[Reference Disclosure] Key Performance Figures Based on U.S. GAAP
October 30, 2018
Sony Financial Holdings Inc.
Sony Corporation (“Sony”), the parent company of Sony Financial Holdings Inc. (“SFH”), prepares its consolidated
financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”). This reporting in accordance with U.S. GAAP includes the disclosure of financial information for the Sony
Group’s Financial Services segment, including the Sony Financial Group. On the other hand, the Sony Financial Group,
which accounts for substantially all of the Sony Group’s Financial Services segment, discloses financial information inaccordance with accounting principles generally accepted in Japan (“Japanese GAAP”). SFH has received inquiries fromits shareholders and other investors about the differences between these two accounting standards.
Especially for the insurance business, the differences between the two accounting standards are significant. These
primarily derive from the differences of the accounting standards such as the liabilities for future insurance policy benefits
and deferred insurance acquisition costs. Therefore, we provide supplementary information for Japanese and overseas
investors to help their understanding of the Sony Financial Group’s operating performance. This document contains key
financial information pertaining to the Sony Group’s Financial Services segment that Sony disclosed in accordance with
U.S. GAAP.
Please note that the supplementary information has not been audited at either SFH or Sony. SFH prepares its
consolidated financial results on the basis of Japanese GAAP, and we therefore ask our shareholders and other investors
to refer to figures based on Japanese GAAP. Furthermore, neither SFH nor the Sony Financial Group have closed theiraccounts for the period based on Japanese GAAP, although today, SFH announced its preliminary consolidated financial
results and forecast based on Japanese GAAP. :https://www.sonyfh.co.jp/en/news/article/181030_01.pdf
Note: This release only explains operating performance, which includes preliminary operating results for the six months
ended September 30, 2018, and financial forecast for the fiscal year ending March 31, 2019 on the basis of U.S.
GAAP and Japanese GAAP. SFH expects to announce its operating results for the six months ended September
30, 2018, on November 12, 2018.

1

(1) Performance Trends
Sony Group’s Financial Services Segment <U.S. GAAP><Fiscal year basis>(Billions of yen)
FY13

FY14

FY15

FY16

FY17

Revenue

993.8

1,083.6

1,073.1

1,087.5

1,228.4

Operating income

170.3

193.3

156.5

166.4

178.9

Net income

116.1

151.1

118.8

118.7

126.9

Stockholders’ equityof Financial Services*

1,079.7

1,247.8

1,385.5

1,449.6

1,557.1

Total assets

9,347.9

10,089.9

10,915.5

12,063.9

13,030.5<Quarterly basis, Year-to-date basis >(Billions of yen)

Revenue
Operating income
Net income

FY17-1Q

FY17-2Q

FY17-3Q

FY17-4Q

FY18-1Q

FY18-2Q

FY18-3Q

FY18-4Q

303.2

279.2

373.3

272.7

335.2

353.5

-

-

[582.4][955.7][1,228.4][688.7]

[-]

[-]

36.6

56.3

39.8

39.2

-

-

[82.8][139.1][178.9][79.7]

[-]

[-]

26.2

40.0

28.0

28.7

-

-

[58.9][98.9][126.9][57.7]

[-]

[-]

46.2
32.7

40.6
29.0

Stockholders’ equity of
Financial Services*

1,457.8

1,485.3

1,531.0

1,557.1

1,577.9

1,582.3--

Total assets

12,408.9

12,596.8

12,906.0

13,030.5

13,410.8

13,688.5--

Note: Figures on a quarterly basis and those on a year-to-date basis ([ ] in the table) are expressed in billions of yen. However, figures on a yearto-date basis may not necessarily equal the total of figures on a quarterly basis for the respective period. Fractional amounts of less than¥0.1 billion are rounded.
*The figure of stockholders’ equity of Financial Services equals total net assets minus non-controlling interests.

