BANDAI NAMCO
Holdings Inc.
Notice of the Eleventh Ordinary General Meeting of Shareholders
to be held on June 20, 2016
An English translation of the original notice in Japanese

DISCLAIMER
The following is an English translation of the Japanese original “Notice of the Eleventh Ordinary General
Meeting of Shareholders of BANDAI NAMCO Holdings Inc.” which meeting is to be held on June 20, 2016.
The Company provides this translation for your reference and convenience only and does not guarantee its
accuracy or otherwise. In the event of any discrepancies, the Japanese original notice shall prevail.
These documents have been prepared solely in accordance with Japanese law and are offered here for
informational purposes only. In particular, please note that the financial statements included in the following
translation have been prepared in accordance with Japanese GAAP.

1Securities code: 7832
May 30, 2016
5-37-8 Shiba, Minato-ku, Tokyo
BANDAI NAMCO Holdings Inc.
Mitsuaki Taguchi
President and Representative Director
Dear Shareholders,
NOTICE OF THE ELEVENTH ORDINARY GENERAL MEETINGOF SHAREHOLDERS
You are cordially invited to attend the Eleventh Ordinary General Meeting of
Shareholders of BANDAI NAMCO Holdings Inc. (“the Company”) to be held as set
forth below.
If you are unable to attend the meeting in person, we ask you to please review theenclosed “Reference Documents for the General Meeting of Shareholders” andexercise your voting rights by either of the methods stated on the next page by 5:30
p.m., Saturday, June 18, 2016.
Meeting Details
1.

Date and Time:

June 20, 2016 (Monday) at 10:00 a.m.

2.

Place:“Hiten,” Grand Prince Hotel New Takanawa
3-13-1 Takanawa, Minato-ku, Tokyo

3.

Purpose of the Meeting:
Matters to be Reported:
1.

Report on the Contents of the Business Reports, the Consolidated Financial
Statements and the Results of the Auditing of the Consolidated Financial
Statements by the Accounting Auditor and the Audit & Supervisory Board for the
Eleventh Fiscal Year (from April 1, 2015 to March 31, 2016)
2. Report on the Contents of the Non-Consolidated Financial Statements for the
Eleventh Fiscal Year (from April 1, 2015 to March 31, 2016)

Matters to be Resolved:
Proposal No. 1: Appropriation of Surplus
Proposal No. 2: Election of Ten Directors
4.

Information on Exercise of Voting Rights
Please see “Information on Exercise of Voting Rights” on pages 3 to 4 of thisdocument.

2

[Information on Exercise of Voting Rights]
Please exercise your voting rights after reviewing the Reference Documents for the General
Meeting of Shareholders on pages 5 to 17.
You may exercise your voting rights by one of the following three methods.
A: Exercise of Voting Rights via attending the General Meeting of Shareholders:
Please hand in the enclosed Voting Rights Exercise Form at the reception desk at
the place of the shareholders’ meeting.
In addition, please bring this NOTICE OF THE ELEVENTH ORDINARY
GENERAL MEETING OF SHAREHOLDERS.
B: Exercise of Voting Rights via Postal Mail:
Please indicate, on the enclosed Voting Rights Exercise Form, your approval ordisapproval of each item on the agenda and return the completed form so that it arrivesby 5:30 p.m., Saturday, June 18, 2016.
C: Exercise of Voting Rights via the Internet etc.:
Please access the website designated by the Company for the exercise of voting
rights (http://www.evote.jp/), enter and send your approval or disapproval of each itemon the agenda by 5:30 p.m., Saturday, June 18, 2016.
For details, please see the following page.

If you exercise your voting rights more than once via both postal mail and theInternet etc., then only the vote cast via the Internet etc. shall be deemed valid.
In addition, if you cast your vote via the Internet etc. multiple times, then only thelast vote cast shall be deemed valid. If you cast your vote via the Internet etc. morethan once, using a personal computer, a smartphone and/or a mobile phone, then only
the last vote cast shall be deemed valid.
If you attend the meeting in person, you do not need to follow the procedures forthe exercise of voting rights via postal mail (sending the Voting Rights Exercise Form)or via the Internet etc.
If revisions to the contents of the “Reference Documents for the General Meeting of Shareholders,” the“Business Reports,” the “Non-Consolidated Financial Statements” and the “Consolidated Financial
Statements” are required, the Company shall publish a notification on the Company website at thefollowing URL:
(http://www.bandainamco.co.jp/ir/stock/meeting/index.html).

3

[Information on Exercise of Voting Rights via the Internet etc.]
1. The exercise of voting rights via the Internet etc. is available only by gaining access to theCompany’s designated website for the exercise of voting rights (http://www.evote.jp/) from a PC,
a smartphone, or a mobile phone (i-mode, EZweb or Yahoo! Mobile)*. However, please notethat you cannot exercise your voting rights via the Internet on the designated website between
the hours of 2:00 a.m. and 5:00 a.m.
* “i-mode,” “EZweb” and “Yahoo!” are trademarks or registered trademarks of NTT DOCOMO,
INC., KDDI Corporation, and Yahoo Inc. in the U.S., respectively.
2. Please note that you may not be able to exercise your voting rights via PC or smartphone on thedesignated website for the exercise of voting rights, depending on the Internet settings
configured on your PC or smartphone, such as firewalls, etc. that are in place to regulate yourInternet connections, anti-virus software that has been installed on your PC or smartphone, or
the use of a proxy server.
3. When exercising voting rights via mobile phone, you must use one of the following services:
i-mode, EZweb or Yahoo! Mobile. For security reasons, you cannot vote using mobile handsetsthat cannot send encrypted information (TSL communications) or that cannot send informationof the mobile phone used.
4. Please note that, in order to prevent unauthorized access to the designated website by individuals
other than shareholders (persons impersonating shareholders) and to prevent the alteration of
votes, we request that you change your “temporary password” to a permanent password on thedesignated website for the exercise of voting rights, when you want to exercise your voting
rights via the Internet.
5. All costs associated with accessing the website for the exercise of voting rights (cost of dial-up
connections, telephone tolls, etc.) are to be borne by the shareholder. Also, when voting via
smartphone or mobile phone, all packet communication fees and other costs incurred in the useof a smartphone or a mobile phone are also to be borne by the shareholder.

For further assistance, regarding the system, etc., please contact:
Transfer Agent Department (Help Desk)
Mitsubishi UFJ Trust and Banking Corporation
Phone: 0120-173-027 (9:00 to 21:00 (Japan Time); toll free only within Japan)[For institutional investors]
Institutional investors may make use of the Tokyo Stock Exchange’s Electronic
Voting Platform (the TSE Platform).

4

Reference Documents for the General Meeting of Shareholders
Proposals and References
Proposal No. 1 Appropriation of Surplus
Appropriation of surplus is as follows:
Fiscal Year-end Dividends
The Company places the return of profits to shareholders as one of its highest
management priorities. The Company assumes its basic policy is to further strengthen theGroup’s competitiveness and, while maintaining a sound financial status, to achieve regular
distributions of dividends and improvement in the Company’s corporate value. In concreteterms, the Company’s basic policy is to provide a return to shareholders that targets at apayout ratio of 30% in accordance with consolidated operational results and based on stableannual dividend payments of ¥24 per share.
In view of the Company’s performance in this fiscal year, it will add a performance-based
dividend of ¥28 per share to the stable year-end dividend of ¥12 per share to pay a year-end
dividend of ¥40 per share for this eleventh fiscal year.
Since the Company paid an interim dividend of ¥12 per share on December 7, 2015, thetotal annual dividend for the fiscal year will be ¥52 per share.
(i) Type of dividend assets:Cash(ii) Allocation of dividend assets to be paid to shareholders and total amount of dividend:
Dividend per share of common stock of the Company ·············¥40
Total amount of dividends ······························ ¥8,791,809,600(iii) Effective date of distribution of surplus (dividend):
June 21, 2016

5

Proposal No. 2: Election of Ten Directors
Since the terms of office of the nine Directors of the Company will expire as of the close ofthis General Meeting of Shareholders, the Company requests the election of ten Directors.
Policy on and process for selecting candidates for Director of the Company
To select candidates for Director of the Company, candidates will be nominated on the basis ofsufficiently broad expertise and experience in decision-making for corporate management,
background in a business supervisory capacity, or achievements and knowledge from their career todate. The basic policy is to ensure that at least two of the Directors are independent Outside
Directors.
To select Candidates for Outside Director of the Company, nominations that provide anappropriate balance of, for example, individuals with extensive experience in corporate
management, individuals with profound scholarly knowledge of corporate strategy, or lawyers whoare experts in compliance and other internal controls, will be considered and a decision will bemade accordingly.
When selecting Candidates for Director of the Company, a Personnel Committee of which amajority of the members are independent Outside Directors will be established on a discretionary
basis to act as a forum for debate and receive recommendations, and the independent Outside
Directors will conduct interviews, before a decision is made at a Board of Directors Meeting.

6

The candidates for Director of the Company are as follows:
Positions andCandidate
Name
Responsibilities inNo.
(Date of Birth)
the Company
Apr. 1978:

1

Career Summary

Joined NAMCO LIMITED (currently
BANDAI NAMCO Entertainment Inc.)
Aug. 1991:
General Manager, EM Development
Department of NAMCO LIMITED
Jun. 1995:
Director in charge of Development
Division II, General Manager, EM
Development Department and VS
Development Department of NAMCO
LIMITED
Jun. 1999:
Managing Director in charge of Research,
Development and Production, andDevelopment Division II of NAMCO
Shukuo Ishikawa
LIMITED(April 15, 1955)
Apr. 2005:
Executive Vice President andRepresentative Director in charge ofChairman andcontents business of NAMCO LIMITED
Representative Apr. 2006:
President and Representative Director of
Number of the
Director
NAMCO BANDAI Games Inc.
Company’s(currently BANDAI NAMCO
Shares Owned
Entertainment Inc.)
49,300 Shares
Jun. 2006:
Director of the Company
Apr. 2009:
President and Representative Director of
the Company
Apr. 2010:
President and Representative Director of
NAMCO BANDAI Games Inc.
Apr. 2012:
Chairman of the Board of NAMCO
BANDAI Games Inc.
Apr. 2015:
Chairman of the Board of BANDAI
NAMCO Business Arc Inc. (current
position)
Jun. 2015:
Chairman and Representative Director of
the Company (current position)
Reasons for proposing Mr. Shukuo Ishikawa as a candidate for Director:
Mr. Shukuo Ishikawa has worked as a Representative Director of the Company since 2009 andpossesses extensive experience, achievements, and knowledge as a business manager. He is
proposed as a candidate for Director as the Company considers him capable of promoting
Group management and strengthening corporate governance.

7

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Apr. 1982:
Apr. 1999:

2

Joined BANDAI CO., LTD.
General Manager, Vending Machine
Business Department of BANDAI CO.,LTD.
Jun. 2003:
Director, Leader of Lifestyle Group andLifestyle Company President of
BANDAI CO., LTD.
Apr. 2006:
Managing Director in charge of new
business policy of BANDAI CO., LTD.
Mitsuaki Taguchi(June 16, 1958)
Apr. 2009:
Senior Managing Director in charge of
media policy and new business policy of
President and
BANDAI CO., LTD.
Representative
Number of theApr. 2010:
Executive Vice President and Director in
Director
Company’s
charge of media policy and new business
Shares Owned
policy of BANDAI CO., LTD.
58,500 Shares
Apr. 2012:
Executive Vice President and COO incharge of global media policy and humanresources policy and in charge of Real B
Voice Business Group, Strategy Projects,
Human Resources of BANDAI CO.,LTD.
Apr. 2015:
Adviser of the Company
Jun. 2015:
President and Representative Director of
the Company (current position)
Reasons for proposing Mr. Mitsuaki Taguchi as a candidate for Director:
Mr. Mitsuaki Taguchi has exhibited leadership skills based on his extensive experience andbroad knowledge gained through roles at BANDAI CO., LTD., which is the core company of
the Toys and Hobby Business in the Group and where he was responsible for media policy andnew business policy. He supervised the business appropriately after his appointment as
President and Representative Director of the Company. He is proposed as a Candidate for
Director as the Company considers him capable of achieving the Mid-term Plan and ensuringthat the Group continues to grow.

8

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Mar. 1986:
Dec. 1996:
Jan. 2000:

3

Licensed as a CPA
Partner in Century Audit Corporation
Partner in Century Ota Showa & Co.
(currently Ernst & Young ShinNihon
LLC)
Sep. 2003:
Partner in KPMG AZSA & Co. (currently
KPMG AZSA LLC)
May 2004:
Board Member of KPMG AZSA & Co.
Oct. 2007:
Joined the Company as Adviser
Jun. 2008:
Director in charge of Overseas
Operations, Group Administrative
Headquarters, Corporate Legal Affairs
Office and Internal Auditing Division of
the Company
Shuji Ohtsu
Director and
Jun. 2011:
Director in charge of Overseas Regional(August 6, 1959)
Division
Headquarters Companies and Division
GeneralGeneral Manager of the Group
Number of theManager of the
Administrative Headquarters of theCompany’sGroup
Company
Shares Owned
Administrative Apr. 2013:
Director and Division General Manager
25,100 Shares
Headquartersof the Group Administrative
Headquarters of the Company (current
position)
President and Representative Director of
NAMCO BANDAI Holdings (USA) Inc.
(currently BANDAI NAMCO Holdings
USA Inc.) (current position)
Apr. 2015:
President and Representative Director of
BANDAI NAMCO Business Arc Inc.
(current position)(Major concurrent positions)
President and Representative Director of BANDAI
NAMCO Holdings USA Inc.
President and Representative Director of BANDAI
NAMCO Business Arc Inc.
Reasons for proposing Mr. Shuji Ohtsu as a candidate for Director:
Mr. Shuji Ohtsu possesses specialist expertise as a CPA, as well as extensive experience andachievements as Division General Manager of the Group Administrative Headquarters of theCompany. He is proposed as a candidate for Director as the Company considers him capable ofstrengthening Group management structures and ensuring highly transparent management.

9

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Apr. 1986:
Aug. 2005:

4

Joined BANDAI CO., LTD.
General Manager, Accounting Division of
BANDAI CO., LTD.
Sep. 2005:
Joined the Company, as General Managerof the Corporate Administration
Department
Apr. 2006:
Director of NAMCO BANDAI Games
Inc. (currently BANDAI NAMCOEntertainment Inc.)
Yuji Asako(January 18,
Director and
Apr. 2008:
Executive Officer, Division General
1966)
DivisionManager of Corporate Planning Division
Generalof the Company
Manager of the Jun. 2010:
Director in charge of Corporate Planning
Corporate
Number of theand Division General Manager of theCompany’s
Planning
Corporate Planning Division of the
Shares Owned
Division
Company
25,000 Shares
Jun. 2011:
Director and Division General Managerof the Corporate Planning Division of theCompany (current position)
Apr. 2014:
Director of NAMCO LIMITED (*)(current position)* Newly established company throughthe incorporation-type company split of
NAMCO LIMITED (currently BANDAI
NAMCO Entertainment Inc.)
Reasons for proposing Mr. Yuji Asako as a candidate for Director:
Mr. Yuji Asako possesses extensive experience, achievements, and knowledge relating tomanagement and administration, including business planning and accounting, and also has
experience in roles where he was responsible for internal and external communications, such as
IR, PR and SR. He is proposed as a candidate for Director as the Company considers him
capable of implementing the Group’s management strategies and seeking a sustained increasein corporate value.

10

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Apr. 1983:
Apr. 2002:

5

Joined BANDAI CO., LTD.
Executive Officer and General Manager,
Vending Machine Business Departmentof BANDAI CO., LTD.
New Candidate
Apr. 2006:
Director in charge of distribution policy
for Directorof BANDAI CO., LTD.
Apr. 2010:
Managing Director in charge of hobby
Masarubusiness policy and quality assurance
Kawaguchi
policy of BANDAI CO., LTD.
(November 2,
Apr. 2015:
Senior Managing Director in charge of1960)–
toy business policy of BANDAI CO.,LTD.
Number of theAug. 2015:
President and Representative Director ofCompany’s
BANDAI CO., LTD. (current position)
Shares Owned
Executive Officer of the Company
30,600 Shares(current position)(Major concurrent position)
President and Representative Director of BANDAI CO.,LTD.
Reasons for proposing Mr. Masaru Kawaguchi as a candidate for Director:
Mr. Masaru Kawaguchi possesses extensive experience, achievements, and knowledge in the
Toys and Hobby Business and has driven the business forward as the President andRepresentative Director of BANDAI CO., LTD., which is the core company of Toys and Hobby
Business in the Group, since 2015. He is proposed as a candidate for Director as the Company
considers him capable of building closer ties between the Toys and Hobby Business and Groupmanagement.

