of yen(77)－

Millions of yen(7)－Millions of yen
19
－

－

－

－

(858)

10

－

－

－

－

(2)

－

10
－

－

1

(858)
－

－

－

－

(135)

－

－

－

－

－

－

－

－

22

Transfer from other components ofequity to retained earnings
Equity transaction with noncontrolling interest

1

(2)

－

(135)

－

－

26,494－(0)－(1,071)
－

3
－

19
－

－

－

－

191

3

－

－

－

－

－

8

－

(0)
－

3
－

－

－

191
－
－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

8

－

(0)

－

－

－

26,75326,494

(0)

(880)

6

19

Other comprehensive income
Total comprehensive income
Share-based payment transaction22
31

Equity transaction with noncontrolling interest
Increase (decrease) by businesscombination
Total transaction with owners
March 31, 2020

Equity attributable to owners of parent
Note

Other
components ofequityNon-controllinginterests

Total equity

Millions of yen

Millions of yen

Millions of yen

45,698(24)

45,674

(632)

(11)

(643)

(848)

(632)
－

(848)

4

(845)

(848)
－

(632)
－

(1,480)(1,487)

(1)

(7)
－

(135)

135

－

－

－

－

－

－

17

17

Retainedearnings

Total

Millions of yen

Millions of yen(7,476)

Profit (loss)(65)－

Other comprehensive income

Total

April 1, 2018

Total comprehensive income
Issuance of new shares

22

Transfer from other components ofequity to retained earnings
Equity transaction with noncontrolling interest
Total transactions with owners
March 31, 2019
Profit (loss)
Other comprehensive income
Total comprehensive income
Acquisition of treasury shares
Share-based payment transaction
Equity transaction with noncontrolling interest
Increase (decrease) by businesscombination
Total transaction with owners
March 31, 2020

22
31

－

26,745－

Total transactions with owners

Acquisition of treasury shares

StockacquisitionrightsCapital surplus

Total comprehensive income

March 31, 2019
Profit (loss)

Exchangedifferences ontranslation offoreign
operations

Share capital

Other comprehensive income
Issuance of new shares

Financialassetsmeasured atfair value
through othercomprehensive
income

(1)

(135)

135

(1)

17

16

(1,048)－(7,972)

44,217(15)

44,203

(152)
－

(152)

3

(149)

194

194

1

195

194
－

(152)
－

42
(0)

4
－

(0)

－

－

8

－

8

－

－

－

8

8

－

－

－

(6)

(6)

46

－

－

8

2

10

(854)

(8,124)44,268(9)44,259－ 11 －－

④ 【Consolidated statement of cash flows】
Previous consolidated fiscal year
Note (From March 31, 2018 to March
31, 2019)
Millions of yen
Cash flows from operating activities
Profit (loss) before tax
Depreciation and amortization
Finance income
Finance costs
Losses (gains) on CEJ Fund
Share of loss of investments accounted for using
equity method
Decrease (increase) in inventories
Decrease (increase) in trade and other receivables
Increase (decrease) in trade and other payables
Other
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Payments for administrative expenses etc. related
to CEJ FundNet cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of investments
Proceeds of redemption of investments
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities

Millions of yen
(569)

91

12, 13,1727, 32
32
33

436

492

(239)
15
(61)

(1,184)
100
(75)

14

24

29

(336)
128
24
(138)

85
1
(45)
85

(716)
17
(0)
－

(420)
318
(0)
(2)

(76)

(111)

(775)

(215)

(28,000)
30,000(2,500)－(29,999)
29,000－33

32Proceeds from purchase of stock of subsidiaries
with change of scope consolidation
Purchase of investments accounted for using
equity method
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Lease liabilities paid
Contributions into CEJ Fund from third-party
investors
Proceeds from stock issuance to non-controlling

Current consolidated fiscal year
(From March 31, 2019 to March
31, 2020)

33

interests
Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents

(789)
(7)
(618)
－

2,500
(399)
(6)
(1,715)
333

－

91

(5)

(46)

2

(2)

(1,917)

(244)

－

(53)

680

1,360

4

－

(14)

(3)

670

1,304

(3)

(5)

Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of fiscal year7

(2,025)
10,820840
8,796

Cash and cash equivalents at end of year

7

8,796

9,636

－ 12 －

【Notes to consolidated financial statements】
1. Nature of operationsCYBERDYNE, INC. (the "Company") is a company domiciled in Tsukuba, Ibaraki, Japan. Location of the Company's
headquarters as well as its main offices are disclosed on the Company website, (https://www.cyberdyne.jp/english). The
accompanying consolidated financial statements comprise the Company, its group companies (with the Company,
collectively referred to as the "Group"), associates as well as jointly controlled entities and the fiscal year is from April 1
to March 31.
The Group utilizes Cybernics to work on the entire process from basic research of innovative technologies to theirsocial implementation, which could contribute to overcome various problems that modern society faces. At the same time,
the Group will continue its endeavors to create new industries and nurture human resources, in order to induce upward
spiral of innovation and to shape the future. The Group operates under a single segment of business related to robotics andit is detailed in "6. Segment information".
2. Basis of presentation(1) Conformance of consolidated financial statements with IFRS and matters regarding the first-time adoption
As the Group meets the requirement of "Specified Company Applying Designated International Reporting Standards"
pursuant to Article 1-2 of the "Ordinance on terminology, forms and preparation methods of consolidated financial
statements" (Ordinance of the Ministry of Finance No. 28 of 1976, referred to as the "Ordinance"), the consolidated
financial statements of the Group have been prepared in accordance with International Financial Reporting Standards("IFRS") as permitted by the provisions of Article 93 of the Ordinance.
The consolidated financial statements under review have been approved by Yoshiyuki Sankai, President and CEO of
the Company as well as Shinji Uga, Director and Head of the Corporate Department of the Company on June 25, 2020.
(2) Basis of measurement
As detailed in Note "3. Significant accounting policies", consolidated financial statements of the Group have been
prepared on a historical cost basis, except for specific financial instruments and others measured at fair value.
(3) Functional currency and presentation currency
The consolidated financial statements of the Group are presented in Japanese yen, which is the Company's functional
currency, rounded to the nearest million yen.
(4) Early adoption of new accounting standards
The Group has applied the following accounting standards from the fiscal year ended March 31, 2020.

IFRSs
IFRS 16Nature of the new standards or amendments
Leases

Revised accounting process upon leases

The Group adopted IFRS 16 "Leases" (issued on January 2019; hereinafter "IFRS 16") in the beginning of the fiscal year
ended March 31, 2020.
Upon applying IFRS 16, the Group recognizes cumulative effect of application at the point of effective date. Furthermore,in transition to IFRS 16, the Group has chosen the practical expedient detailed in IFRS 16 paragraph C3 by conducting
assessment of whether contracts contain leases based on IAS 17 "Leases" (hereinafter "IAS 17") and IFRIC 4 "Determining
whether an Arrangement contains a Lease."
For the leases that the Group previously classified as operating leases based on IAS 17, the Group recognizes leaseliabilities at the point of effective date. These lease liabilities are measured at the present value of the remaining lease
payments discounted using the lessee's incremental borrowing rate at the point of effective date. At the point of effective
date, the amount of lease liabilities recognized by the Group is ¥363 million and the weighted average of the lessee's
incremental borrowing rates is 0.7%.

－ 13 －

As of the end of fiscal year ended March 31, 2019, operating agreements disclosed in accordance with IAS 17 and thereconciliation of lease liabilities as of the date of adoption recognized in the consolidated statement of financial position is asfollows.
AmountMillions of yen
Lease liabilities under non-cancellable operating lease contracts (March 31, 2019)−
Lease liabilities under cancellable operating lease contracts
363
Lease liabilities as of April 1, 2019
363
Upon applying IFRS 16 the Group has chosen the following practical expedient.
• A single discount rate is applied to portfolios of leases with reasonably similar characteristics• As an alternative to performing an impairment review, the Group relies on its assessment of whether leases are onerous
applying IAS 37 "Provisions, Contingent Liabilities and Contingent Assets" immediately before the date of initial
application• Leases for which lease contracts ends after 12 months from the point of effective date are processed in the same manneras short-term lease• Initial direct costs are excluded from the measurement of right-of-use assets at the point of effective date
• Use hindsight: e.g. in determining the lease term of the contract that contains options to extend or terminate the lease
3. Significant accounting policies(1) Basis of consolidation① Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it has exposure, or rights, tovariable returns from involvement with an investee and has the ability to affect those returns through its power overthe investee.
The financial statements of subsidiaries are included in the consolidated financial statements of the Group from thedate the Group gains control until the date it loses control of the subsidiary.
Some of the subsidiaries has a close date of December 31. Due to the relationship with other shareholders andagreements of contract, it is impossible to practically unify the closing date for these subsidiaries. As such, thesesubsidiaries are subject to provisional settlements of accounts on March 31, and the Group utilizes these accounts for
its consolidated financial statements.
All intergroup balances, transactions, income and expenses and unrealized gains and losses arising from intergrouptransactions are eliminated in preparing the consolidated financial statements.
Comprehensive income of subsidiaries is attributed to owners of the parent and to the non-controlling interests
even if this results in the non-controlling interests having a deficit balance.
A change in the Group's ownership interest in a subsidiary, without a loss of control, is accounted for as an equity
transaction. Any difference between the amount by which the non-controlling interests are adjusted and the fair valueof the consideration paid or received is recognized directly in equity attributable to the owners of the parent.
In case of a change in the Group's ownership interest in a subsidiary, resulting a loss of control, profit or losses
arising from the loss of control is recognized as net loss.
② Associates
An associate is defined as an entity over which the Group has significant influence on financial and operating policy
decision but does not have control over the entity.
The Group is presumed to have significant influence over another entity when it holds at least 20%, but no morethan 50% of the voting rights of that entity.
Investments in associates are accounted for by equity method from the date the Group gains significant influence
until the date it loses that influence.
If the Group's share of the associates' loss (amount equivalent to equity interest) exceeds the Group’s share of theinvestment in the associate, the Group reduces the carrying amount of the investment to zero and does not recognize
any further losses unless the Group incurs or pays obligations (legal or constructive obligations) on behalf of theassociate.
Any excess of the cost of acquisition over identifiable assets, liabilities and contingent liabilities of the associates
at the date of acquisition are recognized as goodwill and it shall be included in the carrying value of the investment.
As the relevant goodwill is not recognized separately, it shall not be tested for impairment on individual basis.
－ 14 －

However, if there is objective evidence on possibility of impaired investment, the Group shall test its investment toassociates for impairment by recognizing the investment as single asset in net amounts.
③ Joint venture
Joint venture is an entity jointly controlled by two or more parties including the Group under the contractually agreed
share of control of an arrangement over economic activity of the joint venture, which exist only when decision forstrategic, financial and operating decisions related to relevant activities require unanimous consent of the parties
sharing control. A joint venture of the Group is accounted for using the equity method.
Some of the joint venture has a close date of December 31. Due to the relationship with other shareholders andagreements of contract, it is impossible to practically unify the closing date for the said joint venture. As such, theGroup makes adjustments to important transaction and event during the period, in order to reflect the impact ofchanges caused by the difference of close dates.

