Toyota Industries Report

2 0 11

Financial Review for the Year Ended March 31, 2011

Consolidated Eleven-Year Summary

P1Management’s Discussion and Analysis ofFinancial Condition and Results of Operations

P2−7

Consolidated Balance Sheets

P8−9

Consolidated Statements of Income

P10

Consolidated Statements of Comprehensive Income

P11

Consolidated Statements of Changes in Net Assets

P12−13

Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Report of Independent Auditors

P14
P15−43
P44

Consolidated Eleven-Year Summary

Toyota Industries Corporation
Years ended March 31
The figures in this table are unaudited.
Millions of yen

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

¥ 1,479,839¥ 1,377,769¥ 1,584,252¥ 2,000,536¥ 1,878,398¥ 1,505,955¥ 1,241,538¥ 1,164,378¥ 1,069,218¥ 980,163¥ 767,382

Operating income (loss)

68,79822,002(6,621)

96,853

89,95464,04053,12052,63152,477

46,33047,304

Ordinary income

73,911

31,756

14,343

126,488

108,484

80,63570,91258,97051,37547,86544,526

Net income (loss)

47,205(26,273)(32,767)

80,46059,46847,07743,35733,623

21,93327,311

22,637

For The YearNet sales

Investment in tangible assets

26,963¥ 104,495¥ 104,205¥ 129,023¥ 130,121¥ 111,321

Depreciation¥

38,25462,372¥

73,23887,21983,74474,44964,423

51,277¥49,26465,651¥

69,60745,939

¥

—
—

¥

—

—

Research and development expenses

27,78826,826

33,64636,75034,54831,16630,051

29,562

29,70529,98526,195Per share of common stock (yen):
Net income (loss) per share—basic
Net income per share—diluted¥

151.51¥(84.33)¥(105.16)¥257.50¥189.88¥146.16¥135.09¥108.04

¥

70.19

¥

87.28

¥

75.90

—

—

—

257.43189.66146.02135.03101.97

62.90

78.26

67.77

Total net assets per share

3,300.17

3,390.02

2,987.16

4,483.32

5,612.11

5,044.45

3,504.80

3,199.69

2,522.52

2,809.54

3,036.77

Cash dividends per share

50.00

30.00

40.00

60.00

50.00

38.00

32.00

24.00

22.00

19.00

17.00

Total assets¥ 2,481,452¥ 2,589,246¥ 2,327,432¥ 2,965,585¥ 3,585,857¥ 3,245,341¥ 2,326,824¥ 2,011,995¥ 1,650,391¥ 1,770,401¥ 1,869,642

Total net assets

1,075,939

1,104,929

977,670

1,453,996

1,810,483

1,611,227

1,115,747

1,016,763

738,867

878,812951,298

Common stock

80,46280,46280,46280,46280,46280,46280,46280,462

68,04668,02168,018

Number of shares outstanding (excluding treasury stock) (thousands)

311,564

311,570

311,577

311,589

312,075

319,320

318,237

317,666

292,777

312,796313,260¥ 153,661¥ 203,452

65,768¥ 188,805¥ 177,467¥ 131,784¥ 100,095

92,406¥ 103,183(187,574)(36,855)(114,217)(138,789)(164,446)(205,013)(128,230)(92,667)(95,120)

At Year-End

Cash FlowsNet cash provided by operating activities
Net cash used in investing activities

¥

¥

¥

81,078¥78,412(106,710)(155,870)

Net cash provided by (used in) financing activities(85,728)(38,230)

120,971(33,992)(19,749)

85,17250,020(56,015)

57,775

1,225

94,472

Cash and cash equivalents at end of year

195,566

317,590

188,011

121,284

108,569

112,596

100,535

77,212

136,929

71,11995,296Return on equity (ROE) (%)

4.5

(2.6)

(2.8)

5.1

3.5

3.5

4.1

3.8

2.7

3.0

3.6

Return on assets (ROA) (%)

1.9

(1.1)

(1.2)

2.5

1.7

1.7

2.0

1.8

1.3

1.5

1.8

Operating profit margin (%)

4.6

1.6

(0.4)

4.8

4.8

4.3

4.3

4.5

4.9

4.7

6.2

Equity ratio (%)

41.4

40.8

40.0

47.1

48.8

49.7

48.0

50.5

44.8

49.6

50.9

71,608¥ 222,125¥ 191,007¥ 150,674¥ 128,381¥ 113,676

39,91639,52836,09632,97730,99027,431

Indices

EBITDA (millions of yen)
Number of employees¥ 150,481
40,825¥90,521
38,903¥¥

95,47225,030¥97,54023,056¥79,921
21,118

1. Net income (loss) per share is computed based on the average number of shares for each year.
2. ROE and ROA are computed based on the average total net assets and total assets, respectively, for each year.
3. Operating profit margin = Operating income (loss) / Net sales
4. Equity ratio = (Total net assets – Subscription rights to shares – Minority interests) / Total assets
5. EBITDA = Income before income taxes + Interest expenses – Interest and dividends income + Depreciation and amortization

1

Management’s Discussion and Analysis ofFinancial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations are
based on information known to management as of June 2011.
This section contains projections and forward-looking statements that involve risks, uncertainties andassumptions. You should be aware that certain risks and uncertainties could cause the actual results ofToyota Industries Corporation and its consolidated subsidiaries to differ materially from any projections or
forward-looking statements. These risks and uncertainties include, but are not limited to, those listed under“Risk Information” and elsewhere in this report.
The fiscal year ended March 31, 2011 is referred to as fiscal 2011 and other fiscal years are referred toin a corresponding manner. All references to the “Company” herein are to Toyota Industries Corporation
and references to “Toyota Industries” herein are to the Company and its 162 consolidated subsidiaries.

¥2.5 billion compared with an operating loss of ¥1.8 billion in
fiscal 2010.

Ordinary income amounted to ¥73.9 billion, an increase of¥42.2 billion (133%) from fiscal 2010. This was due tooperating income of ¥68.7 billion, an increase of ¥46.7 billion(213%) from fiscal 2010, despite equity in net losses ofaffiliated companies amounting to ¥0.4 billion compared withequity in net earnings of affiliated companies of ¥0.7 billion in
fiscal 2010.

financing and liquidity for its business activities and to maintainstrong balance sheets. Currently, funds for capital investments
and other long-term capital needs are provided from retained
earnings and long-term debt, and working capital needs are
met through short-term loans. Long-term debt financing iscarried out mainly through issuance of corporate bonds andloans from financial institutions.
Toyota Industries continues to maintain its solid financial
condition. Through the use of such current assets as cash
and cash equivalents and securities, as well as free cash
flows and funds procured from financial institutions, Toyota
Industries believes that it will be able to provide sufficient
funds for the working capital necessary to expand existing
businesses and develop new projects, as well as for future
investments.
Regarding fund management, the Company undertakes
integrated fund management of its subsidiaries in Japan,
while Toyota Industries North America, Inc. (TINA) and Toyota
Industries Finance International AB (TIFI) centrally manage
the funds of subsidiaries in North America and Europe,
respectively.
Through close cooperation among the Company, TINA
and TIFI, we strive for efficient, unified fund management on a
global consolidated basis.

Income before Income Taxes and Minority
Interests

Cash Flows

Others Segment
Net sales of the Others Segment totaled ¥34.4 billion, adecrease of ¥3.9 billion (10%) from fiscal 2010. Operating
income was ¥3.4 billion, a decrease of ¥0.5 billion (13%) fromfiscal 2010.

Operating Income
Operating income for fiscal 2011 was ¥68.7 billion, an
increase of ¥46.7 billion (213%) from fiscal 2010. This wasdue to an increase in net sales and reduction of fixed costs
despite rising prices of raw materials and exchange rate
fluctuations.

Result of Operations
Operating Performance
In fiscal 2011, the global economy began to recover gradually,
as certain Asian countries, especially China, witnessed an
economic recovery and the economies in the United States,
Europe and other countries appear to have bottomed out.
Despite the sharp appreciation of the yen and the end of
the economic stimulus plan, the Japanese economy also
showed signs of an upturn due to such factors as thestabilization of private sector capital investment and a steadyrevival of exports.
In this operating environment, Toyota Industries undertook
efforts to strengthen its management platform by ensuring
customer trust through its dedication to quality as well as
responding quickly and flexibly to the recovery trend andexpansion of sales. However, the Great East Japan
Earthquake in March had a significant impact on the Japanese
economy. Toyota Industries was also forced to suspend
production partially due to the problem of parts supply
from suppliers.
As a result, despite the aftermath effects of the earthquake,
total consolidated net sales amounted to ¥1,479.8 billion, an
increase of ¥102.1 billion (7%) from fiscal 2010.

Operating Performance Highlights by Business
Segment
Operating results by business segment are as follows. Net
sales for each segment do not include inter-segment
transactions.
Automobile Segment
The automobile industry showed a mild recovery due torecovery of the U.S. market and the expansion of the Asianmarket. However, sales in the Japanese market declined,
attributable to the end of the economic stimulus plan. Amidsuch operating conditions, net sales of the Automobile
Segment totaled ¥804.1 billion, an increase of ¥25.8 billion(3%) from fiscal 2010. Operating income amounted to ¥32.8

2

Toyota Industries Report 2011

billion, an increase of ¥9.2 billion (39%) from fiscal 2010.
Within this segment, net sales of the Vehicle Businessamounted to ¥375.5 billion, a decrease of ¥23.2 billion (6%),
due mainly to a decline in sales of the RAV4 and Mark X ZiO,
although sales of the Vitz (Yaris outside Japan) increased.
Net sales of the Engine Business totaled ¥197.3 billion,
an increase of ¥32.3 billion (20%), attributable primarily to
an increase in sales of KD diesel engines and AR gasoline
engines.
Net sales of the Car Air-Conditioning Compressor
Business totaled ¥191.8 billion, an increase of ¥14.8 billion(8%), resulting from higher sales outside Japan, offsetting asales decline in Japan.
Materials Handling Equipment Segment
In the materials handling equipment industry, the market inemerging countries, Europe, the United States and Japan saw
signs of recovery. Toyota Industries aggressively engaged in
global sales promotion and production activities for lift trucks,
a mainstay product of this segment, in line with market
recovery. As a result, net sales of the Materials Handling
Equipment Segment totaled ¥490.6 billion, an increase of¥59.0 billion (14%). Operating income amounted to ¥23.9
billion compared with an operating loss of ¥9.5 billion in
fiscal 2010.

Ordinary Income

Income before income taxes and minority interests amounted
to ¥69.2 billion compared with loss before income taxes
and minority interests of ¥11.3 billion in fiscal 2010. An
extraordinary loss of ¥4.6 billion was recorded, which arosefrom the Great East Japan Earthquake.

Net Income
Net income totaled ¥47.2 billion compared with a net lossof ¥26.2 billion in fiscal 2010. Net income per share was¥151.51 compared with a net loss per share of ¥84.33 infiscal 2010.

Consolidated Financial Condition
Logistics Segment
Net sales of the Logistics Segment amounted to ¥107.7 billion
due to the steady performance of cash collection and delivery
services and cargo transport business of automotive-relatedparts. Operating income amounted to ¥5.3 billion, an increaseof ¥0.1 billion (2%) from fiscal 2010.
Textile Machinery Segment
Net sales of the Textile Machinery Segment totaled ¥42.7
billion, an increase of ¥21.9 billion (105%). This was due
mainly to an increase in sales of air-jet looms and spinningmachinery on the back of the economic recovery in Asia, thissegment’s primary market. Operating income amounted toTotal assets decreased ¥107.8 billion from the end of theprevious fiscal year to ¥2,481.4 billion due mainly to adecrease in market value of investment securities. Total
liabilities decreased ¥78.8 billion from the end of the previous
fiscal year to ¥1,405.5 billion due mainly to a decrease inbonds. Net assets amounted to ¥1,075.9 billion, a decreaseof ¥29.0 billion from the end of the previous fiscal year.

Liquidity and Capital Resources
Toyota Industries’ financial policy is to ensure sufficient

Cash flows from operating activities resulted in an increase in
cash of ¥153.6 billion in fiscal 2011 due mainly to income
before income taxes and minority interests of ¥69.2 billion.
Net cash provided by operating activities decreased by ¥49.8
billion from ¥203.4 billion in fiscal 2010.
Cash flows from investing activities resulted in a decreasein cash of ¥187.5 billion in fiscal 2011 attributable primarily toa net increase in time deposits amounting to ¥89.3 billion. Net
cash used in investing activities increased by ¥150.7 billion
from ¥36.8 billion for fiscal 2010.
Cash flows from financing activities resulted in a decreasein cash of ¥85.7 billion in fiscal 2011 due mainly to repaymentsof bonds of ¥49.1 billion.
After translation adjustments, cash and cash equivalents
as of March 31, 2011 stood at ¥195.5 billion, a decrease of¥122.0 billion (38%) from fiscal 2010.

Investment in Property, Plant and Equipment
During fiscal 2011, Toyota Industries made a total investmentof ¥60.0 billion in property, plant and equipment (including
vehicles and materials handling equipment for lease) in orderto launch new products, streamline and upgrade production
equipment.
In the Automobile Segment, investment in property, plant3and equipment totaled ¥20.9 billion. A primary breakdown of
this amount included ¥13.8 billion for the Company, ¥1.6
billion for Tokaiseiki Co., Ltd. and ¥1.0 billion for Michigan
Automotive Compressor, Inc.
The Materials Handling Equipment Segment made aninvestment in property, plant and equipment in the total
amount of ¥30.0 billion. The primary breakdown comprised¥0.8 billion for the Company, ¥17.0 billion for the Toyota
Material Handling Europe Group and ¥6.4 billion for the Toyota
Material Handling Australia Group.
Investment in property, plant and equipment in the
Logistics Segment totaled ¥6.7 billion, including ¥4.0 billion for
Asahi Security Co., Ltd.
The Textile Machinery Segment made an investment inproperty, plant and equipment in the total amount of ¥0.3
billion, including ¥0.2 billion for the Company.
The Others Segment made an investment in property,
plant and equipment in the total amount of ¥1.8 billion,
including ¥0.8 billion for the Company.
Necessary funds were provided by a portion of bonds aswell as cash on hand and bank loans.

