Note: This document has been translated from the Japanese original only for reference purposes. In the event of any
discrepancy between this translation and the Japanese original, the original shall prevail. The Company
assumes no responsibility for this translation or for any direct, indirect or consequential damage arising fromthis translation.

Asahi Holdings, Inc.
(Stock code: 5857)

Notice of the 7th Annual General Meeting of Shareholders
Date and time:
10:30 a.m. on Tuesday, June 14, 2016
Venue:
KOBE PORTOPIA HOTEL
10-1, Minatojima Nakamachi 6-chome, Chuo-ku, Kobe, Hyogo“Kairaku-no-ma,” basement floor, Main Building(Please refer to the place of the meeting shown at the end of this notice.)
Proposals:
Proposal:

Election of Five (5) Directors (Excluding Directors Serving as the Audit andSupervisory Committee Members)
Deadline for the exercise of voting rights:
Documents must arrive before noon on Monday, June 13, 2016.

Cover

Contents
 Notice of the 7th Annual General Meeting of Shareholders ............................................................. 2
Attached documents
Business Report ............................................................................................................................ 5Consolidated Financial Statements ............................................................................................. 24
Financial Statements ................................................................................................................... 37

Audit Reports .............................................................................................................................. 45
 Reference Documents for General Meeting of Shareholders.......................................................... 51

1
Contents

Exercise of voting rights by mail:Please return the enclosed “Voting Right Exercise Form” by the aforementioned deadline,
after indicating your approval or disapproval of each agenda item
Exercise of voting rights via the Internet, etc.:
Please review the “Procedure for Exercising Voting Rights via the Internet, etc.,” on pages
3–4 and exercise your voting rights by the aforementioned deadline.

1. Date and time:
2. Venue:

Details of the meeting
10:30 a.m. on Tuesday, June 14, 2016
KOBE PORTOPIA HOTEL
10-1, Minatojima Nakamachi 6-chome, Chuo-ku, Kobe, Hyogo“Kairaku-no-ma,” basement floor, Main Building(Please refer to the place of the meeting shown at the end of this notice.)

3. Meeting Agenda
Items to be reported: 1) Business Report, the consolidated financial statements and the resultsof audits of the consolidated financial statements by the Accounting
Auditor and the Audit and Supervisory Committee for the 7th fiscal
term (April 1, 2015 through March 31, 2016)
2) Report on non-consolidated financial statements for the 7th fiscal
term (April 1, 2015 through March 31, 2016)
Items to be resolved:
Proposal:
Election of Five (5) Directors (Excluding Directors Serving as the Audit andSupervisory Committee Members)
If you attend the meeting, please submit the “Voting Right Exercise Form” at the reception desk
upon arrival.
Please note that any modifications to the business report, the financial statements and/or thereference documents will be posted on our Web site (http://www.asahiholdings.com/).

2
Cover letter of convocation

Convocation NoticeBusiness Reports

This is to inform you that the 7th Annual General Meeting of Shareholders will be held at thefollowing time and place and to cordially request your presence.
If you are unable to be present, you are entitled to exercise your voting rights through either ofthe following methods. You are kindly requested to read the attached reference documents andexercise your voting rights by noon on Monday, June 13, 2016.

Consolidated
Financial Statements

Notice of the 7th Annual General Meeting of Shareholders

Financial Statements

4-4-17 Kano-cho, Chuo-ku, Kobe, Japan
Asahi Holdings, Inc.
Mitsuharu Terayama, President & CEO

Audit Report(Stock code: 5857)
May 27, 2016

Reference Documents for
General Meeting of Shareholders

Dear Shareholders:Procedure for Exercising Voting Rights via the Internet, etc.
If you intend to exercise your voting rights via the Internet, etc., please pay attention to the following
notes.
If you are attending the meeting, no procedures to exercise voting rights by mail or via the Internet,
etc., are necessary.
1. Voting Rights Exercise Web Site
(1) The exercise of voting rights via the Internet is possible only by accessing the Voting Rights
Exercise Web Site (http://www.evote.jp/) designated by the Company either from a computer,a smartphone or a mobile phone (i-mode, EZweb or Yahoo!Keitai).* (However, this Web site
is not available from 2 a.m. to 5 a.m. daily.)*i-mode, EZweb and Yahoo! are trademarks or registered trademarks of NTT DOCOMO INC., KDDI
CORPORATION and Yahoo! Inc. of U.S., respectively.
(2) The exercise of voting rights using computers or smartphones may be disabled by operating

environments, including the use of a firewall when accessing the Internet, the use of antivirus
software, the use of a proxy server and/or if you have not designated the use of encryptedtransmission (TSL transmission).
(3) For your exercise of voting rights using mobile phones, make sure to use i-mode, EZweb orYahoo! service. To preserve security, you cannot vote through a model of phone that does notallow TSL transmission or transmission of the phone ID information.
(4) Although we will accept the exercise of voting rights via the Internet until noon on Monday,
June 13, 2016, we recommend voting as early as possible. If you have any questions, pleasecontact our Help Desk.
2. Exercising Your Voting Rights via the Internet(1) At the Voting Rights Exercise Web site (http://www.evote.jp/), use the log-in ID andtemporary password given on the enclosed Voting Right Exercise Form and follow the onscreen instructions to indicate your approval or disapproval of each proposal.
(2) To protect against illegal access by persons other than qualified shareholders (“spoofing”)
and the manipulation of voting details, please be aware that shareholders using the site will
be asked to change their temporary password.
(3) Whenever a meeting of shareholders is convened, new log-in IDs and temporary passwords
will be issued.
3. Treatment of Voting Rights Exercised Multiple Times(1) If you have exercised your voting rights both by mail and via the Internet, those exercised
via the Internet will be considered as valid.
(2) If you have exercised your voting rights multiple times on the Internet, the final vote will beconsidered as valid. If you have exercised your voting rights via multiple equipment such as
computers, smartphones and/or mobile phones, the final vote cast will be considered as valid.
4. Costs Incurred in Accessing the Voting Rights Exercise Web Site
The costs incurred when accessing the Voting Rights Exercise Web Site such as Internet access fees
will be the responsibility of the shareholder. Similarly, fees required to use mobile phones, such as
packet transmission fees, will also be the responsibility of the shareholder.

3
Cover letter of convocation

Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

For inquiries about the system or other matters, contact:
Corporate Agency Division (Help Desk), Mitsubishi UFJ Trust and Banking Corporation
Phone: 0120-173-027 (Toll Free within Japan) (available from 9 a.m. to 9 p.m.)

Convocation Notice

5. Electronic Voting Platform for Institutional Investors
Nominee shareholders including banks specializing in asset and trust management/custody may use
with prior application the “Electronic Voting Platform” operated by ICJ Inc. established by Tokyo
Stock Exchange, Inc., and other entities, as a means to exercise their voting rights electronically andparticipate in the General Meeting of Shareholders of the Company.