－ 15 －

(2) Business combinations
Business combinations are accounted for using the acquisition method. The consideration of an acquisition is measured
as the aggregate of the acquisition-date fair value of the assets transferred, liabilities assumed, and equity securities
issued by the Group to the former owners of the acquiree in exchange for control of acquiree. Any excess of theconsideration over the net fair value of identifiable assets acquired and liabilities assumed at the acquisition date isrecognized as goodwill in the consolidated statement of financial position. Conversely, any deficit is immediately
recognized as income in the consolidated statement of income.
Costs associated with business combinations, such as advisory fees, attorney fees and due diligence costs, areexpensed as incurred.
If the initial accounting for a business combination is incomplete by the end of the fiscal year in which the
combination occurs, provisional amounts of incomplete items are measured, which are adjusted during the measurement
period within one year from the date of acquisition. During the measurement period, the Group shall retrospectively
adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts andcircumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts
recognized as of that date. If this new information brings about new recognition on assets and liabilities, it will berecognized as additional assets and liabilities. Measurement period could last no longer than one year from the date ofacquisition.
The additional acquisition of non-controlling interests is accounted for as an equity transaction, and therefore no
goodwill is recognized with respect to such transaction.
Identifiable assets and liabilities of the acquiree in business combinations are measured at their acquisition-date fairvalue, with the following exceptions:・Deferred tax assets and liabilities and assets or liabilities related to employee benefit arrangements
・Share-based payment transactions of the acquire・Non-current assets and disposal groups that are classified as held for sale in accordance with IFRS 5 “Non-current
assets held for sale and discontinued operations”
In a business combination achieved in stages, the Group re-measures its previously held equity interest at theiracquisition-date fair value and recognizes resulting gain or loss, if any, in new profit or loss.
(3) Foreign currency transaction① Foreign currency transactions
Foreign currency transactions are translated into the functional currency of each company of the Group at the spot
exchange rate at the date of the transaction, or an exchange rate that approximates the spot rate.
Foreign currency monetary items are translated into the functional currency using the rates at the end of reporting
period.
Non-monetary items that are measured at fair value in foreign currencies are translated into the functional currency
using the exchange rates at the date when the fair value was measured.
Exchange differences arising from such translations and settlements are recognized in profit or loss. However,exchange differences arising from financial assets measured at fair value through other comprehensive income arerecognized in other comprehensive income.
② Financial statements of foreign operations
Assets and liabilities of foreign operations are translated at the rate at the end of each reporting period. Income andexpenses are translated at the average exchange rates for the period, provided that there were no significant
fluctuations in the exchange rates during the period. Exchange differences arising from translation of the financial
statements of foreign operations are recognized in other comprehensive income. On the disposal of a foreign
operation, the cumulative amount of exchange differences relating to that foreign operation is reclassified fromequity to profit or loss when the gain or loss on disposal is recognized.

－ 16 －

(4) Financial instruments① Financial assets(i) Initial recognition and measurement
The Group classifies the financial assets it holds as financial assets measured at fair value through profit or loss,
financial assets measured at fair value through other comprehensive income or financial assets measured atamortized cost. This classification is determined at initial recognition.
The Group recognizes and derecognize all financial assets on trade date where the purchase or sale of a financial
asset under a contract whose terms require delivery of the financial asset within the timeframe established by themarket concerned, and are initially measured at fair value, plus transaction costs except for those financial assets
classified at fair value through profit or loss, which are initially measured at fair value.
Financial assets held by the Group are measured at amortized cost if both of the following conditions are met.
・The financial asset is held in a business model whose objective is to hold financial assets in order to collectcontractual cash flows
・The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments ofprincipal and interest on the principal amount outstanding.
Equity instruments that are not measured through amortized cost are classified as equity instruments measured
at fair value.
Excluding equity instruments measured at fair value through profit or loss that is held for trading, for eachindividual equity items, the Group designates whether it shall be measured at fair value through profit and loss or,whether it shall be measured at fair value through comprehensive income. This designation is continuously used
after the initial designation.
(ii) Subsequent measurement
Measurement of financial assets after initial recognition is performed according to the classification of financial
asset as follows:(a) Financial assets measured at amortized cost
The carrying amounts of financial assets measured at amortized cost are recognized using the effective interest
method.
(b) Financial assets measured at fair value
These financial assets are measured at fair value after initial recognition, and changes in their fair value arerecognized in profit or loss.
However, for financial assets designated as financial assets measured at fair value through comprehensive
profit, the Group recognizes changes in their fair value as other comprehensive income. Dividends from equity
instruments measured at fair value through other comprehensive income are recognized as financial income inprofit or loss.
(iii) Derecognition of financial assets
The Group derecognizes financial assets only when the contractual rights to the cash flows from the financial
assets expire, or when the Group transfers financial assets. In cases where the Group continue to possessownership over the transferred asset, it shall be recognized as liability related to the asset within the range ofownership held, so long as this ownership continues to remain in effect.
(iv) Impairment of financial assets
With respect to impairment of financial assets measured at amortized cost, the Group recognizes allowance for
doubtful accounts for expected credit losses on such financial assets.
At each reporting date, the Group assesses whether the credit risks on the financial assets have increased
significantly since initial recognition.
If credit risk on a financial instrument has not increased significantly since initial recognition, the allowance for
doubtful accounts for that financial instrument is measured at an amount equal to the 12-month expected credit
losses. If credit risk in a financial instrument has increased significantly since initial recognition, the allowance for
doubtful accounts is measured in an amount equal to the lifetime expected credit losses.

－ 17 －

The Group determines if credit risk has increased significantly by evaluating changes in default risk withreference to factors including downgrading of internal credit ratings, the decline of counterparty results anddelinquency information.
Furthermore, if the credit risk is determined to be low as of the closing date, the Group shall assess that credit
risk on a financial instrument has not increased significantly since the initial recognition.
However, the allowance for doubtful accounts on trade receivables and others is always measured in an amountequal to the lifetime expected credit losses.
The expected credit losses of financial assets are estimated in a way that reflects the following:
・An unbiased and probability-weighted amount determined by evaluating a range of possible outcomes
・The time value of money
・Reasonable and supportable information about past events, current conditions and forecasts of economic
conditions that is available without undue cost or effort at the reporting date
The amounts of these measurements are recognized in profit or loss.
If an event that reduces an impairment loss occurs after the impairment loss has been recognized, theimpairment loss will be reversed to the extent of the decrease and credit to profit or loss.
② Financial liabilities(i) Initial recognition and measurement
The Group classifies financial liabilities as either financial liabilities measured at fair value through profit or loss,
or financial liabilities measured at amortized cost. This classification is determined at initial recognition.
All financial liabilities are measured at fair value. However, financial liabilities measured at amortized cost aremeasured in the full amount after deducting directly attributable transaction costs from the fair value.
(ii) Subsequent measurement
Measurement of financial liabilities after initial recognition is performed as follows, according to the classificationof the financial liabilities.
Financial liabilities measured at amortized cost are subsequently measured at amortized cost using the effective
interest method.
Amortization using the effective interest method and gains and losses on derecognition are recognized in profit
or loss for the period.
(iii) Derecognition of financial liabilities
The Group derecognizes financial liabilities when they are extinguished (i.e., when the obligation specified in thecontract discharged or cancelled or expires).
③ Offsetting of financial assets and financial liabilities
Financial assets and financial liabilities are offset and the net amount is presented in the consolidated statement offinancial position only when the Group currently has a legally enforceable right to set off the recognized amount andintends either to settle on a net basis or realize the assets and settle the liabilities simultaneously.
④ Fair value of financial instruments
For financial instruments measured at fair value, their fair value is classified into Level 1 through Level 3 based on
the observability of inputs used for the measurement and their materiality.
Level 1: Quoted prices in active markets for identical assets or liabilities (unadjusted)
Level 2: Fair value determined using observable prices other than Level 1 for the asset or liability directly or
indirectly
Level 3: Fair value determined using the valuation technique including unobservable inputs for the asset or liability－ 18 －

(5) Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, demand deposits and short-term investments that are highly liquid
and readily convertible to known amounts of cash subject to an insignificant risk of changes in value, and that mature or
become due within three months from the date of acquisition.
Cash and cash equivalents include certificates of deposit and joint-managed money trust.
(6) Inventories
Inventories are measured at the lower of cost and net realizable value. Cost of finished goods as well as work in process
are calculated using specific identification method and purchase cost. Merchandise and raw materials are calculatedusing moving average method. These include processing cost and all other costs incurred in bringing the inventories totheir existing location. Net realize value is estimated selling price in the ordinary course of business less the estimatedcosts of completion and the estimated costs necessary to make the sale.
(7) Property, plant and equipment
Property, plant and equipment are carried at cost less any accumulated depreciation and impairment losses.
The cost of an item of property, plant and equipment comprises any costs directly attributable to acquisition of theasset and the initial estimate of the costs of dismantling and removing the item and restring the site on which it islocated.
Depreciation of assets other than land and construction in progress is calculated on a straight-line basis over theestimated useful lives of the assets. The estimated useful lives of major asset items are as follows:
Buildings and structures:
3 to 38 years
Operating lease assets
5 years
Tools, furniture and fixtures:
2 to 20 years
The estimated useful lives, residual value and depreciation method are reviewed at each fiscal year end, and any
revisions are applied prospectively as changes in accounting estimates.
(8) Intangible assets① Goodwill
The measurement of Goodwill arising from business combination at the time of initial recognition is stated in “2.
Business combinations.”
Goodwill is not amortized but is tested for impairment annually or whenever there is an indication of impairment.
The goodwill impairment test and measurement of impairment loss are described in “10. Impairment of nonfinancial assets.”
Goodwill is presented in the consolidated statement of financial position as the amount obtained by deducting
accumulated impairment loss from the acquisition cost.
② Intangible assets
Intangible assets acquired separately are measured using acquisition cost at the initial recognition.
After initial recognition, with the exception of intangible assets with indefinite useful life, intangible assets areamortized on a straight basis over their estimated useful lives and are presented at acquisition cost reduced by theaccumulated depreciation and the accumulated impairment loss.
Expenditures related to internal generated intangible assets are recognized as expenses when incurred, with the
exception of development expenses that meet the criteria for capitalization.
The Group has no intangible assets with indefinite useful lives. The estimated useful lives of major intangible
assets are as follows:
Software5 years
Patents
8 years
The estimated useful lives, residual values and amortization method are reviewed at each fiscal year end, and any
revisions are applied prospectively as changes in accounting estimates.
③ Research and development expenses
Research expenditures are expensed as incurred. Development expenditures are capitalized only if they can bemeasured reliably, future economic benefits are probably, and the Group intends to, and has sufficient resources to,－ 19 －