Strategies and Outlook
Outlook for Results for Fiscal 2012
Although the global economy is projected to gradually recoverin fiscal 2012, uncertainties remain with regards to credit
contraction, further deterioration in the employment situationand fluctuations in raw material prices such as crude oil, as
well as concerns about exchange rate fluctuations. The
operating environment in Japan is expected to remain severe,as the impacts of the earthquake on the economy could
become more serious or prolonged.
Amid this challenging environment, Toyota Industries willcontinue to undertake concerted efforts to strengthen its
management platform and raise corporate value. As
immediate tasks, we will make a strong effort to recoverquickly from the production decrease owing to the effect of
the earthquake. We will make a flexible production plan andsupport suppliers. We will also promote business and cost
structure reforms to realize a solid management platform sothat we can respond quickly to the changing market
circumstances.
Specifically, we will maintain a streamlined structure
through the reduction of fixed costs and enhance ourbusiness in established markets in developed countries. In
addition, we will accelerate our business expansion into
rapidly growing emerging countries by thoroughly andmeticulously monitoring market conditions in respective
regions and introducing products suited to the characteristics
and needs of each market. Toyota Industries will also strive toestablish production/supply structures to realize optimum
product pricing and delivery and to enhance the value chain to4

Toyota Industries Report 2011provide a wide range of customer services in each country
and region.
Based on quality first, Toyota Industries regards giving
considerations to the environment and safety as well as
increasing our competitive strengths to be important issues totackle over the medium to long term. We will promote productdevelopment and advanced technology development to offer
high value-added products that anticipate customer needs.
Specifically, we will pursue business expansion by refining
our element technologies for contributing to electrification,lighter weight and energy efficiency and by incorporatingthese technologies into new products released by ourmainstay businesses of automobiles and materials handlingequipment. This approach is based on the keywords ofthe 3Es, which Toyota Industries defines as “energy,”“environmental protection” and “ecological thinking”
incorporated into our products and operating activities.
To support such consolidated management on a global
scale, Toyota Industries will strive to nurture people who takethe initiative to learn, think and act and who will enhance thepower of the workplace.
In addition to placing top priority on safety, we willthoroughly enforce compliance, including observance of laws
and regulations, and actively participate in social contribution
activities. Through these and further measures, Toyota
Industries aims to meet the trust of society, raise corporate
value and grow in harmony with society.

Dividend Policy
Toyota Industries regards the benefits of shareholders as oneof its most important management policies. Based on thisstance, we will strive to strengthen Toyota Industries’
corporate constitution, promote proactive businessdevelopment and raise its corporate value.
Toyota Industries’ dividend policy is to meet the
expectations of shareholders for continuous dividends while
giving full consideration to business performance, funding
requirements, the dividend payout ratio and other factors.
Toyota Industries’ Ordinary General Meeting of Shareholders,
held on June 16, 2011, approved a year-end cash dividend of¥25.0 per share. Including the interim cash dividend of ¥25.0
per share, cash dividends for the year totaled ¥50.0 per share,
an increase of ¥20.0 per share from fiscal 2010.
Toyota Industries will use retained earnings to improve thecompetitiveness of its products, augment production capacity
in and outside Japan, as well as to expand into new fields ofbusiness and strengthen its corporate constitution in securing
future profits for its shareholders.
The Company’s Articles of Incorporation stipulate that it
may pay interim cash dividends as prescribed in Article 454-5of the Corporation Law, and it is the Company’s basic policy
to pay dividends from retained earnings twice a year (interim

and annual).
The Company’s Articles of Incorporation also stipulate thatwhat is prescribed in Article 459-1 of the Corporation Law canbe added to the Articles of Incorporation. As the Company’s
policy, discretion to pay interim cash dividends is determinedby the Board of Directors while payment of year-end cash
dividends is subject to approval at the Ordinary General
Meeting of Shareholders.

Risk Information
The following represent risks that could have a material impact
on Toyota Industries’ financial condition, business results andshare prices. Toyota Industries judged the following as futurerisks as of March 31, 2011.

Principal Customers
Toyota Industries’ automobile and engine products are soldprimarily to Toyota Motor Corporation (TMC). In fiscal 2011,
net sales to TMC accounted for 41.0% of consolidated net
sales. Therefore, TMC’s vehicle sales could have an impact on
Toyota Industries’ business results. As of March 31, 2011,
TMC holds 24.61% of the Company’s voting rights.

Product Development Capabilities
Based on the concept of “developing appealing new
products,” Toyota Industries proactively develops new
products by utilizing its leading-edge technologies, as it strives
to anticipate increasingly sophisticated and diversifying needsof the market and ensure the satisfaction of its customers.
R&D activities are focused mainly on developing andupgrading products in current business fields and peripheral
sectors. Toyota Industries expects that revenues derived fromthese fields will continue to account for a significant portion of
total revenues and anticipates that future growth will be
contingent on the development and sales of new products inthese fields. Toyota Industries believes that it can continue todevelop appealing new products. However, Toyota Industries
may not be able to forecast market needs and develop andintroduce appealing new products in a timely manner. This
could result in lower future growth and have an adverse
impact on Toyota Industries’ financial condition and businessresults.
Such a situation could result from risks that include noassurance Toyota Industries can allocate sufficient future
funds necessary for the development of appealing new
products; no assurance that product sales will be successful,as forecasts of products supported by the market may notalways be accurate; and no assurance that newly developed
products and technologies will always be protected as
intellectual property.

Intellectual Property Rights
In undertaking its business activities, Toyota Industries has
acquired numerous intellectual property rights, including thoseacquired outside Japan, such as patents related to its
products, product designs and manufacturing methods.
However, not all patents submitted will necessarily be
registered as rights, and these patents could thus be rejectedby patent authorities or invalidated by third parties. Also, athird party could circumvent a patent of Toyota Industries andintroduce a competing product into the market. Moreover,Toyota Industries’ products utilize a wide range oftechnologies. Therefore, Toyota Industries could become aparty subject to litigation involving the intellectual property
rights of a third party.

Product Defects
Guided by the basic philosophy of “offering products andservices that are clean, safe and of high quality,” Toyota
Industries makes its utmost efforts to enhance quality.
However, Toyota Industries cannot guarantee all its products
will be defect-free and that product recalls will not be made in
the future. Product defects that could lead to large-scale
recalls and product liability indemnities could result in large
cost burdens and have a significant negative impact on theevaluation of Toyota Industries. It could also have an adverse
effect on Toyota Industries’ financial condition and businessresults due to a decrease in sales, deterioration of profitability
and decrease in share prices of Toyota Industries.

Price Competition
Toyota Industries faces extremely harsh competition in eachof the industries in which it conducts business, including its
Automobile and Materials Handling Equipment businesses,
which are the core of Toyota Industries’ earnings foundation.
Toyota Industries believes it offers high value-added productsthat are unrivalled in terms of technology, quality and cost.
Amid an environment characterized by intensifying pricecompetition, however, Toyota Industries may be unable tomaintain or increase market share against low-costcompetitors or to maintain profitability. This could have an
adverse impact on Toyota Industries’ financial condition andbusiness results.

Reliance on Suppliers of Raw Materials andComponents
Toyota Industries’ products rely on various raw materials andcomponents from suppliers outside Toyota Industries. Toyota
Industries has concluded basic business contracts withthese external suppliers and assumes it can carry out stabletransactions for raw materials and components. However,Toyota Industries has no assurances against future shortagesof raw materials and components, which arise from a global
shortage due to tight supply or an unforeseen accident
involving a supplier. Such shortages could have a negative5

effect on Toyota Industries’ production and cause an increasein costs, which could have an adverse impact on Toyota
Industries’ financial condition and business results.

Environmental Regulations
In view of its social responsibilities as a company, Toyota
Industries strives to reduce any burden on the environment
resulting from its production processes, as well as strictly
adheres to applicable environmental laws and regulations.
However, various environmental regulations could also be
revised and strengthened in the future. Accordingly, any
expenses necessary for continuous strict adherence to theseenvironmental regulations could result in increased businesscosts and have an adverse impact on Toyota Industries’
financial condition and business results.

Alliances with Other Companies
Aiming to expand its businesses, Toyota Industries engages
in joint activities with other companies through alliances andjoint ventures. However, a wildly fluctuating market trend or adisagreement between Toyota Industries and its partners,
owing to business, financial or other reasons, could prevent
Toyota Industries from deriving the intended benefits of its
alliances.

Effects of Disasters, Power Blackouts and Other
Incidents
Toyota Industries carries out regular checks and inspections of
its production facilities to minimize the effect of production
breakdown. However, there is no assurance Toyota Industries
can completely prevent or lessen the impact of man-made or
natural disasters and power blackouts occurring at Toyota
Industries’ and its suppliers’ production facilities. Specifically,
the majority of Toyota Industries’ domestic production facilities
and most of its business partners are situated in the Chubu
region. Therefore, major disasters at this region could delay orstop production or shipment activities. Such prolonged delays
and stoppages could have an adverse impact on Toyota
Industries’ financial condition and business results.

Latent Risks Associated with International
Activities
Toyota Industries manufactures and sells products andprovides services in various countries. Such unforeseen
factors as social chaos, including political disruptions,terrorism and wars, as well as changes in economic
conditions, could have an adverse impact on Toyota
Industries’ financial condition and business results.

Retirement Benefit Liabilities
Exchange Rate Fluctuations
Toyota Industries’ businesses encompass the production andsales of products and the provision of services worldwide.
Generally, the strengthening of the yen against othercurrencies (especially against the U.S. dollar and the euro,
which account for a significant portion of Toyota Industries’
sales) has an adverse impact on Toyota Industries’ business,while a weakening of the yen has a favorable impact. An
increase in the value of currencies in countries or regions
where Toyota Industries carries out production could lead toan increase in local production, procurement and distribution
costs. Such an increase in costs could reduce Toyota
Industries’ price competitiveness. Additionally, because export
sales of several businesses are denominated mainly in yen,exchange rate fluctuations could have an adverse impact on
Toyota Industries’ financial condition and business results due
to a change in market prices.

Share Price Fluctuations
Toyota Industries holds marketable securities, and therefore
bears the risk of price fluctuations of these shares. Based onfair market value of these shares at the end of the fiscal year
under review, Toyota Industries had unrealized gains.
However, unrealized gains on marketable securities could
worsen depending on future share price movements.
Additionally, a fall in share prices could reduce the value ofpension assets, leading to an increase in the pension shortfall.

6

Toyota Industries Report 2011

Toyota Industries’ employee retirement benefit expenses andliabilities are calculated based on expected rates of returnon pension assets as well as assumptions upon making
actuarial calculations that incorporate discount rates and otherfactors. Therefore, differences between actual results andassumptions as well as changes in the assumptions could
have a significant impact on recognized expenses andcalculated liabilities in future accounting periods.

Significant Accounting Policies andEstimates
Toyota Industries’ financial statements are prepared inconformity with accounting principles and practices generally
accepted in Japan. In preparing financial statements,
management must make estimates, judgments andassumptions that affect reported amounts of assets andliabilities at fiscal year-end as well as revenues and expenses
during each fiscal year. Among Toyota Industries’ significant
accounting policies, the following categories require a
considerable degree of judgment and estimation and arehighly complex.

examining the feasibility of collection for receivables that seemto be uncollectible. Evaluating the allowance for doubtful
accounts involves judgments made in accordance with thenature of the situation, and this allowance represents anessential and crucial estimate—including future estimatesof cash flow amounts and timing—that could change
significantly. Based on currently available information, Toyota
Industries’ management believes its present allowance for
doubtful accounts is sufficient. However, the need tosignificantly increase allowance for doubtful accounts in the
future could have an adverse impact on Toyota Industries’
business results.

date, TMC holds 24.61% of Toyota Industries’ total voting
rights. Toyota Industries is a TMC affiliate accounted for by theequity method.

Business RelationshipToyota Industries assembles certain cars and produces
automobile engines under consignment from TMC.
Additionally, we sell a portion of our other components andproducts directly or indirectly to other Toyota Group
companies. In fiscal 2011, our net sales to TMC accounted
for 41.0% of our consolidated net sales.

Contributions to the Toyota Group
Allowance for Retirement Benefits
Calculations differ for retirement benefits, retirement benefit
expenses and liabilities after employee retirement, as well as
benefits for employees on leave of absence, because different
assumptions are used at the time of calculation. Assumptions
include such factors as discount rates, amount of benefits,interest expenses, expected rates of return on pension assets
and mortality rates. The difference in amounts between theseassumptions and actual results is calculated cumulatively andamortized over future accounting periods, and thus becomes
an expense and is recognized as a liability in future accounting
periods. Toyota Industries believes its assumptions arereasonable. However, differences between actual results orchanges in the assumptions could have an impact onretirement benefits and retirement benefit expenses andliabilities after employee retirement.

As a member of the Toyota Group, Toyota Industries aims
to contribute to strengthening the competitiveness of
TMC and other Toyota Group companies in such areas asquality, cost, delivery and technologies. Toyota Industries isconfident that raising the Toyota Group’s competitiveness willlead to increases in our sales to and profits from the Toyota
Group, thereby contributing to raising Toyota Industries’
corporate value.

Toyota Industries’ Relationship to Toyota
Motor Corporation
Due to historical reasons, Toyota Industries maintains close
relationships with Toyota Motor Corporation (TMC) and Toyota
Group companies in terms of capital and business dealings.

Historical BackgroundIn 1933, Kiichiro Toyoda, the eldest son of founder Sakichi
Toyoda and then Managing Director of Toyota Industries (thenToyoda Automatic Loom Works, Ltd.), established theAutomobile Department within the Company based on his
resolve to manufacture Japanese-made automobiles. In 1937,
the Automobile Department was spun off and became an
independent company, Toyota Motor Co., Ltd. (the present
Toyota Motor Corporation).

Capital Relationship
Allowance for Doubtful Accounts
To prepare for the risk of receivables becoming uncollectible,
Toyota Industries estimates its allowance for doubtful
accounts by utilizing the percentage of historical experiencesin credit losses for ordinary receivables and individually

In light of this historical background, Toyota Industries and
TMC have maintained a close capital relationship. As of March
31, 2011, Toyota Industries holds 6.88% (215,640 thousand
shares) of TMC’s total shares issued. Likewise, as of the same

7

Consolidated Balance Sheets

Toyota Industries Corporation
As of March 31, 2011 and 2010
Millions of yen

ASSETS

Millions of yen

LIABILITIES AND NET ASSETS

2011

2010

¥ 198,654¥ 287,965

152,121

163,708

Current assets:
Cash and deposits
Trade notes and accounts receivable (Note 8)
Lease investment assets (Notes 3 and 23)

35,146—

Short-term investments

132,430

71,391

Merchandise and finished goods (Notes 4 and 8)

42,94037,358Work in process (Notes 4 and 8)

31,25625,672

Raw materials and supplies (Notes 4 and 8)

30,06525,318Deferred tax assets (Note 22)

18,493

17,182Other current assets

32,64647,307

Allowance for doubtful accounts(2,863)(3,103)670,893

672,801

Buildings and structures (Notes 5 and 8)

159,606

169,991

Machinery, equipment and vehicles (Notes 5 and 8)

185,988

212,079

Total current assets
Fixed assets:
Property, plant and equipment:

Tools, furniture and fixtures (Note 5)

23,634

21,840Land (Note 8)

119,697

119,517

8,350

8,547

Construction in progress
Total property, plant and equipment

497,278

531,977

Goodwill

68,57372,745

Software

10,767

9,976

Total intangible assets

79,34082,722

1,123,306

1,162,685

—

5,554

Deferred tax assets (Note 22)

9,786

10,429Lease investment assets (Notes 3 and 23)

71,480—

Other investments and other assets (Note 7)

29,539123,278

(173)

(202)

1,233,940

1,301,744

1,810,559

1,916,444¥ 2,481,452¥ 2,589,246

Intangible assets:

Investments and other assets:
Investments in securities (Notes 7 and 8)
Long-term loans receivable

Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

2011

2010

¥ 144,956
99,946
11,13330,82937,873
14,34918,320737
521
153,275¥ 141,787
46,241
9,575
50,446—13,14915,014316
310
158,100

511,944434,941

205,649
236,60282,813309,256
46,924
12,321

231,401
299,208
108,014351,00945,234
14,507

893,568
1,405,512

1,049,375
1,484,316

80,46280,462

106,179
412,029(50,703)

106,179
378,648(50,689)

Total shareholders’ equity

547,968

514,601

Accumulated other comprehensive income:
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment

488,277
46(8,075)544,068(9)(2,430)480,248
2,132
45,589
1,075,939¥ 2,481,452

541,628
1,720
46,978
1,104,929¥ 2,589,246

Current liabilities:
Trade notes and accounts payable
Short-term loans payable (Note 8)
Commercial paper
Current portion of bonds
Lease obligations (Notes 3 and 23)
Accounts payable—otherAccrued income taxes
Deferred tax liabilities (Note 22)
Allowance for bonuses to directors and corporate auditors
Other current obligations (Note 8)
Total current liabilities
Long-term liabilities:
Bonds payable (Note 6)Long-term loans payable (Notes 6 and 8)
Lease obligations (Notes 2, 3 and 6)
Deferred tax liabilities (Note 22)
Allowance for retirement benefits (Note 9)
Other long-term liabilities (Notes 3 and 10)
Total long-term liabilities
Total liabilities
Shareholders’ equity (Note 13):
Capital stock
Authorized — 1,100,000,000 shares
Issued— 325,840,640 shares as of March 31, 2011
325,840,640 shares as of March 31, 2010
Capital surplus
Retained earnings
Treasury stock
14,275,721 shares as of March 31, 2011
14,269,943 shares as of March 31, 2010

Total accumulated other comprehensive income
Subscription rights to shares
Minority interests
Total net assets
Total liabilities and net assets

The accompanying notes are an integral part of these financial statements.