11

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Mar. 1976:
Apr. 1992:

6

Joined BANDAI CO., LTD.
General Manager, Toy Marketing
Department of BANDAI CO., LTD.
Jun. 1999:
Executive Officer and Deputy Division
Head, Consumer Business Division, andGeneral Manager, SWAN Business
Department of BANDAI CO., LTD.
Mar. 2002:
Joined Bandai Networks Co., Ltd., as
Executive Manager
Jun. 2002:
President and Representative Director ofBandai Networks Co., Ltd.
Jun. 2007:
Director in charge of Network SBU of theCompany
Satoshi Oshita
Apr. 2009:Managing Director in charge of CS(July 3, 1953)
business and NE business of NAMCO
Director in
BANDAI Games Inc. (currently
charge of
BANDAI NAMCO Entertainment Inc.)
Network
Number of theApr. 2010:
President and Representative Director ofEntertainment
Company’s
BANDAI VISUAL CO., LTD.
SBU
Shares Owned
Apr. 2012:
Executive Officer in charge of Content
43,400 Shares
SBU of the Company
President and Representative Director of
NAMCO BANDAI Games Inc. (current
position)
Jun. 2012:
Director in charge of Content SBU of theCompany
Jan. 2015:
President of BANDAI NAMCO(SHANGHAI) CO., LTD.
Apr. 2015:
Director in charge of Network
Entertainment SBU of the Company(current position)(Major concurrent position)
President and Representative Director of BANDAI
NAMCO Entertainment Inc.
Reasons for proposing Mr. Satoshi Oshita as a candidate for Director:
Mr. Satoshi Oshita possesses extensive experience, achievements, and knowledge from his
wide-ranging involvement in the Toys and Hobby, Network Entertainment, and Visual andMusic Production Businesses in the Group. He has driven the business forward as the President
and Representative Director of BANDAI NAMCO Entertainment Inc., which is the corecompany of the Network Entertainment Business in the Group, since 2012. He is proposed as a
candidate for Director as the Company considers him capable of building closer ties between
the Network Entertainment Business and Group management.

12

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Apr. 1982:

7

Joined CANYON RECORDS INC.
(currently PONY CANYON INC.)
Jul. 1989:
Joined BANDAI CO., LTD.
Apr. 1994:
Joined BANDAI VISUAL CO., LTD.
Sep. 1997:
General Manager of Production at
Production Headquarters of BANDAIVISUAL CO., LTD.
Mar. 1999:
Deputy Division Head of Visual Business
Division and General Manager of Visual
Planning Department of BANDAIVISUAL CO., LTD.
May 1999:
Director, Deputy Division Head of Visual
KazumiBusiness Division and General Manager
Kawashiroof Visual Planning Department of(November 4,
BANDAI VISUAL CO., LTD.
1959)
Director in
President and Representative Director of
charge of Visual May 2003:
BANDAI VISUAL CO., LTD.
and Music
Number of the
Production SBU Jun. 2007:
Director in charge of Visual and Music
Company’s
Content SBU of the Company
Shares Owned
Apr. 2010:
Vice President and Director of BANDAI
13,700 Shares
VISUAL CO., LTD.
Apr. 2012:
President and Representative Director of
BANDAI VISUAL CO., LTD. (current
position)
Apr. 2015:
Executive Officer in charge of Visual andMusic Production SBU of the Company
Jun. 2015:
Director in charge of Visual and Music
Production SBU of the Company (current
position)(Major concurrent position)
President and Representative Director of BANDAIVISUAL CO., LTD.
Reasons for proposing Mr. Kazumi Kawashiro as a candidate for Director:
Mr. Kazumi Kawashiro possesses extensive experience, achievements, and knowledge in the
Visual and Music Production Business. He has driven the business forward as the President andRepresentative Director of BANDAI VISUAL Co., Ltd, which is the core company of the
Visual and Music Production Business in the Group, since 2012. He is proposed as a candidate
for Director as the Company considers him capable of building closer ties between the Visualand Music Production Business and Group management.

13

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary
Apr. 1977:

8

Joined Kyowa Hakko Kogyo Co., Ltd.
(currently Kyowa Hakko Kirin Co., Ltd.)
Jun. 2000:
Executive Officer and Head of
Pharmaceutical Research Institute of
Kyowa Hakko Kogyo Co., Ltd.
Jun. 2002:
Managing Director and General Manager
of Comprehensive Planning Office of
Kyowa Hakko Kogyo Co., Ltd.
Jun.
2003:
President and Representative Director of
Outside Director
Kyowa Hakko Kogyo Co., Ltd.
Oct.
2008:
Executive Director of the Board,
Yuzuru Matsuda
President and Chief Executive Officer of(June 25, 1948)
Kyowa Hakko Kirin Co., Ltd.
Director
Mar. 2012:
Advisor of Kyowa Hakko Kirin Co., Ltd.
Number of theJun. 2012:
Head of Kato Memorial Bioscience
Company’s
Foundation (current position)
Shares Owned
Jun. 2014:
Outside Director of KUBOTA--- Shares
Corporation (current position)
Outside Director of the Company (current
position)
Jun. 2015:
Outside Director of JSR Corporation(current position)(Major concurrent positions)
Head of Kato Memorial Bioscience Foundation
Outside Director of KUBOTA Corporation
Outside Director of JSR Corporation
Reasons for proposing Mr. Yuzuru Matsuda as a candidate for Outside Director and his
suitability as Outside Director:
Given his extensive experience in corporate management and his excellent character andinsight, the Company anticipates that he will be able to further strengthen management
oversight and checking functions, and introduce a broader managerial perspective, and thus
believes that he will be able to perform the duties of an Outside Director appropriately.

14

Candidate
No.

Name
(Date of Birth)

Positions andResponsibilities in
the Company

Career Summary

New Candidate
for Director

Apr. 1990:

Outside Director

Jan. 1998:

SatokoKuwabara(November 1,
1964)

Admitted to the bar in Japan
Joined Mori Sogo Law Office (currently
Mori Hamada & Matsumoto)Partner of Mori Hamada & Matsumoto(current position)–

9
Number of theCompany’s
Shares Owned--- Shares
Reasons for proposing Ms. Satoko Kuwabara as a candidate for Outside Director and hersuitability as Outside Director:
Although she has not been involved in corporate management, the Company anticipates, given
her many years of experience as an attorney-at-law, that she will be able to further strengthen
management oversight and checking functions, mainly from a legal risk perspective, and thus
believes that she will be able to perform the duties of an Outside Director appropriately.
New Candidate
Apr. 2002:
Lecturer of Faculty of Economics andfor Director
Business Administration of Yokohama
City University
Outside Director
Oct. 2003:
Assistant Professor of Faculty of
Economics and Business Administrationof Yokohama City University
Mikiharu NomaOct. 2004:
Assistant Professor of Graduate School of–(November 6,
International Corporate Strategy (ICS) of
1974)
Hitotsubashi University
Apr. 2007:
Associate Professor, Graduate School ofInternational Corporate Strategy (ICS),
10
Number of the
Hitotsubashi University (current position)
Company’s
Shares Owned--- Shares
Reasons for proposing Mr. Mikiharu Noma as a candidate for Outside Director and his
suitability as Outside Director:
Although he has not been involved in corporate management, given his profound scholarly
knowledge accumulated throughout his study and teaching activities in the field of corporate
strategy, the Company anticipates that he will be able to further strengthen management
oversight and checking functions, and thus believes that he will be able to perform the duties ofan Outside Director appropriately.
(Notes) 1. Each of Mr. Yuzuru Matsuda, Ms. Satoko Kuwabara and Mr. Mikiharu Noma is a candidate for
Outside Director of the Company. Mr. Yuzuru Matsuda is currently Outside Director of theCompany. As of the close of this General Meeting of Shareholders, he will have served as
Outside Director for approximately two years.
2. Independence as Outside Director
The Company believes that Mr. Yuzuru Matsuda, Ms. Satoko Kuwabara and Mr. Mikiharu
Noma, who are candidates for Outside Director of the Company, all satisfy the Company’sStandards for the Independence of Outside Directors and Outside Audit & Supervisory Board
Members (please refer to “Standards for the Independence of Outside Directors and Outside

15

Audit & Supervisory Board Members” on page 17) and thus have no risk of conflicts of interest
with general shareholders and have a high degree of independence. The Company has filed anotification with the Tokyo Stock Exchange that each of the candidates would be Independent
Directors/Auditors as defined in the rules of the Tokyo Stock Exchange and would be theIndependent Directors/Auditors of the Company after the election at this Ordinary General
Meeting of Shareholders.
3. The Company does not intend to conclude a Liability Limitation Agreement under Article 427,
Paragraph 1, of the Companies Act with each of the candidates for Director.
4. There are no special interests between each of the candidates for Director and the Company.

16

Standards for the Independence of Outside Directors and Outside Audit & Supervisory Board
Members (Reference)
The Company has prescribed the following “Standards for the Independence of Outside Directors
and Outside Audit & Supervisory Board Members” and has nominated Outside Directors andOutside Audit & Supervisory Board Members based on such standards.
Standards for the Independenceof Outside Directors and Outside Audit & Supervisory Board Members
In order for the Outside Directors and Outside Audit & Supervisory Board Members of the Company to be
judged as being independent, such Outside Directors and Outside Audit & Supervisory Board Members must
not fall under any of the following items.
1. Any person who purports to be a major business partner of the Company (including group companies of theCompany; the same applies hereinafter)
2. Any Executive Director, Executive Officer, Manager or other employee of a company that purports to be amajor business partner of the Company
3. Any person who is a major business partner of the Company
4. Any Executive Director, Executive Officer, Manager or other employee of a company that is a major
business partner of the Company
5. Any attorney-at-law, certified public accountant, certified public tax accountant, consultant or other expert
who receives monies or other economic benefits above a certain amount from the Company, in addition tohis or her remuneration as a Director or Audit & Supervisory Board Member
6. Any person belonging to a company, association or other organization such as a law firm, auditing firm, tax
accountant corporation and consultancy which receives monies or other economic benefits above a certain
amount from the Company
7. Any person receiving donations or subsidies from the Company above a certain amount
8. Any person who is a Board member or other Executive Officer in a company, association or otherorganization which receives donations or subsidies from the Company above a certain amount
9. If an Executive Director or full-time Audit & Supervisory Board Member for the Company concurrently
holds a position as an Outside Director or Outside Audit & Supervisory Board Member at another company,
any person who is an Executive Director, Executive Officer, Manager or other employee of that company
10. Any person who has come under one of the categories listed in items 1 through 9 above in the past 5 years
11. If a person coming under one of the categories listed in items 1 through 9 above is an important person, that
person’s spouse or relative within the second degree of kinship
12. The spouse or relative within the second degree of kinship of any person who is a Director, Executive
Officer, Manager or other important employee of the Company or its subsidiaries(Notes) 1 In items 1 and 2, where it reads “any person who purports to be a major business partner of theCompany,” this means “any person (or company) who has received a payment from the Company 2%
or more of its annual consolidated net sales for the most recent business year.”
2 In items 3 and 4, where it reads “any person who is a major business partner of the Company,” thismeans “any person (or company) who has paid to the Company an amount 2% or more of theCompany’s annual consolidated net sales for the most recent business year, or any person (orcompany) who has provided the Company with a loan of an amount 2% or greater of the value of theCompany’s consolidated total assets as of the end of the most recent business year.”
3 In items 5, 7 and 8, where it reads “a certain amount,” this means “¥10 million a year.”
4 In item 6, where it reads “a certain amount,” this means “2% or more of the total net sales for thatcompany, association or organization for the most recent business year, or ¥100 million; whichever isgreater.”17

(Attached Document)
BUSINESS REPORTS(From April 1, 2015 to March 31, 2016)
1. Current Status of the Group(1) Business Status for This Fiscal Year(i)

Business Progress and Results

During the fiscal year ended March 31, 2016, the Japanese economy continued to moderately
recover, supported by a recovery in personal consumption, improved corporate profitability,and growth in purchasing demand from overseas visitors. However, the outlook for the overall
economy remained uncertain. Overseas, the global economy recovered at a moderate paceoverall, despite signs of more subdued growth in some regions.
In this environment, the BANDAI NAMCO Group (“the Group”) is targeting medium- andlong-term growth under the Vision of “NEXT STAGE: Empower, Gain Momentum andAccelerate Evolution” in the three-year Mid-term Plan that started in April 2015. The Grouphas focused on creating and developing new IP (Intellectual Property: intellectual property ofcharacters), expanding targets, and growing new businesses as part of efforts to strengthen the“IP Axis Strategy” that aims to maximize IP value through the provision of the best products
and services at the best possible times. The Group has also initiated to make WiZ Co., Ltd. awholly owned subsidiary through a tender offer as part of plans to strengthen planning anddevelopment capabilities for toys. The Group is also working to expand IP lineup, businessfields, and areas in the Asian region with high growth potential.
On the business front, while there were favorable sales in the Toys and Hobby Business,
network content and overseas home video game software in the Network Entertainment
Business, and the Visual and Music Production Business, sales of arcade game machines in the
Network Entertainment Business struggled.
Consequently, the Group’s consolidated results for the fiscal year ended March 31, 2016 were
net sales of 575,504 million yen (year-on-year increase of 1.8%), operating income of 49,641
million yen (year-on-year decrease of 11.9%), recurring income of 50,774 million yen(year-on-year decrease of 14.5%), and profit attributable to owners of parent of 34,583 million
yen (year-on-year decrease of 8.0%).

18

(ii) Outline of Business by Business Segment(Millions of yen)
Year Ended
March 31,2015

Net SalesYear Ended
March 31,2016

230,918

206,424

Decreaseof 24,493

17,040

16,639Decrease of
401

296,442

320,941

Increaseof 24,499

29,29023,930Decrease of
5,359

43,77351,967

Increaseof 8,193

10,077

11,665

Increase of
1,588

Other

27,00627,456

Increaseof 449

1,462

1,123

Decrease of339

Eliminations
and Corporate(32,655)(31,285)

Increaseof 1,370(1,550)(3,717)

Decrease of
2,167

Consolidated

565,486

575,504

Increaseof 10,018

56,32049,641

Decrease of
6,679

Business
Segment
Toys and Hobby
Network
Entertainment
Visual andMusic
Production

ChangeOperating Income
Year EndedYear Ended
March 31,
March 31,
2015
2016

Change(Notes) As the Group changed the classification of business segments on April 1, 2015, theclassification of business segments for the previous fiscal year have been restatedaccordingly.

19

Toys and Hobby BusinessIn the Toys and Hobby Business, in Japan, sales performed satisfactorily thanks tolong-established IP products such as Mobile Suit Gundam and Dragon Ball, while products of
Yo-kai Watch became popular. Moreover, although collectable toys for adults expected tocontribute to broadening its base of target customers also became popular, there was a decline
in sales domestically in comparison with the previous fiscal year. Overseas, in the Asian
region, products of Mobile Suit Gundam and collectable toys for adults became popular. In
North America and Europe, products of the Power Rangers series sold steadily. In addition,certain results were realized by changing to a system that controls functions such as planningand development in Japan, and creates dedicated sales and marketing in North America andEurope.
As a result, net sales in the Toys and Hobby Business were 206,424 million yen (year-on-year
decrease of 10.6%), and operating income was 16,639 million yen (year-on-year decrease of
2.4%).
Description of Business
Manufacturing and sales of toys, sweets and food products, production for vending machines,
cards, plastic models, apparel, sundries, stationery, etc.

Network Entertainment BusinessIn the Network Entertainment Business, in home video game software, repeat sales of products
including DRAGONBALL XENOVERSE, which was launched in North America and Europe in
the previous fiscal year, and sales of new titles of the BANDAI NAMCO Group, such as
NARUTO SHIPPUDEN: Ultimate Ninja Storm 4, and titles of local third-party were strong.
Moreover, in network content such as social games, game applications for smartphones andPC online games, key titles already existing in Japan retained stable popularity, and the newtitle The iDOLM@STER Cinderella Girls: Starlight Stage performed favorably andcontributed to performance. The Group also started provision of services overseas, including
the Asian region. In addition, in amusement facilities, the Group started implementing a rangeof measures, including targeting resources on key facilities and strengthening stores in new
business formats, resulting in improved profitability. However, sales from arcade gamemachines struggled due to the effects of uncertainty in the market.
As a result, net sales in the Network Entertainment Business were 320,941 million yen(year-on-year increase of 8.3%), and operating income was 23,930 million yen (year-on-year
decrease of 18.3%).
Description of Business
Planning, development and distribution services for network content, planning, development
and sales of home video game software, arcade game machines, and prizes for amusement
machines, planning, development and operation of amusement facilities, etc.

20

Visual and Music Production BusinessIn the Visual and Music Production Business, LoveLive! School idol project, which is IP for
which visual content was developed in conjunction with music content and live events,
became popular through the year due to synergies with a movie release, products and services
and live events. Moreover, visual package software of Mobile Suit Gundam series soldfavorably and contributed to performance.
As a result, net sales in the Visual and Music Production Business were 51,967 million yen(year-on-year increase of 18.7%), and operating income was 11,665 million yen (year-on-yearincrease of 15.8%).
Description of Business
Planning and production of animations, planning, production and sales of visual and music
content software, distribution services for on-demand visual content, live entertainment
operations, etc.