2

Sony Financial Holdings (Consolidated) <Japanese GAAP><Fiscal year basis>(Billions of yen)

FY13

FY14

FY15

FY16

FY17

Ordinary revenues

1,320.4

1,352.3

1,362.0

1,381.6

1,503.6

Ordinary profit

76.1

90.0

71.1

66.3

66.8

Profit attributableto owners of the parent
Net assets attributable toshareholders*

40.5

54.4

43.3

41.6

51.8

465.7

549.3

603.0

599.6

623.6

8,841.3

9,545.8

10,352.1

11,471.8

12,401.4

Total assets<Quarterly basis, Year-to-date basis >(Billions of yen)

Ordinary revenues
Ordinary profit
Profit attributableto owners of the parent
Net assets attributable toshareholders*

Total assets

FY17-1Q

FY17-2Q

FY17-3Q

FY17-4Q

FY18-1Q

FY18-2Q

FY18-3Q

FY18-4Q

364.9

343.3

467.5

327.7

420.6

440.2

-

-

[708.3][1,175.8][1,503.6][860.8]

[-]

[-]

13.6

16.8

17.3

18.4

-

-

[32.6][49.5][66.8][47.2]

[-]

[-]

9.0

20.8

9.4

11.6

-

-

[21.5][42.4][51.8][31.7]

[-]

[-]

589.6

596.2

620.1

623.6

613.2

616.7

-

-

11,806.8

11,979.2

12,271.6

12,401.4

12,772.0

13,062.0

-

-

18.9
12.5

28.8
20.0

Note 1: Figures on a quarterly basis and those on a year-to-date basis ([ ] in the table) are expressed in billions of yen. However, figures on a
year-to-date basis may not necessarily equal the total of figures on a quarterly basis for the respective period. Fractional amounts of lessthan ¥0.1 billion are discarded.
Note 2: When reporting its quarterly operating performance, SFH discloses figures on a year-to-date basis, so the figures provided on a quarterly
basis are calculated as the difference of figures provided on a year-to-date basis.
*The figure of net assets attributable to shareholders equals total net assets minus subscription rights to shares and non-controlling interests.

3(2) Financial Forecast for the Fiscal 2018
Sony Group’s Financial Services Segment <U.S. GAAP><Fiscal year basis>(Billions of yen)

FY17 Results

FY18 Forecast

Revenue

1,228.4

1,270.0

Operating income

178.9

170.0

Sony Financial Holdings (Consolidated) <Japanese GAAP><Fiscal year basis>(Billions of yen)

FY17 Results

FY18 Forecast

Ordinary revenues

1,503.6

1,578.0

Ordinary profit

66.8

83.0

These Japanese GAAP’s preliminary results for the six months ended September 30, 2018 are based on information available
to SFH’s management as of this date and may differ substantially from actual results expected to be announced on November
12, 2018 for a variety of reasons.
SFH’s consolidated results are prepared in accordance with Japanese GAAP. As such, these figures differ in significant respects
from the financial information reported by Sony, SFH’s parent company, which prepares its financial statements in accordancewith U.S. GAAP.
Sony Financial Group’s scope of consolidation and that of Sony Group’s Financial Services segment are described below.
Scope of consolidation includes following companies:
Sony Financial Holdings Inc., Sony Life Insurance Co. Ltd., Sony Assurance Inc., Sony Bank Inc., Sony Payment Services
Inc., SmartLink Network Hong Kong Limited., Sony Lifecare Inc., Lifecare Design Inc., Proud Life Inc., and Sony Financial
Ventures Inc.
Affiliated companies accounted for under the equity method:
AEGON Sony Life Insurance Co., Ltd., and SA Reinsurance Ltd.
Note : Regarding Sony Financial Group’s scope of consolidation under Japanese GAAP, SmartLink Network Hong Kong
Limited was included in the scope of consolidation from the fourth quarter of the year ended March 31, 2014, Sony Lifecare
Inc. and Lifecare Design Inc. were included in the scope of consolidation from the first quarter of the year ended March 31,
2017, Proud Life Inc. was included in the scope of consolidation from the second quarter of the year ended March 31, 2018,
and Sony Financial Ventures Inc. is included in the scope of consolidation from the second quarter of the year ended March
31, 2019, respectively.
Regarding scope of consolidation of the Sony Group’s Financial Services segment under U.S. GAAP, Sony Lifecare Inc. and
Lifecare Design Inc. were included in the scope of consolidation from the first quarter of the year ended March 31, 2017,
Proud Life Inc. was included in the scope of consolidation from the second quarter of the year ending ended March 31, 2018,
and Sony Financial Ventures Inc. is included in the scope of consolidation from the second quarter of the year ended March
31, 2019, respectively.