8

Toyota Industries Report 20119

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Toyota Industries Corporation
For the years ended March 31, 2011 and 2010

Toyota Industries Corporation
For the years ended March 31, 2011 and 2010
Millions of yen

Millions of yen

2011

2010

Net sales¥ 1,479,839¥ 1,377,769

Income before minority interests (Note 16)

Cost of sales (Note 14)

1,250,313

1,194,399

Other comprehensive income

229,526

183,370

Gross profit

2011

Selling, general and administrative expenses (Notes 14 and 20):

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Sales commissions

8,913

6,814

Foreign currency translation adjustment

Salaries and allowances

62,96964,716

Share of other comprehensive income of associates accounted for using equity method

Retirement benefit expenses

2,020

1,953

Comprehensive income

Depreciation

6,332

8,151

Profit attributable to:

Research and development expenses

21,727

19,482

Owners of the parent

Others

58,76560,248

Minority interests

68,79822,002

Interest income

9,172

10,804

Dividends income

14,975

15,297

Gain on sales of marketable securities

488

135

Equity in net earnings of affiliated companies

—

744

7,407

7,413

Interest expenses(15,773)(17,847)

Loss on disposal of fixed assets(1,281)(1,257)(473)—

Operating income¥ 49,058

2010

¥

—

(55,834)—

55—(6,375)

—

(300)

—

(13,396)—(14,174)

—

777

—

The accompanying notes are an integral part of these financial statements.

Non-operating income:

Other non-operating income
Non-operating expenses:

Equity in net losses of affiliated companies
Other non-operating expenses
Ordinary income(9,402)(5,535)73,911

31,756(4,631)—

Extraordinary losses (Note 15):
Losses on the Great East Japan Earthquake
Losses on business restructuring of the Materials Handling Equipment Segment—(43,099)

69,279(11,343)

Income taxes — current (Note 22)25,456

13,320

Income taxes — deferred (Note 22)(5,234)(438)

Income (loss) before income taxes and minority interests

Income before minority interests
Income on minority interests in consolidated subsidiaries
Net income (loss)¥

49,058

—

1,852

2,048

47,205¥(26,273)

Yen

Net income (loss) per share— basic (Note 28)
Net income (loss) per share— diluted (Note 28)
Net assets per share (Note 29)
Cash dividends per share¥ 151.51¥(84.33)——3,300.17

3,390.02

50.00

30.00

The accompanying notes are an integral part of these financial statements.

10

Toyota Industries Report 201111

Consolidated Statements of Changes in Net Assets

Toyota Industries Corporation
For the years ended March 31, 2011 and 2010
Millions of yen

2011

Shareholders’ equity
Capital stock
Balance at the end of previous period
Balance at the end of current period
Capital surplus
Balance at the end of previous period
Changes of items during the period
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Retained earnings
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Increase (decrease) due to increase in consolidated subsidiaries
Increase (decrease) due to decrease in consolidated subsidiaries
Net income (loss)
Total changes of items during the period
Balance at the end of current period
Treasury stock
Balance at the end of previous period
Changes of items during the period
Repurchase of treasury stock
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Total shareholders’ equity
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Increase (decrease) due to increase in consolidated subsidiaries
Increase (decrease) due to decrease in consolidated subsidiaries
Net income (loss)
Repurchase of treasury stock
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period¥

80,46280,462Millions of yen

2010

¥

80,46280,462

106,179

106,180(0)(0)
106,179(0)(0)
106,179

378,648412,294(14,020)—
196
47,20533,381
412,029(6,231)(1,138)(1)(26,273)(33,646)
378,648(50,689)(50,672)

(15)
1
(13)
(50,703)

(18)
1
(16)
(50,689)

514,601

548,264(14,020)—
196
47,205(15)
033,367547,968(6,231)(1,138)(1)(26,273)(18)
0(33,663)514,601

544,068

392,489(55,790)(55,790)488,277

151,578
151,578
544,068

2011

Deferred gains or losses on hedges
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Foreign currency translation adjustment
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Total accumulated other comprehensive income
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Subscription rights to shares
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Minority interests
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Total net assets
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Increase (decrease) due to increase in consolidated subsidiaries
Increase (decrease) due to decrease in consolidated subsidiaries
Net income (loss)
Repurchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period

¥

2010

(9)

¥

24

55
55
46

(33)
(33)
(9)

(2,430)(10,048)(5,645)(5,645)(8,075)

7,618
7,618
(2,430)541,628

382,466(61,380)(61,380)
480,248

159,162
159,162541,628

1,720

1,224

411
411
2,132

496
496
1,720

46,97845,715(1,389)(1,389)45,5891,263
1,263
46,978

1,104,929

977,670(14,020)—
196
47,205(15)
0(62,357)(28,990)¥ 1,075,939(6,231)(1,138)(1)(26,273)(18)
0160,922
127,259¥ 1,104,929

The accompanying notes are an integral part of these financial statements.

12

Toyota Industries Report 201113

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Toyota Industries Corporation
For the years ended March 31, 2011 and 2010

1. Basis of presenting consolidated financial statements:
Millions of yen

Cash flows from operating activities:
Income (loss) before income taxes and minority interests
Depreciation and amortization
Impairment loss
Increase (decrease) in allowance for doubtful accounts
Interest and dividends income
Interest expenses
Equity in net (earnings) losses of affiliated companies(Increase) decrease in receivables(Increase) decrease in inventories
Increase (decrease) in payables
Others, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes (paid) received
Net cash provided by operating activities
Cash flows from investing activities:
Payments for purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Payments for purchases of investment securities
Proceeds from sales of investment securities
Payments for acquisition of subsidiaries’ stock resulting in change in scope of consolidation
Proceeds from sales of subsidiaries’ stock resulting in change in scope of consolidation
Payments for loans madeProceeds from collections of loans
Net decrease (increase) in time deposits
Others, net
Net cash used in investing activities
Cash flows from financing activities:
Increase in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuances of bonds
Repayments of bonds
Payments for repurchase of treasury stocks
Cash dividends paid
Cash dividends paid to minority shareholders
Proceeds from payment by minority shareholders
Others, net
Net cash used in financing activities
Translation adjustments of cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
The accompanying notes are an integral part of these financial statements.

14

Toyota Industries Report 2011

2011

2010

¥ 69,279
89,576—(195)(24,148)
15,773473
11,650(16,953)
3,440
19,228168,125
24,173(15,882)(22,755)
153,661¥ (11,343)
110,119
36,902
84(26,101)
17,847(744)(777)
17,334
36,164
7,372
186,859
26,145(17,976)
8,424
203,452(48,085)
7,645(56,000)
2,963
(25)
41
(30)
730
(89,351)(5,461)(187,574)(48,312)15,729(3,927)
197
(781)
—
(293)
2,003
—
(1,470)(36,855)(6,759)
240
(826)
4,002
(49,180)(15)(14,020)(528)
143(18,784)(85,728)(2,382)(122,024)
317,590¥ 195,566(37,614)
27,820(1,915)50,000(33,286)(18)(6,231)(625)—(36,359)(38,230)
1,211
129,578
188,011¥ 317,590

The accompanying consolidated financial statements have been
prepared based on the accounts maintained by Toyota Industries
Corporation (the “Company”) and its consolidated subsidiaries(together, hereinafter referred to as “Toyota Industries”) in accordancewith the provisions set forth in the Corporation Law of Japan and the

Financial Instruments and Exchange Law, and in conformity withaccounting principles generally accepted in Japan, which are different
in certain respects from the application and disclosure requirements ofInternational Financial Reporting Standards.

2. Summary of significant accounting policies:(1) Consolidation(2) Equity method

The consolidated financial statements include the accounts of theCompany and its 162 subsidiaries (38 subsidiaries in Japan and 124
subsidiaries outside Japan) as of March 31, 2011, and 159
subsidiaries (40 subsidiaries in Japan and 119 subsidiaries outside
Japan) as of March 31, 2010.
For the year ended March 31, 2011, 11 subsidiaries were newly
added to the scope of consolidation and eight companies were
excluded from the scope of consolidation because of liquidation andmergers as a result of reorganization. Changes in the number ofconsolidated subsidiaries for the year ended March 31, 2011 arelisted below.

Investments in 12 major affiliates in 2011 and 13 major affiliates in2010 are accounted for by the equity method of accounting.
For the year ended March 31, 2011, one company was excluded
from the scope of equity-method accounting as a result of the changes
in shareholdings. Changes in the number of affiliates to which the equity
method applied for the year ended March 31, 2011 are listed below.

(increase)
TOYOTA L&F Fukui Co., Ltd.
Toyota Textile Machinery (Shanghai) Co., Ltd.
Wanbishi Archives China Co., Ltd.
P.T. TD Automotive Compressor Indonesia
Toyota Material Handling North America, Inc.
Toyota Material Handling India Pvt. Ltd.
Atlas Toyota Material Handling, LLC
Four companies of Toyota Material Handling Europe AB Group(decrease)
TF Logistics Co., Ltd.
ACTIS Manufacturing, Ltd., LLC
Two companies of Aichi Corporation
Four companies of Toyota Material Handling Europe AB GroupFor the year ended March 31, 2010, two subsidiaries were newly
added to the scope of consolidation and three companies were
excluded from the scope of consolidation because of liquidation andmergers as a result of reorganization. Changes in the number ofconsolidated subsidiaries for the year ended March 31, 2010 are
listed below.
(increase)
North Vernon Industry Corp.
Cullman Casting Corporation(decrease)
ALTRAN Corporation
Logistics Planning Tokyo Co., Ltd.
SKE INC.
The fiscal years of certain subsidiaries are different from the fiscal
year of the Company. Since the difference is not more than threemonths, the Company is using those subsidiaries’ statements for
those fiscal years, making adjustments for significant transactions thatmaterially affect the financial position or results of operations.
All significant inter-company transactions, balances and unrealized
profits within Toyota Industries have been eliminated.

(decrease)
FUJI LOGISTICS CO., LTD.
For the year ended March 31, 2010, there were no changes in thescope of equity-method accounting.
Some of the affiliates are not accounted for under the equity
method since their net income/losses, retained earnings and otherfinancial amounts are immaterial.

(3) Translation of foreign currencies
Foreign currency denominated receivables and payables aretranslated into Japanese yen at the year-end exchange rates and theresulting transaction gains or losses are included in the consolidated
statements of income.
All asset and liability accounts of foreign subsidiaries and affiliates aretranslated into Japanese yen at year-end exchange rates and all revenue
and expense accounts are translated at prevailing fiscal average rates.

(4) Cash and cash equivalents
Cash and cash equivalents are cash on hand, readily available
deposits and short-term highly liquid and low risk investments withmaturities not exceeding three months at the time of purchase.

(5) Short-term investments and investment securities
Toyota Industries classifies securities into four categories by purposeof holding: trading securities, held-to-maturity securities, other securities
and investments in affiliates. Toyota Industries did not have trading
securities or held-to-maturity securities as of March 31, 2011 and 2010.
Other securities with readily determinable fair values are stated atfair value based on market prices at the end of the year. Unrealized
gains and losses are included in “Valuation difference on available-forsale securities” as a separate component of net assets. Cost of salesof such securities is determined by the moving-average method.
Other securities without readily determinable fair values are stated atcost, as determined by the moving-average method.
Investments in affiliates are accounted for by the equity method(see Note 2 (2)).
Investments in affiliates not accounted for by the equity method
are stated at cost due to their insignificant effect on the consolidated
financial statements.

15

(6) Inventories(14) Hedge accounting

Inventories are stated mainly at cost determined by the movingaverage method (the values on the consolidated balance sheets arecalculated through the write-down method based on the deteriorationof profitability).

(a) Method of hedge accounting
Mainly the deferral method of hedge accounting is applied. In thecase of foreign currency forward contracts and foreign currency
option contracts, the hedged items are translated at contracted
forward rates if certain conditions are met.
As for the interest rate swap contracts, which meet therequirements of the preferential accounting method, the preferential
accounting method is applied.
(b) Hedging instruments and hedged items
Hedging instruments: Derivative instruments (foreign currency
forward contracts, foreign currency option
contracts, foreign currency swaps and interest
rate swaps)
Hedged items:
Risk of change in interest rate on borrowings,
receivables and payables and risk of change inforward exchange rates on transactions
denominated in foreign currencies (borrowings,
receivables and payables, and forecasted
transactions)(c) Hedging policy
Hedging transactions are executed and controlled based on Toyota
Industries’ internal policy and Toyota Industries is hedging interest raterisks and foreign currency risks. Toyota Industries’ hedging activities
are reported periodically to a director responsible for accounting.
(d) Method used to measure hedge effectivenessHedge effectiveness is measured by comparing accumulated changes
in market prices of hedged items and hedging instruments oraccumulated changes in estimated cash flows from the inception of
the hedge to the date of measurements performed. Currently it isconsidered that there are high correlations between them.

(7) Property, plant and equipment, and depreciation(Except for lease assets)
Property, plant and equipment are stated at cost. Depreciation
expenses of property, plant and equipment are computed mainly by
the declining-balance method for the Company and subsidiaries.
Significant renewals and additions are capitalized at cost. Repairs
and maintenance are charged to income as incurred.