4
Cover letter of convocation

Attached documents
Business Report (April 1, 2015 through March 31, 2016)
1. Current Status of the Group(1) Status of business for the fiscal year
1) Circumstances and results of businessIn the Japanese economy during the consolidated fiscal year ended March 31, 2016,
improvements moved forward for the employment and income environment, including
corporate earnings, due to such factors as the government’s economic policies and the Bankof Japan’s monetary easing policy, and the first half of the year had a trend toward gradual
recovery. Afterward, the pace of the recovery slowed down, and a leveling-off situation
continued. In addition, there was a heightening of aspects such as the deceleration of theeconomies of emerging nations including China, the impact of factors such as the reductionof the United States’ monetary easing and crude oil price trends on exchange rates, andconcerns regarding the actualization of geopolitical risks on a global level. In the context ofthese aspects, there was a deepened sense of uncertainty concerning economic conditions.
With regard to personal consumption, with the exception of inbound demand, the situation
was lacking vigor throughout the period.
Under these economic conditions, the Asahi Holdings Group (the “Group”)’s results ineach business segment were as follows.
Precious metal business
Volume of collection in the precious metals recycling business was as follows. In theelectronics sector, the contraction of the domestic market continues, but by expanding
market share in the E-scrap business and the precision cleaning businesses, the Group
increased the volume of collection of gold from corresponding figures for the previous fiscal
year. In the dental sector, with the amount of precious metals used for dental materials
declining, the volume of collection of gold and palladium decreased from the previous fiscal
year. In the jewelry sector, increasing transactions with customers in jewelry purchasing
business led to a higher year-on-year volume of collection of gold and platinum. In theautomotive catalyst sector, due to a continuing trend toward a decreasing number ofdomestic scrapped vehicles, the year-on-year volume of collection of palladium andplatinum decreased.
The average sales price of gold was higher than the corresponding figures for theprevious fiscal year, and the prices of silver, palladium, and platinum were lower than thecorresponding figures for the previous fiscal year.
In the gold and silver refining business in North America, amidst stagnant precious
metals prices and a slowdown in global mining activities, both processing volume and unit
price continued to decline. Under such circumstances, while endeavoring toward companywide cost reductions, Asahi Refining continues to strengthen its business infrastructure
through technical investments to enhance productivity and efficiency, as well as initiatives
to expand sales capabilities.

5
Status of business for the fiscal year

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders

Note: From the fiscal year ended March 31, 2016, the “Precious metal recycling business”
segment has been renamed the “Precious metal business” segment.

Consolidated
Financial Statements

As a result of the above, as consolidated results of operations for the fiscal year, werecorded consolidated net sales of 118,473 million yen, operating income of 8,705 million
yen, ordinary income of 8,510 million yen, and profit attributable to owners of parent of
5,031 million yen.
Compared with the previous fiscal year, net sales increased by 7,056 million yen,operating income decreased by 1,774 million yen, ordinary income decreased by 2,051
million yen, and profit attributable to owners of parent decreased by 743 million yen.
By segment, sales in the precious metal business were 77,516 million yen, sales in theenvironmental preservation business were 15,735 million yen, and sales in the life & healthbusiness were 25,221 million yen.

Financial Statements

Life & health businessIn the healthcare equipment sector, amidst lacking recovery of personal consumption, theGroup is focusing on measures to expand sales including the introduction of new products
for women and a full model change of the massage chair lineup, on top of cost reduction,and performance was robust in terms of profits. The harsh business environment continues
for the heater sales sector, but in addition to reducing fixed costs, the Group is working on
promotion of replacement purchases by existing customers, launching new products such as
far-infrared heaters, and so on.

Audit Report

Environmental preservation business
Reflecting the state of production activity of domestic businesses, a decreasing trend
continues for the volume of industrial waste emissions. Under these circumstances, as theresult of putting efforts into new contract development by leveraging each group company’s
characteristics and expanding sales channels by collaboration among group companies
while working toward stable plant operations, the performance was solid for the segment as
a whole.

6
Status of business for the fiscal year

Net sales were composed of the following:<Breakdown of net sales>
Category

Net sales(Millions of yen)Gold metals

38,931

32.9

100.2

Silver metals

4,318

3.6

87.4

Palladium

14,401

12.2

82.2

Platinum

7,615

6.4

87.5

Indium

11

0.0

8.9

Disposal revenues

18,004

15.2

101.7

Other

35,190

29.7

149.4

Total

118,473

100.0

106.3

Ratio (%)

YOY change (%)2) Capital expenditure
Capital expenditure made in the fiscal year totaled 1,664 million yen. The main expenditure
was an investment in the machinery, equipment and in-house information system.
3) Financing
The Company formed a syndicated loan of 20,304 million yen to finance the repayment ofloans payable to financial institutions for the fiscal year under review.
4) Assignment, absorption-type split and incorporation-type split of businessNot applicable for the fiscal year5) Acquisition of the business of other companies
Not applicable for the fiscal year6) Succession of rights and obligations pertaining to the business of other corporations,etc., through an absorption-type merger or an absorption-type split
Not applicable for the fiscal year7) Acquisition or disposal of shares or other equity or share options of other companies
Not applicable for the fiscal year

7
Status of business for the fiscal year

96,368

94,254111,417

Ordinary income
Profit attributableto owners ofparent
Net income per
share
Total assets(Millions of yen)

7,794

9,989

10,561

8,510(Millions of yen)

4,518

5,971

5,774

5,031

(Yen)

139.24183.50176.89153.54(Millions of yen)

62,26066,112

104,877

103,589

Business Reports(Millions of yen)

(Millions of yen)
Net assets
42,012
46,491
50,95851,300Net assets per(Yen)
1,288.56
1,422.51
1,542.82
1,560.21
share
Note: 1. The figures for the 5th term reflect the retrospective application of the “Practical Solution on
Transactions of Delivering the Company’s Own Stock to Employees, etc., through Trusts” (ASBJ
PITF No. 30, March 26, 2015).
2. Due to application of the “Accounting Standard for Business Combinations” (ASBJ Statement No. 21,
September 13, 2013), etc., the account name of “Net income” has been changed to “Profit attributableto owners of parent” from the fiscal year under review.

(3) Significant parent company and subsidiaries

Company name
Asahi Pretec Corp.
Japan Waste Corporation
Asahi Americas Holdings,
Inc.

Capital4,480 million
yen
400 million
yen
10 million
yen

Our voting
right ratio

Major business100.0%

Precious metal business andenvironmental preservation business100.0%

Environmental preservation business100.0%

Precious metal business

Audit Report

1) Relationship with parent company
Not applicable2) Significant subsidiaries3) Specified wholly owned subsidiarya. Name and address of the specified wholly owned subsidiary
Name: Asahi Pretec Corp.
Address: 21 Uozakihamamachi, Higashinada-ku, Kobeb. Total book value of shares of the specified wholly owned subsidiary held by theCompany and wholly owned subsidiaries at the end of the fiscal year under review:
24,621 million yen
c. Total amount recorded in the assets section of the balance sheet of the Company for the
fiscal year under review:
74,009 million yen