Other Businesses
Other Businesses consist of companies that conduct businesses such as logistics support,
printing, and other kinds of administration and operational support for each of the Group’s
strategic business units: Toys and Hobby SBU, Network Entertainment SBU, and Visual andMusic Production SBU. We are making efforts to manage such operations related to groupsupport in an efficient manner.
As a result, net sales in the Other Businesses were 27,456 million yen (year-on-year increaseof 1.7%), and operating income was 1,123 million yen (year-on-year decrease of 23.2%).
Description of BusinessTransportation and storage of products, management of real estate, printing, etc.

(iii) Capital Expenditures
In this fiscal year, the Group carried out 21,321 million yen in capital expenditures; thefunds were primarily used for investments in the manufacturing of molds associated with thedevelopment of new products and in amusement facilities and machines and for investments
relating to the head office relocation of the Company and its subsidiaries.
(iv) Fundraising
Not applicable.

21

(v)

Transfers of Business, Absorption-Type Company Splits, or Incorporation-Type
Company Splits

On March 29, 2016, BANDAI NAMCO ASIA CO., LTD. (renamed BANDAI NAMCO
Holdings ASIA CO., LTD. effective March 31, 2016), a subsidiary of the Company,
transferred the Toy and Hobby Business to BANDAI NAMCO Holdings ASIA CO., LTD.
(established February 4, 2016 and renamed BANDAI NAMCO ASIA CO., LTD. effective
March 31, 2016).
(vi) Acquisitions of Other Companies’ Businesses
Not applicable.
(vii) Successions of Rights or Duties Related to the Businesses of Other Legal Entities, etc.
due to Absorption-Type Mergers or Absorption-Type Company Splits
Not applicable.
(viii) Acquisitions and Disposals of Shares, Other Equities, and Stock Subscription Rights in
Other Companies
Not applicable.

(2) Status of Assets and Profits & Losses for the Previous Three Fiscal Years
Fiscal Year

8th Fiscal Year
(Year Ended
March 31, 2013)

9th Fiscal Year
(Year Ended
March 31, 2014)

10th Fiscal Year
(Year Ended
March 31, 2015)

11th Fiscal Year
(Year Ended
March 31, 2016)

Net sales(Millions of yen)

487,241

507,679

565,486

575,504

Operating income(Millions of yen)

48,642

44,67256,32049,641

Recurring income(Millions of yen)

49,97247,45659,38350,774

Profit attributable toowners of parent(Millions of yen)

32,38325,05437,58834,583

Basic earnings per
share¥147.40¥114.05¥171.10¥157.43

Total assets(Millions of yen)374,203

405,092

441,763448,336

Net assets(Millions of yen)

248,769

267,951

303,512317,304

Net assets per share¥1,124.45¥1,217.74¥1,378.77¥1,441.49

Classification

22(This Fiscal Year)(3) Important Parent Company and Subsidiaries(i)

Status of the Parent Company
Not applicable.

(ii) Important Subsidiaries
Name of Company

Ownership
Ratio

CapitalDescription of Principal Business
Manufacturing and sales of toys andapparel, etc.
Distribution services for network
content, and planning, development andsales of home video game software andarcade game machines, etc.

BANDAI CO., LTD.

¥10,000 million

100.0%BANDAI NAMCOEntertainment Inc.

¥10,000 million

100.0%BANDAI VISUAL
CO., LTD.

¥2,182 million

100.0%

Planning, production and sales of visualcontent and package software

BANDAI NAMCO
Holdings USA Inc.

US$ 10100.0%

Pure holding company as regional
headquarters in the U.S.

€ 21,690,000

100.0%£ 50,500,000

100.0%

HK$ 103,000,000

100.0%BANDAI S.A.
BANDAI NAMCO
Holdings UK LTD.
BANDAI NAMCO
Holdings ASIA CO.,LTD.

Regional holding company in Europe
Import and sales of toys, etc.
Pure holding company as regional
headquarters in Europe
Pure holding company as regional
headquarters in Asia

(Notes) 1. BANDAI VISUAL CO., LTD. is included as a core company of the strategic business
units (SBUs) instead of NAMCO LIMITED because the classification of businesssegments was changed on April 1, 2015.
2. On April 1, 2015, BANDAI NAMCO Games Inc. changed its trade name to BANDAI
NAMCO Entertainment Inc, and on March 31, 2016, BANDAI NAMCO ASIA CO.,LTD. changed its trade name to BANDAI NAMCO Holdings ASIA CO., LTD.
3. BANDAI NAMCO Holdings UK LTD. carried out a capital increase of £7,000,000 on
April 17, 2015.
4. BANDAI NAMCO Holdings USA Inc. carried out a capital increase of US$50,000,000
on March 1, 2016. The full amount of the capital increase has been incorporated into
capital reserve.
5. There are no special wholly owned subsidiaries at the end of this fiscal year.
(4) Issues to be Addressed
The Group and this industry must address many important, long-term issues, including (i) thediversification of customer needs, (ii) reacting to changes in the market and the environment, and(iii) increasingly intense competition on a global scale. The Group is applying the focus
strategies defined in its Mid-term Plan to address these issues swiftly.
(i)Common Issues Faced by All Strategic Business Units (“SBUs”)

Efforts Toward Maximizing the Value of IP
The Group is strengthening its IP creation and development, acquisition, and utilization
functions in order to respond to changes in the environment such as development ofoligopolies in the distribution and media fields, the widespread penetration of networks, and23

technological improvements. Specifically, the Group will seek to maximize the value of its IP
through promotion of collaboration among its businesses and cross-functional projects in theGroup while creating IP by its products and services and operating the IP posting system byGroup employees. Furthermore, to strengthen ties with IPs owned by other companies, we will
undertake strategic investments related to IP. The “IP Strategy Division” established in the
Company in April 2016 will be the main driver of efforts to strengthen the IP Axis Strategy
over the medium and long term, with a focus on strategic efforts across the Group.
Efforts Toward CSR (Corporate Social Responsibility)
The Group’s corporate philosophy is to continue to provide “Dreams, Fun and Inspiration”
to people around the world, through entertainment based on creativity and boundlessenthusiasm. To ensure that we can continue to provide “Dreams, Fun and Inspiration,” wehave formulated the CSR initiatives, which crosscut the entire Group and include three typesof responsibilities: environmental and social contribution responsibilities, economic
responsibilities, and legal and ethical responsibilities (compliance). In accordance with thesefundamental principles, the “Group CSR Committee” and its sub-committee, the “Group CSR
Subcommittee,” as well as the “Group Risk Compliance Committee,” the “Group Information
Security Committee,” and the “Internal Control Committee” hold meetings and have been
striving to implement a range of measures.
(ii) Issues Specific to Each SBU
Toys and Hobby SBU
This unit’s industry is facing issues, such as a “shrinking domestic market due to the fallingbirthrate” and “increasingly diverse customer needs.” This unit is addressing these issues byaiming for the position as the overwhelming No. 1 in Japan, working at expanding its target
population segment and creating new businesses. In addition, it is expanding its IP lineup andregions in which it is operating, with the aim of expanding its operations across Asia, which ispredicted to continue to grow. In the North American and European markets, it is aiming for
medium-term growth through establishing foundations and strengthening major IP expansion
for improving profitability. In addition, on the development and production side,
improvements in the value chain will enable more speedy and price-competitive productdevelopment.
Network Entertainment SBU
This unit’s industry is facing issues that include “increasingly diverse platforms,”“evolution of networks” and “increasingly diverse customer needs.” To address these issues, itwill endeavor to create new entertainment utilizing networks, over and above the boundaries
of existing operations and products/services. For network content such as game applications
for smartphones, it will respond to new platforms and expand overseas operations. For home
video game software, the Group will develop titles that respond to technologicalimprovements and satisfy customer needs in various regions. For its amusement facility
operations, it will endeavor to improve its development of facilities to differentiate the Groupand plan facilities that provide new forms of entertainment by integrating the real and digitalworlds. On the development front, the unit will put in place and improve the development
environment, such as by implementing measures to respond swiftly to technological progressand changes in the environment, in order to promote these measures in all business fields.

24

Visual and Music Production SBUThis unit’s industry is facing issues, such as “increasingly diverse customer needs” and“intensification of competition in IP creation.” To address these issues, it will focus on
production-related businesses such as live events and fan clubs, in addition to sales of visualand music packaged products. In addition, in the area of IP creation, it will continue to pursue
improved quality in its creations and stronger collaboration with products/services within theGroup, by dividing its organizations dealing with the planning/development and creation ofanimation products and so on into those aimed towards products for older customers and those
aimed towards ones for children and families. The Group will also be proactive in forming
tie-ups with partner companies and will strengthen the creation and development of IP.
We ask for our shareholders’ further assistance and guidance.

25(5) Principal Business Offices of the Group (As of March 31, 2016)(i)

The Company
Head Office

5-37-8 Shiba, Minato-ku, Tokyo(Note) On January 21, 2016, the Company relocated its head office (location of head office) from
Shinagawa-ku, Tokyo to Minato-ku, Tokyo.
(ii) Principal Subsidiaries
BANDAI CO., LTD.

Taito-ku, Tokyo

BANDAI NAMCO Entertainment Inc.

Minato-ku, Tokyo

BANDAI VISUAL CO., LTD.

Shibuya-ku, Tokyo

BANDAI NAMCO Holdings USA Inc.

California, U.S.A.

BANDAI S.A.

Puteaux, France

BANDAI NAMCO Holdings UK LTD.

London, U.K.

BANDAI NAMCO Holdings ASIA CO., LTD.

Hong Kong, China(Notes) 1. On February 2, 2016, BANDAI NAMCO Entertainment Inc. changed the location of its
head office from Shinagawa-ku, Tokyo, to Minato-ku, Tokyo.
2. On July 20, 2015, BANDAI S.A. changed the location of its head office from
Cergy-Pontoise, France to Puteaux, France.
(6) Outline of Employees (As of March 31, 2016)(i)

Employees of the Group
Business Segment

Number of Employees

Change from the End ofPrevious Fiscal Year
Decrease of 12 (Decrease of 486)

Toys and Hobby Business
2,344(1,858)
Network Entertainment
3,912(4,564)
Increase of 35(Increase of 145)
Business
Visual and Music Production
391(12)
Increase of 109(Increase of 3)
Business
Other Businesses
708
(633)
Increase of 127(Increase of 92)
Corporate (Common)
36(–)
Decrease of 89(Decrease of 15)
Total
7,391
(7,067)
Increase of 170 (Decrease of 261)
(Notes) 1. The number of employees refers to the employees actually at work.
2. The average numbers of temporary personnel employed for this fiscal year arepresented separately in parentheses.
3. As the Group changed the classification of business segments for this fiscal year, theChange from the End of Previous Fiscal Year accordingly compares the number of
employees in the previous fiscal year with the number of employees reassigned after thechange in business segments.
4. The increase in the number of employees in the Visual and Music Production Businessis mainly reflective of a strengthening of personnel accompanying reorganization of thebusiness segment.
5. The increase in the number of employees in the Other Businesses is mainly reflective of
personnel who were transferred from the Company.
6. The number of employees listed for “Corporate (Common)” is the number of
employees in the administration sector, etc. of the Company, BANDAI NAMCO

26

Holdings USA Inc., and BANDAI NAMCO Holdings UK LTD.
(ii) Employees of the Company
Number of
Employees

Change from the End
Average Years of
Average Ageof Previous Fiscal Year
Service
Decrease of 91
25 (–)
45.7
17.4(Decrease of 15)(Notes) 1. The number of employees refers to the employees actually at work.
2. The average number of temporary personnel employed for this fiscal year is presented
separately in parentheses.
3. In calculating the average years of service, with respect to the employees who havetransferred from other Group companies to the Company, the aggregate number of each
employee’s years of service at each company is used for calculation.
4. The decrease in the number of employees is mainly due to transfers to other companies
within the Group.
(7) Principal Lenders (As of March 31, 2016)
Lenders
Mizuho Bank, Ltd.
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Sumitomo Mitsui Banking Corporation
Mitsubishi UFJ Trust and Banking Corporation(8) Other Important Matters of the GroupNot applicable.

27

Amount¥712 million¥511 million¥470 million¥80 million

2. Current Status of the Company(1) Status of Shares (As of March 31, 2016)(i)

Total Number of Shares Issuable:

1,000,000,000 shares(ii) Total Number of Issued Shares:

222,000,000 shares(iii) Number of Shareholders:

41,902 (decrease of 19,040 from the end of theprevious fiscal year)(iv) Major Shareholders (Top 10 Shareholders)Number of
Shares Held

Name of Shareholders
Japan Trustee Services Bank, Ltd. (Trust account)
The Master Trust Bank of Japan, Ltd.
(Trust account)
XIL, LTD.

Shareholding Ratio(%)

11,352,500

5.17

10,947,200

4.98

6,000,000

2.73

Masaya Nakamura
The Bank of New York, Non-treaty JASDEC
Account
The Nomura Trust and Banking Co., Ltd.
(Retirement and severance benefits trust. The
Bank of Tokyo-Mitsubishi UFJ account)
MAL Ltd.

5,960,000

2.71

4,885,826

2.22

4,586,100

2.09

4,400,100

2.00

State Street Bank and Trust Company 505225

4,280,975

1.95

Nintendo Co., Ltd.
3,845,700
1.75
Northern Trust Co. (AVFC) Re U.S. Tax
3,389,757
1.54
Exempted Pension Funds(Notes) 1. The shareholding ratio is calculated after reduction of the number of treasury
stocks (2,204,760 shares).
2. Out of the above number of shares held, the numbers of shares relating to thetrust business are as follows:
Japan Trustee Services Bank, Ltd. (Trust account)
11,040,100 shares
The Master Trust Bank of Japan, Ltd. (Trust account)
8,694,400 shares
The Nomura Trust and Banking Co., Ltd.
(Retirement and severance benefits trust. The Bank of
4,586,100 shares
Tokyo-Mitsubishi UFJ account)
3. The 4,586,100 shares owned by The Nomura Trust and Banking Co., Ltd.
(Retirement and severance benefits trust. The Bank of Tokyo-Mitsubishi UFJ
account) were the shares of BANDAI CO., LTD. that were owned by UFJ
Bank (currently The Bank of Tokyo-Mitsubishi UFJ, Ltd.), entrusted for
retirement and severance benefits. Those shares were exchanged with theCompany’s shares through the share transfer on September 29, 2005, and The
Bank of Tokyo-Mitsubishi UFJ directs the exercise of the voting rights
pertaining to those shares.

28

(2) Stock Subscription Rights, etc.
(i)

Stock Subscription Rights Held by Company Directors and Audit & Supervisory Board
Members of the Company That Were Delivered as Consideration for the Execution of
Their Duties at the End of This Fiscal Year

Stock Subscription Rights as per Resolution Made at the Board of Directors Meeting
Held on May 21, 2013
a. Number of Stock Subscription Rights
211
b. Type and Number of Shares Underlying Stock Subscription Rights
21,100 shares of common stock (100 shares per stock subscription right)
c. Amount Paid for the Issuance of Stock Subscription Rights
No requirement to make payment
d. Value of the Property to Be Contributed at the Time of Exercising Stock
Subscription Rights
100 yen per stock subscription right (1 yen per share)e. Period During Which Stock Subscription Rights Can Be Exercised
From June 5, 2013 to June 4, 2033
f. Conditions for Exercising Stock Subscription Rights
i) The stock subscription rights holders may exercise stock subscription rights
during the “Period During Which Stock Subscription Rights Can Be Exercised,”
limited to 10 days after the day following that on which the position of theholder as either Director, Audit & Supervisory Board Member or employee at
the Company or a subsidiary of the Company was lost.
ii) If a stock subscription rights holder dies, his or her heir (limited to one
individual) shall exercise those rights.
iii) The transfer of stock subscription rights requires the approval of the Board of
Directors of the Company.
g. Stock Subscription Rights Held by Company Directors and Audit & Supervisory
Board Members of the Company
Number of Shares
Number of Stock
HolderUnderlying Stock
Number of Holders
Subscription Rights
Subscription Rights
Directors(excluding Outside
211
21,1005
Directors)
Outside Directors–––
Audit & Supervisory–––
Board Members
Stock Subscription Rights as per Resolution Made at the Board of Directors Meeting
Held on May 21, 2015
a. Number of Stock Subscription Rights
150
b. Type and Number of Shares Underlying Stock Subscription Rights
15,000 shares of common stock (100 shares per stock subscription right)
c. Amount Paid for the Issuance of Stock Subscription Rights
No requirement to make payment
d. Value of the Property to Be Contributed at the Time of Exercising Stock
Subscription Rights
100 yen per stock subscription right (1 yen per share)29

e. Period During Which Stock Subscription Rights Can Be Exercised
From June 5, 2015 to June 4, 2035
f. Conditions for Exercising Stock Subscription Rights
i) The stock subscription rights holders may exercise stock subscription rights
during the “Period During Which Stock Subscription Rights Can Be Exercised,”
limited to 10 days after the day following that on which the position of theholder as either Director, Audit & Supervisory Board Member or employee at
the Company or a subsidiary of the Company was lost.
ii) If a stock subscription rights holder dies, his or her heir (limited to one
individual) shall exercise those rights.
iii) The transfer of stock subscription rights requires the approval of the Board of
Directors of the Company.
g. Stock Subscription Rights Held by Company Directors and Audit & Supervisory
Board Members of the Company
Number of Shares
Number of Stock
HolderUnderlying Stock
Number of Holders
Subscription Rights
Subscription Rights
Directors
Directors (excluding
150
15,0005Outside Directors)
Outside Directors–––
Audit & Supervisory–––
Board Members(ii) Stock Subscription Rights Delivered to Directors of the Subsidiaries of the Company, as
Considerations for the Execution of Their Duties in This Fiscal Year
Stock Subscription Rights as per Resolution Made at the Board of Directors Meeting
Held on May 21, 2015
a. Number of Stock Subscription Rights
121
b. Type and Number of Shares Underlying Stock Subscription Rights
12,100 shares of common stock (100 shares per stock subscription right)
c. Amount Paid for the Issuance of Stock Subscription Rights
No requirement to make payment
d. Value of the Property to Be Contributed at the Time of Exercising Stock
Subscription Rights
100 yen per stock subscription right (1 yen per share)e. Period During Which Stock Subscription Rights Can Be Exercised
From June 5, 2015 to June 4, 2035
f. Conditions for Exercising Stock Subscription Rights
i) The stock subscription rights holders may exercise stock subscription rights
during the “Period During Which Stock Subscription Rights Can Be Exercised,”
limited to 10 days after the day following that on which the position of theholder as either Director, Audit & Supervisory Board Member or employee at
the Company or a subsidiary of the Company was lost.
ii) If a stock subscription rights holder dies, his or her heir (limited to one
individual) shall exercise those rights.
iii) The transfer of stock subscription rights requires the approval of the Board of
Directors of the Company.