complete development and to use or sell assets.
(9) Leases
The Group determines whether a contract is a lease or includes a lease at the time the contract is entered into. If thecontract conveys the right to control the use of the identified asset for a period of time in exchange for consideration, thecontract is considered to be a lease or to contain a lease.
Leases as lessee
Right-of-use assets and lease liabilities are recognized at the start date of the lease.
Right-of-use assets are initially measured at acquisition cost, which is obtained by adjusting the amount of the initial
measurement of the lease liability according to any lease payments made at or before the commencement date, any initial
direct costs that were incurred, etc.
After initial recognition, right-of-use assets are depreciated using the straight-line method over the shorter period of
the following, useful lives or lease terms. The lease term is measured as the period that includes the non-cancelable
period of the lease, the extended option period if it is reasonably certain that the lease will be exercised, and thecancellation option period if it is not reasonably certain that the lease will be exercised.
Lease liabilities are initially measured at the present value, which is the total amount of lease payments payable
discounted at the rate of interest on the lease or the rate of interest on additional borrowings of the lessee.
Lease payments are allocated to finance costs and the repayment of lease liabilities using the interest method, withfinance costs recognized in the consolidated statement of profit or loss.
For short-term leases with 12 months or less or leases with small underlying assets, right-of-use assets and leaseliabilities are not recognized and lease payments are amortized over the lease term by the straight-line method or otherregular basis.
Leases as lessor
Leases for which the Group is the lessor are classified as finance leases or operating leases at the point where the lease
contract becomes effective.
When the Group classifies leases, the Group conducts comprehensive evaluates whether all of the risks and economic
values associated with ownership of the underlying asset are substantially transferred. If they are transferred, the lease isclassified as a finance lease and if they are not transferred, the lease is classified as an operating lease. As part of thisevaluation, the Group considers certain indicators, such as whether the lease period based on the non-cancelable period
accounts for the majority of the economic useful life of the underlying asset.
Lease payments under operating leases are recognized as revenue in the consolidated statement of profit or loss on astraight-line basis over the lease term. Units such as HAL that are leased as operating leases are presented as operatinglease assets in the consolidated statement of financial position. Please refer to Note "3. Significant accounting policies, 7.
Property, plant and equipment" for further details.
In finance lease transactions, when the Group becomes a lessor who is a manufacturer or a seller, the Group
recognizes income, cost of sales, and gains or losses on sales, in accordance with its policy for outright sales to which
IFRS 15 applies, on the commencement date. Please refer to Note "24. Revenue".
Leases are classified as finance leases when substantially all the risks and rewards incidental to ownership of assets
are contractually transferred to the Group. All the other leases are classified as operating leases.
(10) Impairment of non-financial assets
Non-financial assets excluding inventories are assessed at the end of each reporting period to determine whether there is
any indication of impairment. If there is an indication of impairment, the recoverable amount of the asset is estimated.
A cash-generating unit, which is a unit for conducting impairment testing, is the smallest group of assets that generates
cash inflows that are generally independent of cash flows of other assets or groups of assets.
Recoverability is measured, first by using the higher of fair value after deducting disposal costs and value in use as
recoverable amount. If the recoverable amount is less than the carrying amount, the carrying amount is reduced to therecoverable amount and the amount is recognized as an impairment loss in profit or loss. When testing goodwill for
impairment, the cash-generating units to which goodwill is allocated are consolidated so that impairment is tested toreflect the smallest unit to which goodwill relates. Goodwill acquired through a business combination is allocated to
cash-generating units that are expected to generate synergies from the combination. An impairment loss recognized inconnection with a cash-generating unit is allocated first to reduce the carrying amount of goodwill allocated to that unit,－ 20 －

and then to reduce the carrying amount of other assets in the cash-generating unit proportionally. Value in use is thepresent value of future cash flows expected to accrue from the asset or cash-generating unit.
Impairment losses related to goodwill have not been reversed. As for the reversal of impairment losses on the otherassets or cash-generating units, if there is an indication at the end of each reporting period that an asset or cashgenerating unit that has incurred an impairment loss in a prior period may have either disappeared or decreased, therecoverability of the asset or cash-generating unit is assessed. In cases where the recoverable amount exceeds the
carrying amount of assets or cash generating units, the Group shall reverse the impairment loss at the maximum of theamount calculated by deducting the depreciation and amortization necessary from the carrying amount that would havebeen determined if no impairment loss had previously been recognized in the prior year.
(11) Employee benefits
Short term employee benefit obligations are measured on an undiscounted basis and are recognized as an expense when
the related services are rendered. For bonuses, when there is a present legal or constructive obligation to make paymentsof bonuses, and a reliable estimate of the obligation can be made, the estimated amount to be paid is accounted for as aliability.
Paid leave expenses are recognized as expenses when labor that grants an employee with additional rights to paid
leave are incurred.
(12) Share-based payment① Stock options
The Company has a stock option scheme accounted for as an equity-settled share-based payment scheme. Equitysettled share-based payment scheme is estimated at fair value of the date of allotment, taking estimated number ofsubscription rights to share that is likely to be vested into the account. It is recognized as an expense in the
consolidated statement of profit or loss from the date of allotment through the vesting period and the same amount as
an increase in asset in the consolidated statement of profit and loss. Fair value of the allotted option is calculated
mainly by Black-Scholes Model, taking the conditions of the option into the account. Furthermore, the conditions ofstock options are reviewed on regular basis and estimate of subscription rights to share are adjusted where necessary.
② Shares with transfer restriction
The Group has adopted shares with transfer restriction as compensation plan for its employees.
Consideration received for services is recognized as an expense by straight-line method over certain period from theday of allotment and an equal amount is recognized as an increase in capital.
(13) Provisions
Provisions are recognized when the Group has a present legal or constructive obligation as a result of a past event, it isprobable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a
reliable estimate can be made of the amount of obligation. Where time value of money is material, a provision ismeasured by its present value to which estimated future cash flows are discounted using a pre-tax discount rate thatreflects the risks specific to the provision. Interest cost associated with the passage of time is recognized as finance costs.
(14) Revenue
The Group recognizes revenue based on the following five-step model, excluding revenue from dividend and interest
income based on IFRS 9 "Financial Instruments".
Step 1: Identify the contract with a customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the entity satisfies a performance obligation
Details on recognition of revenue are stated in Note "22. Revenue".
(15) Government grants
Government grants are measured and recognized at fair value, when there is reasonable assurance that the Group will
－ 21 －

comply with the conditions attaching to them and that the grants will be received. Group fulfills the incidental condition
for grants and receives reasonable assurance that the grants are scheduled for delivery.
For government grants related to expenses items, related costs that will be compensated by grants are recognized over
the recognized term as revenue on regular basis. Grants related to assets is calculated by deducting the amount ofrelevant grants from the acquisition cost of assets.
(16) Income taxes
Income taxes consist of current income taxes and deferred income taxes. Income taxes are recognized as income or
expenses and included in profit or loss, except for taxes related to business combinations and taxes related to items thatare recognized directly in equity or in other comprehensive income.
Current income taxes are recognized in the amount of the expected taxes payable to or receivable from the taxation
authorities. Calculation of the amount of tax is based on the tax rates and tax laws enacted or substantively enacted by
the end of the reporting period in countries.
Deferred tax assets and liabilities are recognized for temporary differences between the carrying amounts of assets or
liabilities at the end of the reporting period and its tax base, and for tax loss carryforwards and tax credits.
Deferred tax assets and liabilities are recognized for the following temporary differences:
・Taxable temporary differences arising from initial recognition of goodwill
・Temporary differences arising from initial recognition of assets and liabilities from transactions that are notbusiness combinations and affect neither accounting income nor taxable income
・Taxable temporary differences associated with investments in subsidiaries and associates where the timing of thereversal of the temporary differences will not reverse in the foreseeable future or where it is no longer probable thatsufficient tax profit subject to taxable temporary difference will be available.
・Taxable temporary differences associated with investments in subsidiaries and associates where the timing of thereversal of the temporary differences can be controlled and it is probable that the temporary differences will notreverse in the foreseeable future.
The carrying amount of deferred tax assets are reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be
recovered. Unrecognized deferred tax assets are reassessed at each reporting period and are recognized to the extent thatit has become probable that future taxable profits will allow the deferred tax assets to be recovered.
Deferred tax assets and liabilities are measured at the tax rate that are expected to apply to the period when the assets
are realized or the liabilities are settled, based on the tax rates and tax laws enacted or substantively enacted by the endof the reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to income taxes levied by the same tax authority, or on different
taxable entities that intend either to settle current tax assets and liabilities on a net basis, or to realize the assets and settle
the liabilities simultaneously.
(17) Earnings per share
Basic earnings per share are calculated by dividing profit (loss) attributable to owners of the parent by the weighted
average number of ordinary shares outstanding during the period, adjusted for treasury shares held. Diluted earnings per
share are calculated by adjusting the effects of all dilutive potential ordinary shares.
(18) Equity and other capital① Common shares
Common shares issued by the Company are recognized in share capital and capital surplus at their issue price. Shareissuance costs are deducted from the issue price.
② Treasury shares
When a treasury share is acquired, consideration received including direct transaction cost is recognized as deducted
items from equity. When a treasury share is sold or re-issued, consideration received is recognized as increase incapital. Surplus and deficit generated by this transaction are presented as capital surplus.

－ 22 －

(19) Significant accounting policy related to Cybernic Excellence Japan Fund 1 Investment Limited Partnership① Consolidation of Cybernic Excellence Japan Fund 1 Investment Limited Partnership by the Company
The Company consolidates Cybernic Excellence Japan Fund 1 Investment Limited Partnership (“CEJ Fund”) due to thefollowing reasons.
The Company practically makes decision of investment of CEJ Fund through the Companies consolidated subsidiary
CEJ Capital, Inc. (general partner "GP" of CEJ Fund) thus the Company has the control. As an GP, CEJ Capital, Inc.
receives the performance fee and the Company receives returns based on the performance according to its contribution
as Limited Partner ("LP") of CEJ Fund. As the Company has the power over the CEJ Fund to influence the return, theCompany has the control based on IFRS 10 "Consolidated Financial Statements".
Inter-company transactions such as management fees and performance fees to CEJ Capital, Inc., GP of CEJ Fund, tobe paid from CEJ Fund are eliminated in consolidation.
② Investment by CEJ FundFor financial instruments measured at fair value, with the exception of financial assets that are held for trading purposesthat must be measured at fair value through profit or loss, for each individual financial instruments, the Group classifies
each individual capital-based financial assets to either financial assets measured at fair value through profit or loss or
financial assets measured at fair value through other comprehensive income. The same classification is applied
continuously.
③ Contribution from Limited Partners (“LP”) to CEJ FundCEJ Fund will issue capital calls for its respective LP ("Capital Call")(a) Contribution from LP other than the Company
The term of existence (up to 12 years from the effective date) is prescribed in the investment limited partnershipagreement of the CEJ Fund. In this agreement, it is stated that equity interests in the CEJ Fund held by LPs otherthan the Company (hereinafter, “Third-Party Investors”) that invest in CEJ Fund shall be distributed and refunded.
As such it is recorded as a liability under “Third-party interests in CEJ Fund” in the consolidated statement offinancial position and classified as “financial liabilities measured at amortized cost”. The carrying amounts of theliabilities is the amount of equity vested in Third-Party Investors under the limited partnership agreement forinvestment assuming that the Fund was liquidated at the end of each quarter.
“Third-party interests in CEJ Fund” is subject to change depending on payments from Third-Party Investors basedon Capital Call, distributions and refunds to Third-Party Investors, and the performance of the CEJ Fund. Changes
in the performance of the CEJ Fund are included in “Gains (losses) related to CEJ Fund” in the consolidated
statement of profit or loss. “Gains (losses) related to CEJ Fund” includes the costs of establishing and managing the
CEJ FundContribution from Third-Party Investors are presented as "Contribution into CEJ Fund from third-party investors"
under cash flows from financing activities in consolidated statement of cash flow. Distribution and refunds to ThirdParty Investors are presented as "Amount distributed and refunded to Third-Party Investors" under cash flow fromfinancing activities.
(b) Contribution from the Company
Contribution from the Company to CEJ Fund as a LP is eliminated in consolidation.