8
Property and profit/loss and Significant parent company and subsidiaries

Consolidated
Financial Statements

6th term
April 1, 2014
through
March 31,2015

Financial Statements

5th term
April 1, 2013
through
March 31,2014

Reference Documents for
General Meeting of Shareholders

Net sales

7th term
April 1, 2015
through
March 31, 2016
(Current fiscalyear)
118,473

Category

4th term
April 1, 2012
through
March 31,2013

Convocation Notice(2) Property and profit/loss

(4) Challenges to be addressed
1) Precious metal business segment
As it is the Group’s core business, the competitiveness of each Japanese domestic businessshall be enhanced. Along with working to expand the business base in North America, weshall work on expansion of new fields in Asian markets. Along with raising awareness of the“Asahi Refining” brand, we shall expand processing volumes of recycling raw materials in
the global market.
2) Environmental preservation business segment
As it is a stable growth business of the Group, profitability shall be emphasized, and active
capital expenditure shall be performed. M&A of companies that can contribute to growth willcontinue3) Life & health business segment
Through new business development, the opening of new sales channels, and the buildingof a unique business model, it shall be set on the path of business growth as the Group’s third
business pillar.
(5) Principal businesses (as of March 31, 2016)
The Group is mainly engaged in the precious metal business, the environmental
preservation business and the life & health business.
1) Precious metal business○ Collection/reproduction and processing of precious metals and other metals (gold,
silver, palladium, platinum, indium, etc.) and refining of precious metals○ Purchase and sales of precious metals and other metals○ Sales of precious metal products
2) Environmental preservation business3) Life & health business(6) Major sales offices and plants (as of March 31, 2016)
1) The Company
Main office
Head offices

4-4-17 Kano-cho, Chuo-ku, Kobe
Kobe Head Office: 4-4-17 Kano-cho, Chuo-ku, Kobe
Tokyo Head Office: 1-7-12 Marunouchi, Chiyoda-ku, Tokyo
2) Major subsidiaries’ business offices(a) Asahi Pretec Corp.
Main office
21, Uozakihamamachi, Higashinada-ku, Kobe
Head offices
Kobe Head Office: 4-4-17 Kano-cho, Chuo-ku, Kobe
Tokyo Head Office: 1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Research laboratory The Technical Research Center (Kobe-shi)
Business offices
Kitakanto (Kitakatsushika-gun, Saitama Pref.), Nagano (Tomi-shi,
Nagano Pref.), Hanshin (Amagasaki-shi, Hyogo Pref.), Kobe (Kobeshi), Shikoku (Saijo-shi, Ehime Pref.), Kitakyushu (Kitakyushu-shi),
Fukuoka (Koga-shi, Fukuoka Pref.)9
Challenges to be addressed, Principal businesses, and Major sales offices and plants

(c) Asahi Americas Holdings, Inc.
Main office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Head office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
3) Other subsidiaries
Japan

Overseas

Nihon Chemitech Co., Ltd. (Kawaguchi-shi, Saitama Pref.), JW
Logistics, Co., Ltd. (Yokohama-shi), Taiyo Chemical Co., Ltd.
(Kagoshima-shi), Iyotec Co., Ltd. (Akashi-shi, Hyogo Pref.), Fuji
Rozai Co., Ltd. (Ota-ku, Tokyo), JW Glass Recycling Co., Ltd.
(Koto-ku, Tokyo), Ecomax Incorporated (Koza-gun, Kanagawa
Pref.), Kyodo Chemical Co., Ltd. (Kitahiroshima-shi, Hokkaido),
INTER CENTRAL, INC. (Takizawa-shi, Iwate Pref.), KOEIKOGYO
CO., LTD. (Yokohama-shi), FUJI MEDICAL INSTRUMENTS MFG.
CO., LTD. (Osaka-shi), and otherAsahi G&S Sdn. Bhd. (Malaysia), Shanghai Asahi Pretec Co., Ltd.
(China), Asahi Pretec Korea Co., Ltd. (Seoul Special City), Asahi
Pretec Taiwan Co., Ltd. (Taiwan), Asahi Shih Her Technologies Co.,
Ltd. (Taiwan), Asahi Refining Holdings UK Limited (United
Kingdom), Asahi Refining USA Inc. (USA) and Asahi Refining
Canada Ltd. (Canada)

10
Major sales offices and plants

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements(b) Japan Waste Corporation
Main office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Head office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Business office
Yokohama (Yokohama-shi)
PlantsOgimachi Center (Kawasaki-shi), Aikawa Center (Aiko-gun,
Kanagawa Pref.)Note: Japan Waste Corporation moved its main office to Chiyoda-ku, Tokyo, as of March 1,
2016.

Audit Report

Plants

Sapporo (Kitahiroshima-shi, Hokkaido), Aomori (Aomori-shi),Sendai (Miyagi-gun, Miyagi Pref.), Niigata (Sanjo-shi, Niigata Pref.),
Kitakanto (Kitakatsushika-gun, Saitama Pref.), Kanto (Kawaguchishi, Saitama Pref.), Yokohama (Yokohama-shi), Kofu (Chuo-shi,
Yamanashi Pref.), Shizuoka (Yaizu-shi, Shizuoka Pref.), Nagoya(Komaki-shi, Aichi Pref.), Hokuriku (Toyama-shi), Hanshin(Amagasaki-shi, Hyogo Pref.), Kobe (Kobe-shi), Okayama(Okayama-shi), Hiroshima (Hiroshima-shi), Shikoku (Saijo-shi,Ehime Pref.), Fukuoka (Koga-shi, Fukuoka Pref.), Kagoshima(Kagoshima-shi), Okinawa (Itoman -shi, Okinawa Pref.)Saitama (Kitakatsushika-gun, Saitama Pref.), Amagasaki(Amagasaki-shi, Hyogo Pref.), Kobe (Kobe-shi), Ehime (Saijo-shi,Ehime Pref.), Kitakyushu (Kitakyushu-shi), Kitakyushu Hibiki(Kitakyushu-shi), Fukuoka (Koga-shi, Fukuoka Pref.)

Reference Documents for
General Meeting of Shareholders

Sales offices

(7) Employees (as of March 31, 2016)
1) Employees of the Group
Number of employees
2,005 (852)Change from the end of previous fiscal year
–75 (down 118)

Note: The number of employees refers to the number of workers (excluding the staff seconded
from the Group to companies outside the Group but including staff seconded fromcompanies outside the Group to the Group) and for the number of part-timers and fixedterm employees, annual average number of persons are shown separately in brackets.
2) Employees of the Company
Number of employees

Change from the endof previous fiscal year

Average age

54 (1)+13 (1)42 years andnine months

Average length ofserviceTwo years and
11 months(Note) The number of employees refers to the number of workers (excluding the staff seconded
from the Company to companies outside the Company but including staff seconded
from companies outside the Company to the Company) and for the number of parttimers and fixed-term employees, annual average number of persons are shown
separately in brackets.
(8) Major financial institutions with loans to the Company (as of March 31, 2016)
Financial institutions
Loan amount
Syndicated loan
20,304 million yen
Sumitomo Mitsui Banking Corporation
5,239 million yen
Resona Bank, Limited
2,000 million yen
The Minato Bank, Ltd.
600 million yen
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
259 million yen
Mizuho Bank, Ltd.
100 million yen
The Chugoku Bank, Ltd.
100 million yen
Note: The syndicated loan is extended by two banks with The Bank of Tokyo-Mitsubishi UFJ,
Ltd. as the lead bank.
(9) Other important matters relating to the current state of the GroupNot applicable

11
Employees, Major financial institutions with loans to the Company, and Other important mattersrelating to the current state of the GroupNumber ofshares held(Thousands ofshares)Percentage ofshares held(%)

Japan Trustee Services Bank, Ltd. (Trust account)

2,007

6.12

TERA ENTERPRISES Co., Ltd.

1,350

4.11

The Master Trust Bank of Japan, Ltd. (Trust account)

923

2.81

Mitsuharu Terayama

882

2.69

Masamichi Terayama

802

2.44

K&M Co., Ltd.