30

g. Stock Subscription Rights Delivered to Directors of the Subsidiaries of theCompany
Number of Shares
Number of Stock
HolderUnderlying Stock
Number of Holders
Subscription Rights
Subscription Rights
Directors ofsubsidiaries of the121
12,1007Company(Reference)
Stock Subscription Rights Delivered to Directors of the Subsidiaries of the Company Prior
to This Fiscal Year
Seventh Issuance of Stock Subscription
RightsMay 21, 2013
6 Directors of subsidiaries of the Company
Common stock; 15,000 shares (100 shares perstock subscription right)
June 5, 2013
No requirement to make payment
100 yen per stock subscription right (1 yen
per share)

Date of resolution by the Board of Directors
Persons receiving rights; number of persons
Type of stock; number of stock subscription
rights (*)
Date of delivery of stock subscription rights
Amount paid
Value of the property to be contributed upon
exercising stock subscription rights
Period during which stock subscription rights
From June 5, 2013 to June 4, 2033
can be exercised(*) In the above, the number of stock subscription rights is stated by converting the number
into the number of shares underlying the stock subscription rights.

31

(3) Directors and Audit & Supervisory Board Members of the Company(i)

Directors and Audit & Supervisory Board Members (As of March 31, 2016)
Title

Responsibilities in the Company and
Major Concurrent Positions

Name

Chairman and, Representative Shukuo Ishikawa
Director
President and Representative Mitsuaki Taguchi
Director
Director
Shuji Ohtsu

Director

Yuji Asako

Director

Kazunori Ueno

Director

Satoshi Oshita

Director

Kazumi Kawashiro

Director

Nobuo Sayama

Director

Yuzuru Matsuda

Full Time Audit &Supervisory Board Member
Full Time Audit &Supervisory Board Member
Audit & Supervisory Board
MemberKazuo Asami
Katsuhiko Kohtari
Osamu Sudoh

Division General Manager of the Group Administrative
Headquarters
President and Representative Director of BANDAI
NAMCO Holdings USA Inc.
President and Representative Director of BANDAI
NAMCO Business Arc Inc.
Division General Manager of the Corporate Planning
Division
Responsible for the Toys and Hobby SBU
Chairman & Director of BANDAI CO., LTD.
Responsible for Network Entertainment SBU
President and Representative Director of BANDAI
NAMCO Entertainment Inc.
Responsible for Visual and Music Production SBU
President and Representative Director of BANDAIVISUAL CO., LTD.
Professor at Graduate School of International Corporate
Strategy (ICS), Hitotsubashi University
Representative Director of Integral Corporation
Chairman & Representative Director of Skymark Airlines
Inc.
Head of Kato Memorial Bioscience Foundation
Outside Director of KUBOTA Corporation
Outside Director of JSR Corporation

Certified Public Accountant

Attorney-at-Law
Partner in Sudoh & Takai Law Offices
Outside Director of Rakuten Bank, Ltd.
Outside Director of Accordia Golf Co., Ltd.
Outside Audit & Supervisory Board Member of
MITSUI-SOKO HOLDINGS Co., Ltd.
Audit & Supervisory Board Katsuhiko Kamijo
Certified Tax Accountant
MemberProfessor at Faculty of Law of Teikyo University
Outside Audit & Supervisory Board Member of HASEKO
Corporation(Notes) 1. Directors Nobuo Sayama and Yuzuru Matsuda are Outside Directors.
2. Full Time Audit & Supervisory Board Member Katsuhiko Kohtari and Audit &Supervisory Board Members Osamu Sudoh and Katsuhiko Kamijo are Outside Audit &Supervisory Board Members.

32

3. Full Time Audit & Supervisory Board Member Katsuhiko Kohtari is a certified public
accountant and has considerable knowledge of finance and accounting.
4. Audit & Supervisory Board Member Osamu Sudoh has considerable experience withbankruptcy issues as an attorney-at-law and has the deep knowledge of finance andaccounting necessary to engage in such bankruptcy issues.
5. Audit & Supervisory Board Member Katsuhiko Kamijo is a certified tax accountant andhas considerable knowledge of finance and accounting.
6. The Company has appointed Outside Directors Nobuo Sayama and Yuzuru Matsuda
and Outside Audit & Supervisory Board Members Katsuhiko Kohtari, Osamu Sudoh,
and Katsuhiko Kamijo as Independent Directors/Auditors as defined in the rules of theTokyo Stock Exchange and has filed therewith the notification regarding their
appointments.
7. Director Kazunori Ueno retired as President and Representative Director of BANDAI
CO., LTD. on August 5, 2015 and took office as Chairman & Director of theaforementioned company.
8. The Director set out below, who was in office from the day immediately following the
day of the Ordinary General Meeting of Shareholders held on June 22, 2015, retired
from office during this fiscal year:
Positions and responsibilities in the
Date of
Reason for
Name
Company and major concurrent positions at
retirement
retirement
the time of retirement
Outside Director
Attorney-at-Law, Partner of STW & Partners
Outside Audit & Supervisory Board Member
Tomohisa Tabuchi March 1, 2016
Deceasedof Rakuten Bank, Ltd.
Outside Director of Accordia Golf Co., Ltd.
(ii) Summary of Contracts Concerning Limited Liability
Not applicable.
(iii) Directors and Audit & Supervisory Board Members Who Retired or Were Dismissed
during This Fiscal Year
Not applicable.
(iv) Remuneration, etc. Paid to Directors and Audit & Supervisory Board Members
a. Total Amount of Remuneration, etc., Paid During This Fiscal Year
Number of People
8

Amount of Remuneration, etc.
¥468 million

Directors
Audit & Supervisory Board
4¥67 million
MembersTotal
12¥535 million(Outside Directors and Outside
Audit & Supervisory Board(6)(¥88 million)
Members)(Notes) 1. There are no employees serving as Directors.
2. The number of people above includes the director who retired (deceased) as of March 1,
2016.

33

3. At the Tenth Ordinary General Meeting of Shareholders held on June 22, 2015, it was
resolved that the remuneration limit for Directors is 850 million yen per fiscal year (ofwhich 60 million yen is the limit for Outside Directors), and that of the 850-million-yen
remuneration limit, 400 million yen is for the limit for base remuneration and theremaining 450 million yen is the limit for cash bonus. It was also resolved that, in
addition to that remuneration limit, there is a separate upper limit on their stock option
remuneration, which is 160 million yen per year.
4. At the Ordinary General Meetings of Shareholders for BANDAI CO., LTD. and
NAMCO LIMITED (currently BANDAI NAMCO Entertainment Inc.) held on June 23,2005 and on June 25, 2005 respectively, it was resolved that the remuneration limit for
Audit & Supervisory Board Members must be 8 million yen per month.
b. Policy and Procedures for Decisions on Remuneration• Remuneration policy
The remuneration system for Directors, excluding Outside Directors, has as its basic
policy the creation of a remuneration framework which provides sustainable growth for
the Company and improves the Company’s corporate value in the medium and long term,by bringing out a healthy sense of entrepreneurship in its Directors while taking into
account what level of remuneration will enable the Company to secure and retain top
grade personnel, through promoting sharing of value with the shareholders and ensuring
an adequate level of objectivity and transparency to fulfil its accountability obligations.
• Remuneration framework
The remuneration framework for Directors, excluding Outside Directors, comprises
the base remuneration as fixed remuneration, performance-based bonuses as variable
remuneration, and stock compensation-type stock options that are provided to promotesharing of common value with all shareholders, to steadily improve actual businessperformance for each fiscal year, and to support an appropriate level of risk-taking so as
to improve the Company’s corporate value in the medium and long term.
Each Director contributes a fixed proportion of the base remuneration to theshareholding association for directors and officers to purchase the Company’s shares andcontinues to hold such shares during his or her term of office.
Remuneration standards are determined by utilizing a management remuneration
database with which data on remunerations are aggregated and analyzed by an external
specialist organization, setting objective benchmarks in light of the scales of theCompany’s business operations and other factors, and comprehensively taking into
consideration the proportion of medium- and long- term performance-based
remuneration within annual total remuneration and the level of difficulty of achieving
business performance targets.
Where the standard performance for the period of the Mid-term Plan has beenachieved, the ratio of fixed remuneration to variable remuneration within annual total
remuneration shall be about 50:50, and the ratio of share-type remuneration shall be alittle over 20%.
• Structure for performance-based remuneration
Performance-based bonuses shall be paid in principle according to the consolidated
operating income of the Group for each fiscal year, in an amount determined within alimit of 1.5% of the profit attributable to owners of parent for the period, within a range34

of 0% to 200% of the predetermined standard amount.
The stock compensation-type stock options shall only be granted when the
consolidated operating income of the Group rises above a prescribed level, and whether
the options are granted and what baseline is set shall be determined for each fiscal year
during the period of the Mid-term Plan.
• Procedures for decisions on remuneration
The policy for remuneration, the remuneration framework, and the structure for
performance-based remuneration for Directors, excluding Outside Directors, shall bedecided at Board of Directors Meetings after receiving opinions from the Personnel
Committee of which a majority of the members are Outside Directors (independent
Outside Directors), in order to elicit Outside Directors’ adequate participation andappropriate advice.
In the course of deliberations by the Committee, sufficient information is provided to
the Outside Directors so that they are able to perform their analysis, including for
instance by asking for advice from external specialist organizations where necessary.
• Policy and procedures for remuneration of Outside Directors and Audit & Supervisory
Board Members
Remuneration for Outside Directors comprises base remuneration only, to ensure
their independence from the Company, and the amount of remuneration for each Outside
Director is determined by the Board of Directors Meetings.
Remuneration for Audit & Supervisory Board Members comprises base remuneration
only, with the amount set in accordance with their job positions, considering that they
bear the duty to audit the execution of all businesses across the Group. The amount of
remuneration for each Audit & Supervisory Board Member is determined by the Audit &Supervisory Board Meetings.

35

(v)

Matters Concerning Outside Directors and Outside Audit & Supervisory Board Members

a. Status of Major Concurrent Positions of Other Companies, etc. and Relationships Between
Those Companies, etc. and the Company
Major concurrent positions of Outside Directors and Outside Audit & Supervisory Board
Members are as stated in “(i) Directors and Audit & Supervisory Board Members” on page
32.
Moreover, there are no special relationships between the Company and the entities withwhich Outside Directors and Outside Audit & Supervisory Board Members haveconcurrent positions.
b. Main Activities in This Fiscal Year
(Directors)
Board of Directors Meetings(Held 19 times)
Number of
Meetings
Attendance Rate
Attended

Nobuo
SayamaTomohisa
TabuchiYuzuruMatsuda

19

17

19

Statements Made at Board of Directors Meetings

100.0%

Provided advice and proposals by giving opinions,etc. based on his wealth of experience and position
as a corporate officer and from his profoundscholarly knowledge via his teaching activities in
the field of corporate strategy to ensure theappropriateness and validity of decisions of theBoard of Directors.

100.0%

Provided advice and proposals by giving opinions,etc. primarily from his position as an
attorney-at-law to ensure the appropriateness andvalidity of decisions of the Board of Directors.

100.0%

Provided advice and proposals by giving opinions,etc. reflecting his broad view on overallmanagement based on his wealth of experience andposition as a corporate officer to ensure theappropriateness and validity of decisions of theBoard of Directors.

(Note) For Mr. Tomohisa Tabuchi, the Table shows the number of meetings he attended andhis attendance rate at the Board of Directors Meetings (17 meetings) held during histime in this role.

36

(Audit & Supervisory Board Members)
Board of Directors
Meetings(Held 19 times)
NumberofAttendance
Meetings
Rate
Attended

KatsuhikoKohtari

Osamu
Sudoh

KatsuhikoKamijo1919

19

100.0%

100.0%

100.0%

Audit & Supervisory
Board Meetings(Held 15 times)
Statements Made at Board of Directors
Meetings and Audit & Supervisory
NumberBoard MeetingsofAttendance
Meetings
Rate
Attended
Provided advice and proposals bygiving opinions, etc. primarily fromhis position as a certified public
accountant to ensure the15
100.0%
appropriateness and validity ofdecisions of the Board of Directors andthe Audit & Supervisory Board.

15

15

100.0%

Provided advice and proposals bygiving opinions, etc. primarily fromhis position as an attorney-at-law toensure the appropriateness and validityof decisions of the Board of Directors
and the Audit & Supervisory Board.

100.0

Provided advice and proposals bygiving opinions, etc. based on his
wealth of experience dealing with tax
affairs and from his profound scholarly
knowledge via his teaching activities
in tax affairs to ensure theappropriateness and validity ofdecisions of the Board of Directors andthe Audit & Supervisory Board.

c. Total Amount of Remuneration, etc. Paid to Directors and Audit & Supervisory Board
Members by the Parent Company and Subsidiaries, etc.
Not applicable.

37(4) Accounting Auditors(i)Name: KPMG AZSA LLC(ii) Amount of Remuneration, etc.
Amount of Remuneration, etc.
Amount of Remuneration, etc. for Accounting Auditors¥79 million
for This Fiscal Year
Total in Money and Other Financial Benefits to Be Paidby the Company and Its Subsidiaries to Accounting¥252 million
Auditors(Notes) 1. BANDAI NAMCO Holdings USA Inc., BANDAI S.A., BANDAI NAMCO Holdings
UK LTD., and BANDAI NAMCO Holdings ASIA CO., LTD., among major
subsidiaries of the Company, are audited (within the meaning of being audited as
required by the Companies Act and Financial Instruments and Exchange Act or theequivalent laws and regulations in other countries) by audit firms (including entities
overseas with qualifications equivalent to those of a Japanese audit firm) other than the
Company’s Accounting Auditor.
2. Under the audit agreement between the Company and its Accounting Auditor, there isno clear distinction between the amount of remuneration, etc., for audits under theCompanies Act and that under the Financial Instruments and Exchange Act;furthermore, it is practically impossible to make such distinction. Therefore, the amountof remuneration, etc., for Accounting Auditors for this fiscal year described above is thetotal amount of remuneration, etc., for these audits.
3. The Audit & Supervisory Board of the Company has analyzed and evaluated the audit
report for the previous fiscal year, and reviewed the sufficiency of the audit plan for thisfiscal year as well as the appropriateness of the time for audit planning, the staffing plan,and the hourly rate. As a result, the Audit & Supervisory Board concluded that the
Accounting Auditor remuneration is appropriate and gave its consent to the
remuneration in accordance with Article 399, Paragraph 1 of the Companies Act.
(iii) Non-Auditing Operations
Not applicable.
(iv) Policy on Removal or Non-Renewal of an Accounting Auditor
If the Audit & Supervisory Board judges that action is necessary, such as in cases where the
Accounting Auditor’s execution of its duties is impeded, the Audit & Supervisory Board will
determine the contents of a proposal to be submitted to the General Meeting of Shareholders
regarding the removal or non-renewal of the Accounting Auditor.
In addition, if the items stipulated in the matters set forth in Article 340, Paragraph 1 of theCompanies Act are deemed applicable to the Accounting Auditor, the Accounting Auditor will
be removed based on the agreement of all Audit & Supervisory Board members. If this occurs,an Audit & Supervisory Board Member selected by the Audit & Supervisory Board will report
the fact of the Accounting Auditor’s removal and the reason for the removal at the first
General Meeting of Shareholders held after the removal.
(v)

Summary of Contracts Concerning Limited Liability

Not applicable.