(8) Intangible assets and amortization
Amortization of intangible assets is computed using the straight-line
method. Software costs for internal use are amortized by thestraight-line method over their expected useful lives (mainly five years).

(9) Lease transactions
The depreciation method of leased properties on finance leases thatare deemed to transfer the ownership of the leased properties tolessees is the same as those applied to properties owned by Toyota
Industries.
The depreciation method of leased properties on finance leases
other than those deemed to transfer the ownership of leased
properties to lessees is computed mainly by the straight-line method,which assumes zero residual value and the leasing term to be for theuseful life of the asset.
As for the finance leases other than finance leases deemed totransfer the ownership of leased properties to lessees, those thatcame into effect before March 31, 2008 (inclusive) will continue to beaccounted for by the former method (similar to the method applicableto ordinary operating leases).

(10) Allowances for doubtful accounts
Toyota Industries adopted the policy of providing an allowance for
doubtful accounts in an amount sufficient to cover possible losses oncollection by estimating individually uncollectible amounts andapplying to the remaining accounts a percentage determined bycertain factors such as historical collection experiences.

Goodwill, if material, is amortized principally over less than 20 years
on a straight-line basis, while immaterial goodwill is charged to gain orloss as incurred.

(16) Consumption tax(11) Allowance for bonuses to directors, managing
officers and corporate auditors

The consumption tax under the Japanese Consumption Tax Law
withheld by Toyota Industries on sales of goods is not included in theamount of net sales in the accompanying consolidated statements ofincome, and the consumption tax paid by Toyota Industries under thelaw on purchases of goods and services and expenses is not includedin the related amount.

Bonuses to directors, managing officers and corporate auditors arerecorded on the accrual basis with a related change to income.

(17) Income taxes(12) Allowance for retirement benefits
Toyota Industries accrues an amount which is considered to be
incurred in the period based on the estimated projected benefit
obligations and estimated pension assets at the end of the year. To
provide for the retirement benefits for directors, managing officers andcorporate auditors, an amount which is calculated at the end of theyear as required by an internal policy describing the retirement
benefits for directors and managing officers is accrued.

(13) Accounting standards for finance leasetransactions
As for the accounting standards for finance lease transactions, net
sales and cost of sales are recognized when the lease payments arereceived or when the lease transactions are started.

16(15) Goodwill and amortization

Toyota Industries Report 2011

The provision for income taxes is computed based on the pretax
income included in the consolidated statements of income. The asset
and liability approach is used to recognize deferred tax liabilities andassets for the expected future tax consequences of temporary
differences between the carrying amounts and the tax bases of assets
and liabilities.

(18) Net income per share
The computation of basic net income per share is based on theweighted-average number of outstanding shares of common stock.
The calculation of diluted net income per share is similar to thecalculation of basic net income per share, except that the weightedaverage number of shares outstanding includes the additional dilution
from potential common stock equivalents such as subscription rights
to shares. Cash dividends per share shown in the statements ofincome are the amounts applicable to the respective years.

3. Changes in accounting policies and adoption of new accounting standards:
For the year ended March 31, 2011
Accounting Standard for Asset Retirement Obligations
Effective from the fiscal year beginning April 1, 2010, Toyota Industries
applies Financial Accounting Standard No. 18 “Accounting Standard
for Asset Retirement Obligations” and its Implementation Guidance
No. 21 “Guidance on Accounting Standard for Asset Retirement
Obligations,” both of which were issued on March 31, 2008 by the
Accounting Standards Board of Japan.
As a result, operating income decreased by ¥93 million. Ordinary
income and income before income taxes also decreased by ¥1,090
million, respectively.

Classification Change in Consolidated Financial
Statements(1) Consolidated Balance Sheets“Lease investment assets” (included in “Other current assets” and“Other investments and other assets” in the previous fiscal year) and“Lease obligations” (included in “Other current liabilities” under“Current liabilities” in the previous fiscal year) are listed as a separate
item from the fiscal year beginning April 1, 2010 due to the increasein materiality.
In the previous fiscal year, ¥15,455 million of “Lease investment
assets” was in “Other current assets” under “Current assets,” ¥95,064
million of “Lease investment assets” was in “Other investments andother assets” under “Investments and other assets” and ¥15,576
million of “Lease obligations” was in “Other current liabilities” under“Current liabilities.”“Long-term loans receivable” (listed as a separate item in theprevious fiscal year), amounting to ¥4,865 million, is included in“Other investments and other assets” under “Investments and otherassets” in the fiscal year beginning April 1, 2010 due to the decreasein materiality.
(2) Consolidated Statements of Income
Effective from the fiscal year beginning April 1, 2010, Toyota Industries
applies Ordinance of the Ministry of Justice No. 7 “Ordinance forPartial Revision of Enforcement Regulations of the Corporation Law
and the Company Accounting Regulations,” which was issued on
March 27, 2009 and is based on Financial Accounting Standard
No. 22 “Accounting Standard for Consolidated Financial Statements”

issued on December 26, 2008 by the Accounting Standards Board ofJapan. Accordingly, Toyota Industries includes “Income before
minority interests” in the financial statements from the fiscal year
beginning April 1, 2010.
(3) Consolidated Statements of Cash Flows“Net decrease (increase) in time deposits” (included in “Others, net”
under “Cash flows from investing activities” in the previous fiscal year),amounting to ¥9 million, is listed as a separate item from the fiscal
year beginning April 1, 2010 due to the increase in materiality.

Accounting Standard for Presentation ofComprehensive Income
Effective from the fiscal year beginning April 1, 2010, Toyota Industries
applies Financial Accounting Standard No. 25 “Accounting Standard
for Presentation of Comprehensive Income,” which was issued onJune 30, 2010.
As a result, “Valuation and translation adjustments” and “Total
valuation and translation adjustments” are newly stated as“Accumulated other comprehensive income” and “Total accumulated
other comprehensive income” due to a change in presentation.

For the year ended March 31, 2010
Accounting Standard for Construction Contracts
Effective from the fiscal year beginning April 1, 2009, Toyota Industries
applies Financial Accounting Standard No. 15 “Accounting Standard
for Construction Contracts” and its Implementation Guidance No. 18“Guidance on Accounting Standard for Construction Contracts,” bothof which were issued on December 27, 2007 by the AccountingStandards Board of Japan. This modification does not have asignificant effect on the income (or loss) of the Company.

Partial Amendments to Accounting Standard for
Retirement Benefits (Part 3)
Effective from the fiscal year beginning April 1, 2009, Toyota Industries
applies Financial Accounting Standard No. 19 “Partial Amendments
to Accounting Standard for Retirement Benefits (Part 3),” which was
issued on July 31, 2008 by the Accounting Standards Boardof Japan. This modification has no effect on the income (or loss) of
the Company.

4. Inventories:
Inventories as of March 31, 2011 and 2010 consist of the following:
Millions of yen

Merchandise and finished goods
Raw materials
Work in process
Supplies
Total

2011
¥
42,94018,383
31,256
11,682¥ 104,263

2010
37,35814,12725,672
11,190¥88,349¥17

(3) Other debts as of March 31, 2011 and 2010 consist of the following:

5. Property, plant and equipment:

Millions of yen

Accumulated depreciation as of March 31, 2011 and 2010 is as follows:
Millions of yen

Weighted-averageinterest rate (%)

2011¥
40,712

2010¥
33,51059,233
236,602

12,731
299,208

1.00
1.47

37,87382,813
11,133¥ 468,368

15,576108,0149,575¥ 478,617

—
—
2.17
—

6. Long-term debt:

Short-term loans payable
Long-term loans payable:
Current portion
Non-current portion
Lease obligations:
Current portion
Non-current portion
Commercial paper
Total(1) Bonds payable as of March 31, 2011 and 2010 consist of the following:

The interest rate is the weighted-average interest rate for the ending balances of those debts. The interest rate of lease obligations is omitted since the amount shown on the
consolidated balance sheets does not exclude interest receivable, which is included in total lease payment receivable.

Buildings and structures
Machinery, equipment and vehicles
Tools, furniture and fixtures
Total

2011
¥ 208,325
591,219
88,272¥ 887,816

2010¥ 196,985
569,604
86,215¥ 852,805

Millions of yen

2011
1.91% bonds due 2010 without collateral
1.13% bonds due 2012 without collateral
1.03% bonds due 2012 without collateral
1.46% bonds due 2014 without collateral
1.01% bonds due 2010 without collateral
1.66% bonds due 2015 without collateral
0.45–2.65% medium-term notes due 2012–2015 without collateral
1.95% bonds due 2016 without collateral
1.72% bonds due 2018 without collateral
1.35% medium-term notes due 2014 without collateral
2.109% bonds due 2019 without collateral
Total

¥

—
50,00030,00020,000—30,0008,485
19,99426,0002,000
50,000¥ 236,479(30,829)2010¥
20,00050,00030,00020,00020,00030,00013,85319,99326,0002,000
50,000¥ 281,847

1.33(4) Annual maturities of other debts as of March 31, 2011 are as follows:
Millions of yen

Year ending March 31
2013
2014
2015
2016
2017 and thereafter
Total

Long-termloans payable¥

46,48955,08835,02427,50072,501¥ 236,602

Leaseobligations¥¥

31,527
26,99815,3326,600
2,356
82,813

Total¥

78,01682,08650,356
34,10074,857¥ 319,415

7. Investments in affiliated companies:
Investments in affiliated companies as of March 31, 2011 and 2010 are as follows:

The amount shown in parentheses in total for 2011 is that redeemed within one year.

Millions of yen(2) Annual maturities of bonds payable as of March 31, 2011 are as follows:
Millions of yen

Year ending March 31
2012
2013
2014
2015
2016
2017 and thereafter
Total

Investment securities (stock)
Investments and other assets (others)

Toyota Industries Report 2011¥2010
10,964
4,440

Total

¥

30,82950,000
4,504
20,00035,15095,994¥ 236,479

8. Assets pledged as collateral:(1) Assets pledged as collateral as of March 31, 2011 and 2010 are as follows:
Millions of yen

Investment securities
Machinery, equipment and vehicles
Accounts receivable
Buildings and structures
Land
Merchandise and finished goods
Work in process
Raw materials and supplies
Total

18

2011
¥
8,473
3,556

2011
¥
68,600
708
264
115
—
—
—
—
¥
69,688

2010
70,680
1,734
283
2,004
466
335
122
77
¥
75,704¥19

(2) Secured liabilities as of March 31, 2011 and 2010 are as follows:

15. Extraordinary losses:
Millions of yen

Other current liabilities
Short-term loans payable
Long-term loans payable
Total

2011
¥
23,217894
89¥24,2002010¥
22,4102,246
492¥
25,149

9. Allowance for retirement benefits:
Allowance for retirement benefits including the allowance for retirement benefits to directors (including managing officers) for the years ended March
31, 2011 and 2010 is as follows:

For the year ended March 31, 2011, Toyota Industries recorded extraordinary losses on the Great East Japan Earthquake of ¥4,631 million, including
fixed costs arising from the suspension of operations (¥4,532 million), expenses for recovery support and monetary condolence.
For the year ended March 31, 2010, Toyota Industries recorded extraordinary losses on business restructuring of the Materials Handling
Equipment Segment. The amount of impairment losses related to property, plant and equipment and goodwill was ¥36,902 million. Toyota Industries
also recorded extraordinary losses associated with restructuring expenses of closing a plant in Canada and an early retirement scheme in France.
The total amount was ¥3,464 million in Japan, ¥5,075 million in the United States and Canada, ¥27,606 million in Europe and ¥755 million inAustralia.
By category of assets, impairment losses totaled ¥27,606 million for goodwill, ¥4,334 million for machinery, equipment and vehicles, ¥2,697
million for buildings and structures, ¥1,213 million for tools, furniture and fixtures, ¥452 million for software, ¥414 million for land and ¥183 million for
construction in progress.
The recoverable amount of assets is measured based on the value in use. The value in use is calculated by discounting the expected future cash
in-flow mainly using a 9% discount rate.

Millions of yen

Allowance for retirement benefits to directors (including managing officers)

2011
¥
3,021

¥

2010
3,741

16. Comprehensive income:(1) Comprehensive income as of March 31, 2010 is as follows:
Millions of yen

10. Asset retirement obligations:2010
Comprehensive income attributable to:
Owners of the parent
Minority interests
Total

The amount of asset retirement obligations as of March 31, 2011, which is less than 1% of total liabilities and net assets, is omitted pursuant to
Article 92, paragraph (2) of the Regulation for Terminology, Forms and Preparation of Consolidated Financial Statements.

¥ 132,888
1,848¥ 134,737

11. Contingent liabilities:(2) Other comprehensive income as of March 31, 2010 is as follows:

Toyota Industries is contingently liable for guarantees as of March 31, 2011 and 2010 as follows:

Millions of yen
Millions of yen

2011
Guarantees given by consolidated subsidiaries

¥

2010
34

¥

67

12. Export discount bills:

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Share of other comprehensive income of associates accounted for using equity method
Total

2010
¥ 151,677
(33)
7,018
300
¥ 158,962

Export discount bills as of March 31, 2011 and 2010 are as follows:
Millions of yen

2011
Export discount bills

¥

67

2010
¥
314

13. Net assets:
Under the Corporation Law of Japan, amounts equal to at least 10% of the sum of the cash dividends and other external appropriations paid by theCompany and its subsidiaries in Japan must be set aside as a legal reserve until it equals 25% of capital stock. The legal reserve may be used toreduce a deficit or may be transferred to capital stock taking appropriate corporate action. In consolidation, the legal reserves of the Company andits subsidiaries in Japan are accounted for as retained earnings. The year-end cash dividend is approved at the Ordinary General Meeting of
Shareholders of the Company held after the close of the fiscal year to which the dividend is applicable. In addition, interim cash dividends may be
paid upon resolution of the Board of Directors, subject to limitations imposed by the Corporation Law of Japan.

14. Research and development expenses:
Research and development expenses, which are included in selling, general and administrative expenses and manufacturing costs, amounted to¥27,788 million and ¥26,826 million for the years ended March 31, 2011 and 2010, respectively.