700

2.13

Asahi Employee Stock Ownership Plan

698

2.13

Japan Trustee Services Bank, Ltd. (Trust account 9)

531

1.62

CBNY-GOVERNMENT OF NORWAY

529

1.61

519

1.58

Shareholders

STATE STREET BANK AND TRUSTCOMPANY 505025

Audit Report(Notes) 1. The Company holds treasury stock of 3,432,607 shares, which is excluded from theabove major shareholders. The treasury stock (3,432,607 shares) does not include
the Company’s shares held by the Employee Stock Ownership Plan (ESOP) trust
account (145,200 shares) and the Company’s shares held by the Board Incentive
Plan (BIP) trust account (76,800 shares).
2. Percentage of shares held is calculated by excluding treasury stock.

Consolidated
Financial Statements

129,000,000 shares
1) Number of shares authorized:
36,254,344 shares
2) Number of shares issued:
11,1293) Number of shareholders:
4) Major shareholders (top 10 shareholders)

Financial Statements(1) Shares (as of March 31, 2016)

Business Reports

Convocation Notice

2. Current state of the Company(2) Stock options, etc.

Reference Documents for
General Meeting of Shareholders

Not applicable.

12
Shares and Stock options,etc.

(3) Board members and corporate officers
1) Directors (as of March 31, 2016)
Position

Name

Representative Director, President
and CEO

Mitsuharu Terayama

Director

Yoshikatsu Takeuchi

Director

Tomoya Higashiura

Director

Keitaro Shigemasa

Director

Kazuo Kawabata

Director/Audit and Supervisory
Committee Member
Director/Full-Time Audit andSupervisory Committee Member
Director/Audit and Supervisory
Committee Member

Director/Audit and Supervisory
Committee Member(Notes)Responsibility and importantconcurrent assignment
Chairman and Director
Asahi Pretec Corp.
Representative Director andPresident, Japan Waste Corporation
Representative Director andPresident, Asahi Pretec Corp.
General Manager of Information
Technology Department
Representative Director andPresident, Asahi Americas Holdings,
Inc.
Director, Asahi Pretec Corp.
Director, Asahi Americas Holdings,
Inc.

Shoji Morii
Yukio Tanabe
Kazuhiko Tokumine

LawyerHiroharu Okubo

Advisor, Senshu Ikeda Bank, Ltd.
President & Representative Director,
Shizen Soken Co., Ltd.
Outside Corporate Auditor,
Mitsuboshi Belting Ltd.

1. According to a resolution at the meeting of the 6th Annual General Meeting of
Shareholders held on June 16, 2015, the Company made a transition to a Board with
Audit and Supervisory Committee as of the same date.
2. Directors/Audit and Supervisory Committee Members Shoji Morii, Kazuhiko Tokumineand Hiroharu Okubo are Outside Directors.
3. Director/Full-Time Audit and Supervisory Committee Member Yukio Tanabe has
longtime experience of accounting of the Company and possesses extensive expertise infinance and accounting.
4. The Company has a full-time Audit and Supervisory Committee Member to enhance theeffectiveness of audits including information gathering and strengthen its auditing andsupervisory functions.
5. The Company designated Directors/Audit and Supervisory Committee Members Shoji
Morii, Kazuhiko Tokumine and Hiroharu Okubo as independent board members under
the provisions of the Tokyo Stock Exchange, and filed such status with the exchange.

13
Board members and corporate officers

Directors not serving as an Audit andSupervisory Committee Member(Outside Director)
Directors serving as an Audit andSupervisory Committee Member(Outside Directors)
Corporate Auditors(Outside Corporate Auditors)
Total(Outside board members)

Number of persons
subject to payment

Payment amount7(1)

112 million yen
(1)

4
(3)

23 million yen
(14)

3
(2)
11
(4)

7 million yen(2)
143 million yen(18)(Notes) 1. The above includes the Directors and Corporate Auditors who retired from officeduring the fiscal year under review. According to a resolution at the 6th Annual
General Meeting of Shareholders held on June 16, 2015, the Company made atransition to the Board with Audit and Supervisory Committee as of the same datefrom a company with a Board of Corporate Auditors.
2. The amount of compensation for Directors does not include the employee salaries
of Directors who serve concurrently as employees.

14
Board members and corporate officers

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders

Category

Audit Report

4) Compensation, etc., for Directors and Corporate Auditors
Total compensation, etc., for the fiscal year

Consolidated
Financial Statements

3) Description of the limited liability contract
The Company and each Director (excluding any Director with executive authority over
operations, etc.) signed a contract that limits the liability for compensation for damage set
forth in Article 423, Paragraph 1 of the Companies Act under provisions set forth Article
427, Paragraph 1 of the same Act.
The limit amount of the liability for compensation for damage under such a contract isdetermined to be the minimum liability amount stipulated in Article 425, Paragraph 1 of
the Companies Act.

Financial Statements

2) Directors and Corporate Auditors who resigned during the fiscal year(a) At the conclusion of the 6th Annual General Meeting of Shareholders held on June 16,
2015, Director Masaki Hirano and Corporate Auditor Junzo Kojima retired due toexpiration of their terms of office.
(b) According to a resolution at the 6th Annual General Meeting of Shareholders held on
June 16, 2015, the Company made a transition to the Board with Audit and Supervisory
Committee as of the same date from a company with a Board of Corporate Auditors.
Due to the transition, the terms of Director Shoji Morii, Full-Time Corporate Auditor
Yukio Tanabe and Corporate Auditor Kazuhiro Tokumine expired and they each
assumed the office of Director serving as an Audit and Supervisory Committee
Member.

3. At the 6th Annual General Meeting of Shareholders held on June 16, 2015, it was
resolved that the limit of compensation for Directors not serving as Audit andSupervisory Committee Members be up to an annual 200 million yen (notincluding the portion of salary as employees) and that the limit of compensation for
Directors serving as Audit and Supervisory Committee Members be up to anannual 100 million yen.
4. At the 1st Annual General Meeting of Shareholders held on June 16, 2010, it was
resolved that the limit of compensation for Directors be up to an annual 200 million
yen (not including the portion of salary as employees) and that the limit ofcompensation for Corporate Auditors be up to an annual 30 million yen.
5. The above amounts of compensation do not include the 7 million yen provision ofreserve for the performance-based stock compensation plan for Directors, which
was approved at the 6th Annual General Meeting of Shareholders held on June 16,
2015, and recorded for the fiscal year under review.
5) Matters related to outside board members(a) Important concurrent assignment at other corporations, etc., and relationship between the
Company and the other corporations, etc.
Director/Audit and Supervisory Committee Member Hiroharu Okubo serves as theAdvisor to Senshu Ikeda Bank, Ltd., President & Representative Director of Shizen Soken
Co., Ltd., and Outside Corporate Auditor of Mitsuboshi Belting Ltd. There are no special
relationships between the Company and the corporations where he has concurrent
assignments.
(b) Kinship with a person executing business or an officer not executing business of theCompany or specified related business operators of the Company
Not applicable(c) Main activities in the fiscal year
Category

Name

Director(Audit andSupervisory
Committee
Member)Shoji Morii

Director(Audit andSupervisory
Committee
Member)Kazuhiko
Tokumine

15
Board members and corporate officers

Activities
He attended all the meetings of the Board of Directors
and the Audit and Supervisory Committee held during the
fiscal year. He has expertise and experience related to
management, including finance, and has been submitting
advice / recommendations to ensure the validity andappropriateness of making decisions on deliberations ofagenda and other matters.
He attended all the meetings of the Board of Directors
and the Audit and Supervisory Committee held during the
fiscal year. He has been submitting advice /recommendations to ensure the validity andappropriateness of making decisions on deliberations ofagenda and other matters from the highly professional
viewpoint for laws as a lawyer.