38(5) Systems for Ensuring the Properness of Operations and Operating Status of the Systems
Systems for Ensuring the Properness of Operations
The following outlines decisions regarding the basic policy for the structure of internal
control systems.
(i)Systems to Ensure that the Execution of the Duties by Directors, etc. and Employees of
the Company and Its Subsidiaries Is in Compliance with the Laws and Regulations andthe Articles of Incorporationa. The Company shall set in place the Group’s Corporate Philosophy and Group Declarationof compliance, ensure that Directors and employees of the Company and its subsidiaries
are familiar with them, and always pay due attention to ensure they carry out their duties
lawfully and fairly.
b. Directors of the Company shall report periodically to the Board of Directors on the
structure and operating status of internal control systems.
c. The Company shall install a Director in charge of compliance who is responsible forsupervision of compliance overall based on its compliance regulations, and establish a
structure ensuring that the Company and the entire Group abides by the law, behaves
ethically, and complies with internal regulations.
d. Should violations of compliance or suspicions thereof occur within the Group, theCompany shall immediately convene the Group Risk Compliance Committee with theCompany’s President and Representative Director as its chair to discuss and decide how
the issue should be handled.
e. Overseas, an overseas regional headquarters shall be determined for each region to
manage risk and support compliance.
f. Internal reporting systems including an internal consultation point, an external
consultation point comprising external legal advisors, and the Audit & Supervisory Board
Members hotline, which enables reporting directly delivered to the Audit & Supervisory
Board Members, shall be put in place in the Company and its major subsidiaries.
g. The Internal Auditing Division shall be established independently of the executive
sections in the Company and its major subsidiaries to work towards maintaining theproperness of execution of operations through internal audits.
(ii) Systems for Preserving and Managing Information Related to Directors’ Execution of
Their Duties
a. The Company shall establish regulations concerning document management and ensure(i) the centralized collection and management of minutes of several kinds of meetings,
contracts and other documents, and (ii) appropriate safekeeping and management ofimportant documents including documents circulated for approval in each department.
The Company shall have a system to ensure that Directors and Audit & Supervisory
Board Members may peruse those documents at any time.
b. The Company shall establish regulations concerning information security as a part ofGroup management. These regulations will provide for a system to ensure appropriate
safekeeping and preservation of information.

39

(iii) Regulations Concerning Management for Risk of Loss of the Company and Its
Subsidiaries and Other Systems
a. The Company shall establish regulations concerning risk management and compliance asa part of Group management. Throughout the Group, we will work to prevent risk and to
discover risk factors as rapidly as possible.
b. When risk arises, the Company shall convene the Group Risk Compliance Committee
without delay to minimize the impact of risk on our business by responding to risk
quickly and in an appropriate manner.
c. Anticipating the occurrence of situations that could cause drastic damage to the
management of the Group through a major disaster or the like, the Group shall define thebasic policy for a Business Continuity Plan (BCP) for the Group, and formulate a BCP for
the Group and organize a Business Continuity Management (BCM) system to achieve
rapid recovery and restart of operations. Directors and employees of the Company and its
subsidiaries shall be made aware of this.
(iv) Systems to Ensure that Directors, etc. of the Company and its Subsidiaries Execute theirDuties Efficiently
a. The Company shall assign each subsidiary into strategic business units (SBUs)
categorized by business segment, and appoint a Director and lead company in charge ofeach SBU in order to improve efficiency of business operations based on the division ofduties, chain of command structure, authorities and competencies, decision making
frameworks and other regulations regarding structure within the Group.
b. The Company shall formulate a Mid-term Plan with a period of three business years forthe entire Group and each SBU, and determine the budget for each business year based on
those Mid-term Plans.
(v)

Systems Concerning Reporting Matters Regarding Execution of Duties of Directors, etc.
of Subsidiaries to the Company

a. The Company shall establish meetings such as SBU Quarterly Report Meetings andGroup Management Meetings, and put in place a system for reporting inside the Groupand decision making.
(vi) Other Systems to Ensure Proper Business Behavior by the Company and its Subsidiaries
a. The Company shall revise the Group Declaration of compliance as appropriate in
response to revisions to laws and regulations and changes in the social context
surrounding the Group, and shall ensure that the contents of the Declaration are madethoroughly known to Directors, etc. and employees of the Company and its subsidiaries
through distributing the Compliance Book and through training.
b. The Company and its subsidiaries shall endeavor to improve and standardize businessprocesses considering the importance of effectiveness and efficiency in business
operations, and shall evaluate and operate internal controls on financial reporting basedon related laws and regulations, etc.

40

(vii) Matters Regarding Employees Required by Audit & Supervisory Board Members toAssist Their Duties, and Matters Regarding the Independence of such Employees fromthe Board of Directors
a. The Company shall provide a speedy response when Audit & Supervisory Board
Members ask the President and Representative Director to provide employees to assist
their duties. Where that employee simultaneously works for any other section, his or her
business duties pertaining to the Audit & Supervisory Board Members shall take priority.
b. The Company shall provide an opportunity for Directors and Audit & Supervisory Board
Members to consult in advance regarding personnel matters relating to such employees,
so as to ensure independence from the Board of Directors.
(viii) Matters Concerning Ensuring the Effectiveness of Instructions to Employees who Assist
the Audit & Supervisory Board Members
a. The Company shall keep Directors and employees thoroughly informed that employees
who assist the Audit & Supervisory Board Members in their duties are under thecommand of the Audit & Supervisory Board Members.
(ix) System for Directors, etc. and Employees of the Company and its Subsidiaries to Reportto the Company’s Audit & Supervisory Board Members
a. Directors, etc. and employees of the Company and its subsidiaries shall report to the
Audit & Supervisory Board promptly with regard to matters prescribed by laws andregulations, other matters likely to have a major impact on the Company and the Group,and matters related to the current status of internal audits and compliance.
b. Directors, etc. and employees of the Company and its subsidiaries shall report promptly
and appropriately when requested to do so by an Audit & Supervisory Board Member of
the Company regarding the performance of their duties.
c. The Company shall put in place an Audit & Supervisory Board Members Hotline to allow
reports to be made directly to the Company’s Audit & Supervisory Board Members as aninternal reporting system.
(x) System for Ensuring that Persons Making Reports to Audit & Supervisory Board
Members shall not be Treated Disadvantageously
a. The Company shall prohibit the disadvantageous treatment of persons who have reported
or consulted with Audit & Supervisory Board Members, and shall state that clearly in theGroup Risk Compliance Regulations and make it thoroughly known to Directors, etc. andemployees of the Company and its subsidiaries.
(xi) Matters Regarding Policies Pertaining to Procedures for Advance Payments or
Reimbursement of Expenses Arising in the Performance of Duties by Audit &Supervisory Board Members and Other Payment of Expenses and Liabilities Arising in
the Performance of Said Duties
a. The Company shall immediately pay expenses or liabilities where an Audit &Supervisory Board Member has requested advance payments or reimbursement of41

expenses arising in the performance of his or her duties, excluding cases where they were
not considered necessary for the performance of said duties.
(xii) Other Systems to Ensure the Effectiveness of Audits Conducted by the Audit &Supervisory Board Members
a. Directors of the Company shall formulate a system whereby Audit & Supervisory Board
Members can attend important meetings, and ensure that a system exists whereby they
can meet periodically or on an ad hoc basis with Directors and employees, and cooperatewith Internal Audit Division and Accounting Auditors.
b. Subsidiaries of the Company shall install an appropriate number of Audit & Supervisory
Board Members according to their scale, business category, etc., and ensure that there aresystems in place wherein Audit & Supervisory Board Members of subsidiaries reportperiodically to the Audit & Supervisory Board Members of the Company.

Operating Status of Systems for Ensuring the Properness of Operations
The overview of the operating status of the above-mentioned systems for ensuring theproperness of operations is as follows:1.

Overall Internal Control Systems
In order to establish and operate overall internal control systems at the Company andits subsidiaries, an Internal Control Committee established within the Company conducts
regular monitoring and evaluation of internal controls and reports to the Board of
Directors as internal control reports. Improvements are implemented based on thesereports. The appropriateness and reliability of evaluations of internal controls are ensured
by having Internal Audit Divisions established at the Company and its major subsidiaries
conduct appropriate internal audits.

2.

Compliance and Risk Management
The Company conducts regular training, using e-learning tools and other programs, toensure the Company and the entire Group abide by laws, behave ethically, and comply
with internal regulations, with a central role played by the Director in charge ofcompliance who is responsible for supervision of compliance overall. The Company has
set in place the Group Declaration of compliance to define behavioral guidelines for
Directors and employees of the Company and its subsidiaries. The Company is working
to ensure that Directors and employees are familiar with the Declaration, through aposter campaign and the distribution of a Compliance Book. The Company has
established and been operating at the Company and its major subsidiaries a
whistle-blowing system to provide a point of contact for internal and external
consultations and an Audit & Supervisory Board Members Hotline to allow direct
reporting to Audit & Supervisory Board Members. The Company and its subsidiaries
have also included provisions in their internal regulations to ensure the protection ofwhistleblowers.
For risk management, the Company and its subsidiaries have established guidelines onrisk management and have formulated and been operating a Business Continuity Plan
(BCP) and a Business Continuity Management (BCM) system for the Group. The

42

Company is working to ensure that Directors and employees of the Company and its
subsidiaries are well aware of these guidelines and systems.
Should violations of compliance occur or risk arise, a meeting of the Group Risk
Compliance Committee, chaired by the President and Representative Director, isconvened immediately to ensure a quick and appropriate response. Every month, theGroup Compliance Committee Secretariat reports to the Board of Directors any
information on compliance and risk and how they have been managed in the Company
and its subsidiaries.
3.

Subsidiary Business Management
The Company assigns each subsidiary into strategic business units (SBUs) categorized
by business segment, and appoints a Director and lead company in charge of each SBU
in order to improve efficiency of business operations based on the division of duties,
chain of command structure, authorities and competencies, decision making frameworks
and other regulations regarding structure within the Group. The SBU Quarterly Report
Meeting (held four times this fiscal year) and the Group Management Meeting (held 11
times this fiscal year) are convened regularly to allow information sharing across theGroup and facilitate decision-making. The Company has also established and controls abusiness management system at subsidiaries, with a central role played by theCompany’s Business Planning Division, and monitors progress every month through areview of the Mid-term Plans and business performance across the Group and at each
SBU. In addition, the Company’s Internal Auditing Division efficiently monitors theGroup’s internal controls through regular internal audits of the subsidiaries.

4.

Execution of Duties by Directors
The Company has established the Group’s Corporate Philosophy, the Group
Declaration of compliance, and the Group Rules for Executives and has disseminatedthese regulations to ensure that Directors carry out their duties in a fair and legal manner.
The Company has appointed a number of Outside Directors and actively exchanged
ideas with them at the Board of Directors Meetings and executive training sessions inorder to strengthen the supervisory function of the Company. The Independent
Committee consisting of only Outside Directors and Outside Audit & Supervisory Board
Members evaluates the effectiveness of the Board of Directors and works on corporate
governance and corporate value improvement.
In this fiscal year, the Board of Directors Meetings were held 19 times and theIndependent Committee meeting was held once.

5.

Audits by the Audit & Supervisory Board Members
The Audit & Supervisory Board Members of the Company attend key meetings at theCompany and the major subsidiaries, including the Board of Directors Meeting and the
SBU Quarterly Report Meeting, and audit the execution of duties by Directors andcompliance with laws and regulations and the Articles of Incorporation. The Audit &Supervisory Board Meetings convened 15 times this fiscal year, allowing the Audit &Supervisory Board Members to exchange opinions and share information on importantmatters. The Audit & Supervisory Board Members also meet regularly or as needed with
the Directors of the Company, Internal Auditing Divisions, the Audit & Supervisory
Board Members of subsidiaries and the Accounting Auditors to ensure the audits
conducted by the Audit & Supervisory Board Members are effective and efficient.

43

(6) Basic Policy Concerning Control of the Company(i)Content of Basic Policy

The Corporate Value of the Group
Guided by our vision of becoming “The Leading Innovator in Global Entertainment,” theGroup mission is to continue to offer “Dreams, Fun and Inspiration,” through entertainment, topeople throughout the world.
Emerging victoriously in the global competition of the fast-changing world of entertainment
requires not only construction of a solid management foundation but also the creation ofentertainment constantly predicting the changes of times and environments. Such creation isclosely linked to raising the corporate value of the Company.
Therefore, in determining what and how a person or entity controlling decisions on thefinancial and business policies should be, the Company should take the enhancement of thecorporate value into account.
What and How a Person or Entity Controlling Decisions on the Financial and Business
Policies Should Be
We believe that a person or entity controlling decisions on financial and business policies
should be the one who sufficiently understands the importance of the above kind ofmanagerial vision and mission of the Group, the managing resources, such as content, that
support the accomplishment of that vision and mission, and the importance of various
stakeholders related to the Company, and who maximizes the corporate value of the Company
and its shareholders’ common interests over the medium to long term.
Therefore, we believe that, in the event that any person or entity that attempts to acquirelarge quantities of the Company’s shares falls under any of the following and would harm theCompany’s corporate value for such reason, such person or entity is inappropriate to control
the decisions of the Company’s financial and business policies:
 Any person or entity who could clearly harm the Company’s corporate value, Any person or entity who forces shareholders to sell their shares in a hurry by creating a
disadvantageous situation if they do not accept a takeover proposal, or Any person or entity that does not provide the Company with the information or the timerequired for making decisions.
(ii) Details of Engagement
The Board of Directors of the Company, to whom the shareholders have entrusted the
management of the Company, is engaged in the following efforts to implement the Group’s
basic policy.
Steps to Increase the Corporate Value of the Group

Promoting the Mid-term Plan
Under the Mid-term Plan implemented from April 2012 to March 2015, the Grouppursued various strategies around the “IP Axis Strategy.” On the business front, specificmeasures aimed at the regional characteristics of each market were pursued. Japan, where
the Group has secured a certain level of market share, was set as the “Basic Business Area,”
and we aimed to further expand our existing share and revenue utilizing the strengths ofeach business operation. North America and Europe, set as the “Profit Recovering Area,”44

had revenue recovery as its first priority, and also aimed towards stabilizing revenue. In
Asia, set as the “New Growth Area,” we focused on strengthening expansion of eachbusiness operation, and aimed to grow around the pillars of new business operations andregions. Under the three-year Mid-term Plan that started in April 2015 we will further
strengthen the “IP Axis Strategy” to expand the value of our IPs based on the Mid-term
Vision of “NEXT STAGE: Empower, Gain Momentum and Accelerate Evolution” taking
light of the effects and issues arising in the previous Mid-term Plan, through taking
advantage of the worldview and unique characteristics of IPs and providing the bestproducts and services at the best possible times. In addition, aiming towards growing in
the global market, we will further strengthen business development in the area of highgrowth potential, which is Asia. Through implementing these measures based on the
Mid-term Plan, the Company is developing solid business foundations in order to generate
stable earnings in this industry that is characterized by rapid changes in operating climate
and user preferences. The objective is to move to the next stage as an entertainment
corporate group.
Strengthening Corporate Governance
The president and representative director of each core company responsible for each
SBU also serves on the Company’s Board of Directors. This mainly contributes tostrengthening the collaborative efforts between the holding company and the operatingcompanies and between the operating companies and to facilitating speedierdecision-making as a group. In addition, the Company is working to strengthen
management oversight functions by having two or more independent Outside Directors.

Promoting Efficient Management
The Group has put in place standards for business reconstruction; it has reinforced
systems for continuous monitoring in order to discern business trends more swiftly, and ismaking swift decisions on restructuring businesses or withdrawing from them, based on
in-house indicators. In addition, the Group is working towards cost reductions bystandardizing processes across the Group as a whole and is promoting managerial
efficiency.

Reinforcing Personnel Strategies
Aiming for business growth in overseas markets, the Group is strengthening its global
systems for acquiring and training personnel. In addition, the Group is driving forward a
proactive system for personnel exchanges within the Group to invigorate its humanresources.



Reinforcing CSR (Corporate Social Responsibilities) Activities
The Group, as an enterprise delivering “Dreams, Fun, and Inspiration,” has defined“The Group’s CSR Initiatives” that include three types of responsibilities; “Environmental
and Social Responsibilities,” “Economic Responsibilities,” and “Legal and EthicalResponsibilities (compliance),” and is promoting a variety of CSR activities.



Proactive IR Activities
The Group discloses information in a timely and appropriate manner in accordance with
the Financial Instruments and Exchange Act and rules prescribed by the Tokyo Stock45

Exchange. We aim to be a highly transparent corporation that clearly provides
shareholders with information concerning management strategies and business directions.
The Group thus works to provide ample opportunities, for instance, company information
meetings and financial information meetings for the president and representative director
and other executives of the Company to explain directly to both foreign and Japaneseindividual investors, institutional investors, stock analysts, etc.
Proactive Policy for the Return of Profits to Shareholders
The Company places the return of profits to shareholders as one of its highest priorities
in its management. The Company assumes that its basic policy is to further strengthen theGroup’s competitiveness and, while maintaining a sound financial status, to achieve
regular distributions of dividends and improvement in the Company’s corporate value. In
concrete terms, the Company will provide a return to shareholders that targets a
consolidated payout ratio of 30%, based on stable annual dividend payments of 24 yen per
share.
In addition, its fundamental policy is that part of any profit, after deduction of dividends,
may be used to acquire treasury stock, upon comprehensive consideration of the amount offunds on hand, performance trends, recent share price trends, the existence or nonexistenceof major investment proposals, and other factors.