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Statements made in this press release concerning the current plans, expectations, strategies and beliefs of the Sony Financial Group.
Any statements contained herein that are not historical facts are forward-looking statements or pro forma information. Forwardlooking statements may include—but are not limited to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,”“assume,” “forecast,” “predict,” “propose,” “intend” and “possibility” that describe future operating activities, businessperformance, events or conditions. Forward-looking statements, whether spoken or written, may also be included in other materials
released to the public. These forward-looking statements and pro forma information are based on assumptions, decisions andjudgments made by the management of Sony Financial Group companies, and are based on information that is currently available tothem. As such, they are subject to various risks and uncertainties, and actual business results may vary substantially from the forecasts
expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue reliance on forwardlooking statements. Sony Financial Group companies are under no obligation to revise forward-looking statements or pro forma
information in light of new information, future events or other findings. The information contained in this press release does notconstitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe to any securities,
nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever in Japan orabroad.

For inquiries:
Investor Relations Dept.
Sony Financial Holdings Inc.
Telephone: +81-3-5290-6500
E-mail: press@sonyfh.co.jp
Website of Sony Financial Holdings Inc.
https://www.sonyfh.co.jp/index_en.html

5Appendix:
Significant Differences between Japanese GAAP and U.S. GAAP
SFH’s consolidated results are prepared in accordance with accounting principles generally accepted in Japan (“Japanese GAAP”) andprovisions of the Insurance Business Act of Japan. As such, these figures differ in significant respects from the financial information reported
by Sony Corporation, SFH’s parent company, which prepares its financial statements in accordance with accounting principles generally
accepted in the United States of America (“U.S. GAAP”). Significant differences between Japanese GAAP and U.S. GAAP are described
below:(1) Standards for recognizing income from insurance premiums in the life insurance business
Under U.S. GAAP, premium income on traditional insurance products is recognized as revenues during the premium-paying period.
Income other than premium payments received under investment agreements or for separate agreements under universal life insurance (*),
which are equivalent to deposits, is recognized as revenue. Under Japanese GAAP, all premiums paid by policyholders are recognized asrevenues.
*Note: For Sony Life Insurance Co., Ltd., investment agreements primarily include single premium endowment insurance, single premium
educational endowment insurance and individual annuities. Universal insurance mainly includes variable life insurance andinterest-rate sensitive whole life insurance.
(2) Standards for recognizing net gains from investment in the life insurance business
The recognition of net gains from investment in the life insurance business, which are classified in separate accounts defined under the
Insurance Business Act of Japan and which directly belong to policyholders, differs between Japanese GAAP and U.S. GAAP. Under U.S.
GAAP, net gains or losses are always recorded as revenues, whereas under Japanese GAAP such figures are recognized as ordinary
revenues if they are positive, and as ordinary expenses if negative.