Convocation Notice

Hiroharu
Okubo

After he assumed office on June 16, 2015, he attended all
the meetings of the Board of Directors and the Audit andSupervisory Committee. He has considerable expertiseand experience concerning the financial industry and has
been submitting advice / recommendations to ensure thevalidity and appropriateness of making decisions on
deliberations of agenda and other matters.

Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

Director(Audit andSupervisory
Committee
Member)16
Board members and corporate officers

(4) Accounting Auditor
1) Name of Accounting Auditor
Ernst & Young ShinNihon LLC
2) Amount of compensation, etc., for the Accounting Auditor
Amount of compensation, etc.
(a) Amount to be paid by the Company
37,800 thousand yen(b) Total amount of money to be paid by the Company
and the Company’s subsidiaries and other benefits
62,000 thousand yen
on property(Notes) 1. In the agreement between the Company and the Accounting Auditor, the amount ofcompensation, etc., for audit under the Companies Act and the amount ofcompensation, etc., for audit under the Financial Instruments and Exchange Act are
not separated and may not be separated actually. Therefore, the total of thoseamounts is stated for the amount in (a) above.
2. The Audit and Supervisory Committee provided its consent to the amount ofcompensation, etc., for the Accounting Auditor based on its verification asnecessary of its auditing plan, the status of its execution of duties of accounting
audits and the appropriateness of the basis for calculating its estimates.
3) Policy for determining the dismissal or the refusal of reappointment of the Accounting
Auditor
When it is found that the Accounting Auditor falls under the items set forth in any of itemsof Article 340, Paragraph 1 of the Companies Act, the Audit and Supervisory Committee
will dismiss the Accounting Auditor in accordance with the consent of all Audit andSupervisory Committee Members. In this case, the Audit and Supervisory Committee
Member appointed by the Audit and Supervisory Committee will report the fact of thedismissal of the Accounting Auditor and reasons for the dismissal at the General Meeting of
Shareholders convened for the first time after the dismissal.
When it is deemed necessary to change the Accounting Auditor in consideration of thestatus of the execution of its duties, the Company’s auditing system and other factors, theAudit and Supervisory Committee will determine the content of a proposal concerning thedismissal or the refusal of reappointment of the Accounting Auditor to be submitted to a
General Meeting of Shareholders.
4) Issuance in the past two years of an order for the Accounting Auditor to suspend
operations
Description of the disciplinary action announced by the Financial Services Agency as ofDecember 22, 2015:(a) Entity subject to the disciplinary action
Ernst & Young ShinNihon LLC(b) Content of the action
Partial suspension of operations for three months (suspension of any operations
concerning the conclusion of new contracts from January 1, 2016 to March 31,
2016)

17
Accounting Auditor

Convocation Notice
Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

Business improvement order (improvement of the business management systems)(c) Reasons for the action
In auditing the financial documents for other corporations, Ernst & Young
ShinNihon LLC, in negligence of due care, attested documents containing
material misstatements as if they contained no material misstatements.
Ernst & Young ShinNihon LLC’s management of operations was deemed asconsiderably unjust.

18
Accounting Auditor

(5) Structure to ensure the appropriateness of business
Decisions on a framework to ensure that the performance of duties by the directors is consistent
with the laws and the articles of incorporation and a framework to secure the appropriateness ofthe businesses of our company are as follows:
1) Framework to ensure that the performance of duties by the directors, corporate
officers and employees of our company and our subsidiaries is consistent with the laws
and the articles of incorporation(a) The board of directors will establish “Asahi Way” and “Code of Ethics” for the
directors and employees in order for the directors, corporate officers and employees tocomply with the laws, articles of incorporation and internal rules and to fulfill theirduties.
(b) We will distribute “Asahi Way” to the directors and employees so as to keep theminformed of legal compliance. The internal audit division will make improvements andgive guidance through the business audit.
(c) We will establish the “internal control promotion meeting” consisting of responsible
persons of various divisions as an organization that controls the entire compliance inorder to promote the construction, maintenance and improvement of the internal control
system.
(d) To promote compliance, the actual situation of compliance will be audited.
(e) In order to respond appropriately to any legal violation or other doubtful act under laws
which may be discovered by a director or an employee, we will develop and operate awhistle-blowing system.
(f) We will never have any relationship, including business relationships, with anti-social
forces which threaten the social order and sound corporate activities. In the event of anillegal request, we will take a firm attitude and respond to it organizationally inaccordance with the law and internal rules.
2) Framework for storage and management of information relating to business
operations by the directors and a framework for report to our company about thematters relating to the performance of duties by the directors and employees of our
subsidiaries(a) We will appropriately control the manner of storing, disposing of and otherwise
managing the records and documents relating to the performance of duties and decisionmaking of the directors and will review the relevant rules from time to time whenneeded.
(b) The directors, Audit and Supervisory Committee Members and accounting auditor will
always have access to these information and documents.
(c) We will manage our subsidiaries and they will report important matters to us.
3) Rules and other frameworks for management for risk of loss in our company and our
subsidiaries(a) We will establish the risk management rules and build a risk management system inaccordance with such rules.
(b) In the event of an unexpected event, we will discuss and make decisions at the
management meeting, etc., and the responsible manager will inform such decisions toeach division and plant. Each division and plant will take prompt actions to prevent

19
Structure to ensure the appropriateness of business

20
Structure to ensure the appropriateness of businessConvocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Audit Report
Reference Documents for
General Meeting of Shareholders