Takeover Defenses
At present, the Company has taken no specific measures as takeover defenses. The Group
regards implementing our management and business strategies in accordance with themeasures to increase the corporate value of the Group and aiming to increase the corporate
value of the Group as a whole as a substantial defense against inappropriate takeovers.
That said, since the Group is entrusted by shareholders as the management of the Group, we
will study and develop a system of takeover defenses in anticipation of situations in which an
inappropriate entity or person might emerge to have decision-making power over theCompany’s financial and business policies.
In concrete terms, in the event an inappropriate bidder emerges, the management team will
not take steps to guard its own interests against the takeover offer by the bidder, but will
construct a system that enables the Company to judge from the perspective of improving
corporate value first. The Company will continue to study takeover defenses by utilizing stock
subscription rights, etc. with a close eye on legal and social trends.

(Note) In this Business Report, fractional amounts less than the indicated unit amount are rounded
down for sums of money and numbers of shares, while percentages and other values arerounded off to the nearest figure.

46

Consolidated Balance Sheet(As of March 31, 2016)(Millions of yen)AmountASSETS
Current assets
Cash and time deposits
Trade receivables
Finished goods and merchandiseWork in process
Raw materials and supplies
Deferred tax assets
Other current assets
Allowance for doubtful receivables
Total current assets

174,757
72,53016,74325,605
3,893
8,522
20,730(606)
322,176

Fixed assets
Property, plant and equipment
Buildings and structures
Amusement facilities and machines
Land
Other property, plant and equipment
Total property, plant and equipment
Intangible assets:
Investments and other assets
Investment securities
Net defined benefit asset
Deferred tax assets
Other investments and assets
Allowance for doubtful receivables
Total investments and other assets
Total fixed assets
TOTAL ASSETS

16,863
12,685
11,025
13,12753,702
9,449
34,51971
12,544
16,887(1,015)63,007
126,159448,33647

(Millions of yen)AmountLIABILITIESCurrent liabilities
Trade payables
Provision for directors’ bonuses
Provision for sales returns
Other current liabilities
Total current liabilities

62,645
1,401
970
49,315
114,333

Long-term liabilities
Net defined benefit liability
Deferred tax liabilities for land revaluation
Other long-term liabilities
Total long-term liabilities
TOTAL LIABILITIES

9,920
443
6,333
16,697131,031

NET ASSETSStockholders’ equity
Common stock
Additional paid-in capital
Retained earnings
Treasury stock
Total stockholders’ equity

10,00052,246265,231(2,410)
325,067

Accumulated other comprehensive income
Unrealized gains or losses on other securities, net of tax
Deferred gains or losses on hedges, net of tax
Revaluation reserve for land, net of tax
Foreign currency translation adjustments
Remeasurements of defined benefit plans, net of tax
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

6,907
(706)
(5,670)(5,788)(3,145)(8,403)99541
317,304
448,33648

Consolidated Statements of Operations(From April 1, 2015 to March 31, 2016)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in gain of affiliated companies
Other non-operating income
Non-operating expenses
Interest expense
Foreign exchange losses
Loss on valuation of derivatives
Provision of allowance for doubtful accounts
Other non-operating expenses
Recurring income
Extraordinary income
Gain on sales of fixed assets
Other extraordinary income
Extraordinary loss
Loss on impairment of fixed assets
Other extraordinary loss
Profit (loss) before income taxes
Corporate income, inhabitant and enterprise taxes
Adjustment for income taxes
ProfitLoss attributable to non-controlling interests
Profit attributable to owners of parent

49(Millions of yen)Amount575,504
372,904
202,600
152,959
49,641
216
352
1,508
1,018
49
629
750
299
232
900
124
2,552
758
13,746
186

3,094

1,961
50,774
1,025
3,311
48,48913,932
34,55627
34,583

Consolidated Statement of Changes in Net Assets (From April 1, 2015 to March 31, 2016)(Millions of yen)
Stockholders’ equity
Common stock
Balance at beginning of year

10,000Additional paid-in
capitalRetained earnings

52,246

Treasury stock244,274

Total stockholders’equity(2,403)

304,118

Changes during the period
Cash dividends(13,627)(13,627)

Profit attributable toowners of parent

34,58334,583Purchase of treasury stock
Disposal of treasury stock0

Change in treasury sharesof parent arising fromtransactions with
non-controllingshareholders
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method
is applied
Net changes of items
other than shareholders’equityTotal changes during theperiod

(4)

(4)

0

0

0

Balance at end of year

0

(2)

(2)

–

0

20,956(7)

20,94910,00052,246265,231(2,410)

325,067

Accumulated other comprehensive income
Unrealized gains Deferred gains
Revaluation
or losses onor losses onreserve for land,
other securities,
hedges,net of tax
net of tax
net of tax

Balance at beginning of year

6,757

1,300

(5,695)

Foreigncurrencytranslation
adjustments(1,542)

Total
Subscription Non-controlling
Remeasurements
Total net assets
accumulated
rights to sharesinterestsof definedotherbenefit plans, netcomprehensiveof taxincome(2,045)(1,224)

44575

303,512

Changes during the period
Cash dividends(13,627)

Profit attributable toowners of parent

34,583Purchase of treasury stock(4)

Disposal of treasury stock0

Change in treasury sharesof parent arising fromtransactions with
non-controllingshareholders
Changes in treasury stock
accompanying changes toholdings in companies towhich the equity method
is applied
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at end of year

0

(2)

149

(2,006)24(4,246)(1,100)(7,179)55(33)(7,157)149(2,006)24(4,246)(1,100)(7,179)55(33)

13,791

6,907

(706)

(5,670)(5,788)(3,145)(8,403)99541

317,30450

Notes to Consolidated Financial Statements
All sums are shown in millions of yen and have been rounded down.
I.

Notes to Important Information Constituting the Basis for Preparation of Consolidated Financial
Statements
1. Information Concerning the Scope of Consolidation(1)

Status of Consolidated Subsidiaries:(i)

Total Number of Consolidated Subsidiaries:
68 companies(ii)

Names of Principal Consolidated Subsidiaries:
BANDAI CO., LTD., BANDAI NAMCO Entertainment Inc., BANDAIVISUAL CO., LTD., BANDAI NAMCO Holdings USA Inc., BANDAI S.A.
BANDAI NAMCO Holdings UK LTD., BANDAI NAMCO Holdings ASIA
CO., LTD.
BANDAI NAMCO Games Inc. changed its trade name to BANDAI NAMCOEntertainment Inc., and BANDAI NAMCO ASIA CO., LTD. changed its tradename to BANDAI NAMCO Holdings ASIA CO., LTD.

(iii) Changes in the Scope of Consolidation
Since BANDAI NAMCO Pictures Co., Ltd. and BANDAI NAMCO ASIA CO., LTD.
were newly established in this consolidated fiscal year and Grand-Slam Ltd. and
Highway Star Inc. became subsidiaries through stock acquisition, these companies are
now included in the scope of consolidation.
Since BANDAI Polska sp.zo.o, which was a consolidated subsidiary in the fiscal year
ended March 31, 2015, was liquidated, it has been excluded from the scope of
consolidation.
(2)

Status of Non-Consolidated Subsidiaries:(i)Names of the Principal Non-Consolidated Subsidiaries:
BANDAI LOGIPAL (H.K.) LTD.

(ii)

Reason for Exclusion from the Scope of Consolidation:
Non-consolidated subsidiaries have been excluded from the scope of consolidation. As
the scale of the business conducted by each of those companies is small and the total
assets, net sales, profit or loss and retained earnings, etc. corresponding to the ownership
held by the Company of each non-consolidated subsidiary have no material impact on
the consolidated financial statements.

2. Information Concerning Application of the Equity Method(1)(i)

Status of Non-Consolidated Subsidiaries and Affiliated Companies to Which the Equity Method
Was Applied:
Number of Affiliated Companies to Which the Equity Method Was Applied:
6 companies

51

(ii)

Names of the Principal Affiliated Companies to Which the Equity Method Was Applied:
Happinet Corporation, Sotsu Co., Ltd. and People Co., Ltd.

(iii) Changes in Affiliated Companies to Which the Equity Method Was Applied
Since SHANGHAI NAMCO LTD., which was a non-consolidated subsidiary to which
the equity method was applied in the fiscal year ended March 31, 2015, was liquidated,
it has been excluded from the scope of application of the equity method.
(2)

Status of Non-Consolidated Subsidiaries and Affiliated Companies to Which the Equity Method
Was Not Applied:(i)Name of the Principal Companies, etc.:
BANDAI LOGIPAL (H.K.) LTD.

(ii)

Reason the Equity Method Was Not Applied to the Company:
The equity method was not applied to this company, because it was deemed thatthe exclusion of the company from the application of the equity method would
have little, and no material impact on the consolidated financial statements of theCompany and it seemed unimportant as a whole in consideration of thecompany’s profit or loss and retained earnings, etc. corresponding to theCompany’s equity share in it.

(iii) Special Notes Regarding Procedures for Applying the Equity Method
If any of the companies to which the equity method is applied has a fiscal year thatdiffers from the consolidated fiscal year, then the financial statements for the fiscal yearof that company are used.
3. Information Concerning the Fiscal Year, etc. for Consolidated Subsidiaries
The fiscal year closing dates for BANDAI (SHENZHEN) CO., LTD. and BANDAI NAMCO(SHANGHAI) CO., LTD. are December 31, and their financial data as of their respective
closing dates are used. The fiscal year closing date for Sun-Star Stationery Co., Ltd is June 30
and its financial data is based on a provisional closing as of December 31 pursuant toprocedures for the fiscal year-end closing.
Necessary adjustments on a consolidated basis are made when transactions of material
importance occur between the reported closing date and the consolidated closing date.
4. Accounting Policies(1)(i)

Valuation Basis and Methods for Significant Assets:
Valuation Basis and Methods for Securities:
Other securities:
Securities with market values:
Stated using the market price method based on amounts using market
prices, etc. on the closing date. (Valuation differences are reflected
directly in net assets and cost of sales is calculated using the moving
average method.)52

Securities without market values:
Stated using the cost method based on the moving average method. With
respect, however, to contributions to limited partnerships for investment
and similar partnerships (deemed to be securities under Article 2,
Paragraph 2 of the Financial Instruments and Exchange Act), these arestated by the net amount corresponding to the Company’s equity share,
based on the most recent available financial reports according to the date
for settlement of accounts provided for in the partnership agreement.
(ii)

Derivative Transactions: Stated using the market price method.

(iii) Valuation Basis and Methods for Inventories:
Work in process, such as game software, etc.:
Stated using the cost method based on the specific-cost method. (The value
stated on the balance sheet was calculated by writing down the book value
based on declining profitability.)
Others:Domestic consolidated subsidiaries:
Generally, stated using the cost method based on the average method.
(The value stated on the balance sheet was calculated by writing down thebook value based on declining profitability.)
Overseas consolidated subsidiaries:
Generally, stated using the lower of cost or market method based on the
average method.
(2)

Depreciation Methods for Significant Depreciable Assets:(i)

Property, Plant and Equipment (Exclusive of leased assets):
The Company and domestic consolidated subsidiaries:
Generally stated using the declining-balance method.
However, for buildings (excluding equipment attached thereto) acquired on
or after April 1, 1998 and for part of the amusement facilities and machines,
etc., the straight-line method was used. The general useful life of property,
plant and equipment is as follows:
Buildings and structures:
3 to 50 years
Amusement facilities and machines:
3 to 15 years
Overseas consolidated subsidiaries:
Stated using the straight-line method.
The general useful life of property, plant and equipment is as follows:
Buildings and structures:
5 to 50 years
Amusement facilities and machines:
3 to 7 years(ii)

Intangible Assets (Exclusive of leased assets):
Stated using the straight-line method.
The general useful life of software is as follows:
Software (used internally):
1 to 5 years(iii) Leased Assets:
Stated using the straight-line method, with the useful life set to the lease period,
for a residual value of zero.

53

(3)

Basis of Recognition for Significant Provision:(i)

Allowance for Doubtful Receivables:
The allowance for doubtful receivables is provided for possible losses on
unrecoverable receivables. For ordinary receivables, the amount of the allowanceis based on the historical rate of loss. For receivables from debtors at risk ofbankruptcy and receivables from debtors in bankruptcy or under reorganization,etc., the amount of the allowance is based on individually estimatedunrecoverable amounts.

(ii)

Provision for Directors’ Bonuses:
Accrued bonuses for directors are provided based on the estimated amounts to be
paid in respect of this consolidated fiscal year.

(iii) Provision for Sales Returns:
To provide for losses on returned goods after the last day of this consolidated
fiscal year, the estimated amount of losses on returned goods is provided basedon the historical rate of returned goods.
(4)

Accounting Standards for Significant Income and Expense:(i)Video Game Software Revenue Recognition:
Consolidated subsidiaries operating in the United States recognized revenue inaccordance with “Software Revenue Recognition” of FASB AccountingStandards Codification No. 985-605, treating video game software with online
functions as software products with multiple-element arrangements. Unless thevendor can objectively and reasonably prove the fair value of undelivered
elements specified by the vendor, recording of any revenue attributable to video
game software is deferred until all the elements are delivered.

(ii)

Video Game Software Production Costs:
A distinctive characteristic of video game software is the process through which
the software is highly combined with the content that cannot be separated into
identifiable components.
The content is considered to be an important component of each video game title,
which includes the game content and visual / music data.
Once management makes a decision to go forward in distributing a title, theCompany records the software and content development costs as work inprocess.
The capitalized production costs are amortized to cost of sales based on
projected sales volumes.

(5)
(i)

Significant Accounting Policies for Hedging:
Accounting for Hedging:
The Company used deferred hedge accounting.
In cases where forward foreign exchange contracts meet certain hedging criteria,
they are accounted for under the allocation method.

54

(ii)

Hedging Instruments and Hedged Items:
Hedging instruments:

Forward exchange contracts and currency option
contracts

Hedged items:

Foreign-currency-denominated assets and liabilities
and scheduled transactions(iii) Hedging Policies:
Hedging is implemented for the purpose of reducing risks arising fromfluctuations in exchange rates involved in operational and financing activities.
(iv) Method of Assessing the Effectiveness of Hedging:
The Company assesses the effectiveness of hedging transactions, in principle,
from the start of the transaction to the point at which effectiveness is assessed bycomparing the cumulative changes in the fair value or the cumulative changes in
the cash flows of the hedged item with the cumulative changes in the fair valueor the cumulative changes in the cash flows of the hedging instrument.
In the event that critical terms are the same for the hedging instrument and thehedged assets, liabilities, or scheduled transaction, it is assumed that the hedge is100% effective, so the assessment of effectiveness is not performed.
(6)

Amortization of Goodwill
Goodwill is amortized over a five-year period using the straight-line method.

(7)

Other Important Information Constituting the Basis of Preparation of Consolidated Financial
Statements(i)

Method of accounting for retirement benefits
a. Method of attributing expected retirement benefits to periods
In calculating the retirement benefit obligations, the benefit formula basis is mainly
used in determining the amount of the expected retirement benefit obligations
attributed to the period up to the end of this consolidated fiscal year.
b. Method of recognizing actuarial gains and losses and past service costs
Actuarial gains and losses are recognized in gain or loss in the year following the year
in which a respective gain or loss arises, and are amortized proportionally on astraight-line basis over a certain period (9 to 19 years) that is within the averageremaining period of service of the eligible employees.
The entire amount of past service costs is recognized in gain or loss in the fiscal year
during which it arises, and is amortized on a straight-line basis over a period (10 years),
which is within the average remaining years of service of the eligible employees.
c. The Company and certain consolidated subsidiaries use a simplified method in
calculating net defined benefit asset, net defined benefit liability, and periodic pension
cost under which retirement benefit obligations are principally based on accrued
benefits at the end of the year.

(ii)

Accounting treatment of consumption tax:
Consumption tax is accounted for separately and is not figured into each listed
item.

55

(iii) Application of consolidated taxation system:
The Company has applied the consolidated taxation system.
II.

Notes to Changes in Accounting Policy(Application of Accounting Standard for Business Combinations, etc.)
Effective from this consolidated fiscal year, the Company has applied the AccountingStandard for Business Combinations (ASBJ Statement No. 21, September 13, 2013), the
Accounting Standard for Consolidated Financial Statements (ASBJ Statement No. 22,
September 13, 2013), and the Accounting Standard for Business Divestitures (ASBJ
Statement No. 7, September 13, 2013), etc. Accordingly, the method of recording the amountof difference caused by changes in the Company’s ownership interests in subsidiaries in thecase of subsidiaries under ongoing control of the Company was changed to one in which it isrecorded as additional paid-in capital, and the method of recording acquisition-related costs
was changed to one in which they are recognized as expenses for the fiscal year in which they
are incurred. Furthermore, for business combinations carried out on or after the beginning of
this consolidated fiscal year, the accounting method was changed to one in which thereviewed acquisition cost allocation resulting from the finalization of the provisional
accounting treatment is reflected in the consolidated financial statements for the consolidated
fiscal year to which the date of business combination belongs. In addition, the presentation
method for “net income” and other related items was changed, and the presentation of“minority interests” was changed to “non-controlling interests.”
Application of the Accounting Standard for Business Combinations, etc. is in line with thetransitional measures provided for in paragraph 58-2 (4) of the Accounting Standard forBusiness Combinations, paragraph 44-5 (4) of the Accounting Standard for Consolidated
Financial Statements and paragraph 57-4 (4) of the Accounting Standard for Business
Divestitures. The Company is applying the said standard, etc. prospectively from the
beginning of this consolidated fiscal year.
The effect of this change on the consolidated financial statements and the per-share data forthis consolidated fiscal year is immaterial.