20

Toyota Industries Report 2011

17. Financial instruments:(1) For the year ended March 31, 2011
1) Matters concerning financial instruments:(A) Policy for financial instruments
Toyota Industries borrows funds from financial institutions and issues corporate bonds to procure funds to meet its needs for long-term funding.
Toyota Industries also borrows funds from financial institutions and issues commercial paper to procure funds to meet its needs for short-termworking capital. Toyota Industries manages its cash reserves as highly safe financial assets. The purpose of using derivative instruments is to reducerisk, not to obtain earnings from exchanges or for speculative purposes.
(B) Contents and risk of financial instruments
Cash and deposits are subject to credit risk of financial institutions and foreign currency risk. Trade notes and accounts receivable are subject tocounterparty credit risk and foreign currency risk. Lease investment assets are subject to counterparty credit risk, foreign currency risk and interest
rate risk.
Short-term investments and investment securities are subject to market risk and foreign currency risk.
Trade notes and accounts payable include those denominated in foreign currencies and are thus subject to foreign currency risk. All of them
are due within one year. Loans payable, commercial paper, bonds payable and lease obligations are subject to foreign currency risk and interest
rate risk.
Toyota Industries uses derivative instruments (foreign currency forward contracts, foreign currency option contracts, foreign currency swaps andinterest rate swaps) to cover such kinds of risks, and these transactions are subject to credit risk of financial institutions.
With regard to foreign currency risk, Toyota Industries uses derivative instruments (foreign currency forward contracts and foreign currency option
contracts) for the amount of foreign currency trade assets (trade notes and accounts receivable) offset by foreign currency trade liabilities (trade21notes and accounts payable). Foreign currency swaps and interest rate swaps are used for hedging the foreign currency risk and interest rate risk ofloans, bonds and others.
As for the hedge accounting, the method, items, policy and evaluation method of measure of effectiveness are referred to in Note 2 “(14) Hedge
accounting.”(C) Risk management of financial instrumentsa) Management of credit risk (risk of non-execution of contract by counterparty)
In accordance with its treasury policy, Toyota Industries carries out regular monitoring of principal counterparties and strives to quickly
ascertain and minimize concerns about collecting credits due to worsening financial and other conditions of counterparties. In using
derivatives, to reduce credit risk of financial institutions, Toyota Industries engages in transactions only with those financial institutions thathave high credit ratings.
b) Management of market risk (foreign currency risk, interest rate risk, others)
In accordance with its treasury policy, in principle, Toyota Industries uses foreign currency forward contracts, foreign currency option contracts
and foreign currency swaps to hedge foreign currency risk for each currency for its monetary credits and liabilities denominated in foreign
currencies. Toyota Industries uses interest rate swaps to hedge interest rate risk on monetary liabilities. Toyota Industries monitors the financial
condition and reviews the valuations of short-term investments and investment securities.
c) Management of financing-related liquidity risk (risk that payments cannot be made on due date)In accordance with its treasury policy, Toyota Industries manages liquidity risk with cash reserves and commitment lines.
(D) Supplemental explanation of financial instruments
The fair value of financial instruments includes values based on market values as well as rationally calculated values when market values cannot be
determined. These calculated values could also conceivably change along with the adoption of different premises.
2) Matters concerning the fair value of financial instruments:
The amounts in the consolidated balance sheets, fair values and the differences between those as of March 31, 2011 are as follows. Financial
instruments for which ascertaining fair value is extremely difficult are not included in the following chart. Refer to Note 2 regarding these financial
instruments.
Millions of yen

Cash and deposits
Trade notes and accounts receivable
Lease investment assets (current assets)
Short-term investments and investment securities
Investments in affiliated companies
Other securities
Lease investment assets (fixed assets)
Total assets
Trade notes and accounts payable
Short-term loans payable
Commercial paper
Current portion of bonds
Lease obligations (current liabilities)
Bonds payable
Long-term loans payable
Lease obligations (long-term liabilities)
Total liabilities
Derivative transactions *3
Derivative instruments for which hedge accounting is not applied
Derivative instruments for which hedge accounting is applied
Total derivative transactions

Carrying
amount *1,*2

Fair value¥ 198,654
149,270
35,146¥ 198,654
149,269
35,146

3,911
1,230,638
71,480¥ 1,689,102¥ (144,956)(99,946)(11,133)(30,829)(37,873)(205,649)(236,602)(82,813)¥ (849,805)

6,745
1,230,638
68,643¥ 1,689,098¥ (144,956)(99,946)(11,133)(30,829)(37,873)(214,580)(244,838)(82,577)¥ (866,735)

¥

¥

¥

403
(93)
309

*1: Allowance for doubtful accounts is excluded from total assets.
*2: The figures for liabilities are indicated in parentheses.
*3: Stated values are the net amounts of assets and liabilities arising from derivative transactions. Net liabilities are represented with parentheses.

¥

403
(93)
309

Difference

¥

¥
¥

¥
¥
¥

—
(0)
—
2,834
—
(2,837)
(3)
—
—
—
—
—
(8,930)(8,235)236(16,929)———

1. Methods for calculating fair value of financial instruments and matters concerning marketable securities and derivatives(Assets)(1) Cash and deposits
All deposits are short term and fair value approximates the carrying amount. Therefore, fair value for deposits is calculated at the carrying amount.
(2) Trade notes and accounts receivable
These items are categorized into a specified time period, and are stated at present value calculated by the discount rate, which takes into
account the respective period.
(3) Lease investment assets (current assets)
Lease investment assets (current assets) are short term and fair value approximates the carrying amount. Therefore, fair value for these items is
calculated at the carrying amount.
(4) Short-term investments and investment securities
Fair value of stocks in investments in affiliated companies is calculated based on prices listed on stock exchanges. Other securities are stocks,
money management funds and negotiable certificates of deposit. Fair value of stocks in other securities is calculated based on prices listed on
stock exchanges. Fair value of money management funds and negotiable certificates of deposit approximates the carrying amount. Therefore, fairvalue is calculated at the carrying amount.
Details regarding other securities are referred to in Note 18 “Marketable securities.”(5) Lease investment assets (fixed assets)
Fair value is calculated by discounting to net present value the total amount of lease receipts using an expected interest rate when newly
undertaking the same lease transaction.
(Liabilities)(1) Trade notes and accounts payable
All notes and accounts payable are short term and fair value approximates the carrying amount. Therefore, fair value for notes and accounts
payable is calculated at the carrying amount.
(2) Short-term loans payable, (3) Commercial paper, (4) Current portion of bonds, (5) Lease obligations (current liabilities)
These items payable are short term and fair value approximates the carrying amount. Therefore, fair value for these items is calculated at thecarrying amount.
(6) Bonds payable
Fair value is calculated by discounting to net present value the total of principal and interest using expected interest rates when newly borrowing
the same amount.
(7) Long-term loans payable
Fair value is calculated by discounting to net present value the total of principal and interest using expected interest rates when newly borrowing
the same amount.
Interest rate swaps that meet the requirement for the preferential accounting method are handled together with the aforementioned long-termloans payable. The fair value of interest rate swaps is included in the fair value of the aforementioned long-term loans payable. The fair value iscalculated by discounting expected future cash flow using interest rates when newly borrowing the same amount.
(8) Lease obligations (long-term liabilities)
Fair value is calculated by discounting to net present value the total amount of lease payments using an expected interest rate when newly
undertaking the same lease transaction.
(Derivative transactions)
Details regarding derivative transactions are referred to in Note 19 “Derivative instruments.”
2. Financial instruments for which ascertaining fair value is extremely difficult
Millions of yen
Carrying
amountNon-listed stocks
Investments in affiliated companies
Other securities
Total

¥

4,562
16,625
21,187¥

Non-listed stocks are not included in “Short-term investments and investment securities” because there are no market prices and ascertaining fair value is extremely difficult.

3. Amounts of projected future redemptions after March 31, 2011 for monetary credits and liabilities as well as marketable securities with maturities
Millions of yen
Year ending March 31

Cash and deposits
Trade notes and accounts receivable
Lease investment assets (fixed assets)
Total

22

Toyota Industries Report 20112012

¥ 198,654
149,098—¥ 347,752

2013–2016

¥

¥

—
172
70,20570,3772022 and
thereafter

2017–2021

¥

¥

—
—
1,275
1,275

¥

¥

—
—
—
—

23

4. Scheduled repayments of bonds payable, long-term loans payable, lease obligations (long-term liabilities) and other interest-bearing debt after the
consolidated settlement dateMillions of yen
Year ending March 31

Bonds payable
Long-term loans payable
Lease obligations (long-term liabilities)
Total

2012

¥

¥

2013–2016————¥ 109,655
164,10280,458¥ 354,2162022 and
thereafter

2017–2021¥

95,99472,5001,956¥ 170,450

¥

¥

—
—
398
398

(2) For the year ended March 31, 2010
1) Matters concerning financial instruments:(A) Policy for financial instruments
Toyota Industries borrows funds from financial institutions and issues corporate bonds to procure funds to meet its needs for long-term funding.
Toyota Industries also borrows funds from financial institutions and issues commercial paper to procure funds to meet its needs for short-termworking capital. Toyota Industries manages its cash reserves as highly safe financial assets. The purpose of using derivative instruments is to reducerisk, not to obtain earnings from exchanges or for speculative purposes.
(B) Contents and risk of financial instruments
Cash and deposits are subject to credit risk of financial institutions and foreign currency risk. Trade notes and accounts receivable are subject tocounterparty credit risk and foreign currency risk. Loans receivable are subject to counterparty credit risk and foreign currency risk. With regards toforeign currency risk, Toyota Industries uses derivative instruments (foreign currency forward contracts and foreign currency option contracts) for theamount of foreign currency trade assets (trade notes and accounts receivable) offset by foreign currency trade liabilities (trade notes and accounts
payable).
Trade notes and accounts payable include those denominated in foreign currencies and are thus subject to foreign currency risk. All of them are
due within one year. Loans payable, commercial paper, bonds payable and lease obligations are subject to foreign currency risk and interest raterisk. Toyota Industries uses derivative instruments (foreign currency swaps and interest rate swaps) to cover such kinds of risks. The longest
redemption date is 12 years after the closing date on March 31, 2010.
Toyota Industries uses derivative instruments (foreign currency forward contracts, foreign currency option contracts, foreign currency swaps andinterest rate swaps) in order to hedge the above risk and derivative instruments are subject to credit risk of financial institutions.
As for the hedge accounting, the method, items, policy and evaluation method of measure of effectiveness are referred to in Note 2 “(14) Hedge
accounting.”(C) Risk management of financial instrumentsa) Management of credit risk (risk of non-execution of contract by counterparty)
In accordance with its treasury policy, Toyota Industries carries out regular monitoring of principal counterparties and strives to quickly
ascertain and minimize concerns about collecting credits due to worsening financial and other conditions of counterparties. In using
derivatives, to reduce credit risk of financial institutions, Toyota Industries engages in transactions only with those financial institutions thathave high credit ratings.
b) Management of market risk (foreign currency risk, interest rate risk, others)
In accordance with its treasury policy, in principle, Toyota Industries uses foreign currency forward contracts, foreign currency option contracts
and foreign currency swaps to hedge foreign currency risk for each currency for its monetary credits and liabilities denominated in foreign
currencies. Toyota Industries uses interest rate swaps to hedge interest rate risk on monetary liabilities. Toyota Industries monitors the financial
condition and reviews the valuations of short-term investments and investment securities.
c) Management of financing-related liquidity risk (risk that payments cannot be made on due date)In accordance with its treasury policy, Toyota Industries manages liquidity risk with cash reserves and commitment lines.
(D) Supplemental explanation of financial instruments
The fair value of financial instruments includes values based on market values as well as rationally calculated values when market values cannot be
determined. These calculated values could also conceivably change along with the adoption of different premises.
2) Matters concerning the fair value of financial instruments:
The amounts in the consolidated balance sheets, fair values and the differences between those as of March 31, 2010 are as follows. Financial
instruments for which ascertaining fair value is extremely difficult are not included in the following chart. Refer to Note 2 regarding these financial
instruments.

24

Toyota Industries Report 2011

Millions of yen

Cash and deposits
Trade notes and accounts receivable
Short-term investments and investment securities
Investments in affiliated companies
Other securities
Long-term loans receivable
Total assets
Trade notes and accounts payable
Short-term loans payable
Commercial paper
Current portion of bonds
Bonds payable
Long-term loans payable
Lease obligations
Total liabilities
Derivative transactions *3
Derivative instruments for which hedge accounting is not applied
Derivative instruments for which hedge accounting is applied
Total derivative transactions

Carrying
amount *1,*2

Fair value¥ 287,965
160,608¥ 287,965
160,6076,380
1,207,913
5,552¥ 1,668,420¥ (141,787)(46,241)(9,575)(50,446)(231,401)(299,208)(108,014)¥ (886,674)

5,410
1,207,913
5,552¥ 1,667,449¥ (141,787)(46,241)(9,575)(50,446)(238,739)(307,370)(108,146)¥ (902,306)

¥

¥

¥

1,317
(559)
757

¥

1,317
(861)
455

Difference

¥

¥
¥

¥
¥
¥

—
(0)
(969)
—
—
(970)
—
—
—
—
(7,338)(8,161)(132)(15,632)
—
(301)
(301)

*1: Allowance for doubtful accounts is excluded from total assets.
*2: The figures for liabilities are indicated in parentheses.
*3: Stated values are the net amounts of assets and liabilities arising from derivative transactions. Net liabilities are represented with parentheses.

1. Methods for calculating fair value of financial instruments and matters concerning marketable securities and derivatives(Assets)(1) Cash and deposits
All deposits are short term and fair value approximates the carrying amount. Therefore, fair value for deposits is calculated at the carrying amount.
(2) Trade notes and accounts receivable
These items are categorized into a specified time period, and are stated at present value calculated by the discount rate, which takes into
account the respective period and credit risk.
(3) Short-term investments and investment securities
Fair value of stocks in investments in affiliated companies is calculated based on prices listed on stock exchanges. Other securities are stocks,
money management funds and negotiable certificates of deposit. Fair value of stocks in other securities is calculated based on prices listed on
stock exchanges. Fair value of money management funds and negotiable certificates of deposit approximates the carrying amount. Therefore, fairvalue is calculated at the carrying amount.
Details regarding other securities are referred to in Note 18 “Marketable securities.”(4) Long-term loans receivable
The majority of these are loans with floating interest rates made to employees, with fair value approximating the carrying amount. Therefore, fairvalue is calculated at the carrying amount.
(Liabilities)(1) Trade notes and accounts payable
All notes and accounts payable are short term and fair value approximates the carrying amount. Therefore, fair value for notes and accounts
payable is calculated at the carrying amount.
(2) Short-term loans payable, (3) Commercial paper, (4) Current portion of bonds
These items payable are short term and fair value approximates the carrying amount. Therefore, fair value for these items is calculated at thecarrying amount.
(5) Bonds payable
Fair value is calculated by discounting to net present value the total of principal and interest using expected interest rates when newly borrowing
the same amount.
(6) Long-term loans payable
Fair value is calculated by discounting to net present value the total of principal and interest using expected interest rates when newly borrowing
the same amount.
Interest rate swaps that meet the requirement for the preferential accounting method are handled together with the aforementioned long-termloans payable. The fair value of interest rate swaps is included in the fair value of the aforementioned long-term loans payable. The fair value iscalculated by discounting expected future cash flow using interest rates when newly borrowing the same amount.
(7) Lease obligations
Fair value is calculated by discounting to net present value the total amount of lease payments using an expected interest rate when newly
undertaking the same lease transaction.

25

(b) Other securities sold during the year ended March 31, 2011 are as follows:
Other securities sold is omitted due to its quantitative immateriality.