－ 23 －

4. Significant accounting estimates and judgments
The preparation of the consolidated financial statements in conformity with IFRS requires management to make estimatesand assumptions that affect the application of policies and reported amounts of assets, liabilities, income, expenses andrelated disclosures. Due to uncertain nature of estimates, in some cases actual results may vary from initial estimates.
The estimates and their underlying assumptions are reviewed by management on an ongoing basis. The effects ofrevisions to accounting estimates and assumptions are recognized in the period when the estimates are revised and in future
periods.
With regard to the impact of the spread of COVID-19 infection, while it is difficult to predict with a degree of certainty
the spread of the disease in the future, accounting estimates are based on the assumption that the situation will gradually
recover as the spread of the infection is slowing down and economic activities have resumed in each region. Even if thisassumption changes to a reasonable extent at the end of the consolidated fiscal year under review, the impact on the
conclusion based on the valuation result is limited and the Company determined that the effect on the consolidated
financial statement for the consolidated fiscal year of the assumptions pertaining to the accounting estimates and thechanges therein is not significant.
Estimates and assumptions that significantly affect the amounts recognized in the Group's consolidated financial
statements are as follows:・ Matters concerning financial instruments (Notes "3. Significant accounting policies, 4. Financial instruments", Notes"3. Significant accounting policies, 19. Significant accounting policy related to Cybernic Excellence Japan Fund 1
Investment Limited Partnership", Notes "9. Other financial assets", "32. Financial instruments" as well as "33. CEJ
Fund”)・ Impairment of non-financial assets (Note "3. Significant accounting policies, 10. Impairment of non-financial assets")
・ Useful lives of property, plant and equipment, estimation of residual value (Note "3. Significant accounting policies,
7. Property, plant and equipment" as well as Note "12. Property, plant and equipment")・ Collectability of deferred tax assets (Note "15. Income taxes")
・Recognition of revenue (Note "3. Significant accounting policies, 15. Revenue", Note "24. Revenue")・Measurement of share-based payments (Note "31. Share-based payment")
・Equity interests in CEJ
・Estimates of measurement of equity from Third-Party in CEJ Funds (Note "3. Significant accounting policies, 19.
Significant accounting policy related to Cybernic Excellence Japan Fund 1 Investment Limited Partnership")－ 24 －

5. New standards and interpretations not yet adopted
None of the accounting standards or interpretations newly established or amended by the approval date of the consolidated
financial statements have a material impact.
6. Segment information(1) Summary of reportable segments
The Group's reportable segments are the components of the Group for which discrete financial information is available
and which are regularly reviewed by the Board of Directors in deciding how to allocate resources and in assessing theirperformance.
Since the Group operates under a single segment of business related to robotics, segment information is omitted.
(2) Revenue and results of reportable segments
Since the Group operates under a single segment, segment information is omitted.
(3) Information about Products and Services
Since revenue of a single classification of products and services to outside clients exceed 90% of revenue in thestatement of profit or loss, segment information by product and service is omitted.
Note "24. Revenue" presents the details of revenue.
(4) Geographical information
Revenue to customers and non-current assets by region consist of the following:
Revenue to customers
Previous consolidated fiscal
year(From April 1, 2018 to March
31, 2019)
Millions of yen

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)
Millions of yen

Japan
US
EMEA
APAC

1,450
43
146
70

1,472
29
173
118

Total

1,709

1,792

(Note) Revenue is classified by country or region based on the location of customers.
Non-current assets
Since the amount of non-current assets located in Japan exceeds 90% of the amount of non-current assets in the
consolidated financial position, non-current assets information by geographical area is omitted.
(5) Information about major customers
Information about major customers has been omitted as the revenue from each customer is less than 10% of the Group's
revenue.

－ 25 －

5. Cash and cash equivalents
Cash and cash equivalents consist of the following:

Cash and cash equivalents
Cash and deposits
Short-term investments
Total

Previous consolidated
fiscal year
(As of March 31, 2019)

Current consolidated
fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

5,296
3,500

7,136
2,500

8,796

9,636

The balance of cash and cash equivalents presented in the consolidated statement of financial position is equal to thebalance of cash equivalents presented in the consolidated statement of cash flows.
6. Trade and other receivables
Trade and other receivables consist of the following:

Accounts receivable-trade
Accounts receivable-other
Allowance for doubtful accounts
Total

Previous consolidated
fiscal year
(As of March 31, 2019)

Current consolidated
fiscal year
(As of March 31, 2020)

Millions of yen
242
17
(1)

Millions of yen
256
9
(2)

257

263

Trade and other receivables are classified into the financial assets measured at amortized cost.

－ 26 －

7. Other financial assets(1) Other financial assets
Other financial assets consist of the following:
Previous consolidated
fiscal year
(As of March 31, 2019)

Current consolidated
fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

Other financial assets
Financial assets measured at amortized cost:
Bonds
Time deposits
Leasehold and guarantee deposits
Other
Financial assets measured at fair value through profit or loss:
Equity securities
Convertible bonds
Other
Financial assets measured at fair value through other comprehensive
income:Equity securities
Total
Current assets
Non-current assets
Total

18,0002,500
61
518,999
－

1,611
337
6

3,550
367
22

416

864

22,93623,876

20,5052,431

19,004
4,872

22,93623,87668
5(2) Financial assets measured at fair value through other comprehensive income
Names and fair values of major financial assets measured at fair value through other comprehensive income are as
follows:
Previous consolidated
Current consolidated
fiscal year
fiscal year
(As of March 31, 2019)(As of March 31, 2020)
SharesNon-marketable equity securities
WHILL, Inc.
Materials Innovation Tsukuba Co. Ltd.
Other

Millions of yen

Millions of yen

352
－

Total

1,044

626
100
64

2,039

416

Equity securities are held mainly for strengthening relationships with investees. As such, the shares are designated to befinancial assets measured at fair value through other comprehensive income.
Dividend income recognized from equity instruments consists of the following:
Current consolidated
fiscal year
(From April 1, 2019 toMarch 31, 2020)
Millions of yen
Investments derecognized during the previous fiscal year
Investments held as of March 31, 2020
Total

－
304
304

－ 27 －

10. Inventories
Inventories consist of the following:

Merchandise and finished goods
Work in process
Raw materials
Total

Previous consolidated
fiscal year
(As of March 31, 2019)

Current consolidated
fiscal year
(As of March 31, 2020)

Millions of yen
150
25
725

Millions of yen
221
17
594

901

832

The amount of inventories recognized as expenses and included in the cost of sales for the fiscal years ended March 31,
2019 and 2020 were ¥266 million and ¥298 million, respectively.
Write-down of inventories recognized as expenses and included in the cost of sales for the fiscal years ended March
31, 2019 and 2020 were ¥39 million and ¥14 million, respectively.
11. Other assets
Other assets consist of the following:

Other current assets
Prepaid expenses
Consumption taxes receivable
Other
Total
Other non-current assets
Long-term prepaid expenses
Total－ 28 －

Previous consolidated
fiscal year
(As of March 31, 2019)

Current consolidated
fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

113
36
20

128
9
18

169

156

74

68

74

68

12. Property, plant and equipment
Change in property, plant and equipment
The following tables present changes in acquisition costs, accumulated depreciation and impairment losses, and carrying
amounts of property, plant and equipment.
Property plant and equipment
Operating leaseassetsAcquisition costs

Millions of yen

Total

Land

Buildings andstructures

Tools,
furniture andfixtures

Other

Construction inprogress

Subtotal

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

April 1, 2018

824

3,118

1,814

1,038

265

6,783

13,018

13,842

Additions

221

400

11

150

6

－

567

789

Sales and disposals

－

－

－

(47)

(5)

－

(51)

(51)

Reclassification

－

6,288

－

－

－

(6,288)－－Exchange differenceson translation offoreign operations

－

－

1

(5)

0

－

(4)

(4)

Other

－

(3)

(4)

－

－

－

(7)

(7)

1,046

9,803

1,822

1,136

266

495

13,522

14,568

224

69

3

84

7

13

176

400

Sales and disposals

(199)

－

－

(21)

(2)

－

(22)

(222)

Exchange differenceson translation offoreign operations

－

－

(0)

(0)

(0)

－

(1)

(1)

Other

－

0

(1)

(1)

－

0

(2)

(2)

1,070

9,872

1,823

1,198

271

508

13,673

14,743

March 31, 2019
Additions

March 31, 2020

Property plant and equipment
Operating leaseassets

Accumulated
depreciation andimpairment losses

Millions of yen

Total

Land

Buildings andstructures

Tools,
furniture andfixtures

Other

Construction inprogress

Subtotal

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

April 1, 2018

(423)

－

(753)

(693)

(233)

－

(1,679)(2,102)

Depreciation

(159)

－

(88)

(149)

(14)

－

(250)

(410)

Sales and disposals

－

－

－

32

1

－

33

33

Exchange differenceson translation offoreign operations

－

－

(0)

(0)

(0)

－

(0)

(0)

Other

－

－

(2)

－

－

－

(2)

(2)

March 31, 2019

(583)

－

(842)

(810)

(245)

－

(1,897)(2,480)Depreciation

(123)

－

(86)

(205)

(12)

－

(302)

(425)

Sales and disposals

116

－

－

78

2

－

80

196

Exchange differenceson translation offoreign operations

－

－

0

0

0

－

0

0

Other

－

－

－

0

－

－

0

0

(589)

－

(928)

(936)

(255)

－

(2,119)(2,709)March 31, 2020

(Note) Depreciation of property, plant and equipment is included in cost of sales, research and development expenses
and other selling, general and administrative expenses in the consolidated statement of income.

－ 29 －

Property plant and equipment
Carrying amounts

Operating leaseassetsMillions of yen

Total

Land

Buildings andstructures

Tools,
furniture andfixtures

Other

Construction inprogress

Subtotal

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

April 1, 2018

401

3,118

1,061

345

32

6,783

11,33911,740March 31, 2019

463

9,803

979

327

21

495

11,62412,087

March 31, 2020

481

9,872

895

262

15

508

11,553

12,034－ 30 －

13. Goodwill and intangible assets
The following tables present changes in acquisition costs, accumulated amortization and impairment losses, and carrying
amounts of intangible assets.
Intangible assets
Goodwill
Acquisition cost

SoftwarePatents

Other

Total

Millions of yen－－－

Millions of yen
127
10
(1)

Millions of yen
20－－

Millions of yen
121－

Millions of yen
158
11
(1)

－

(0)

－

(0)

(0)

－

－

－

(4)

(4)

March 31, 2019
Additions
Acquired through business combination
Sales and disposals
Exchange difference on translation offoreign operations

－
－

20
－
－
－

9
－

57
－

136
6
2
－

－

165
6
2
－

－

(0)

－

(0)

(0)

March 31, 2020

57

145

20

9

173

April 1, 2018
Additions
Sales and disposals
Exchange difference on translation offoreign operations
Other

Intangible assets
Accumulated amortizationand impairment losses

Goodwill
SoftwarePatents

Other

Total

Millions of yen－－－

Millions of yen
(56)
(24)
－

Millions of yen
(11)
(2)
－

Millions of yen
(2)
(0)
－

Millions of yen
(69)
(26)
－

－

0

－

0

0

March 31, 2019
Amortization
Sales and disposals
Exchange difference on translation offoreign operations

－
－
－

(79)
(23)
－

(13)
(2)
－

(2)
(0)
－

(95)
(26)
－

－

－

－

－

－

March 31, 2020

－

(103)

(16)

(2)

(121)

April 1, 2018
Amortization
Sales and disposals
Exchange difference on translation offoreign operations(Note) Amortization of intangible assets is included in cost of sales, research and development expenses and otherselling, general and administrative expenses in the consolidated statement of income.
Intangible assets
Goodwill
Carrying amount
April 1, 2018
March 31, 2019
March 31, 2020