damage from expanding and will arrange a system to minimize the damage.
4) Framework to secure the efficient performance of duties by the directors of ourcompany and our subsidiaries(a) The board of directors will hold a meeting regularly no less than once every threemonths and from time to time when needed in order to determine the management
policies and other important matters relating to the business strategies and to supervise
the situation of business operations by the directors.
(b) In order to enhance the functions of the board of directors and improve management
efficiency, the board of directors will hold an extraordinary meeting from time to time
when needed in order to expeditiously make decisions on basic matters and importantmatters relating to the business operations.
(c) The board of directors will draft a mid-term business plan and a budget for each fiscal
year to set the business target and will supervise the progress.
(d) Regarding the business operations according to decisions made by the board of
directors, we will establish the responsibility of the directors for performance of duties
and the procedures for performance so as to ensure the efficient performance of duties.
Each provision will be reviewed from time to time when needed.
5) Framework to secure the appropriateness of business of the corporate groupconsisting of our company and our subsidiaries(a) We will build a system to manage our subsidiaries and will develop a system to reporttheir business results, business activities and the like to our board of directors on aregular basis.
(b) A manager of our company will serve as an officer of our subsidiary and will develop asystem to observe the appropriateness of such subsidiary’s business.
(c) The internal audit division of our company will conduct the internal audit regularly or
when needed and will develop a system to report the result of audit to the representative
director and president, the Audit and Supervisory Committee and the relevant divisionsof our company.
6) Framework to appoint an employee who assists the duties of the Audit andSupervisory Committee of our company, and the matters relating to the independenceof such employee from the directors (except those who are Audit and Supervisory
Committee Members) and the matters relating to the assurance of effective
instructions given by the Audit and Supervisory Committee to such employee(a) We will assign an employee who assists the duties of the Audit and Supervisory
Committee in the Audit and Supervisory Committee Secretariat.
(b) Appointment and relocation of the Audit and Supervisory Committee Secretariat staff
that assists such committee in performing its duties requires prior consent of suchcommittee.
(c) The Audit and Supervisory Committee shall have the right to direct and order the Audit
and Supervisory Committee Secretariat staff who assists the committee in performing
its duties to perform his/her duties.
7) Framework where the directors (except those who are Audit and Supervisory
Committee Members) and employees of our company and the directors, corporate
officers, employees and auditors of our subsidiaries or parties who receives a reportfrom aforementioned persons report to the Audit and Supervisory Committee of ourcompany, and other matters relating to reporting to the Audit and Supervisory
Committee(a) The directors (except those who are Audit and Supervisory Committee Members) andemployees of our company and the directors, corporate officers, employees and auditorsof our subsidiaries or parties who receive a report from aforementioned persons willpromptly report the important matters relating to, without limitation, the management,
the accounting division and division in charge of compliance and awards and penalties
to the Audit and Supervisory Committee of our company, in addition to the matterswhich conflict with the laws and articles of incorporation and the matters which may
remarkably damage our company and our subsidiaries.
(b) In order to grasp the important decision-making process and the situation of its business
operations, the Audit and Supervisory Committee Members may attend important
meetings in addition to the meeting of the board of directors, access important
documents relating to the business operations and request a director or an employee toexplain the situation when needed.
8) Framework to ensure that no person who reported to the Audit and Supervisory
Committee of our company is treated disadvantageously by reason of the report
We will not treat any officer or employee of our company and our subsidiaries whoreported to the Audit and Supervisory Committee disadvantageously by reason of suchreport.
9) Matters relating to the policies for settlement of expenses or debts associated with theprocedures for prepayment or reimbursement of expenses incurred for the
performance of duties by the Audit and Supervisory Committee Members of ourcompany (limited to the performance of duties of the Audit and Supervisory
Committee) and the performance of other duties
The Audit and Supervisory Committee Members may request the company to repay the
expenses required for the performance of their duties (limited to the performance of dutiesof the Audit and Supervisory Committee).
10) Other framework to ensure that the Audit and Supervisory Committee of ourcompany conducts audits effectively
The Audit and Supervisory Committee, accounting auditor and Audit and Supervisory
Committee Secretariat will cooperate with each other in audit tasks and the director andemployees will assist them in conducting audits efficiently.
(6) Status of operation of structure to ensure the appropriateness of business
As of June 16, 2015, the Company made a transition to the Board with Audit and Supervisory
Committee to promote efforts to ensure transparency and improve the efficiency of corporate
management by reinforcing the supervisory function of the Board of Directors and utilizing
Outside Directors. The Company’s Board of Directors discusses management risks and reviews
the Company’s internal organizations, operations and regulations accordingly to enhance theireffectiveness.
The status of operation of structure to ensure the appropriateness of business operations is asfollows.

21
Structure to ensure the appropriateness of business and Status of operation of structure to ensure theappropriateness of business22
Status of operation of structure to ensure the appropriateness of businessConvocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Audit Report
Reference Documents for
General Meeting of Shareholders

1) Status of efforts to enhance the appropriateness and efficiency of business execution(a) The Board of Directors consists of five (5) Directors with executive authority over
operations and four (4) Directors serving as Audit and Supervisory Committee
Members (including three (3) Outside Directors) and has held active discussions.
(b) During the fiscal year under review, the Board of Directors held ten (10) meetings
where the status of business execution was supervised by deliberating proposals andreceiving reports on the status of important business execution.
(c) The Board of Directors entrusts the authority over some important businessexecution to Directors to ensure efficient decision making and business execution.
(d) To secure the transparency in decisions on nomination and compensation for
Directors and Group companies, the Nominating Committee and the Compensation
Committee, each of which consists of one Representative Director and two (2)Outside Directors serving as Audit and Supervisory Committee Members, were
newly established as voluntary committees, and have provided advice andsuggestions to the Board of Directors.
2) Status of efforts regarding compliance and risk management(a) Continuous efforts to ensure compliance with laws, regulations and the Articles ofIncorporation have been made by providing employees with compliance education
through in-house trainings and meetings and announcing the content of laws andtheir revisions on the internal portal site or with other means.
(b) To counter an act that violates laws, regulations and the Articles of Incorporation, thewhistle-blowing system has been reinforced to monitor such an act, thereby
strengthening legal compliance and risk management.
(c) The internal control promotion meeting engages in identification and control ofinternal risks, and improves the internal organizations, facilities and equipment,
information systems and internal regulations accordingly.
3) Status of execution of duties of the Audit and Supervisory Committee(a) Directors serving as Audit and Supervisory Committee Members join the discussion
and resolution of proposals and receive reports on the status of business execution at
the meetings of the Board of Directors and attend the Group Subsidiaries
Management Meeting and other meetings to enhance the effectiveness of audits.
(b) To ensure the effectiveness of audits by Directors serving as Audit and Supervisory
Committee Members, the full-time support staff for the Audit and Supervisory
Committee Members are placed in the Audit and Supervisory Committee Secretariat,
which is independent of orders from Directors with authority over operations.
4) Status of the internal audits system(a) To reinforce the internal audits system, the Group Audit Division was newly
established to conduct audits on a Group-wide basis.
(b) The Group Audit Division conducts audits on overall business operations and reports
to the Representative Director and Directors. The division also cooperates with the
Audit and Supervisory Committee Members and the Accounting Auditor to enhancethe effectiveness of audits.

(7) Policy to determine the distribution, etc., of surplus
The Articles of Incorporation stipulates that the Company may carry out the distribution, etc.,
of surplus pursuant to the resolutions of the Board of Directors, instead of the resolutions of
the General Meeting of Shareholders. In addition, we believe that it is also important to seek
to improve our corporate value through ongoing stable profitability and further growth, andto enhance retained earnings to prepare for investments in growth fields and the developmentof new businesses, with a basic policy to respond to expectations of shareholders throughstable dividends.
Under this policy, regarding the distribution, etc., of surplus, we will further strengthen
consolidated and nonconsolidated results for each fiscal year and our financial structure, withgiving comprehensive consideration to the future management strategy, etc., of our group.
After then, we will return earnings to shareholders.

(Note) The amount and the number of shares stated in this report are rounded down to the nearest unit.
The percentage is rounded to the nearest unit.