(Derivative transactions)
Details regarding derivative transactions are referred to in Note 19 “Derivative instruments.”(2) As of and for the year ended March 31, 2010:

2. Financial instruments for which ascertaining fair value is extremely difficult
Millions of yen(a) Other securities with readily determinable fair value as of March 31, 2010 are as follows:

Carrying
amountMillions of yen
Acquisition
cost

Carrying
amountDifference

StocksSubtotal
Securities with carrying amount not exceeding acquisition cost:¥ 223,373
223,373¥ 1,130,531
1,130,531¥ 907,157
907,157

StocksOthersSubtotal
Total

7,432
71,391
78,824¥ 302,197

5,991
71,391
77,382¥ 1,207,913(1,441)—(1,441)¥ 905,716

Non-listed stocks
Investments in affiliated companies
Other securities
Total

¥

4,584
15,19819,783¥Non-listed stocks are not included in “Short-term investments and investment securities” because there are no market prices and ascertaining fair value is extremely difficult.

3. Amounts of projected future redemptions after March 31, 2010 for monetary credits and liabilities as well as marketable securities with maturities
Millions of yen
Year ending March 31

Cash and deposits
Trade notes and accounts receivable
Long-term loans receivable
Total

2011

2012–2015¥ 287,965
160,541771¥ 449,279

¥

¥

—
66
2,109
2,176

2021 and
thereafter

2016–2020

¥

—
—
1,198
1,198

¥

¥

—
—
1,472
1,472

¥

Securities with carrying amount exceeding acquisition cost:Non-listed stocks (total amount is ¥15,198 million in the consolidated balance sheets) are not included in “Other securities” because there are no market prices and ascertaining fair value
is extremely difficult. “Others” in “Securities with carrying amount not exceeding acquisition cost” above are mainly money management funds and negotiable certificates of deposit.

(b) Other securities sold during the year ended March 31, 2010 are as follows:

Millions of yen
Proceeds

Realized gains

Realized losses

¥197

¥135

¥0

4. Scheduled repayments of bonds payable, long-term loans payable, lease obligations and other interest-bearing debt after the consolidated
settlement dateMillions of yen
Year ending March 31

Bonds payable
Long-term loans payable
Lease obligations
Total

2011

¥

¥

—
—
—
—

2012–2015

2016–2020¥ 105,407
199,208
106,637¥ 411,254¥ 125,993
100,000
1,376¥ 227,369

19. Derivative instruments:
2021 and
thereafter

¥

—
—
0
0

¥

(1) Quantitative disclosure about derivatives for the year ended March 31, 2011
1) Derivative instruments for which hedge accounting is not applied(a) Foreign currency transactions as of March 31, 2011 are as follows:
Millions of yen

Category

Notional amount
Maturity
Totalover 1 year

Type

Application of Accounting Standard for Financial Instruments
Effective from the fiscal year beginning April 1, 2009, Toyota Industries applies Financial Accounting Standard No. 10 “Accounting Standard for
Financial Instruments” and its Implementation Guidance No. 19 “Guidance on Disclosures about Fair Value of Financial Instruments,” both of whichwere issued on March 10, 2008 by the Accounting Standards Board of Japan.

18. Marketable securities:(1) As of and for the year ended March 31, 2011:(a) Other securities with readily determinable fair value as of March 31, 2011 are as follows:
Millions of yen
Acquisition
cost

Carrying
amountDifference

StocksOthersSubtotal
Securities with carrying amount not exceeding acquisition cost:¥ 275,747
101
275,848¥ 1,090,265
116
1,090,381¥ 814,518
14
814,532

StocksOthersSubtotal
Total

9,325
132,430
141,756¥ 417,605

7,825
132,430
140,256¥ 1,230,638(1,499)—(1,499)¥ 813,033

Securities with carrying amount exceeding acquisition cost:Non-listed stocks (total amount is ¥16,625 million in the consolidated balance sheets) are not included in “Other securities” because there are no market prices and ascertaining fairvalue is extremely difficult. “Others” above are mainly money management funds and negotiable certificates of deposit.

Transactions other thanmarket transactions

Foreign currency forward contracts transactions
Buy JPY / Sell SEK
Buy JPY / Sell CNY
Buy SEK / Sell EUR
Buy SEK / Sell USD
Buy SEK / Sell AUD
Buy SEK / Sell DKK
Buy SEK / Sell NOK
Buy SEK / Sell CHF
Buy SEK / Sell CZKBuy SEK / Sell RON
Buy SEK / Sell HUF
Sell SEK / Buy EUR
Sell SEK / Buy CAD
Sell SEK / Buy NOK
Sell SEK / Buy GBP
Sell SEK / Buy USD
Sell SEK / Buy PLN
Sell SEK / Buy DKK
Sell SEK / Buy HUF
Sell PLN / Buy EUR
Subtotal
Foreign currency swap transactions
Payment JPY / Receipt USD
Subtotal
Total

¥

¥

257
424
16,799
9,252
6,793
668
348
139
96
652
25
12,066
5,055
3,696
2,422
151
703
298
24
52
59,9283,506
3,506
63,435

¥

¥

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
3,506
3,506
3,506

Fair value

¥

¥

(7)
6
(154)
181
(46)
(0)
(1)
1
0
(30)
(0)
42
(11)
10
(39)
(1)
3
0
0
0
(45)
471
471
426

Net unrealized
gain/loss

¥

¥

(7)
6
(154)
181
(46)
(0)
(1)
1
0
(30)
(0)
42
(11)
10
(39)
(1)
3
0
0
0
(45)
471
471
426

The fair value calculation method is based on the index price as of March 31, 2011.

26

Toyota Industries Report 201127

(b) Interest rate transactions as of March 31, 2011 are as follows:

Millions of yen

Category

Millions of yen

Category

Notional amount
Maturity
Totalover 1 year

Type

Transactions other thanmarket transactions

Interest rate swap transactions
Fixed rate payment / Floating rate receipt
Floating rate payment / Fixed rate receipt
Total

¥
¥

5,269
829
6,098

¥

3,333
—
3,333

¥

Net unrealized
gain/loss

Fair value

¥

(32)
9
(22)

¥

¥
¥

(32)
9
(22)

The fair value calculation method is based on the index price as of March 31, 2011.

2) Derivative instruments for which hedge accounting is applied
Millions of yen

Category

Deferred hedge
methodType
Foreign currency forward contracts transactions
Buy JPY / Sell USD
Buy JPY / Sell EUR
Buy JPY / Sell AUD
Buy JPY / Sell SEK
Buy SEK / Sell GBP
Buy SEK / Sell EUR
Buy SEK / Sell USD
Buy SEK / Sell NOK
Buy SEK / Sell AUD
Buy SEK / Sell THB
Buy SEK / Sell CHF
Buy SEK / Sell DKK
Buy SEK / Sell CAD
Buy SEK / Sell HUF
Buy SEK / Sell PLN
Buy SEK / Sell CZK
Sell SEK / Buy EUR
Sell SEK / Buy GBP
Sell SEK / Buy DKK
Sell SEK / Buy PLN
Sell SEK / Buy HUF
Sell SEK / Buy NOK
Sell SEK / Buy CZKBuy USD / Sell EUR

Contents ofhedge

Accounts
receivable

Foreign currency option contracts transactions
Sell
Call USD / Put JPY
Call EUR / Put JPY
Call AUD / Put JPY
Buy
Put USD / Call JPY
Put EUR / Call JPY
Put AUD / Call JPY
Total

Accounts
receivable

Notional amount
Maturity
Totalover 1 year

¥ 1,486
376
229
24
1,501
1,066
562
349
190
176
141
64
60
9
8
4
332
170
26
17
8
7
4
86

¥

Net
unrealized
gain/loss

¥

¥

(9)
(13)
(9)
(1)
70
16
28
0
3
6
1
0
0
(0)
(0)
(0)
(2)
(3)
(0)
0
0
0
(0)
(3)

(9)
(13)
(9)
(1)
70
16
28
0
3
6
1
0
0
(0)
(0)
(0)
(2)
(3)
(0)
0
0
0
(0)
(3)

Evaluation method

Fair value hedge
accounting

¥

—

15

1

—

17

(9)

—

11

(6)

—

8

(8)

—

1

(7)

—
—

1
141

(4)
(50)

¥

¥

Toyota Industries Report 2011

Accounts
receivable

Call EUR / Put JPY
Call AUD / Put JPY
BuyAccounts
receivable

Put USD / Call JPY

Put AUD / Call JPY

By the price on
currency option
marketForeign currency forward contracts transactions
Buy JPY / Sell USD
Buy JPY / Sell EUR
Buy JPY / Sell AUD

Preferential accounting Interest rate swap transactions
Fixed rate payment / Floating rate
method of interest ratereceiptswap transactions
Total

48
14
13
881
813
390
239
179
123
91
64
38
26
8
7
609
44
31
11
8
153

748
<9>
305
<4>
275
<4>
748
<9>
305
<4>
275
<4>

Put EUR / Call JPY

Net valuation method
using forward foreignexchange contracts

Notional amount
Maturity
Totalover 1 year¥

Foreign currency option contracts transactions
Sell
Call USD / Put JPY

By theexchange rate
on foreign
currency
market

The amounts indicated in brackets for foreign currency option contracts transactions refer to the option fee, and the related figures for fair value and net unrealized gain/loss arealso shown.

28

Foreign currency forward contracts transactions *1
Buy JPY / Sell EUR
Buy JPY / Sell SEK
Buy JPY / Sell USD
Buy SEK / Sell GBP
Buy SEK / Sell EUR
Buy SEK / Sell USD
Buy SEK / Sell PLN
Buy SEK / Sell AUD
Buy SEK / Sell THB
Buy SEK / Sell DKK
Buy SEK / Sell CHF
Buy SEK / Sell CAD
Buy SEK / Sell NOK
Buy SEK / Sell HUF
Buy SEK / Sell CZK
Sell SEK / Buy EUR
Sell SEK / Buy DKK
Sell SEK / Buy PLN
Sell SEK / Buy CZKSell SEK / Buy AUD
Buy BRL / Sell CHF

Interest rate swap transactions
Fixed rate payment / Floating ratereceipt

1,663
<16>
517
<8>
361
<5>
1,663
<16>
517
<8>
361
<5>
¥ 11,993

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

Fair value

Type

Contents of
hedge

¥

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

Fair valueNet
unrealized
gain/loss

¥

¥

(1)
(0)
(0)
48
6
21
(0)
0
7
2
0
0
(0)
(0)
0
(3)
0
(0)
0
(0)
2

(1)
(0)
(0)
48
6
21
(0)
0
7
2
0
0
(0)
(0)
0
(3)
0
(0)
0
(0)
2

—

3

6

—

10

(5)

—

7

(3)

—

2

(7)

—

0

(4)

—

0

(3)

(208)

(208)

Lease
investment
assets21,056

12,945

Accounts
receivable

1,274
380
74

—
—
—

*2

*2

Long-termloans payable

25,00025,000*2*2¥ 66,238¥ 37,945¥

40¥

Evaluation method

By theexchange rate
on foreign
currency
marketBy the price on
currency option
marketBy the rate oninterest swap
marketBy theexchange rate
on foreign
currency
marketBy the rate oninterest swap
market(93)*1: The amounts indicated in brackets for foreign currency option contracts transactions refer to the option fee, and the related figures for fair value and net unrealized gain/loss arealso shown.
*2: Fair value and net unrealized gain/loss of derivative instruments for which these accounting methods are applied are inclusively reported as a portion of fair value of their hedge
instruments such as accounts receivable and long-term loans payable (see Note 17).

292) Derivative instruments for which hedge accounting is applied(2) Quantitative disclosure about derivatives for the year ended March 31, 2010
1) Derivative instruments for which hedge accounting is not applied(a) Foreign currency transactions as of March 31, 2010 are as follows:

Millions of yen

TypeContents ofhedge

Foreign currency forward contracts transactions
Buy JPY / Sell USD
Buy JPY / Sell AUD
Buy JPY / Sell EUR
Buy SEK / Sell GBP
Buy SEK / Sell EUR

Accounts
receivable

Category
Millions of yen

Category

Notional amount
Maturity
over 1 year

Type

Fair value

Total

Transactions other thanmarket transactions

Foreign currency forward contracts transactions
Buy JPY / Sell USD
Buy JPY / Sell EUR
Buy JPY / Sell SEK
Buy SEK / Sell EUR
Buy SEK / Sell USD
Buy SEK / Sell AUD
Buy SEK / Sell DKK
Buy SEK / Sell NOK
Buy SEK / Sell CHF
Buy SEK / Sell CZKBuy SEK / Sell THB
Buy SEK / Sell CAD
Buy SEK / Sell HUF
Sell JPY / Buy USD
Sell SEK / Buy EUR
Sell SEK / Buy CAD
Sell SEK / Buy NOK
Sell SEK / Buy GBP
Sell SEK / Buy USD
Sell SEK / Buy PLN
Sell SEK / Buy DKK
Sell SEK / Buy CHF
Sell SEK / Buy HUF
Sell SEK / Buy CZKSell PLN / Buy EUR
Sell USD / Buy CAD
Sell EUR / Buy USD
Total

¥

¥

119
68
27
22,796
4,477
3,336
1,783
1,332
328
208
206
118
28
45
13,742
3,865
2,854
911
637
243
135
130
79
5
49
28
46
57,609

¥

¥

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

Net unrealized
gain/loss

¥

120
64
26
22,541
4,547
3,420
1,724
1,332
327
208
215
127
28
46
13,735
3,913
2,894
908
635
249
134
131
80
4
48
28
45
¥57,546

¥

(1)
3
0
254
(70)
(83)
59
0
0
0
(9)
(8)
0
1
(7)
47
40
(3)
(2)
6
(1)
1
0
(0)
(0)
0
0
¥ 226

Deferred hedge
methodCall EUR / Put JPY
BuyTransactions other thanmarket transactions

Notional amount
Maturity
Totalover 1 year

Foreign currency swap transactions
Payment SEK / Receipt USD
Payment JPY / Receipt USD
Total

¥
¥

4,730
7,042
11,772

¥
¥

—
2,378
2,378

Fair value

¥

4,482
8,482
12,964¥¥

Put EUR / Call JPY

Interest rate swap transactions
Long-term
Fixed rate payment / Floating rate632
loans payable
receipt
Total¥ 10,864

Category
Transactions other thanmarket transactions

Interest rate swap transactions
Fixed rate payment / Floating rate receipt
Floating rate payment / Fixed rate receipt
Total

The fair value calculation method is based on the index price as of March 31, 2010.