Millions of yen－－
57

SoftwarePatents

Other

Total

Millions of yen
71
57
42

Millions of yen
964

Millions of yen
1077

Millions of yen
90
70
53

－ 31 －

14. Investments accounted for using equity method
Investments in associates are accounted for using equity method in the Group's consolidated financial statements. There areno associates or joint venture that are individually material for the Group.
(1) Investments in associates
The carrying amount of investments in associates that are not individually material is as follows:
Previous consolidated fiscal year
(As of March 31, 2019)

Current consolidated fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

Total carrying amount

180

209

Changes in the Group's share of profit and other comprehensive income of associates that are not individually material are
as follows:
Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

Millions of yen

Millions of yen

The Group’s share of profit
The Group's share of other comprehensive income

(15)
－

(17)
－

The Group's share of comprehensive income

(15)

(17)

(2) Investments in joint venture
The carrying amount of investments in joint venture that are not individually material is as follows:
Previous consolidated fiscal year
(As of March 31, 2019)

Current consolidated fiscal year
(As of March 31, 2020)

Millions of yen

Millions of yen

Total carrying amount

275

263

Changes in the Group's share of profit and other comprehensive income of joint venture that are not individually material
are as follows:
Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

Millions of yen

Millions of yen

The Group’s share of profit
The Group's share of other comprehensive income

(9)
－

(12)
－

The Group's share of comprehensive income

(9)

(12)

－ 32 －

15. Income taxes(1) Deferred tax assets and liabilities
Derails of major causes of occurrence and changes in deferred tax assets and liabilities consist of the following:
Previous consolidated fiscal year (April 1, 2018 to March 31, 2019)
April 1, 2018

Recognizedthrough profit
or loss

Recognizedthroughcomprehensive
incomeMarch 31, 2019

Millions of yen

Millions of yen

Millions of yen

Millions of yen

－

－

－

－

79

68

－

146

2

－

45

47

64

(3)

－

61

1

(0)

－

1

145

64

45

254

April 1, 2019

Recognizedthrough profit
or loss

Recognizedthroughcomprehensive
incomeMarch 31, 2020

Millions of yen

Millions of yen

Millions of yen

Millions of yen

－

－

－

－

146

244

－

390

47

－

80

126

61

(10)

－

51

1

0

－

0

254

234

80

568

Deferred tax assets
Deferred tax liabilities
Financial assets measured at fair value through profit or loss
Financial assets measured at fair value through othercomprehensive income
Property, plant and equipment
Other
Total

Current consolidated fiscal year (April 1, 2019 to March 31, 2020)

Deferred tax assets
Deferred tax liabilities
Financial assets measured at fair value through profit or loss
Financial assets measured at fair value through othercomprehensive income
Property, plant and equipment
Other
Total

Deductible temporary differences and unused tax losses for which no deferred tax asset is recognized are as follows:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Unused tax losses
Deductible temporary differences

5,300
2,323

6,425
2,525

Total

7,623

8,951

(Note) The amount of unused tax losses and deductible temporary differences is described as income basis amount.
Unused tax losses for which no deferred tax asset is recognized will expire as follows:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Expires within 1 year
Expires between 1 and 2 years
Expires between 2 and 3 years
Expires between 3 and 4 years
Expire after 4 years
Total－ 33 －

600
516
455
559
3,171

516
455
559
921
3,975

5,300

6,425

The aggregate amounts of taxable temporary differences associated with investments in subsidiaries and associates for which
deferred tax liabilities were not recognized at March 31, 2019 and 2020 were not material, respectively.
The Group did not recognize deferred tax liabilities for these temporary differences because it was able to control thetiming of the reversal of these temporary differences, and it was probable that the temporary difference will not reverse in
the foreseeable future.
(2) Income tax expense
Income tax expense consists of the following:
Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

Millions of yen

Millions of yen

Current taxes
Deferred taxes
Total

8
66

6
234

74

240

(3) Reconciliation of effective tax rate
The details of difference between the effective statutory tax rate and the Group's average tax rate consist of the following:
Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)

%

%

Effective statutory tax rate
Non-deductible expenses
Differences in overseas tax rates
Unrecognized differed tax asset
Share of profit (loss) of investments accounted for using
equity method
Gains (losses) related to CEJ Fund
Other

30.46
(0.67)
0.35(70.36)30.46(5.39)
3.11(341.62)

4.16(9.77)

23.95(0.85)

63.41(3.89)

Average actual tax rate

(12.96)(263.70)

Income tax, inhabitant tax and business tax are the main components of income tax expense imposed on the Group, and theeffective statutory tax rate based on those taxes was 30.46% for the fiscal year ended March 31, 2019 and fiscal year ended
March 31, 2020.
16. Bonds and borrowings
Bonds and borrowings consist of the following:
Current consolidated
fiscal year
(March 31, 2020)
Short-term loans payables
Long-term loans payable due within one year

Millions of yen
18
19

Long-term loans payable
Current liabilities
Non-current liabilities
Total－ 34 －

Repayment period

%
0.46
1.47

－
－

88

1.35
－

2022 to 2027
－

37
51

－
－

－
－

88

－

－

51
Total

Averageinterest rate

17. Leases(1) Operating leases (as lessee)
As a lessee the Group leases primarily land and buildings with a contractual term of 2 to 20 years. The Group has nocovenants such as restrictions on renewable option, purchase option, escalation clauses and lease contracts.
The comparative information presented in the year ended March 2019 is based on IAS 17 “Leases”
Consolidated fiscal year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)
Lease payments included in “cost of sales”, “research and development expenses” and “other selling, general andadministrative expenses” in the consolidated statements of profit or loss was ¥61 million. The amount of lease payments
includes variable lease payment of ¥5 million in conjunction with sales revenues.
Consolidated fiscal year ended March 31, 2020 (from April 1, 2019 to March 31, 2020)
Gains (losses) related to leases consists of the following:
Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)
Millions of yen
Depreciation of right-of-use assets
Land and buildings
Vehicles

53
0

Total

53

Interest expense on lease liabilities
Short-term lease expenses
Lease expenses under small assets
Variable lease payments (note)

3
7
0
5

(Note) This item is expenses related to variable lease payments not included in the measurement of lease liabilities.
Carrying amount of right-of-use asset consists of the following:

Right-of-use-assets
Land and buildings
VehiclesApril 1, 2019

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen
363－

Tools, furniture and fixtures
Total

352
1

－

8

363

361

The increase in right-of-use assets for the current fiscal year was ¥51 million.
The total amount of cash outflows related to leases for the current fiscal year was ¥45 million.
Maturity analysis of lease liabilities is presented in Note “32. Financial Instruments ② Liquidity risk management.

－ 35 －

(2) Operating leases (as lessor)
As a lessor, the Group leases products such as HAL. The Group has no covenants such as restrictions on renewable option,purchase option, escalation clauses and lease contracts.
The comparative information presented in the year ended March 2019 is based on IAS 17 “Leases”
Consolidated fiscal year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)
The total of future minimum lease payment under non-cancellable operating lease contracts consists of the following:
Previous consolidated fiscal year
(March 31, 2019)
Millions of yen
Not later than 1 year
More than 1 year, 5 years or less

780
493

Total

1,273

Consolidated fiscal year ended March 31, 2020 (from April 1, 2019 to March 31, 2020)
As a lessor of operating leases, the Group leases HAL etc. Risk of the underlying asset is reduced by conducting
monitoring via the internet and designating the place of use in the contract.
Lease income for the consolidated fiscal year ended March 31, 2020 was ¥1,179 million.
The total of future minimum lease payment under non-cancellable operating lease contracts consists of the following:
Current consolidated fiscal year
(March 31, 2020)
Millions of yen
Not later than 1 year
More than 1 year, 2 years or lessMore than 2 years, 3 years or lessMore than 3 years, 4 years or lessMore than 4 years, 5 years or less

682
192
109
81
33

Total

1,096

(3) Finance lease (as lessor)
In cases where the Group acts as a lessor of right-of-use for devices such as HAL, if the lease transfers substantially all therisks and reward of ownership to the lessee, the Group classifies such lease as financial lease.
The comparative information presented in the year ended March 2019 is based on IAS 17 “Leases”
Consolidated fiscal year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)
As the Group manufactures devices such as HAL, the Group recognizes the revenue from the asset as asset transferred
at a point of time in the same way the Group recognizes regular purchase transactions. Due to the aforementioned reason,
there is no gross investment in a lease as well as minimum lease payment based on finance lease contract does not occur
and related statement is omitted.
Consolidated fiscal year ended March 31, 2020 (from April 1, 2019 to March 31, 2020)
As a lessor of operating leases, the Group leases HAL etc. Risk of the underlying asset is reduced by conducting
monitoring via the internet and designating the place of use in the contract.
As the Group manufactures devices such as HAL, the Group recognizes the revenue from the asset as asset transferred
at a point of time in the same way the Group recognizes regular purchase transactions, and the profit from sales underfinance leases was posted at ¥59 million. Due to the aforementioned reason, finance income and variable lease paymentson the net investment in leases based on finance lease contracts does not occur and related statement is omitted.

－ 36 －

18. Trade and other payables
Trade and other payables consist of the following:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Accounts payable-trade
Accounts payable-other
Other
Total
Current liabilities
Non-current liabilities
Total

41
240
4

35
206
7

284

247

284
－

247
－

284

247

Trade and other payables are classified into the financial liabilities measured at amortized cost.
19. Employee benefits
The Company and certain subsidiaries adopted defined contribution pension plans covering substantially all of their employees
for their employees’ retirement benefits. Defined contribution pension plans are exposed to general investment risk, interest
rate risk, inflation risk, etc., but are judged to be immaterial.
The amount recognized as an expense for the defined contribution pension plan was ¥6 million for the current fiscal year.
20. Provisions
Changes in provisions consist of following:
Asset retirement
obligations
As of April 1, 2018
Interest expense on discount provision
Decrease (other)

Millions of yen
91
－
(0)

As of March 31, 2019
Increase
Interest expense on discount provision
Decrease (other)91
2－

As of March 31, 2020

93

(0)

Asset retirement obligations are provided based on or pursuant to reasonably estimated future expenditures using historicalexperience and other factors when the Group has a legal or contractual obligation associated with the retirement of buildings
and land etc.
Provisions consist of the following:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Current liabilities
Non-current liabilities
Total－ 37 －

－

－

91

93

91

93

21. Other liabilities
Other liabilities consist of the following:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Other current liabilities
Advances received
Accrued bonuses
Obligation for unused paid leave
Accrued expenses
Accrued consumption taxes
Deposits received
Other tax liabilities
Other
Total

－ 38 －

95
4
23
18
4
14
189
22

118
－
25
15
43
11
237
12

370

464

22. Share capital and other equity items(1) Total numbers of authorized shares and issued shares
Total numbers of authorized shares and issued shares are as follows.