(3) Policy reserves (future insurance policy benefit, etc.) in the insurance business
Since the method of calculation differs between Japanese regulations and U.S. GAAP, profits and losses during the period differ as well.
Under the Insurance Business Act of Japan, insurance companies in Japan are required to accumulate a policy reserve for the fulfillmentof future obligations such as payment of insurance benefits based on the accumulation method and actuarial assumptions approved by theauthorities of the supervisory administrative agencies in Japan.
On the other hand, under U.S. GAAP, liabilities for future insurance policy benefits are composed of the present value of estimated future
payments to policyholders. Under U.S. GAAP, liabilities for future insurance policy benefits are computed based upon actuarial
assumptions, such as future investment yield, mortality rates, morbidity rates, contingency rates and other factors, which are revised at least
once a year. Future insurance policy benefits are remeasured and large impacts may be reflected to profit in variable insurance policies fromrevising investment yield due to fluctuations in the stock market or the bond market. Liabilities for future insurance policy benefits also
include liabilities for minimum guaranteed benefits related to certain insurance products such as variable insurance policies.
With respect to liabilities for minimum guaranteed benefits, the relevant insurance policies differ between Japanese GAAP and U.S.
GAAP.
(4) Deferral and amortization of deferred insurance acquisition costs
Under Japanese GAAP, insurance acquisition costs in the life insurance and non-life insurance businesses are charged as costs whenincurred, whereas under U.S. GAAP insurance acquisition costs are deferred and amortized, in general, equally over the premium-paying
period of the related insurance policies or the policy term by using the same calculation basis used in computing future insurance policy
benefit. The deferred insurance acquisition costs for interest rate-sensitive whole life insurance and variable insurance are amortized overthe policy term in proportion to the estimated gross profits, which are revised at least once a year as well as the actuarial assumptions toevaluate liabilities for future insurance policy benefits. From revising the estimated gross profits large impacts may be reflected to profit.
Under U.S. GAAP, insurance acquisition costs include such items as commissions and medical examination and inspection report fees that
directly relate to the costs of acquiring new insurance policies and renewing policies, as long as they are recoverable.
(5) Contingency reserve
Pursuant to provisions of the Insurance Business Act of Japan, to ensure the fulfillment of future obligations, insurance companies in Japanare required to accumulate a contingency reserve to account for the risk of insurance payment events occurring at a higher-than-expected
rate due to higher-than-expected mortality and morbidity rates (insurance risks), the risk of actual investment yields being lower than theassumed investment yields relating to outstanding policies (assumed interest rate risk), the risk of actual investment results being lower than
the amount guaranteed relating to the minimum guaranteed portion of variable life insurance or variable annuities (minimum guaranteerisks) and other risks. The Insurance Business Act of Japan establishes an accumulation standard and a maximum amount of reserve foreach risk. The contingency reserve can be reversed in regards to each risk. Contingency reserve is recorded as a component of policy reserveon the balance sheet. Under U.S. GAAP, there is no requirement for the provision of such a legal reserve.