30

Toyota Industries Report 2011

Notional amount
Maturity
Totalover 1 year

Type

Contents ofhedge

Foreign currency forward contracts transactions
Buy SEK / Sell GBP
Buy SEK / Sell EUR

Accounts
receivable

Foreign currency option contracts transactions
Sell
Call USD / Put JPY
Call AUD / Put JPY

Net unrealized
gain/loss

Call EUR / Put JPY
Buy

¥
¥

9,545
923
10,469

¥
¥

4,734
923
5,657

¥
¥

9,429
938
10,367

¥
¥

(116)
15
(101)

—
—
—
—
—

¥ 1,627
355
187
1,746
1,346

¥

—

44

(14)

—

15

(6)

—

3

(0)

—

9

(20)

—

1

(7)

—

1

(2)

148

575

(57)

148

¥ 5,915

¥

(46)
(17)
(2)
61
49

Evaluation method

By theexchange rate
on foreign
currency
marketBy the price on
currency option
marketBy the rate oninterest swap
market(63)

Millions of yen

TypeFair value hedge
accounting

Fair value¥Net
unrealized
gain/loss

Fair value

The amounts indicated in brackets for foreign currency option contracts transactions refer to the option fee, and the related figures for fair value and net unrealized gain/loss arealso shown.

The fair value calculation method is based on the index price as of March 31, 2010.

Millions of yen

1,860
<29>
358
<9>
199
<3>

Put AUD / Call JPY

(248)
1,439
1,191

(b) Interest rate transactions as of March 31, 2010 are as follows:

Accounts
receivable

Put USD / Call JPY

Net unrealized
gain/loss

¥

¥

1,860
<29>
358
<9>
199
<3>

Call AUD / Put JPY

Millions of yen

Type¥ 1,580
338
184
1,807
1,396

Foreign currency option contracts transactions
Sell
Call USD / Put JPY

Category
Category

Notional amount
Maturity
Totalover 1 year

Put USD / Call JPY
Put AUD / Call JPY
Put EUR / Call JPY

Accounts
receivable

Notional amount
Maturity
Totalover 1 year

¥

947
943

744
<14>
255
<6>
62
<0>
744
<14>
255
<6>
62
<0>

¥

—
—

Fair valueNet
unrealized
gain/loss

¥

¥

901
891

46
51

—

17

(2)

—

9

(3)

—

0

0

—

1

(13)

—

0

(5)

—

0

(0)

Evaluation method

By theexchange rate
on foreign
currency
marketBy the price on
currency option
market31

(4) Assumptions used for calculation of retirement benefits for the years ended March 31, 2011 and 2010 are as follows:

Millions of yen

Category
Fair value hedge
accounting

Net valuation method
using forward foreignexchange contracts

TypeInterest rate swap transactions
Fixed rate payment / Floating ratereceipt
Foreign currency forward contracts transactions
Buy JPY / Sell USD
Buy JPY / Sell AUD
Buy JPY / Sell EUR

Preferential accounting Interest rate swap transactions
method of interest rate
Fixed rate payment / Floating rate
swap transactions
receipt
Total

Contents ofhedge

Notional amount
Maturity
Totalover 1 year

Fair valueNet
unrealized
gain/loss

Evaluation method¥

By the rate oninterest swap
marketLease
investment
assets¥ 21,577

Accounts
receivable

2,338
239
73

—
—
—

2,421
255
74

(83)
(15)
(1)

By theexchange rate
on foreign
currency
marketLong-term
borrowings

25,00025,00024,698(301)

By the rate oninterest swap
market¥ 53,245¥ 38,925¥ 50,379¥ 13,925¥ 21,108

¥

(468)

(798)

The amounts indicated in brackets for foreign currency option contracts transactions refer to the option fee, and the related figures for fair value and net unrealized gain/loss arealso shown.

20. Retirement benefits:

Discount rate
Expected return on plan assets
Amortization of prior service obligation

2.00%
3.00%
20 years

Amortization period of unrecognized actuarial gains or losses

20 years

2.00%
3.00%
6–11 years—Straight-line method over the remaining service
period of employees
20 years—Straight-line method over the average remaining
service period of employees(5) Plan assets relating to welfare pension fund under multiemployer pension plan:
Information regarding the welfare pension fund under multiemployer plans as of March 31, 2011 and 2010 are as follows.
As of March 31, 2010
Plan assets

The Japan Society of Industrial Machinery
Manufacturers’ welfare pension fund

Other welfare pension funds¥ 82,259 million¥ 229,880 million

Estimated benefit obligation¥ 95,550 million¥ 299,583 million

Variance¥ (13,291 million)¥ (69,703 million)

6.02%

2.78%

The Japan Society of Industrial Machinery
Manufacturers’ welfare pension fund

Other welfare pension funds¥ 72,130 million¥ 118,423 million

Toyota Industries Group contribution to welfare pension plan

The Company and its subsidiaries in Japan maintain tax-qualified pension plans, lump-sum indemnities plans and welfare pension fund plans,
all of which are non-contributory defined benefit pension plans. In addition, certain foreign subsidiaries maintain non-contributory defined benefit
pension plans.
Since 1987, the Company has been transferring the covering percentages of its pension plan from its lump-sum indemnities plan to its taxqualified pension plan. As of March 31, 2011 and 2010, its tax-qualified pension plan covers 50% of total plans. Also, the Company established an
employee retirement benefit trust. In April 2003, the Company transferred a portion of the lump-sum indemnities plan to a defined contribution
pension plan. In April 2011, the Company transferred tax-qualified pension plans to defined benefit corporate pension plans.

(2) Components of allowance for retirement benefits as of March 31, 2011 and 2010 are as follows:
Millions of yen

2011¥ (146,537)
89,737(56,800)
17,737(3,987)(43,050)853¥ (43,903)

2010¥ (152,615)
92,936(59,678)
19,953(186)(39,911)1,580¥ (41,492)

Certain subsidiaries use the simplified method to determine benefit obligations. Prepaid pension expenses are included in other investments and other assets.

Estimated benefit obligation¥ 104,869 million¥ 172,737 million

Variance¥ (32,739 million)¥ (54,313 million)

6.01%

4.66%

As of March 31, 2010
Toyota Industries Group contribution to welfare pension plan

21. Stock options:(1) Stock option expenses recorded in the fiscal year and class of options
Millions of yen

Selling, general and administrative expenses

2011
¥720

2010
¥604

Millions of yen

Millions of yen

2011
8,149
4,345
(3,194)57
2,290¥
11,648¥

As of March 31, 2009
Plan assets(2) The amount recorded as a profit because of forfeitures of stock option rights(3) Components of retirement benefit expenses for the years ended March 31, 2011 and 2010 are as follows:

Service cost
Interest cost
Expected return on plan assets
Amortization of prior service obligation
Amortization of unrecognized actuarial gains or losses
Retirement benefit expenses

2010

As of March 31, 2011

(1) Outline of retirement benefit plans:

Benefit obligation
Plan assets
Unfunded benefit obligation
Unrecognized actuarial gains or losses
Unrecognized loss in prior service obligation
Net amount recognized on the balance sheets
Prepaid pension expenses
Allowance for retirement benefits

2011
Method of attribution of estimated retirement benefits to periodsof employee service:
Straight-line method

2010
8,968
4,111
(2,673)36
2,150¥
12,593

2011
¥308

2010
¥108

¥

Retirement expenses of subsidiaries which adopted the simplified method are included in service cost.

32

Toyota Industries Report 201133

(3) Stock option details, number of stock options and state of fluctuation
1) Stock option details
2011

2010

2009

Company name

The Company

The Company

The Company

Position and number ofgrantees

Directors: 16
Managing officers and employees: 146

Directors: 14
Managing officers and employees: 153

Directors: 17
Managing officers and employees: 159

Class and number of shares*

1,262,000 shares of common stock

1,157,000 shares of common stock

1,360,000 shares of common stock

Date of issue

August 2, 2010

August 3, 2009

August 1, 2008

Same as left

Same as left

1. Grantee must be employed as a director,
managing officer or regular employee of theCompany at the time of exercise. However, thisdoes not apply if no more than 18 months haveelapsed after retirement or resignation from theCompany.

Condition of settlement ofrights

2. Other conditions of exercise shall be decided
as prescribed by the Contract for Allotment of
Subscription Rights to Shares concluded by
the Company and grantee in accordance withresolutions at the General Meeting of Shareholders
and resolutions on the issue of subscription rights
to shares by the Board of Directors.

Same as left

Stock options outstanding at the end of the previous fiscal year
Conversion from non-exercisable stock options
Stock options exercised
Forfeitures
Stock options outstanding at the end of the fiscal year

Same as left

2007
—
—
—
—
—

2006
—
—
—
—
—

2008
756,000——
147,000
609,000

2007
665,000——
142,000
523,000

2006
120,500——
6,800
113,700

2007¥4,642—759

2006¥3,306——(shares)

2011
—
—
—
—
—

2010
—
—
—
—
—

2009
—
1,358,000—
239,000
1,119,000

2011¥2,449—686

2010¥2,570—581

2009¥3,410—421(b) Price of options
Same as left

Periods that grantees must
provide service in return forstock options

From August 2, 2010 to July 31, 2012

From August 3, 2009 to July 31, 2011

From August 1, 2008 to July 31, 2010

Periods that stock subscription
rights are to be exercised

From August 1, 2012 to July 31, 2016

From August 1, 2011 to July 31, 2015

From August 1, 2010 to July 31, 2014

Exact yen amounts
Same as left

Paid-in value
Average market price of the stock at the time of exercise
Fair value of options on grant date

2008

2007

2006

Company name

The Company

The Company

The Company

Position and number ofgrantees

Directors: 16
Managing officers and employees: 159

Directors: 17
Managing officers and employees: 152

Directors: 30
Employees: 134

Class and number of shares*

830,000 shares of common stock

802,000 shares of common stock

791,000 shares of common stock

Date of issue

August 1, 2007

August 1, 2006

August 1, 2005

1. Grantee must be employed as a director, managing
officer or regular employee of the Company at thetime of exercise. However, this does not apply if nomore than 18 months have elapsed after retirement or
resignation from the Company.

Same as left

Same as left

Same as left

Same as left

3. In the case where grantee becomes no longer
applicable to the conditions of exercise, the grantee
immediately loses subscription rights to shares and must
return the rights to the Company without consideration.

——

Periods that grantees must
provide service in return forstock options

From August 1, 2007 to July 31, 2009

From August 1, 2006 to July 31, 2008

From August 1, 2005 to June 30, 2007

Periods that stock subscription
rights are to be exercised

From August 1, 2009 to July 31, 2013

From August 1, 2008 to July 31, 2012

From July 1, 2007 to June 30, 2011

2. Other conditions of exercise shall be decided asprescribed by the Contract for Allotment of Subscription
Rights to Shares concluded by the Company andgrantee in accordance with resolutions at the General
Meeting of Shareholders and resolutions on the issue ofsubscription rights to shares by the Board of Directors.

(shares)

2008
—
—
—
—
—

Exercisable stock options

3. In the case where grantee becomes no longer
applicable to the conditions of exercise, thegrantee immediately loses subscription rights toshares and must return the rights to the Company
without consideration.

Condition of settlementof rights

2) Number of stock options and state of fluctuation
Stock options are those outstanding in the fiscal year and are listed as the number of shares.
(a) Number of stock options
Non-exercisable stock options
2011
2010
2009
Stock options outstanding at the end of the previous fiscal year
— 1,157,000 1,358,000
Stock options granted
1,262,000——
Forfeitures———
Conversion to exercisable stock options—— 1,358,000
Stock options outstanding at the end of the fiscal year
1,262,000 1,157,000—

2008¥5,866—682(4) Methods for estimating fair value of stock options
The methods for estimating fair value of stock options granted for fiscal 2011 and 2010 are as follows:(a) Valuation method used: Black-Scholes model(b) Principal basic values and estimation methods
Share price fluctuations *1
Projected remaining period *2
Projected dividend *3
Non-risk interest rate *4

2011
42.97%
4 years¥30/share
0.280%

2010
32.47%
4 years¥40/share
0.600%*1: Computed based on actual share prices during a four-year period (from August 2006 to July 2010) and (from August 2005 to July 2009)*2: Because of a lack of accumulated data and difficulty in making rational estimates, it is assumed the rights are exercised at the midpoint of the exercise period.
*3: For fiscal 2011, based on the estimated dividend on the grant date; For fiscal 2010, based on the year-end dividend for the fiscal year ended March 31, 2009
*4: Yields on government bonds for the period corresponding to the projected remaining period(5) Method for estimating the number of confirmed stock option rights
Specifically, because of the difficulty in rationally estimating the number of expired rights in the future, a method has been adopted that reflects actual
past expirations.

*Number of options granted by class are listed as number of shares.

34

Toyota Industries Report 201135

(a) Pro forma information regarding the leased properties such as acquisition cost and accumulated depreciation, which are not reflected in theaccompanying consolidated balance sheets under finance leases as of March 31, 2011 and 2010 are as follows:

22. Income taxes:(1) The significant components of deferred tax assets and liabilities as of March 31, 2011 and 2010 are as follows:

Millions of yen

2011

Millions of yen

2011
Deferred tax assets:
Allowance for retirement benefits
Depreciation
Net operating loss carry-forwards for tax purposes
Accrued expenses
Securities
Trade receivables
Other
Subtotal
Less: valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Other securities
Depreciation
Land
Reserve for advanced depreciation of non-current assets
Reserve for special depreciation
Other
Total deferred tax liabilities
Net deferred tax liabilities¥

18,096
12,928
7,940
7,598
6,070
1,303
18,122
72,061(22,482)
49,578(324,127)(2,149)
(562)
(447)
(206)
(3,798)(331,293)¥ (281,715)

2010¥

17,33915,628
8,949
6,988
5,036
1,839
19,49075,271(28,696)
46,574(361,032)(2,258)
(562)
(456)
(288)
(5,689)(370,288)¥ (323,714)

Buildings and structures:
Acquisition cost equivalents
Accumulated depreciation equivalents
Buildings and structures net balance equivalents
Machinery, equipment and vehicles:
Acquisition cost equivalents
Accumulated depreciation equivalents
Machinery, equipment and vehicles net balance equivalents
Tools, furniture and fixtures:
Acquisition cost equivalents
Accumulated depreciation equivalents
Tools, furniture and fixtures net balance equivalents
Software:Acquisition cost equivalents
Accumulated depreciation equivalents
Software net balance equivalents
Total net leased properties

2010

¥

88
52
36

¥

245
178
66

¥

7,474
5,203
2,270

¥

7,980
4,696
3,283

¥

5,568
4,409
1,159

¥

9,761
6,742
3,018

¥

90
73
17
3,484

¥

100
63
36
6,405

¥

¥

Acquisition cost equivalents include the imputed interest expense portion because the percentage which is computed by dividing future minimum lease payments by total balance ofproperty, plant and equipment at year-end is immaterial.

(b) Pro forma information regarding future minimum lease payments as of March 31, 2011 and 2010 is as follows:
Millions of yen

Net deferred tax liabilities consist of the following components on the consolidated balance sheets.
Millions of yen

Current assets — deferred tax assets
Investments and other assets — deferred tax assets
Current liabilities — deferred tax liabilities
Long-term liabilities — deferred tax liabilities
Net deferred tax liabilities

2011¥
18,4939,786(737)(309,256)¥ (281,715)

2010
17,182
10,429(316)(351,009)¥ (323,714)¥(2) Reconciliations of differences between the statutory rate of income taxes and the effective rate of income taxes forthe years ended March 31, 2011 and 2010 are as follows:
Statutory rate of income taxes
Addition (reduction) in taxes resulting from:
Valuation allowance
Dividends income and others permanently not recognized as taxable income
Other
Effective rate of income taxes

2011
39.9%

2010
39.9%

(9.0%)(4.6%)
2.9%
29.2%

—
—
—
39.9%

Toyota Industries eliminated the line item for the year ended March 31, 2010 because it recorded a loss before income taxes and minority interests.