Number of authorized shares: (Note 1)
Common SharesClass B Shares
Total
Number of issued shares:
Common Shares:
Beginning balance
Change during the year (Note 2)
Ending balance
Class B Shares:
Beginning balance
Change during the year
Ending balancePrevious consolidated fiscal year
(From April 1, 2018
to March 31, 2019)

Current consolidated fiscal year
(From April 1, 2019
to March 31, 2020)

SharesShares618,300,000
77,700,000

618,300,000
77,700,000

696,000,000

696,000,000

137,347,609
98,200137,445,809－

137,445,809

137,445,809

77,700,000－

77,700,000－

77,700,000

77,700,000(Note 1) Information concerning authorized shares is as follows:
1. Information concerning the scheme of Common Shares and Class B shares is set out below as defined by theCompany's Articles of Incorporation.
(1) Dividends of surplus and distribution of residual assets
Common Shareholders and Class B Shareholders will receive the same amount of distribution of surplus per sharein the same rank.
(2) Voting rights
Common Shareholders and Class B Shareholders are both eligible to exercise their voting rights for all items
resolved at the Meeting of Shareholders.
(3) Restriction on the transfer of Class B Shares
Approval of the Board of Directors is required upon transfer of Class B Share. However, if Class B Shares aretransferred to Class B Shareholders, it will be deemed that the Board of Directors approved the transfer according
to Article 136 or Article 137, Paragraph 1 of the Companies Act.
(4) Cases where resolution of the Meeting of Class Shareholders are not required
Upon conducting acts stated in the items of Article 322, Paragraph 1 of the Companies Act, unless stated otherwise
by related law or the Company's Articles of Incorporation, resolution of General Meeting of Class Shareholders for
Common Shares shall not be required.
(5) Conversion of Common Shares at the option of the shareholders.
Holders of Class B Shares may request that the Company acquire Class B Shares held by such shareholders, inwhole or in part, at any time. In exchange for the acquisition of one Class B Share, one Common Share shall bedelivered to such shareholders.
(6) Compulsory conversion
a. Upon occurrence of any event described below, all outstanding Class B Shares shall be acquired, either at thedate stated below or any date before if designated by the Board of Director. In these cases, in exchange for theacquisition of one Class B Share, one Common Share shall be delivered to such shareholders.
① A resolution at the General meeting of Shareholders (or the Board of Directors of the Company if aresolution at the General Meeting of Shareholders is not required) for (a) a merger of the Company into
any other corporation, (b) share exchange by which the Company becomes a wholly-owned subsidiary of
another corporation or (c) share transfer that is effected jointly with any other corporation is passed, andthe day before the effective date of such merger, share exchange or share transfer has occurred.
② As a consequence of a tender offer, the offeror holds three-quarters or more of the total number of theCompany's outstanding shares and 90 days have passed after the tender offer report regarding such tender
offer was filed.
－ 39 －

"Hold", "offeror" and "tender offer report" means hold, offeror and tender offer report defined in Chapter
II-2, Section 1 of the Financial Instruments and Exchange Act. In addition, "tender offer" means tender
offer defined in Article 27-3 Paragraph 1 of the Financial Instruments and Exchange Act.
③ Consent (a "Shareholders' Consent") is obtained for the acquisition by the Company of all of theCompany's outstanding Class B Shares in exchange for the same number of Common Shares in aconfirmation process (the "Shareholders' Confirmation Process") and 90 days have passed since then.
Under the Company's Article of Incorporation, the Shareholders' Confirmation Process must be
implemented (a) before the conclusion of the General Ordinary Meetings of the Shareholders for the last
fiscal year which ends within one year from the time of retirement of Yoshiyuki Sankai, the President andCEO of the Company, from a member of the Board of Directors and (b) before the conclusion of theGeneral Ordinary Meeting of the Shareholders for the last fiscal year which ends within five years from thetime of the last Shareholders' Confirmation Process. Under the Company's Article of Incorporation, thequorum for a Shareholders' Consent is one-third of the total number of voting rights of the shareholders
who are entitled to exercise their voting rights (100 shares constitute one unit of both Common Shares andClass B Shares for the calculation. Same calculation shall be applied for the entire item a-3) and theconsent of at least two-thirds of the voting rights represented in the Shareholders' Confirmation Process isrequired for a Shareholders' Consent.
b. If any of the events set forth in the following items occurs with respect to Class B Shareholders, the Company
will, on the date prescribed in Article 170, item 1, acquire Class B Shares specified in each of said items anddeliver one share of Common Share to said Class B Shareholders in exchange for acquiring said one share ofClass B Shares.
① the Company is requested to approve the acquisition of Class B Shares by any person other than theholders of Class B Shares, Class B Shares with respect to which approval for the acquisition was requested
based on Article 136 or Article 137 of the Companies Act; and② a holder of the Class B Shares died, and 90 days have passed without succession or transfer to any otherholder of the Class B Shares, all Class B Shares held by such departed shareholder.
(7) Share split and share consolidation etc.
a. When the Company splits or consolidate its Common Shares or Class B Share, the Company shall split orconsolidate its other share type at the same ratio, simultaneously.
b. When the Company allocates subscribed shares to Common Shareholders or Class B Shareholders, theCompany shall allocate shares to the shareholders of another share type at the same ratio, simultaneously.
c. When the Company allocates stock acquisition rights to Common Shareholders or Class B Shareholders,the Company shall allocate stock acquisition rights to shareholders of another share type at the same ratio,
simultaneously.
d. When the Company distributes shares for free to Common Shareholders or Class B Shareholders, theCompany shall distribute shares for free to shareholders of another share type at the same ratio,
simultaneously.
e. When the Company distributes stock acquisition rights for free to Common Shareholders or Class B
Shareholders, the Company shall distribute stock acquisition rights for free to shareholders of another sharetype at the same ratio, simultaneously.
f. When the Company transfers its shares (excluding cases where the share transfer is conducted together

with other companies), the Company shall substitute the shares held by shareholders with the shares of the
new company set up after the transfer, granting shareholders same numbers of shares and same class of2.

shares at the same ratio.
g. When the Company plans to change its calculation of share units stated in the Articles of Incorporation, it
shall be executed at the same timing and same ratio.
Class B Shares differ from Common Shares in traded units. Common Shares are traded in units of 100 shares, andClass B Shares are traded in units of 10 shares. This scheme that grants 10 times as many voting rights to Class B
Share was adopted to has been adopted to concentrate the voting rights to Yoshiyuki Sankai and the foundations ofwhich Yoshiyuki Sankai serves as Representative Director (hereinafter referred to collectively as "the Foundation"),so that the Group's innovative technologies can be used solely for peaceful purpose and avoid being used for nonpeaceful purposes such as lethal weaponry in the military industry (the scheme involving the Company's Class B
Shares is hereafter referred to as "Scheme").
Furthermore, the Group has a vision for the future to create a human-assistive industry- a new industrial field that－ 40 －

3.

will support people by solving issues directly faced by aging and declining birthrate. To realize this vision, theGroup must coordinate business management with R&D of Cybernic Technology. Yoshiyuki Sankai created theGroup's Cybernics Technologies and continues to be a central figure in Cybernic research. He is also a businessleader who seeks to make this innovative technology widely available for the benefit of the society. For the Groupto increase corporate value (i.e., common interest of shareholders), Yoshiyuki Sankai must be a stable leadershipfigure in the management of the Company in the future. This scheme has been adopted to ensure he remains so.
In order to preserve continuity of this Scheme, Yoshiyuki Sankai plans on transferring part of the Class B Shares heholds as of this submission date to the Foundation at no cost. Furthermore, there are no plans for the Foundations torelease the Class B Shares in their possession.
As a shareholder of Class B Shares, the Foundations established guidelines on the exercise of their voting rights,
to prevent the Group's technologies from being used to harm people or to create military weapons, damaging theGroup's corporate value.
The Foundations will exercise its voting rights related to the Class B Shares they hold against resolutions in the
General Meetings of Shareholders and General Meeting of Class Shareholders in the cases stated below.
Furthermore, a resolution of the board meeting of the Foundations will be required to alter these guidelines, and thechange will be announced by a method determined by the Foundations:a. if in resolutions for the dismissal or appointment of Directors will lead to the misuse of the Group's innovativetechnology or damage the Group's corporate value
b. for all other resolutions, if the passing of the resolution leads to the prevention of peaceful utilization of theGroup's innovative technologies or damage to the Group's corporate value(Note 2) The following is the main reason of increase of issued Common Shares in the previous consolidated fiscal year.
Increase due to issuance of new shares in remuneration of the Company employeeswith restriction of transfer
98,200 shares(2) Treasury shares
The changes in treasury shares are as follows
Number of shares

AmountSharesApril 1, 2018
Change during the year

138－

Millions of yen
0－March 31, 2019
Change during the year

138
4,313

0
0

March 31, 2020

4,451

0

(3) Capital surplus
The Companies Act stipulates that over half of the capital contributed from the issue of shares must be included inshare capital and that the remainder must be included in the legal capital surplus. Moreover, legal capital surplus may
be included in share capital by resolution of the General Meeting of Shareholders.
(4) Retained earnings
The Companies Act stipulates that an amount equal to one-tenth of dividends must be appropriated as legal capitalsurplus or as legal retained earnings until the total of the aggregate amount of legal capital surplus and legal retained
earnings equals a quarter of share capital. Legal retained earnings may be appropriated to reduce a deficit, and also
may be reversed by resolution of the General Meeting of Shareholders.

－ 41 －

23. Dividends
Dividends paid are as follows:
Previous consolidated fiscal year (From April 1, 2018 to March 31, 2019)
There are no items to report.
Current consolidated fiscal year (From April 1, 2019 to March 31, 2020)
There are no items to report.
Dividends with an effective date after the fiscal year ended are as follows:
Previous consolidated fiscal year (From April 1, 2018 to March 31, 2019)
There are no items to report.
Current consolidated fiscal year (From April 1, 2019 to March 31, 2020)
There are no items to report.

－ 42 －

24. Revenue(1) Disaggregation of revenue
Details of disaggregation of revenue are set forth below.
Previous consolidated fiscal year
(From April 1, 2018
to March 31, 2019)

Current consolidated fiscal year
(From April 1, 2019
to March 31, 2020)

Millions of yen

Millions of yen

Timing of revenue recognition
Service transferred over time
Asset transferred at a point of time
Service transferred at a point of time
Total

1,167
214
328

1,315
186
291

1,709

1,792

(Note) Since the Group operates under a single segment of business related to robotics, segment information on revenue isomitted.
Service transferred over time
Service transferred over time includes rental income based on the individual rental contract and maintenance income basedon the maintenance contract in relation to finance lease income where the Group acts as a lessor of right-of-use asset.
The Group recognizes rental income as income generated throughout the rental period after the customer acceptance ofthe relevant product, by either of the following method. Pay-per-use model based on times of product usage in the relevant
month and base fee model based on fixed monthly price.
The Group recognizes maintenance income as performance obligation satisfied over time. The Company records thisrevenue during this contract period based on average amount during the period.
Asset transferred at a point of time
Asset transferred at a point of time includes revenue from sales of commodities and products based on sales contract.
The Group mainly determines that performance obligation of sales of commodities as well as products are satisfied at the
point of customer acceptance the relevant product. The Group receives most of the payment within one month from the pointof satisfying the performance obligation. With regards to transaction price, there is no significance in the amount of sales
revenue that includes variable consideration. Furthermore, there are no significant financial components in the amount ofpromised consideration.
Furthermore, if the Group acts as a lessor of right-of-use of its devices such as HAL, the Group classifies the relevant
lease as finance lease. Finance lease income is processed in the same way as cases where the Group acts as a lessor of
manufacturer or distributor of sales of goods. The Group determines that performance obligation is satisfied at the point ofcustomer acceptance and the revenue is recognized at a point of time.
Service transferred at a point of time
Service transferred at a point of time includes revenue from offering Cybernic Treatment and training service at Cybernic
Treatment Center and Robocare Centers, to end users (such as patients). It also includes revenue received in return ofproviding outcomes of consigned development projects.
The Group determines that performance obligation of Cybernic Treatment as well as training services are satisfied at the
point of completion of such services. The Group determines that performance obligation of providing outcomes of consigned
development projects are satisfied at the point when the customer inspects and accepts the outcome.
(2) Changes in the contract
Receivables and contract liabilities from contracts with customers are as follows:
Accounts receivable arising fromcontracts with customers