6(6) Catastrophe reserve
Pursuant to the provisions of the Insurance Business Act of Japan, non-life insurance companies in Japan are required to accumulate an
amount based on premium income to cover losses due to catastrophic events. The catastrophe reserve acts as a provision against risks towhich the law of large numbers is not applicable on a single-year basis, in consideration of the special characteristics of the non-life
insurance business to cover a wide range of risks including disasters. The catastrophe reserve is reversed in fiscal years in which a
catastrophe occurs. Furthermore, the catastrophe reserve is accounted for as a part of underwriting reserves on the balance sheet. There is
no requirement for the accumulation of such a legal reserve under U.S. GAAP.
(7) Reserve for price fluctuations
Pursuant to provisions of the Insurance Business Act of Japan, insurance companies in Japan are required to accumulate a reserve to coverlosses due to price fluctuations in assets subject to market price volatility, particularly investments in stocks, debt securities and foreign
currency-denominated investments. The Insurance Business Act of Japan establishes the accumulation standard and a maximum amountof reserve for each asset. The reserve for price fluctuations may be reversed to reduce losses arising from price fluctuations of those assets.
Under U.S. GAAP, there is no requirement for the provision of such a legal reserve.
(8) Foreign currency transactions
The majority of the Sony Financial Group’s operations in the banking business involve transactions denominated in foreign currencies.
Under Japanese GAAP, transactions involving assets and liabilities denominated in foreign currencies are in principal translated to yen
at the exchange rate prevailing on the date of the fiscal year end, and any gains and losses on translation are recorded in the statements ofincome as foreign exchange gains or losses. For that reason, in the banking business, gains and losses on translation of those investments
coming from foreign currency deposits (liabilities) are offset partially in the statements of income by ones from investments in availablefor-sale debt securities denominated in foreign currency (assets) for the purpose of covering those foreign currency deposits.
However, under U.S. GAAP, although gains and losses on translation on foreign currency deposits (liabilities) are recorded in thestatements of income, gains and losses on translation of available-for-sale debt securities denominated in foreign currency (assets) are posted
directly to net assets in accordance with fluctuations in the fair market value of securities held, and are therefore not recorded in thestatements of income until maturity or sale. As such, under U.S. GAAP, asset-side gains and losses on translation and liability-side gains
and losses on translation are recorded differently. Therefore, foreign exchange gains or losses resulting from liability-side exchange rate
fluctuations have a larger impact on profit under U.S. GAAP than is the case under Japanese GAAP.
Under U.S.GAAP, the fair value option has been elected for certain investments in available-for-sale debt securities denominated inforeign currency (assets) in the banking business. The election was made to mitigate above accounting mismatches related to fluctuationsof foreign exchange rates. Under U.S. GAAP, unrealized gains and losses on items for which the fair value option have been elected shallbe reported in current earnings, and the gains and losses on translation of these debt securities to be recorded in the statements of income.
(9) Financial instruments
From the fiscal year 2018, under U.S.GAAP, all equity investments will be generally measured at fair value through earnings. Debt
securities remain to be measured depending on the category in which they are held, however, if hybrid financial instruments (financial
instruments that contains an embedded derivative) are elected to be valued as a unit, they are measured at fair value through earnings,
regardless of the category in which they are held.
On the other hand, under Japanese GAAP the method for valuing these financial instruments differs depending on the category in which
they are held.
Consequently, the amounts of valuation gains or losses, gains or losses on sale, and impairment losses differ depending on whether U.S.
GAAP or Japanese GAAP is applied.
(10) Policy reserve matching bonds
Life insurance businesses maintain policy reserves to ensure their ability to meet their long-term insurance obligations, and use debt
securities to manage the interest rate risk associated with the characteristics of those obligations. With the aim of reflecting the reality ofmanaging this interest rate risk, under Japanese GAAP the “Temporary Treatment of Accounting and Auditing concerning Policy-ReserveMatching Bonds in the Insurance Industry” (The Japanese Institute of Certified Public Accounts Industry Audit Committee Report No. 21)
categorizes debt securities used for this purpose as “policy reserve matching bonds,” authorizes their valuation and accounting treatmentusing the amortized cost method. Sony Life Insurance Co., Ltd. valued debt securities categorized as “policy reserve matching bonds” using
the amortized cost method in accordance with Japanese GAAP. However, as the accounting treatment recognized under Japanese GAAP
is not applied under U.S. GAAP, such debt securities are classified as securities available for sale, measured at fair value as of the date of
the financial statements, and recorded the unrealized holding gains and losses (net of tax) in accumulated other comprehensive income.
Gains or losses on sale of debt securities are realized as profit or loss in the statements of income.
(11) Goodwill
Under Japanese GAAP, if acquisition cost excess net value of acquired assets and liabilities when an entity obtains the control of otherentities or businesses, "goodwill" in the amount equal to the excess is recorded as an asset. Goodwill excludes the portion of the noncontrolling interest and shall be amortized regularly over the effective period up to 20 years.

7Under U.S. GAAP, goodwill includes the portion of the non-controlling interest and shall not be amortized. If the carrying amount of
goodwill exceeds the implied fair value of goodwill, an impairment loss in the amount equal to the excess is recorded.
Consequently the amounts of the balance of goodwill and the expenses or impairment losses on goodwill differ depending on whether
U.S. GAAP or Japanese GAAP is applied.

8