III. Notes to Changes in Method of Presentation(Consolidated Balance Sheet)“Accounts payable-other” (the balance of which at the end of this consolidated fiscal year is
19,923 million yen) is at or below 5 percent of the total liabilities and net assets. “Accrued income
taxes” (the balance of which at the end of this consolidated fiscal year is 2,747 million yen) is ator below 1 percent of the total liabilities and net assets. “Provision for losses from businessrestructuring” (the balance of which at the end of this consolidated fiscal year is 35 million yen)became immaterial. Due to the above reasons, these are included in “Other current liabilities”
under “Current liabilities,” although they had been stated separately until the previous
consolidated fiscal year.
(Consolidated Statements of Operations)(1) “Interest on refund” (the balance of which at the end of this consolidated fiscal year is 0
million yen), which had been stated separately until the previous consolidated fiscal year, is
included in “Other non-operating income” under “Non-operating income” since it is at or
below 10 percent of the total non-operating income.
(2) “Sales discounts,” (the balance of which at the end of this consolidated fiscal year is 39
million yen) and “Loss on investments in partnerships,” (the balance of which at the end of
this consolidated fiscal year is 109 million yen) which had been stated separately until theprevious consolidated fiscal year, are included in “Other non-operating expenses” under56

“Non-operating expenses” since each of them is at or below 10 percent of the total
non-operating expenses.
(3) “Gain on sales of investment securities” (the balance of which at the end of thisconsolidated fiscal year is 0 million yen) and “State subsidy” (the balance of which at theend of this consolidated fiscal year is 12 million yen), which had been stated separately
until the previous consolidated fiscal year, are included in “Other extraordinary income”
under “Extraordinary income” since each of them is at or below 10 percent of the total
extraordinary income.
(4) “Gain on sales of fixed assets,” which had been included in “Other extraordinary income”
under “Extraordinary income” until the previous consolidated fiscal year, is statedseparately since it is above 10 percent of the total extraordinary income for thisconsolidated fiscal year. The total of “Gain on sales of fixed assets,” for the previous
consolidated fiscal year was 36 million yen.
IV. Notes to Consolidated Balance Sheet
1. Assets pledged as collateral
Cash and time deposits
There are no liabilities associated with this collateral.

¥95 million

In addition to the above, the assets deposited as a security deposit for issuance under the
Payment Services Act, are as follows:“Other investments assets” under “Investments and other assets”¥433 million
2. Amount of Accumulated Depreciation of Property, Plant and Equipment:¥158,768 million

3. Guarantee Obligation:(1) The Company has guarantee obligations concerning borrowings from financial institutions
by companies other than consolidated companies.
ISHIMORI PRODUCTION INC.

¥144 million

Theater Company HIKOSEN¥64 million

Total¥209 million(2) The Company has guarantee obligations concerning obligations in leasing contracts ofcompanies other than consolidated companies.
¥60 million

BANDAI NAMCO WILL INC.
4. Land revaluation

A revaluation of land for business-use was implemented pursuant to the “Law Concerning
Land revaluation” (Law No. 34, March 31, 1998) and the revalued difference was recorded
under net assets.
Revaluation Method:
The fair value of land is determined based on official notice prices that arecalculated by the method assessed and published by the Commissioner of the
National Tax Agency. The Commissioner assesses and publishes the method to
calculate land value that forms the foundation for calculating taxable value for land
value tax prescribed in “Article 16 of Land Value Tax Law (Law No. 69, May 2,1991),” as stipulated in “Article 2-4 of the Ordinance Implementing the Law
Concerning Land revaluation (Cabinet Order No. 119, March 31, 1998).”

57

Reasonable adjustments are made to the official notice prices.
Revaluation Date: March 31, 2002
Difference between the market value of the revalued land at the end of this consolidated
fiscal year and the revaluated book value after the revaluation: negative 1,018 million yen.
V. Notes to Consolidated Statement of Changes in Net Assets
1. Type and Total Number of Shares Issued
Common stock

222,000,000 shares

2. Matters Concerning Distribution of Surplus(1)

Paid Dividend Amounts, etc.

Date of Resolution

June 22, 2015,
Ordinary General
Meeting of
Shareholders
November 5, 2015,
Board of Directors
Meeting(2)

Type ofsharesTotalamount ofdividends(millions ofyen)

Dividend pershare (yen)Date ofrecordEffective
date

Commonstock

10,98950

March 31,2015

June 23,
2015

Common
stock

2,637

12

September
30, 2015

December 7,
2015

Dividends with a Date of Record in This Consolidated Fiscal Year but an Effective Date in the
Following Consolidated Fiscal Year

Date of Scheduled
Resolution

Type ofsharesTotalamount ofdividends(millionsof yen)June 20, 2016,
Ordinary General
Meeting of
Shareholders

Common
stock

8,791

Source ofdividends

Dividend
per share(yen)

Date ofrecordEffective
date

Retainedearnings

40

March 31,2016

June 21,2016

3. Type and Number of Shares to be Issued upon the Exercise of Subscription Rights to Shares(excluding those whose exercise period has not yet commenced) as of March 31, 2016
Common stock

63,200 shares

58VI. Notes Concerning Financial Instruments
1. Financial Instruments
The Group manages funds by means of highly secure financial instruments only andprocures funds through borrowing from banks and other financial institutions.
With regard to credit risk posed by customers with respect to trade receivables, which areoperating receivables, credit information on major customers is updated at least once a year,
to minimize such credit risk. Hedging is implemented as necessary through the use of
forward exchange contracts for the purpose of reducing risks arising from fluctuations in
exchange rates for foreign-currency-denominated operating receivables.
Shares, which are investment securities, are exposed to the risk of market pricefluctuations; their market values are checked once a quarter.
Part of trade payables, which are operating liabilities, is denominated in foreign
currencies. Hedging is implemented as necessary through the use of forward exchange
contracts and currency option contracts for the purpose of reducing risks arising fromfluctuations in exchange rates for foreign-currency-denominated operating liabilities.
Derivative transactions are executed and managed according to internal rules that
determine trading authority and limits on amounts traded; derivatives are used in ways thatminimize credit risk, and thus transactions are carried out only with highly creditworthy
financial institutions.
2. Market Values of Financial Instruments
The book values of financial instruments as stated in the consolidated balance sheet, theirmarket value as of March 31, 2016, and the difference between book value and market
value are as stated below. This table does not include assets for which it was judged
extremely difficult to assess the market value.
Book value
stated in theMarket value
Difference
consolidated(Millions of yen) (Millions of yen)balance sheet(Millions of yen)
(1) Cash and time deposits
174,757
174,757—(2) Trade receivables
72,53072,530—(3) Short-term investments andinvestment securities
1. Other Securities
17,423
17,423—
2. Stock of affiliated companies
10,73815,057
4,319
Total assets
275,449
279,7694,319
Trade payables
62,64562,645—
Total liabilities
62,64562,645—Derivative transactions (*)(1,588)(1,588)—(*) Debts and credits derived from derivative transactions are stated on a net basis. Items to berecorded as net debts in the total are enclosed in brackets.
(Notes) 1. Relevant matters of method of calculating the market value of financial instruments andsecurities and derivative transactions
Assets(1) Cash and time deposits
Since these are readily convertible into cash, their market value is almost identical withthe book value, and thus these are stated at the book value.
(2) Trade receivables
Since trade receivables that are settled in a short period of time are readily convertible into
cash, their market value is almost identical with the book value, and thus these are statedat the book value. For trade receivables that are settled after a long period of time, the fair59

values are measured based on the present values calculated by discounting receivableamounts classified by certain periods of time at a rate for which time to maturity andcredit risk has been taken into account.
(3) Short-term investments and investment securities
Since MMF is readily convertible into cash, their market value is almost identical with thebook value; and these are stated at the book value. Stocks and others are stated at the priceon the stock exchange or the price as presented by counterparty financial institutions andothers.

Liabilities
Trade payables
Since these are readily convertible into cash, their market value is almost identical withthe book value; and thus these are stated at the book value.
Derivative transactions
The market value of derivative transactions is stated at the price as presented bycounterparty financial institutions and others.
2. Unlisted stocks (stated as 2,510 million yen in the consolidated balance sheet), stocks ofaffiliated companies (unlisted stocks) (stated as 3,949 million yen in the consolidatedbalance sheet), and contributions to investment partnerships (stated as 602 million yen
in the consolidated balance sheet) have no market price and it is extremely difficult toassess their market value, so they are not included in “(3) Short-term investments andinvestment securities.”
VII. Notes Concerning Per-Share Data
1. Net assets per share¥1,441.49¥157.43

2. Basic earnings per share

VIII. Significant Subsequent Events(Acquisition of Shares Through Tender Offers)
The Company adopted a resolution at a Board of Directors meeting on March 9, 2016 to acquirecommon shares in WiZ Co., Ltd. (“Target Company” and “Target Company’s Shares”) through atender offer under the Financial Instruments and Exchange Act (Act No. 25 of 1948, including
subsequent amendments).
The First Tender Offer, which commenced on March 10, 2016, was completed on April 7, 2016
and the Second Tender Offer was commenced on April 15, 2016.
1. Outline of the Business Combination(1)

Name and Business of the Target Company
Name
Business(2)

WiZ Co., Ltd.
Planning, developing, producing, and selling of toys, sundries, andanimation films

Main Reasons for the Business Combination

The Target Company is listed on the Tokyo Stock Exchange JASDAQ Standard section.
The Company decided to make Target Company a wholly owned subsidiary through a tender
offer to strengthen planning and development capabilities for toys.
While the Company has grown through business operations centered on key IPs, which is a60

core strength of the Group, it believes having the Target Company in the Group should enable
the strengthening of its source of growth, the planning and development function for IPs andproducts, with the Target Company’s strengths and knowhow in digital toys planning anddevelopment integrated into the Group. More specifically, the Company believes thatdeepening the collaboration between BANDAI CO., LTD., which has capabilities in boys’ andgirls’ basic (classic) toys planning and design, and the Target Company, which has capabilities
in digital toys planning and development, should improve the planning capability of theoverall Group including the Target Company and enable the planning, development, andoperations of new products leveraging the strengths of both companies with their planningcapabilities as a pillar.
In addition, the Company recognizes the Target Company as an important business partnerof the Group in jointly holding and operating the rights of original IPs such as Tamagotchi,
Primopuel, and Digital Monsters. The Target Company believes that the alliance with theGroup will allow it to establish a stable revenue base by strengthening the licensing-out
function for these original IPs.
To realize the synergies described above, the Company has decided it is imperative toestablish management structures to allow decisions to be made promptly and flexibly based on
medium- and long-term strategic judgments, including the restructuring of the Target
Company’s business management, through the acquisition of all of the Target Company’s
Shares. It has also been determined that the Target Company should become a wholly-owned
subsidiary of the Company and both companies should be integrated as a group to conductbusiness operations, which will eventually serve to enhance the corporate value of the Target
Company.
(3)

Date of Business Combination
Share acquisition dateCommencement date ofsettlement for First Tender Offer

April 14, 2016

Scheduled commencement dateof settlement for Second TenderOffer

May 31, 2016 (scheduled)

Deemed acquisition date(4)

May 31, 2016 (scheduled)

Legal Format for the Business Combination
Acquisition of shares in consideration for cash

(5)Company Name after Combination
No change

(6)
1)
2)
3)
4)
(7)

Percentages of Voting Rights Acquired
Percentage of voting rights owned immediately before combination
0.00%
Percentage of voting rights acquired through First Tender Offer
55.02%
Percentage of voting rights planned to be acquired through Second Tender Offer TBD
Percentage of voting rights after the Tender Offer
TBD
Main Basis on Which Acquiring Company was Chosen
In order for the Company to acquire the shares in consideration for cash61

2. Matters Relating to Calculation of Acquisition Price, etc.
(1)

Purchase Price of Acquired Company and Breakdown by Type of Consideration(2)

Not confirmed at this stage
Details and Amount of Main Acquisition-Related Costs
Not confirmed at this stage

3. Matters Relating to Acquisition Cost Allocation(1)

Amounts and breakdowns for assets received, and debts assumed, on date of businesscombination
Not confirmed at this stage(2)

Goodwill amounts incurred, reason for being incurred, amortization method and period; fornegative goodwill, amounts incurred and reason for being incurred
Not confirmed at this stage

62

Non-Consolidated Balance Sheet(As of March 31, 2016)(Millions of yen)AmountASSETS
Current assets
Cash and time deposits
Trade receivables
Prepaid expenses
Deferred tax assets
Accounts receivable-other
Taxes receivable
Other current assets
Total current assets

78,909
274
303
32
8,501
1,655
276
89,954

Fixed assets
Property, plant and equipment
Buildings
Structures
Machinery and equipment
Tools, furniture and fixtures
Construction in progress
Total property, plant and equipment
Intangible assets
Software
Other intangible assets
Total intangible assets
Investments and other assets
Investment securities
Investments in affiliated companies
Other investments and assets
Total investments and other assets
Total fixed assets
TOTAL ASSETS

1,693
69
66
845
46
2,722
1,505
151
1,656
18,628233,565
1,823
254,017258,396348,35063

(Millions of yen)AmountLIABILITIESCurrent liabilities
Short-term borrowings from affiliated companies
Short-term borrowings
Accounts payable-otherAccrued expenses
Accrued income taxes
Provision for directors’ bonuses
Unearned revenue
Other current liabilities
Total current liabilities
Long-term liabilities
Deferred tax liabilities
Accrued retirement and severance benefits
Long-term accounts payable - other
Guarantee deposits received
Asset retirement obligations
Total long-term liabilities
TOTAL LIABILITIESNET ASSETSStockholders’ equity
Common stock
Additional paid-in capital
Capital reserve
Other capital surplus
Retained earnings
Legal reserve
Other retained earnings
General reserve
Retained earnings carried forward
Treasury stock
Total stockholders’ equity
Valuation difference and foreign currency translation
adjustments
Unrealized gains or losses on other securities, netof taxTotal valuation difference and foreign currencytranslation adjustments
Subscription rights to shares
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

64

89,742
1,000
1,558
201
29
179
153
14
92,878
2,248
27
1,859
1,445
486
6,067
98,946

10,000174,284
2,500
171,784
60,401
1,645
58,756
26,10432,651(2,322)
242,363

6,941
6,941
99
249,403348,350

Non-Consolidated Statements of Operations(From April 1, 2015 to March 31, 2016)(Millions of yen)AmountOperating revenue
Dividend income from affiliatedcompanies
Business management income fromaffiliated companies
Operating expenses
General and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Rent income
Other non-operating income
Non-operating expenses
Interest expense
Expenses related to rental assets
Other non-operating expenses
Recurring income
Extraordinary income
Gain on sales of fixed assets
Gain on sales of investment securities
Compensation income at affiliatedcompanies
Extraordinary loss
Loss on disposal of fixed assets
Loss on impairment of fixed assets
Loss on valuation of golf club membership
Other extraordinary loss
Profit before income taxes
Corporate income, inhabitant and enterprise
taxes
Adjustment for income taxes
Profit65

26,592
2,648

29,241
3,544
25,696

99
166
1,784
203
60
1,773
94

2,254

1,927
26,023

1
0
6
13
12
7
3

8

37
25,994(36)
83

47
25,946

Non-Consolidated Statement of Changes in Net Assets (From April 1, 2015 to March 31, 2016)(Millions of yen)
Retained earnings
Additional paid-in capital
Commonstock

Retained earnings

Total
Other capital additional
Legal reservepaid-insurpluscapitalOther retained earnings
Total
retainedearnings

Treasury
stock

Total
stockholders’equity(2,318)230,047

Generalreserve

Retainedearnings
carriedforward26,104

20,331

48,082

Cash dividends(13,627)(13,627)(13,627)

Profit25,94625,94625,946

Balance at beginning of year

10,000Capitalreserve

2,500

171,783

174,283

1,645

Changes during the period

Purchase of treasury stock00

Disposal of treasury stock
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at end of year

(4)

(4)

0

0

–

–

0

0

–

–

12,31912,319(4)

12,315

10,0002,500

171,784

174,284

1,645

26,10432,65160,401(2,322)

242,363

Valuation difference and foreign currency translation
adjustments
Unrealized gains or losses onother securities, net of tax
Balance at beginning of year

Total valuation difference Subscription rights to sharesand foreign currencytranslation adjustments

6,765

6,765

44

Total net assets

236,857

Changes during the period
Cash dividends(13,627)

Profit25,946

Purchase of treasury stock(4)

Disposal of treasury stock0

Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at end of year

175

175

55

231

175

175

55

12,546

6,941

6,941

99

249,40366

Notes to Non-Consolidated Financial Statements
All sums are shown in millions of yen and have been rounded down.
1. Notes Concerning Significant Accounting Policies(1)(i)

Valuation Basis and Methods for Assets:
Valuation basis and methods for securities:
Shares of Subsidiaries and Affiliated Companies:
Stated using cost method based on the moving average method.