Advances received oncontractual liabilities

Millions of yen

Millions of yen
363
242
256

April 1, 2018
March 31, 2019
March 31, 2020

－ 43 －

8
56
69

(Note) The balance of advances received at the beginning of April 1, 2018 and 2019 was fully recognized as revenue and theamount was ¥8 million and ¥35 million respectively. Furthermore, the amount of revenue recognized during theprevious fiscal year and the current fiscal year, from performance obligations satisfied in previous periods were notmaterial.
(3)

Timing of performance obligations satisfaction
Recognition of revenue arising from maintenance contract that occur incidental to sales of commodities are as follows:
Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

Not later than 1 year
More than 1 year, 5 years or less

153
319

153
209

Total

472

362

Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

25. Selling, general and administrative expenses
Other selling, general and administrative expenses consist of the following:

Personnel expenses
Taxes and dues
Commission expenses
Depreciation
Other
Total

414
291
195
142
412

443
366
227
185
424

1,454

1,646

Personnel expenses included in cost of sales, research and development and other selling, general and administrative
expenses in the consolidated statement of profit or loss were ¥776 million as of March 31, 2019 and ¥875 million as ofMarch 31, 2020.
26. Other income and other expenses
Other income consists of the following:
Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

Grants13

16Consigned research income
Other

364
29

107
15

406

138

Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

Total
Other expenses consist of the following:

Foreign exchange loss

10

Other
Total

－ 44 －

13

1

5

11

18

27. Financial income
Financial income consists of the following:
Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

Interest income:Financial assets measured at amortized cost
Dividends received:

19

20

Financial assets measured at fair value through othercomprehensive income－

304

Financial assets measured at fair value through profit or loss

220

860

Total

239

1,184

－ 45 －

28. Other comprehensive income
Amount incurred during the fiscal year, reclassifications to profit or loss and tax effects including non-controlling interests foreach item of other comprehensive income are as follows:
Previous consolidated fiscal year
Current consolidated fiscal year
(From April 1, 2018 to March(From April 1, 2019 to March
31, 2019)
31, 2020)
Millions of yen
Items that will not be reclassified to profit or loss
Financial assets measured at fair value through othercomprehensive income
Gains (losses) arising for the year
Tax effects

Millions of yen

(815)
(43)

275
(84)

(858)

191

14
－

4
－

Tax effects

14
－

4
－

Exchange differences on translation of foreign operations

14

4

(845)

195

Financial assets measured at fair value through othercomprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Gains (losses) arising for the year
Reclassifications
Before tax

Total－ 46 －

29. Earnings per share(1) The basis for calculating basic earnings per share
Previous consolidated fiscal
year(From April 1, 2018 toMarch 31, 2019)

Current consolidated fiscal
year(From April 1, 2019 toMarch 31, 2020)

(632)

(152)

－

－

(632)

(152)

215,054,735

215,141,368(2.94)(0.71)

Previous consolidated fiscal
year(From April 1, 2018 toMarch 31, 2019)

Current consolidated fiscal
year(From April 1, 2019 toMarch 31, 2020)

(632)

(152)

－

－

(632)

(152)

215,054,735

215,141,368

Gain (loss) attributable to owners of parent (Millions of yen)
Gain not attributable to common shareholders of the parent(Millions of yen)
Gain (loss) used to calculate basic earnings per share(Millions of yen)
Weighted average number of common shares and shares equivalent
to common shares (Shares)
Basic earnings (loss) per share (Yen)(2) The basis for calculating diluted earnings per share

Gain (loss) used to calculate basic earnings per share(Millions of yen)
Adjustments to loss (Millions of yen)
Gain (loss) used to calculate diluted earnings per share(Millions of yen)
Weighted average number of common shares and shares equivalent
to common shares (Shares)
Adjustment *Note－

Weighted average number of diluted common shares and sharesequivalent to common shares (Shares)

215,054,735

215,141,368(2.94)(0.71)

Diluted earnings (loss) per share (Yen)(Note) Summary of potential shares not included in the calculation of diluted earnings per share as it does not have dilutive
effects
Previous consolidated fiscal
year(From April 1, 2018 toMarch 31, 2019)

Current consolidated fiscal
year(From April 1, 2019 toMarch 31, 2020)2015 1st Series Stock Option of CYBERDYNE, INC.

Shares(Common share)

7,800

Shares(Common share)

7,800

2016 1st Series Stock Option of CYBERDYNE, INC.

(Common share)

4,600(Common share)

4,600

2017 1st Series Stock Option of CYBERDYNE, INC.

(Common share)

10,500(Common share)

10,500－ 47 －

30. Cash flow information
Changes in liabilities arising from financing activities are as follows:
Previous consolidated fiscal year (From April 1, 2018 to March 31, 2019)

April 1, 2018

Fluctuations
accompanied by cashflows

Fluctuations not accompanied by cash flows
Change inscope ofconsolidationExchange
fluctuation

New lease

Other

March 31,2019

Millions ofyenMillions ofyenMillions ofyenMillions ofyenMillions ofyenMillions ofyenMillions ofyen

Third-party interestsin CEJ Fund

－

680

－

－

－

(136)

544

Total

－

680

－

－

－

(136)

544

Current consolidated fiscal year (From April 1, 2019 to March 31, 2020)

April 1, 2019

Short-term loans
payableLong-term loans
payable (Note 1)
Lease liabilities(Note 2)
Third-party interestsin CEJ Fund
Total

Fluctuations
accompanied by cashflows

Fluctuations not accompanied by cash flows
Change inscope ofconsolidationExchange
fluctuation

New lease

Other

March 31,
2020

Millions ofyenMillions ofyenMillions ofyenMillions ofyenMillions ofyenMillions ofyenMillions of
yen

－

(3)

22

－

－

0

18

－

(2)

71

－

－

－

70

363

(45)

38

0

18

－

373

544

1,360

－

－

－

(189)

1,714

906

1,310

131

0

18

(189)

2,176

Note 1 Includes Long-term loans payable due within 1 year
2 The balance of April 1, 2019 is due to the adoption of IFRS 16. Amounts are stated in Note “2. Basis of preparation(4) Change in accounting policies”－ 48 －

31. Share-based payments(1) Outline of share-based payments
The Company adopted an equity-settled share-based payment (stock option) as well as shares with restrictions on transfer as
remuneration for the Company employees.
The stock option is allotted to external consultant for the purpose of boosting his/her motivation and moral towards thegrowth of the Company's corporate value. The stock option is issued based on the resolution at the Meeting of Shareholders
and approval by the Meeting of Board of Directors of the Company. Exercise period of the stock acquisition rights that isincluded in the stock option is determined by the allotment contract and if the stock acquisition rights is not exercised by theholder of the stock acquisition rights during this period, stock acquisition rights will lose its effect.
Shares with restrictions on transfer as remuneration for the Company employees are allotted to the Company employees
for the purpose of boosting his/her motivation and morale towards the growth of the Company's corporate value. The
issuance of these shares is approved by the Meeting of the Board of Directors of the Company.
Outlines of the Company stock options issued are as follows:
Class and number ofshares covered by thestock option

Allottee

Date ofallotment

ExerciseperiodConditions for determinationof rights

2015 1st Series Stock
Common Share
Option of CYBERDYNE,
7,800 shares
INC. (Note 1)

1 external
consultant

August 12,
2015

July 28,2025

Conditions on determination ofrights are not attached (Note 2)2016 1st Series Stock
Common Share
Option of CYBERDYNE,
4,600 shares
INC.

1 external
consultant

June 8, 2016

May 24,2026

Conditions on determination ofrights are not attached (Note 2)2017 1st Series Stock
Common Share
Option of CYBERDYNE,
10,500 shares
INC.

1 external
consultant

August 8,
2017

July 25,
2027

Conditions on determination ofrights are not attached (Note 2)(Notes)1 This stock acquisition right was determined before the date of transition to IFRS (April 1, 2016). As such, IFRS 2"Share-based Payment" has not been applied.
2 This stock acquisition right has no conditions for determination of rights attached. As such, related expenses areprocessed at once when the rights are allotted.
(2) Number of stock options and weighted average exercise pricePrevious consolidated fiscal year
(From April 1, 2018 to March 31, 2019)
Number of shares
Beginning balance of outstanding
GrantedExercised
ExpiredExpired at maturity
Ending balance of outstanding

Current consolidated fiscal year
(From April 1, 2019 to March 31, 2020)

Weighted average
exercise price

Shares22,900－－－

Yen

Number of shares

Weighted average
exercise price

2,050
－
－
－

Shares22,900
－
－
－

Yen

－

－

－

－

22,9002,050

22,900

2,050

2,050
－
－
－

Ending balance of exercisable
12,4002,271
22,9002,050(Notes)1 As of March 31, 2019 and 2020, exercise price of stock options that is not yet exercised are between ¥1,788 to ¥3,060
and ¥1,788 to ¥3,060, respectively.
2. As of March 31, 2019 and 2020, weighted average remaining contractual life of stock options that is not yet exercisedare 7 years and 7 years, respectively.

－ 49 －

(3) The assumption used to measure the fair value of stock options weighted average fair value of the stock options allotted in
the fiscal year, are measured through Black-Scholes Model using the following assumptions
Fiscal year ended March 31, 2019
There are no items to report.
Fiscal year ended March 31, 2020
There are no items to report.
(4) Shares with restrictions on transfer as remuneration for the Company employees
The Group has introduced a restricted share payment scheme under which it provides remuneration to Company employees,
by way of shares with restrictions on transfer until the rights are vested. The scheme is accounted for using a means of equity
settlement. Under this scheme, the transfer of shares becomes possible when the requirements of the service conditions are
met. In principle, the vesting period is five years.
The fair value of such shares are measured based on observable market prices.
In the fiscal year ended March 31, 2019, share-based remuneration expenses related to the scheme were ¥1 million and thenumber of shares allotted were 98,200 shares. The related expenses were recorded as other selling, general andadministrative expenses in the consolidated statement of profit or loss.