Due within one year
Due after one year
Total

2011
¥
2,015
2,227
¥
4,242

2010
3,061
4,641
¥
7,702
¥

The amount equivalent to future minimum lease payments as of the end of the year includes the imputed interest expense portion because the percentage which is computed by
dividing future minimum lease payments by total balance of property, plant and equipment at year-end is immaterial.

(c) Total lease payments and pro forma depreciation expenses for the years ended March 31, 2011 and 2010 are as follows:
Millions of yen

Lease payments
Pro forma depreciation expenses

2011
¥
2,388
2,388

¥

2010
3,606
3,606

Pro forma depreciation expenses, which are not reflected in the accompanying consolidated statements of income, are computed mainly by the straight-line method, which assumes
zero residual value and leasing term to be useful lives for the years ended March 31, 2011 and 2010, and are equivalent to the amount of total lease payments of the above.

2) Finance leases (as a lessor)(a) Lease investment assets listed on the consolidated balance sheets as of March 31, 2011 and 2010 are as follows:
Millions of yen

Lease receivables
Residual value
Unearned interest income
Total

2011
¥
95,851
26,861(16,085)¥ 106,627

2010
¥

¥

—
—
—
—

23. Leases:(1) Finance leases
1) Finance leases (as a lessee)
Lease assets are mainly materials handling equipment which is leased as operating leases.
The depreciation method of leased assets is referred to in Note 2(9).
As for finance leases other than finance leases deemed to transfer the ownership of leased properties to lessees, those that came into
effect before March 31, 2008 (inclusive) will continue to be accounted for by the former method (similar to the method applicable to ordinary
operating leases).

36

Toyota Industries Report 201137

(b) Amounts of projected future recovery after March 31, 2011 for the portion of lease payment receivable in lease investment assets is as follows:

24. Changes in net assets:

Millions of yen

2011Year ending March 31
2012
2013
2014
2015
2016
2017 and thereafter
Total(1) Common stock outstanding for the years ended March 31, 2011 and 2010:2010

shares¥35,90227,447
18,194
9,936
3,612
757
95,851

¥

¥

—
—
—
—
—
—
—

¥

As for finance leases other than finance leases deemed to transfer the ownership of leased properties to lessees, those that came into effect before March 31, 2008 (inclusive) willcontinue to be accounted for by the former method (similar to the method applicable to ordinary operating leases).

Balance at March 31, 2009
Increase
Decrease
Balance at March 31, 2010
Increase
Decrease
Balance at March 31, 2011

325,840,640——
325,840,640——
325,840,640(2) Treasury stock outstanding for the years ended March 31, 2011 and 2010:
shares(c) Information regarding leased properties such as acquisition cost and accumulated depreciation under finance leases as of March 31, 2011 and2010 is as follows:
Millions of yen

2011
Machinery and equipment:
Acquisition cost
Accumulated depreciation
Total net leased property

¥

4,990
4,609
380

¥

2010
¥

6,302
5,541
761

¥

Balance at March 31, 2009
Increase due to purchase of odd stock
Decrease due to sale of odd stock
Balance at March 31, 2010
Increase due to purchase of odd stock
Decrease due to sale of odd stock
Balance at March 31, 2011

14,263,027
7,277
(361)
14,269,943
6,183
(405)
14,275,721(3) Subscription rights to shares outstanding for the years ended March 31, 2011 and 2010:
Millions of yen(d) Pro forma information regarding future minimum lease income as of March 31, 2011 and 2010 is as follows:
Millions of yen

Due within one year
Due after one year
Total

2011
699
288
¥
988

¥

2010
1,651
1,016
¥
2,667

¥

Future minimum lease income under finance leases include the imputed interest income portion because the percentage which is computed by dividing the total of future minimum
lease income and estimated residual value by the total of future minimum lease income and estimated residual value and the balance of operating receivables at the year-end isimmaterial.

2011
¥
2,132

The Company(a) Dividends paid for the year ended March 31, 2011
Resolutions

Ordinary General Meeting of Shareholders held on June 23, 2010
Board of Directors meeting held on October 29, 2010
Millions of yen

¥
¥

2011
606
282

¥
¥

2010
1,793
951

(2) Operating leases
Ordinary General Meeting of Shareholders held on June 16, 2011
Millions of yen

Due within one year
Due after one year
Total

2011
¥
6,889
29,645¥36,534

2010
¥
9,069
34,148¥43,217

Resolutions

Board of Directors meeting held on October 30, 2009
Millions of yen

Due within one year
Due after one year
Total

2011
¥
20,43735,652¥56,0902010¥
19,491
29,056¥48,547

Toyota Industries Report 2011

Dividends
per share¥6,231

¥20

7,789

25

Yen

Recorddate

Effective
date

March 31,2010
September
30, 2010

June 24,2010
November26, 2010

Class ofsharesTotal
dividends
Millions ofyen

Source ofdividends

Commonstock¥7,789Retainedearnings

Class ofsharesTotal
dividends
Millions ofyen

Dividends
per share¥3,115

¥10

3,115

10

Dividends
per share
Yen¥25

Recorddate

Effective
date

March 31,2011

June 17,
2011

Commonstock
Commonstock

Yen

Recorddate

Effective
date

March 31,2009
September
30, 2009

June 22,2009
November26, 2009(d) Dividends with a record date in the fiscal year ended March 31, 2010 for which the effective date falls in the following fiscal year
Resolutions

Ordinary General Meeting of Shareholders held on June 23, 201038

Commonstock
Commonstock

Total
dividends
Millions ofyen(c) Dividends paid for the year ended March 31, 2010

Ordinary General Meeting of Shareholders held on June 19, 2009
2) Operating leases (as a lessor)
Pro forma information regarding future minimum rentals under operating leases as of March 31, 2011 and 2010 is as follows:

Class ofshares(b) Dividends with a record date in the fiscal year ended March 31, 2011 for which the effective date falls in the following fiscal year
Resolutions

1) Operating leases (as a lessee)
Pro forma future lease payments under operating leases as of March 31, 2011 and 2010 are as follows:

2010
1,720

(4) Dividends(e) Total lease payments to be received and depreciation expenses for the years ended March 31, 2011 and 2010 are as follows:

Total lease payments to be received
Depreciation expenses¥

Class ofsharesTotal
dividends
Millions ofyen

Source ofdividends

Commonstock¥6,231Retainedearnings

Dividends
per share
Yen¥20

Recorddate

Effective
date

March 31,2010

June 24,2010

39

25. Subsequent events:

Millions of yen

2011
There were no subsequent events for the years ended March 31, 2011 and 2010.

26. Segment information:(1) Outline of reporting segments
The operating segments reported below are the segments of Toyota Industries for which separate financial information is available and for which
operating income/loss amounts are evaluated regularly by executive management in deciding how to allocate resources and in assessing performance.
The reporting segments of Toyota Industries consist of Automobile, Materials Handling Equipment, Logistics, Textile Machinery and Others.
The similarity of products and services are taken into account for the separation. Within the Automobile Segment, vehicles, engines, car airconditioning compressors and others are included due to the similarity of their business environments. The main products and services of eachsegment are as follows.
Automobile . . . . . . . . . . . . . . . . . . . . . . . . . . . . Vehicles, diesel and gasoline engines, car air-conditioning compressors, foundry parts for engines,
electronics components for automobiles
Materials Handling Equipment . . . . . . . . . . . . . . Lift trucks, warehouse trucks, automated storage and retrieval systems, aerial work platforms
Logistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Land transportation services, cash collection and delivery and cash proceeds management
services, data storage, management, collection and delivery services
Textile Machinery . . . . . . . . . . . . . . . . . . . . . . . . Weaving machinery, spinning machinery
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Semiconductor package substrates(2) Calculation method of reporting segment information
The accounting method of reporting segment information is based on “Summary of significant accounting policies.”
Segment income is based on operating income.
Inter-segment sales and transactions are based on arm’s-length price.

(3) Business segments
As of and for the years ended March 31, 2011 and 2010:
Millions of yen

2011

2010

¥ 804,167
21,151
825,319¥ 778,356
12,810791,166

490,676654
491,330

431,619
999
432,618

107,773
8,069
115,842

108,596
5,685
114,282

42,79512
42,807

20,87857
20,93634,426
11,853
46,279
1,521,580(41,740)¥ 1,479,839

38,317
10,301
48,6191,407,623(29,853)¥ 1,377,769

Sales:
Automobile
Outside customer sales
Inter-segment transactions
Materials Handling Equipment
Outside customer sales
Inter-segment transactions
Logistics
Outside customer sales
Inter-segment transactions
Textile Machinery
Outside customer sales
Inter-segment transactions
Others
Outside customer sales
Inter-segment transactions
Subtotal
Elimination of inter-segment transactions
Total

40

Toyota Industries Report 2011

Segment income (loss):
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersElimination of inter-segment transactions
Total
Assets:Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total
Depreciation:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total
Amortization of goodwill:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total
Investment in equity method company:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total
Increase in tangible assets and intangible assets:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total

¥

¥

32,87623,999
5,397
2,592
3,445
485
68,798

2010¥¥

23,663(9,549)5,294(1,836)
3,971
459
22,002¥ 305,871
499,120
191,774
15,27761,8081,407,600¥ 2,481,452¥ 346,068
500,652
190,745
14,03756,187
1,481,555¥ 2,589,246

¥

¥

¥
¥

¥
¥

¥
¥

¥

41,81330,845
7,298
904
1,725
—
82,587
0
2,465
3,374
—
—
—
5,840
1,691
2,148
—
—
—
—
3,840
22,95337,453
7,215
473
1,433
—
69,528

¥
¥

¥
¥

¥
¥

¥

50,085
38,130
7,166
1,032
2,306
—
98,722
—
7,828
3,568
—
—
—
11,396
2,575
2,169
2,468
—
—
—
7,213
14,98429,908
6,963
72
1,104
—
53,03341

(4) Related information(3) Outstanding balances arising from sale/purchase of goods/services as of March 31, 2011 and 2010 were as follows:

Geographical segments
As of and for the year ended March 31, 2011:

Receivables from a related party:
Millions of yen
Millions of yen

2011
Sales:Japan
U.S.A.
OthersTotal
Tangible assets:
Japan
Others
Total
Major customer:
Sales (Automobile Segment)
Toyota Motor Corporation
Total
Unamortized segment balance of goodwill:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of inter-segment transactions
Total
Impairment loss: Not applicable
Negative goodwill: Negative goodwill is omitted due to its quantitative immateriality.

¥ 937,349
148,756
393,734¥ 1,479,839

Toyota Motor Corporation

2011¥
11,102¥

2010
32,841

Payables to a related party:
Millions of yen

Toyota Motor Corporation

2011¥
36,309¥2010
47,212The balance as of March 31, 2011 and 2010 includes consumption taxes.

¥ 376,797
120,480¥ 497,278

28. Net income (loss) per share (EPS):
The basis of calculation for net income (loss) per share basic and net income (loss) per share diluted is as follows:¥ 607,201¥ 607,201¥¥—
17,02751,546———
68,573(Additional Information)
Effective from the fiscal year beginning April 1, 2010, Toyota Industries applied Financial Accounting Standard No. 17 “Revised Accounting Standard for Disclosures about Segmentsof an Enterprise and Related Information” issued on March 27, 2009 and its Implementation Guidance No. 20 “Guidance on Accounting Standard for Disclosures about Segments ofan Enterprise and Related Information” issued on March 21, 2008 by the Accounting Standards Board of Japan.

Millions of yen

2011
Net income (loss) per share—basic:
Net income (loss)
Net income not attributable to common shareholders(bonuses for directors and statutory auditors that are paid through appropriation)
Net income (loss) attributable to common shareholders
Weighted-average shares (thousands)
Net income (loss) per share—basic (exact yen amounts)
Net income (loss) per share—diluted:
Weighted-average shares for diluted computation (thousands)
Net income (loss) per share—diluted (exact yen amounts)

¥

2010

47,205—¥(26,273)—

47,205311,568¥
151.51(26,273)
311,573¥(84.33)————

Amounts for net income (loss) per share—diluted are not shown due to no dilutive shares.

29. Net assets per share:
The basis of calculation for net assets per share is as follows:

27. Related party transactions:

Millions of yen

The following transactions were carried out with related parties:(1) Sales of goods and services for the years ended March 31, 2011 and 2010 were as follows:
Millions of yen

Toyota Motor Corporation2011¥ 606,592

2010¥ 599,217

Toyota Motor Corporation held 24.61% of the Company’s voting rights as of March 31, 2011. As for the sales of automobiles and engines, etc.,
the Company offers prices on such products based on their overall costs and negotiates conditions for each fiscal year, as per conditions on
arm’s-length transactions. The above transactions are carried out based on commercial terms and conditions. Transaction amounts exclude
consumption taxes.

(2) Purchase of goods for the years ended March 31, 2011 and 2010 were as follows:
Millions of yen

2011¥ 434,947

2010¥ 435,232

As for the purchase of parts of automobiles and engines, etc., the Company negotiates conditions for each fiscal year, based on offered prices onsuch products, as per conditions on arm’s-length transactions. The above transactions are carried out based on commercial terms and conditions.
Transaction amounts exclude consumption taxes.

42

Toyota Industries Report 20112010

¥ 1,075,939¥ 1,104,929

2,132
45,589
1,028,217

1,720
46,9781,056,230

311,564¥ 3,300.17

311,570¥ 3,390.02

30. Cash and cash flows:

Purchase of goods:

Toyota Motor Corporation

Net assets per share:
Total net assets
Amounts deducted from total net assets
Subscription rights to shares
Minority interests in consolidated subsidiaries
Net assets applicable to common stock at end of year
Outstanding shares of common stock at end of year used for the computationof net assets per share (thousands)
Net assets per share (exact yen amounts)

2011

The relationship between the accounts in the consolidated balance sheets and the remaining balance of cash and cash equivalents as of March 31,
2011 and 2010 are as follows:
Millions of yen

Cash and deposits
Deposits which have a maturity of over three months to one year
Short-term investments (securities) which have an original maturity within three months
Cash and deposits for business engaged in collection and delivery
Cash and cash equivalents

2011¥ 198,654(90,087)
132,430(45,431)¥ 195,566

2010¥ 287,965(30)
71,391(41,736)¥ 317,590

43

Report of Independent Auditors

44

Toyota Industries Report 2011

2-1, Toyoda-cho, Kariya-shi, Aichi 448-8671, Japan
Telephone: +81-(0)566-22-2511 Facsimile: +81-(0)566-27-5650
www.toyota-industries.com

This report is printed with ink derived from vegetables using a waterless printing process.
Printed in Japan