23
Policy to determine the distribution, etc., of surplus

(Thousands of yen)
LIABILITIESCurrent liabilities

28,442,093

Cash and deposits

16,668,868

Notes and accounts receivable-trade

11,558,400

Merchandise and finished goods

5,606,622

Work in process

8,365,176

Notes and accounts payabletrade
Short-term loans payable
Current portion of long-termloans payable
Accounts payable-otherRaw materials and supplies

1,272,557

Income taxes payable

2,012,613

937,847

Provision for bonuses

827,470

Deferred tax assets

8,875,855
1,845,255
5,270,000
1,891,414

Other

7,192,634

Provision for directors’ bonuses

31,100Allowance for doubtful accounts(31,682)

Provision for repairs

107,293

Provision for product warranties

82,233

Provision for sales rebates

468,804

Provision for sales returns

17,500Other

7,012,553

Noncurrent assets

52,019,002

Noncurrent liabilities

23,846,595

Property, plant and equipment

30,791,944

Long-term loans payable

21,584,600

Buildings and structures
Machinery, equipment andvehicles

11,401,828

Deferred tax liabilities

1,937,720

4,504,962

Construction in progress

256,302

Provision for management board
incentive plan trust
Provision for stocks payment

Other438,235

Other

Land

14,190,615

Net defined benefit liability

Total liabilities

142,594
31,69987,96262,01852,288,689

Intangible assets

20,105,667

NET ASSETS

Goodwill

19,136,239

Shareholders’ equity

52,747,308

Capital stock

4,480,817

Capital surplus

6,112,929

Other
Investments and other assets

969,427
1,121,391

Investment securities

155,794

Deferred tax assets

322,263Other

664,400

Allowance for doubtful accounts(21,066)

Total assets

103,589,426

Retained earnings

47,524,629

Treasury stock
Accumulated othercomprehensive income
Valuation difference on
available-for-sale securities
Deferred gains or losses onhedgesForeign currency translation
adjustment(5,371,066)(1,884,946)
29,368(111,682)(1,802,631)

Non-controlling interests

438,374

TOTAL NET ASSETS

51,300,737

TOTAL LIABILITIES AND
NET ASSETS

103,589,426

24
Consolidated Balance Sheets

Business Reports

51,570,423

Consolidated
Financial Statements

Current assets

AmountFinancial Statements

ASSETS

Account

Audit Report

AmountReference Documents for
General Meeting of Shareholders

Account

Convocation Notice

Consolidated Financial Statements
Consolidated Balance Sheets (as of March 31, 2016)

(Note) Amounts less than one thousand yen are omitted.
(Thousands of yen)
Consolidated Statements of Income (April 1, 2015 to March 31, 2016)
Account
AmountNet sales
118,473,167
Cost of sales
92,719,540
Gross profit
25,753,627
Selling, general and administrative expenses
17,048,207
Operating income
8,705,419
Non-operating income
Interest income and dividends
39,133
Subsidy income
4,277
Rent income
9,876
Other
35,71889,006
Non-operating expenses
Interest expenses
118,420
Foreign exchange losses
82,020Commission for syndicate loan
51,000Other
32,610284,051
Ordinary income
8,510,375
Extraordinary income
Gains on sale of noncurrent assets
18,876
Gains on sale of investment securities
1,794
Gain on transfer of business
44,242Gain on reversal of subscription rights to shares
44,430109,343
Extraordinary loss
Loss on retirement and sale of noncurrent assets
29,339Impairment losses
483,397
512,736
Income before income taxes
8,106,981
Income taxes-current
3,153,999
Income taxes-deferred(179,224)
2,974,774
Profit5,132,206
Profit attributable to non-controlling
100,287
Profit attributable to owners of parent
5,031,919(Note) Amounts less than one thousand yen are omitted.

25
Consolidated Statements of Income

6,038,759

44,459,425

Treasury stock

Total shareholders’equity(5,159,609)

49,819,392(1,966,715)(1,966,715)

5,031,919

5,031,919

74,169(338,722)(338,722)

127,265

201,435－

74,1693,065,203(211,457)

2,927,916

4,480,817

6,112,929

47,524,629(5,371,066)

52,747,308

Accumulated other comprehensive income
Deferred gains
or losses onhedges33,107

313,451

Foreigncurrencytranslation
adjustment

Total
Subscription
accumulated
rights toothersharescomprehensive
income338,715

685,274

77,908

Noncontrollinginterests

375,452

Total net
assets50,958,027(1,966,715)

5,031,919(338,722)
201,435(3,738)(425,133)(2,141,347)(2,570,220)(77,908)

62,921(2,585,206)(3,738)(425,133)(2,141,347)(2,570,220)(77,908)

62,921

342,709

29,368(111,682)(1,802,631)(1,884,946)－

438,374

51,300,737(Note) Amounts less than one thousand yen are omitted.

26
Consolidated Statements of Changes in Net Assets

Audit Report

Balance at April
1, 2015
Changes during
the period
Dividends fromsurplusProfitattributable toowners ofparentPurchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during
the period
Total changes
during the period
Balance at March
31, 2016

Valuationdifference on
available-forsale securities

Convocation Notice

4,480,817

Retained earnings

Reference Documents for
General Meeting of Shareholders

Balance at April 1,
2015
Changes during
the period
Dividends fromsurplusProfitattributable toowners of parent
Purchase oftreasury stock
Disposal oftreasury stock
Net changes of
items other thanshareholders’equityTotal changes
during the period
Balance at March
31, 2016

Capital surplus

Business Reports

Capital stock

Consolidated
Financial Statements

Shareholders’ equity

Financial Statements

Consolidated Statements of Changes in Net Assets (April 1, 2015 to March 31, 2016)(Thousands of yen)

Notes to consolidated financial statements(Basis of preparing consolidated financial statements)
1. Scope of consolidation
Number of consolidated subsidiaries

24

Major consolidated subsidiaries

Asahi Pretec Corp.
Japan Waste Corporation
Nihon Chemitech Co., Ltd.
JW Logistics, Co., Ltd.
Taiyo Chemical Co., Ltd.
Iyotec Co., Ltd.
Fuji Rozai Co., Ltd.
JW Glass Recycling Co., Ltd.
ECOMAX INCORPORATED
Kyodo Chemical Co., Ltd.
INTER CENTRAL, INC.
KOEIKOGYO CO., LTD.
FUJI MEDICAL INSTRUMENTS MFG. CO.,LTD.
Asahi G&S Sdn. Bhd.
Shanghai Asahi Pretec Co., Ltd.
Asahi Pretec Korea Co., Ltd.
Asahi Pretec Taiwan Co., Ltd.
Asahi Shih Her Technologies Co., Ltd.
Asahi Americas Holdings, Inc.
Asahi Refining Holdings UK Limited
Asahi Refining USA Inc.
Asahi Refining Canada Ltd.
and 2 other companies

Nonconsolidated subsidiaries

None

2. Equity method affiliate
Equity method affiliates

None

3. Fiscal year of consolidated subsidiaries
Among consolidated subsidiaries, the fiscal year end of Asahi G&S Sdn. Bhd., Shanghai Asahi
Pretec Co., Ltd., Asahi Pretec Korea Co., Ltd., Asahi Pretec Taiwan Co., Ltd. and Asahi Shih Her
Technologies Co., Ltd. is December 31 of each year. For the preparation of consolidated financial
statements, the Company uses financial statements as of December 31 and makes adjustments asnecessary for consolidation in relation to significant transactions during their year-end date andthe consolidated year-end date.