Date of allotment
Number of shares allotted (Shares)
Fair value at the grant date (yen)Previous consolidated fiscal year Current consolidated fiscal year
(From April 1, 2018 to March 31, (From April 1, 2019 to March 31,
2019)
2020)
－
March 5, 2019－
98,200－670－ 50 －

32. Financial instruments(1) Capital management
The Group is a company centered on research and development of innovative devices. It promotes clinical research,
verification and endeavors to obtain approvals from various regulators, in order to introduce the Group's product into themarket and services, which will realize sustainable growth. In line with these challenges, the Group manages its financial
instruments to maximize its corporate value.
There are no capital restrictions that affect the Group.
(2) Risk management for financial instruments
In the process of its operation, the Group is exposed to various financial risks such as, credit risk, liquidity risk and exchange
rate risk. In order to mitigate these financial risks, the Group selects financial instruments with very low risk. For financing,the Group either borrows from the bank or issue bonds. Furthermore, all equity instruments held by the Group are nonmarketable securities and it is not affected by the risk of stock market.
On derivative transaction, the Group has a policy not to conduct any speculative transactions.
① Credit risk management
Credit risk is the risk that a counterparty to financial assets held by the Group is unable to fulfil its contractual
obligations, resulting in a financial loss for the Group.
a. Trade and other receivables

Accounts receivable-trade expose the Group to customer credit risk. The Group manages that risk with an internal
audit process for investigating and approving customer credit on initial transaction. Furthermore, according toCustomer Credit Management protocol, the Group also manages due dates and outstanding balances by customer,
in order to mitigate any concerns about collection due to deterioration in their financial positions and other reasons.
Accounts receivables-other expose the Group to business partner credit risk, but these receivables are almost
entirely settled in the short term.
b. Short-term investments

Short-term investments are recognized in cash and cash equivalents and other financial assets. They are highly safeand liquid financial instruments that include negotiable deposit and jointly-managed money trust.
The carrying amount after impairment of financial assets in the consolidated statement of financial position represents
the Group's maximum exposure to the credit risk of financial assets. The Group is not exposed to excessive credit risk
associated with a particular customer that requires exceptional management.
The Group recognizes allowance for doubtful accounts for trade receivables and other financial assets measured atamortized cost by estimating future credit losses in consideration of recoverability and significant increases in credit
risk. The Group determines if credit risk has increased significantly by evaluating changes in default risk withreference to factors including the decline of counterparty results, and delinquency information.
Accounts receivable-trade are particularly important financial assets for the Group. The Group collectively measures
expected credit losses of the financial assets for the entire period to recognize the allowance for doubtful accounts. In
the following situations, that would adversely affect future cash flows, however, the Group measures expected credit
losses individually by treating each receivable as a credit-impaired financial asset:
・Where the customer has serious financial difficulties
・Where the customer defaults or becomes delinquent in accounts receivable payments despite repeated demands forpayment
・Where it is more likely that the customer will go into bankruptcy or face a situation that forces it to reconstruct its
business
The Group directly writes down the carrying amount if it does not reasonably expect to recover all or part of the
trade receivables, following an internal process of investigation and approval.
The Group is not exposed to excessive credit risk associated with a particular customer that requires exceptional
management. Furthermore, the customers of the Group are highly creditworthy, and the credit risk is limited. As thecustomer of the Group are highly credit worthy, there are very few delinquents in accounts receivables and impact
towards impairments in accounts receivable-trade and allowance for doubtful accounts are insignificant.
－ 51 －

The Group always sets its limit of allowance for doubtful accounts towards trade receivables that does not include
important financial elements at the amount of expected credit losses for the entire period.
The carrying amount of trade receivables that approximate collectively measured expected credit losses of thefinancial assets for the entire period to recognize the allowance for doubtful accounts as of March 31, 2019 and2020 are ¥242 million and ¥256 million, respectively.
Changes in the related allowance for doubtful accounts are as follows:
Previous consolidated fiscal year
Current consolidated fiscal year
(From April 1, 2018 to March 31,(From April 1, 2019 to March 31,
2019)
2020)
Millions of yen
Millions of yen
Beginning balance
Increase during the year
Decrease during the year due to settlement for
intended purposes
Decrease during the year due to reversal
Other changes
Ending balance

2
1

1
2

－

－

(2)
－

(1)
－

1

2

② Liquidity risk management
Liquidity risk is the risk that an entity is unable to make a payment by its due date in performing its repayment
obligations for financial liabilities that become due.
The Corporate Unit of the Group renews the funding plans where necessary and maintains the level of liquidity on
hand above certain level, in order to manage liquidity risk.
The Group prepares appropriate funds for repayment, secures credit line from the financial institute where necessary,
constantly monitors the plans of cash flows and its performance in order to manage liquidity risk.
Financial liabilities by maturity date consist of the following:
Fiscal year ended March 31, 2019
Carrying amountContract amountNot later than 1 year

Later than 1 year

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Non-derivative financial liabilities－

Trade and other payables
Third-party interests in CEJ Fund

284
544

284
(Note) 544

284
－

544

Total

828

828

284

544

Carrying amountContract amountNot later than 1 year

Later than 1 year

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Fiscal year ended March 31, 2020

Non-derivative financial liabilities－

Trade and other payables
Bonds and borrowings
Lease liabilities
Third-party interests in CEJ Fund

247
88
373
1,714

247
88
373
(Note) 1,714

247
37
61
－

51
313
1,714

Total

2,423

2,423

345

2,078

(Note) This amount is the amount of equity that would be vested to third-party investors if the fund is liquidated as
March 31, 2020.

－ 52 －

Total amounts of commitment lines and their usage are as follows:
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Millions of yen

Millions of yen

Total commitment lines
Drawn
Undrawn

900
－

900
－

900

900

③ Exchange rate risk management
The Group also operates outside Japan, and therefore is exposed to the risks of exchange rate fluctuations associatedwith transactions conducted in foreign currencies etc.
As the impact of changes in exchange rate is insignificant, related information is omitted.
Furthermore, translation of the financial statements of the subsidiaries operating outside of Japan affects the amountof other comprehensive income. However, the Group does not regard this impact to be material.
(3) Fair value of financial instruments
For financial instruments measured at fair value, their fair values are classified into Level 1 through Level 3 based on theobservability of inputs used for the measurement and their materiality.
Level 1: Quoted prices in active markets for identical assets or liabilities (unadjusted)
Level 2: Fair value determined using observable prices other than Level 1 for the asset or liability directly or indirectly
Level 3: Fair value determined using the valuation technique including unobservable inputs for the asset or liability① Measurement methods of the fair value
The Group adopts the following measurement methods for the main financial instruments measured at fair value:(Cash and cash equivalents, trade and other receivables, other financial assets (current), trade and other payables)
Carrying amounts approximate fair values because these are settled in the short-term.
(Other financial assets (non-current))
Fair value of non-marketable equity securities included in other financial assets is measured by appropriate
measurement methods such as measurement using recently available data.
Fair value of leasehold and guarantee deposits is measured by present value obtained through discounting yield tomaturity of long term bonds with high security by planned schedule of redemption.
(Other financial liabilities (non-current)
Carrying amounts approximate fair value of long-term installment accounts payable included in other financial
liabilities (non-current) because these are settled in the short-term.
(Third-party interests in CEJ Fund)The carrying amount of the third-part interests in CEJ Fund is the amount of equity interest attributable to third-party
investors assuming that the fund is liquidated at the end of each quarter. As such the fair value of the equity interest isdetermined based on the carrying amount of the equity interest.

－ 53 －

② Financial instruments measured at amortized cost
The following tables present the measurement techniques for measuring the fair value of major financial instruments
measured at amortized cost. Financial instruments for which carrying amounts are a reasonable approximation of fairvalue or financial instruments that are not material are not included in the tables.
Previous consolidated fiscal year
(March 31, 2019)

Current consolidated fiscal year
(March 31, 2020)

Carrying amount

Fair value

Carrying amount

Fair value

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Financial assets:
Financial assets measured at amortized
cost
Leasehold and guarantee deposits

61

70

68

76

Total

61

70

68

76

(Notes)1 The fair value of leasehold and guarantee deposits is classified into Level 2.
2 There were no transfers between Level 1, Level 2 and Level 3 during the previous fiscal year and the current fiscal
year③ Financial instruments measured at fair value
The carrying amount and fair value of financial instruments measured at fair value are as follows:
Previous consolidated fiscal year (March 31, 2019)
Fair value
Carrying amountFinancial assets:
Financial assets measured at fairvalue through profit or loss
Other financial assets
Financial assets measured at fairvalue through other comprehensive
incomeOther financial assets
Total

Level 1

Level 2

Level 3

Total

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

1,954

－

－

1,954

1,954

416

－

－

416

416

2,370

－

－

2,370

2,370

Current consolidated fiscal year (March 31, 2020)
Fair value
Carrying amount
Level 1

Level 2

Level 3

Total

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Financial assets:
Financial assets measured at fairvalue through profit or loss
Other financial assets

3,924

－

－

3,924

3,924

Financial assets measured at fairvalue through other comprehensive
incomeOther financial assets

864

－

－

864

864

Total

4,788

－

－

4,788

4,788

Transfers between levels of the fair value hierarchy shall be recognized at the date of the event or change incircumstances that caused the transfer. There were no significant transfers between Level 1, Level 2 and Level 3 during－ 54 －

the previous fiscal year and the current fiscal year.
④ Assessment procedures
Assessment of financial instruments classified as Level 3 is measured by the responsible person in the Corporate Unit.
Responsible person conducts assessment and analysis of the assessment based on the Group's accounting policies andprocedures that is approved by the head of Corporate Unit. Results of assessment are than reviewed and approved by
the Head of Corporate Unit.
⑤ Quantitative information with regards to financial instruments classified as Level 3
Fair value of financial asset classified as Level 3 is measured by responsible person in the Corporate unit, each quarterusing recently available data according to the Group accounting policy. Any changes in fair value and reasons arereported to the department manager, and to the President and CEO as necessary. Upon measurement of the fair value,
inputs are reasonably estimated, and most suitable valuation model is selected based on the nature of the asset.
Determination of the suitable valuation model will be verified by the appropriate internal approval process, in order toensure the validity.
Financial instruments classified as Level 3 are not subject to transfer between the fair value hierarchy levels.
⑥ Changes in financial instruments classified as Level 3 during the period
Changes in financial instruments classified as Level 3 are as follows:
Previous consolidated fiscal year
(From April 1, 2018 to March 31,
2019)Millions of yen

Current consolidated fiscal year
(From April 1, 2019 to March 31,
2020)
Millions of yen

Beginning balance
Total gains and losses
Profit or loss (Note 1)

2,344

2,370

220

756

Other comprehensive income (Note 2)
Purchases
Sales

(815)
620
－

272
1,715
(326)

Ending balance

2,370

4,788

220

756

Changes of unrealized profit related topossessed assets posted at the end of reported
period (Note 1)(Notes)1 Gains and losses included in finance income or finance costs in the consolidated statement of profit or loss
2 Gains and losses included in financial assets measured at fair value through other comprehensive income in the
consolidated statement of comprehensive income.

－ 55 －

33. CEJ Fund
Gains (losses) related to CEJ Fund consists of the following:
Previous consolidated fiscal year
(From April 1, 2018 to March
31, 2019)

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)

Millions of yen

Millions of yen

Gains (losses) related to CEJ Fund
Change in third-party interests in CEJ FundManagement fee

136
(76)

189
(115)

Total

61

75

Changes in Third-party interests in CEJ Fund are as follows:
Third-party interests
Millions of yen－

April 1, 2018
Contributions into CEJ Fund from third-party investors
Change in third-party interests in CEJ Fund

680
(136)

March 31, 2019
Contributions into CEJ Fund from third-party investors
Change in third-party interests in CEJ Fund

544
1,360
(189)

March 31, 2020

1,714

34. Related parties(1) Major subsidiaries and associates etc.
Please refer to "Appendix 1 Outline of the Company 4 Status of associated companies" for major subsidiaries and associates
etc. Information on transactions and balance of receivables or payables between the Group and related parties are omitted as
this information is not material.
(2) Compensation to main executives
Compensation to main executives consists of the following:
Previous consolidated fiscal
year(From April 1, 2018 to March
31, 2019)
Millions of yen
Basic remuneration:
Member of the Board of Directors (excluding outside
members of Board of Directors)
Audit and Supervisory Board Members (excluding outside
member of Audit and Supervisory Board)
Outside members of the Board of Directors andoutside members of the Audit and Supervisory Board
Total
35. Subsequent events
There are no items to report－ 56 －

Current consolidated fiscal year
(From April 1, 2019 to March
31, 2020)
Millions of yen

33

41

－

－

13

18

46

59