(ii) Other Securities:
Securities with market values:
Stated using the market price method based on amounts using market prices,
etc. on the closing date. (Valuation differences are reflected directly in net
assets and cost of sales is calculated using the moving average method.)
Securities without market values:
Stated using the cost method based on the moving average method.
With respect, however, to contributions to limited partnerships for investment
and similar partnerships (deemed to be securities under Article 2, Paragraph 2of the Financial Instruments and Exchange Act), these are stated by the net
amount corresponding to the Company’s equity share, based on the mostrecent available financial reports according to the date for settlement ofaccounts provided for in the partnership agreement.
(2)(i)

Depreciation Methods for Fixed Assets:
Property, Plant and Equipment:
Stated using the declining-balance method.
The general useful life of property, plant and equipment is as follows:
Buildings
3 to 18 years
Structures
10 years
Machinery and equipment
8 years
Tools, furniture and fixtures
2 to 15 years(ii) Intangible Assets:
Stated using the straight-line method.
The general useful life of software is as follows:
Software (used internally)
5 years(3)(i)

Basis of Recognition for Provision:
Provision for Directors’ Bonuses:
The Company provides for directors’ bonuses based on estimated bonus
payments in this fiscal year.

(ii) Accrued Retirement and Severance Benefits:
The Company provides for retirement and severance benefits for employees
based on estimated retirement benefit obligations as of the end of this fiscal
year.

67

(4)

Other Important Information Constituting the Basis of Preparation of Non-Consolidated
Financial Statements:(i)

Accounting Treatment of Consumption Tax:
Consumption tax is accounted for separately and is not figured into each listed item.

(ii) Application of consolidated taxation system
The Company has applied the consolidated taxation system.
2. Notes to Changes in Method of Presentation
Non-Consolidated Balance Sheet(1)“Taxes receivable,” which had been included in “Other current assets” under “Current assets”
until the previous fiscal year, is stated separately from this fiscal year due to the increasedmateriality of the amount. The total of “Taxes receivable,” for the previous consolidated
fiscal year was 1 million yen.

(2)

“Guarantee deposits received,” which had been included in “Other current liabilities” under“Non-current liabilities” until the previous fiscal year, is stated separately from this fiscal
year due to the increased materiality of the amount. The total of “guarantee deposits
received,” for the previous consolidated fiscal year was 153 million yen.

3. Notes to Non-Consolidated Balance Sheet(1)

Amount of accumulated depreciation of property, plant and equipment: ¥1,691 million(2)

Guarantee Obligations
The Company has made guarantees in respect of obligations in connection with leasing
contracts of an affiliated company.
BANDAI NAMCO WILL INC.
¥60 million(3)

Monetary claims and obligations with respect to affiliated companies (excluding amounts
given in specific categories)
Short-term monetary claims on affiliated companies:
Short-term monetary obligations to affiliated companies:
Long-term monetary obligations to affiliated companies:¥7,734 million¥560 million¥1,859 million

4. Notes to Non-Consolidated Statements of Operations
Transactions with affiliated companies (excluding amounts given in specific categories)
Operating Transactions:
Service commission fees
¥474 million
Non-operating Transactions:Non-operating income¥1,838 million
Non-operating expenses¥53 million
5. Notes to Non-Consolidated Statement of Changes in Net Assets
The total number and type of treasury stock as of the end of this fiscal year
Common stock
2,204,760 shares
6. Notes Concerning Tax Effect Accounting
The main factors in the occurrence of deferred tax assets are denial of loss on valuation ofstocks of affiliated companies and loss on valuation of investment securities, and they68

were recorded net of valuation allowance. The main factor in the occurrence of deferred
tax liabilities is unrealized gains or losses on other securities, net of tax.

69

7. Notes Concerning Transactions with Related Parties
Subsidiaries and Affiliated Companies, etc.
(Millions of yen)Type

CompanyBANDAI
SubsidiaryCO., LTD.

Ratio of voting
rights ownership

Holding directly
100.0%

Relationshipwith relatedpartiesContent

AmountAccount items

Balance asof March
31, 2016

Borrowings(Note 1)30,463

Short-termborrowings fromaffiliated companies

37,615

Payment ofInterlocking interest
directorate Amountcollected due toapplication of
consolidated
taxation system
Borrowings(Note 1)BANDAI
NAMCO
Holding directly
SubsidiaryEntertainment 100.0%
Inc.

BANDAI
Subsidiary VISUAL
CO., LTD.

Subsidiary

NAMCO
LIMITED

Holding directly
100.0%

Holding directly
100.0%BANPREST Holding indirectly
Subsidiary
O CO., LTD. 100.0%

Subsidiary

SUNRISEINC.

BANDAI
Subsidiary NAMCO
Studios Inc.
BANDAI
NAMCO
Subsidiary
Holdings
USA Inc.
BANDAI
NAMCO
SubsidiaryBusiness Arc
Inc.

Holding directly
100.0%

Holding indirectly
100.0%

Payment ofInterlocking interest
directorate Loans (Note 2)
Receipt ofinterest
Receipt of claims(Note 3)
Borrowings
Interlocking (Note 1)
directorate
Payment ofinterest
Borrowings
Interlocking (Note 1)
directorate
Payment ofinterest

–

–

–

17

–

5,137

Accounts
receivable-other

2,411

8,576

Short-termborrowings fromaffiliated companies

10,708––4
17,350

–

–

61

–

–

5,681

–

–

6,845

Short-termborrowings fromaffiliated companies

6,847

4
2,746
1

–
Short-termborrowings fromaffiliated companies–
Short-termborrowings fromaffiliated companies

–
4,182
–

Borrowings(Note 1)

6,779

Payment ofinterest

4

Borrowings(Note 1)

12,294

Payment ofinterest

7

Borrowings(Note 1)

7,846

Payment ofinterest

4

–

–

–

–

Holding directly
100.0%

Underwriting ofInterlocking
capital increase
directorate(Note 3)

5,681

Holding directly
100.0%

Payment ofInterlocking operation
directorate consignment(Note 4)474–
Short-termborrowings fromaffiliated companies–
Short-termborrowings fromaffiliated companies

Accounts
payable-otherConditions of transactions and policies for determining the conditions of transactions(Notes) 1. The borrowings are transactions made by the cash management system (CMS); theamount stated is the average balance during this fiscal year. To clearly disclose the

70

–

7,179
–
12,294–
7,982

39

actual conditions of CMS transactions, the transaction net amount is shown. Theinterest rate on these borrowings is, based on intra-Group regulations, determinedreasonably, taking into account market interest rates.
2. The interest rate on these loans is, based on intra-Group regulations, determinedreasonably, taking into account market interest rates.
3. The Company received accounts receivable held by BANDAI NAMCOEntertainment Inc. against BANDAI NAMCO Entertainment America Inc. at thebook value, and made a contribution in kind for the aforementioned claims to
BANDAI NAMCO Holdings USA Inc.
4. The amounts of the operation consignment paid to BANDAI NAMCO Business Arc
Inc. are decided through cooperative discussion with that company, giving
consideration to the total cost, etc.
8. Notes Concerning Per-Share Data
(1) Net assets per share:¥1,134.26(2) Net profit per share:¥118.05

9. Notes Concerning Significant Subsequent Events(Acquisition of Shares Through Tender Offers)
This note is omitted because the information is provided in “VIII. Significant
Subsequent Events,” of the Notes to Consolidated Financial Statements.

71Independent Auditor’s Report
May 18, 2016
The Board of Directors
BANDAI NAMCO Holdings Inc.
KPMG AZSA LLC
Toshihiro Otsuka (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Hiroo Iwaide (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Terukazu Nagamine (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant

We have audited the consolidated financial statements, comprising the consolidatedbalance sheet, the consolidated statements of operations, the consolidated statement ofchanges in net assets and the related notes of BANDAI NAMCO Holdings Inc. as at
March 31, 2016 and for the year from April 1, 2015 to March 31, 2016 in accordancewith Article 444-4 of the Companies Act.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated
financial statements in accordance with accounting principles generally accepted inJapan, and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements that are free from material
misstatements, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the consolidated financial statements
based on our audit as independent auditor. We conducted our audit in accordance withauditing standards generally accepted in Japan. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts
and disclosures in the consolidated financial statements. The procedures selected
depend on our judgment, including the assessment of the risks of material misstatementof the consolidated financial statements, whether due to fraud or error. In making those72

risk assessments, we consider internal control relevant to the entity’s preparation andfair presentation of the consolidated financial statements in order to design audit
procedures that are appropriate in the circumstances, while the objective of the financial
statement audit is not for the purpose of expressing an opinion on the effectiveness ofthe entity’s internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of accounting estimates made bymanagement, as well as evaluating the overall presentation of the consolidated financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, inall material respects, the financial position and the results of operations of BANDAI
NAMCO Holdings Inc. and its consolidated subsidiaries for the period, for which theconsolidated financial statements were prepared, in accordance with accounting
principles generally accepted in Japan.
Other Matter
Our firm and engagement partners have no interest in the Company which should be
disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.
Notes to the Reader of Independent Auditor’s Report:
The Independent Auditor’s Report herein is the English translation of the Independent
Auditor’s Report as required by the Companies Act.

73

Independent Auditor’s Report
May 18, 2016
The Board of Directors
BANDAI NAMCO Holdings Inc.
KPMG AZSA LLC
Toshihiro Otsuka (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Hiroo Iwaide (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Terukazu Nagamine (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant

We have audited the non-consolidated financial statements, comprising thenon-consolidated balance sheet, the non-consolidated statements of operations, thenon-consolidated statement of changes in net assets and the related notes, and the
supplementary schedules of BANDAI NAMCO Holdings Inc. as at March 31, 2016 andfor the year from April 1, 2015 to March 31, 2016 in accordance with Article 436-2-1 of
the Companies Act.
Management’s Responsibility for the Financial Statements and Others
Management is responsible for the preparation and fair presentation of the
non-consolidated financial statements and the supplementary schedules in accordancewith accounting principles generally accepted in Japan, and for such internal control as
management determines is necessary to enable the preparation of financial statements
and the supplementary schedules that are free from material misstatements, whether due
to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial statements and the
supplementary schedules based on our audit as independent auditor. We conducted our
audit in accordance with auditing standards generally accepted in Japan. Thosestandards require that we plan and perform the audit to obtain reasonable assurance
about whether the non-consolidated financial statements and the supplementaryschedules are free from material misstatement.

74

An audit involves performing procedures to obtain audit evidence about the amounts
and disclosures in the non-consolidated financial statements and the supplementaryschedules. The procedures selected depend on our judgment, including the assessmentof the risks of material misstatement of the non-consolidated financial statements andthe supplementary schedules, whether due to fraud or error. In making those risk
assessments, we consider internal control relevant to the entity’s preparation and fairpresentation of the non-consolidated financial statements and the supplementaryschedules in order to design audit procedures that are appropriate in the circumstances,while the objective of the financial statement audit is not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness ofaccounting estimates made by management, as well as evaluating the overall
presentation of the non-consolidated financial statements and the supplementaryschedules.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion.
OpinionIn our opinion, the non-consolidated financial statements and the supplementaryschedules referred to above present fairly, in all material respects, the financial position
and the results of operations of BANDAI NAMCO Holdings Inc. for the period, forwhich the non-consolidated financial statements and the supplementary schedules wereprepared, in accordance with accounting principles generally accepted in Japan.
Other Matter
Our firm and engagement partners have no interest in the Company which should be
disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.
Notes to the Reader of Independent Auditor’s Report:
The Independent Auditor’s Report herein is the English translation of the Independent
Auditor’s Report as required by the Companies Act.

75

Audit & Supervisory Board’s Report
Audit Report
We, the Audit & Supervisory Board, prepared this audit report on the execution of duties byDirectors during the 11th fiscal year from April 1, 2015 to March 31, 2016, following deliberations
based on audit reports prepared by each Audit & Supervisory Board Member.

1. Method and Content of Audits by Audit & Supervisory Board Members and the Audit &Supervisory Board(1) We devised the 11th auditing plan (auditing policies, duties assigned to each Audit & Supervisory
Board Member and auditing methods), received reports on the progress on, and results of, audits
from each Audit & Supervisory Board Member, as well as reports on the execution of their duties
from Directors, etc. and the Accounting Auditor, and requested explanations as necessary.
(2) Each Audit & Supervisory Board Member communicated with the Directors, the internal auditing
division, and other employees, etc., in accordance with the internal regulations established by the
Audit & Supervisory Board, and the above-mentioned auditing plan, to collect information andimprove the auditing environment and conducted the audits in the following methods.
(i) We attended the meetings of the Board of Directors and other significant meetings, received
reports on the execution of duties from Directors and employees, etc., obtained explanations
thereof as necessary, viewed documents concerning important decisions, and investigated theconditions of operations and assets of the Company. Regarding the Company’s subsidiaries,
we communicated and shared information with the Directors and the Audit & Supervisory
Board Members, etc. of the subsidiaries, and received reports on their business as necessary
from them.
(ii) We also periodically received reports from Directors and employees, etc., requested
explanations as necessary, and expressed opinion, regarding the development and operation ofinternal control systems that were organized based on decisions by the Board of Directors in
relation to the development of a system to ensure that the execution of duties by Directors andother operations of the corporate group consisting of the Company and its subsidiaries as
described in the business reports were in conformity with applicable laws and regulations andthe Company’s Articles of Incorporation, and a system stipulated in Article 100, Paragraphs 1
and 3 of the Enforcement Ordinance of the Companies Act.
(iii) We further examined the content of basic policies (Article 118, Item 3-(a) of the Enforcement
Ordinance of the Companies Act) and actions (Article 118, Item 3-(b) of the Enforcement
Ordinance of the Companies Act) described in business reports based on the meetings of theBoard of Directors and other discussions.
(iv) We monitored and verified that the Accounting Auditor remained independent and performed
audits appropriately, received reports on the execution of its duties from the Accounting
Auditor and requested explanations as necessary. We were also notified that a “system forensuring the proper execution of duties” (as per Article 131 of the Corporate Accounting
Rules) was organized in accordance with “Quality Control Standards for Auditing” (October28, 2005, Business Accounting Council), and requested explanations as necessary.
Using the aforementioned method, we examined the Business Report and the supplementaryschedules, non-consolidated financial statements (non-consolidated balance sheet, non-consolidated
statements of operations, non-consolidated statement of changes in net assets, and notes thereto), their
supplementary statements and consolidated financial statements (consolidated balance sheet,consolidated statements of operations, consolidated statement of changes in net assets, and notes
thereto) for this fiscal year under review.

762. Results of the Audit(1) Audit Results of business reports, etc.
(i) We confirm that the business reports and its supplementary statements fairly represent thecondition of the Company and are in conformity with the applicable laws and regulations andthe Articles of Incorporation of the Company.
(ii) We confirm that, with respect to the execution of duties by Directors, there are no fraudulent
acts, or material facts that violate applicable laws and regulations or the Articles ofIncorporation.
(iii) We confirm that the decisions made by the Board of Directors with regard to internal control
systems are proper. We recognize that there is nothing to be cited with respect to thedescription of those internal control systems in the business reports and the execution ofduties by Directors.
(iv) We confirm that there is nothing to be cited in respect of the basic policy described in thebusiness reports concerning what and how a person or entity controlling decisions on thefinancial and business policies of the Company should be. We confirm that actions (Article
118, Item 3-(b) of the Enforcement Ordinance of the Companies Act) described in thebusiness reports are in accordance with this basic policy and that these actions do not damage
our Group’s value and shareholders’ common interest, nor serve to maintain the position of
the directors of the Company.
(2) Audit Result of non-consolidated financial statements and their supplementary statements.
We confirm that the methods and the results of the audit by KPMG AZSA LLC, the Accounting
Auditor of the Company, are appropriate.
(3) Audit Result of consolidated financial statements
We confirm that the methods and the results of the audit by KPMG AZSA LLC, the Accounting
Auditor of the Company, are appropriate.
May 19, 2016
Audit & Supervisory Board
BANDAI NAMCO Holdings Inc.
Full Time Audit & Supervisory
Kazuo Asami
Board Member(Seal)

Full Time Audit & Supervisory
Board Member(Outside Audit & Supervisory
Board Member)

Katsuhiko Kohtari(Seal)

Audit & Supervisory Board
Member(Outside Audit & Supervisory
Board Member)

Osamu Sudoh(Seal)

Audit & Supervisory Board
Member(Outside Audit & Supervisory
Board Member)

Katsuhiko Kamijo(Seal)

END

77