27
Notes to consolidated financial statements

28
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Audit Report(2) Depreciation and amortization for major assets
1) Property, plant and equipment other: The Company and domestic consolidated
than leased assets
subsidiaries: straight-line method
Foreign consolidated subsidiaries: straight-line
method based on accounting standards of local
country.
2) Intangible assets other than leased: The Company and domestic consolidated
assetssubsidiaries: straight line method
Foreign consolidated subsidiaries: straight-line
method based on accounting standards of local
country.
Software for internal use is amortized under thestraight-line method based on the period forwhich the Company can use such software (5years or less).
3) Leased assets: Leased assets related to financial leases that do
not transfer ownership rights to the lessees areamortized under the straight-line method basedon the lease term as the useful life and residual
value of zero. Finance leases whose starting
date of lease transactions that do not transfer
ownership rights to the lessees before the start

Reference Documents for
General Meeting of Shareholders

4. Accounting policies(1) Valuation standards and methods for major assets
1) Securities
Other securities
Other securities for which market: Stated at fair value prevailing at the balance
quotations are available
sheet date with unrealized gains and losses,
directly included in net assets. The cost of
securities sold is determined by the movingaverage method.
Other securities for which market: Cost mainly determined by the moving-average
quotations are not available
method.
2) Derivative: Market price method
3) Inventories
Merchandise and finished goods, work : Stated at cost. Cost is determined mainly by thein process, raw materials and supplies
moving-average method (the method of writedowns based on the decrease in profitability isapplied in order to calculate the inventory valueon the balance sheet).
(A part of merchandise and finished goods isdetermined by individual cost method based on
the actual cost method.)of the applied first fiscal year are continuously
subject to accounting in accordance withmethods used for an ordinary lease transaction.
(3) Significant allowances
1) Allowances for doubtful account: To prepare for losses from doubtful receivables,
general allowance of the Company anddomestic consolidated subsidiaries is recorded
based on the actual bad debt ratio, and specificallowance is recorded based on the amountdeemed to the uncollectible considering thecollectibility. As for foreign consolidated
subsidiaries, specific credits are based on
estimated uncollectible amount.
2) Provision for bonuses: To allow for the payment of bonuses to
employees, the standard for estimated amountsof bonuses to be paid is recorded.
3) Provision for director’s bonuses: To allow for the payment of bonuses todirectors, the standard for estimated amounts ofbonuses to be paid is recorded.
4) Provision for repairs: To allow our payment of periodic maintenanceof production equipment, the Company records
the amount of estimated cost to be paid during
this fiscal year.
5) Provision for product warranties: To allow for cost of after-sales service, theCompany records the actual cost of the past to
be paid.
6) Provision for sales rebates: To allow for sales rebates, some consolidated
subsidiaries record the cost of this fiscal year’s
portion of the estimated sales rebate.
7) Provision for sales returns: To allow for sales returns, some consolidated
subsidiaries record the estimated sales returns
losses at the year - end of this fiscal year.
8) Provision for management board : To allow for the granting of the Company
incentive plan trust
shares to the Company’s Directors inaccordance with the Regulations Concerning
Stock Issuance, an amount of stock grantobligations estimated at the end of the fiscal
year under review is recorded.
9) Provision for stocks payment: To allow for the granting of the Company
shares to the Group employees in accordancewith the Regulations Concerning Stock
Issuance, an amount of stock grant obligations
estimated at the end of the fiscal year under29
Notes to consolidated financial statements

30
Notes to consolidated financial statements

Business Reports
Consolidated
Financial Statements
Financial Statements
Audit Report
Reference Documents for
General Meeting of Shareholders(4) Other important items for preparing consolidated financial statements
1) Hedge accounting
Hedge accounting methods: The Company accounts for hedging activities
under deferral hedge accounting. Furiate-shori(accounting method in which the current andforward rate difference is allocated by period
length for the calculation at the accounting
period) is applied to forward foreign exchange
contracts which conform to the requirements ofsuch hedge accounting. Tokurei-shori (anaccounting method in which the net interest
swap amount is treated by adjusting the intereston hedged items) is applied to interest rate
swap contracts that conform to the requirementof such hedge accounting.
Hedging instruments and targets
Hedging instruments: Derivative transactions, exchange contracts,
currency swaps and interest rate swaps
Hedged targets: Precious metal products, monetary assets andliabilities denominated in foreign currencies
and the payment of principal and interest of
long-term loans payable
Hedge policy: To reduce the precious metal market price risk
and to improve income and expenditurebalance, the company hedges price fluctuation
risk based on internal rules.
Methods for valuation of: During the start of hedging to the judgment ofappropriateness for hedging
appropriateness, accumulated rate fluctuationsin hedged targets and hedging instruments arecompared and then valuation is made on thebasis of the amount of those fluctuations. For
foreign exchange contracts and currency swaps
subject to furiate-shori and interest rate swaps
subject to tokurei-shori, the valuation of
appropriateness is omitted.
2) Accounting method for consumption: Consumption taxes are accounted for using thetaxes
net method of reporting.
3) Translation of foreign currency: All monetary assets and liabilities denominateddenominated assets or liabilities into
in foreign currencies are translated into
Japanese yen
Japanese yen at the exchange rates prevailing at
the fiscal closing date. Resulting gains andlosses are included in net profit or loss for the

Convocation Noticereview is recorded.

4) Amortization of goodwill

period.
All assets and liabilities as well as revenues andexpenses of foreign subsidiaries and affiliatedcompanies are translated into Japanese yen at
the spot exchange rates prevailing at the fiscal
closing date of such subsidiaries and affiliates,
and translation adjustments are included in“Foreign currency translation adjustments of“Net assets.”: By judging respective case, goodwill isamortized under the straight-line method withina period of 20 years.

5) Accounting for net defined benefit
liability
Method of attributing expected benefit
to periods: Whencalculating
retirement
benefitobligations, benefit formula is used for
attributing expected retirement benefits toperiods through March 31, 2016.
Amortization of actual gain or loss,: Prior service costs are expensed in a lump sum
prior service cost and othersin the fiscal year in which they arise. Actuarial
differences are expensed in a lump sum in thefiscal year in which they arise.
Simplified method for small companies : Some domestic consolidated subsidiaries use
the simplified method to calculate defined
benefit liabilities and related costs.

(Notes to changes in accounting policies)(1) Application of “Accounting Standard for Business Combinations,” etc.
The Company has applied the “Accounting Standard 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 forBusiness Divestitures” (ASBJ Statement No. 7, September 13, 2013), etc., effective from the fiscal
year under review. As a result, the method of recording the amount of difference caused by changes
in the Company’s ownership interests in subsidiaries in the case of subsidiaries under ongoing
control of the Company was changed to one in which it is recorded as capital surplus, and themethod 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 the fiscal year under review, the accounting method waschanged to one in which the reviewed acquisition cost allocation resulting from the finalization of
the tentative accounting treatment is reflected in the consolidated financial statements for the fiscal
year in which the business combination occurs. In addition, the presentation method of net income
was amended and the reference to “Minority interests” was changed to “Non-controlling interests.”
Application of the Accounting Standard for Business Combinations, etc., is in line with thetransitional measures provided in Paragraph 58-2 (4) of the Accounting Standard for Business

31
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders

Audit Report(Notes to changes in presentation)
Consolidated statements of income“Rent income” included in “Other” under “Non-operating income” until the previous fiscal year
has been separately presented from the fiscal year under review due to its increased financial
importance.
“Rent income” in the previous fiscal year was 8,243 thousand yen.

Consolidated
Financial Statements(2) Change in depreciation method of property, plant and equipment
The Company and its domestic consolidated subsidiaries had formerly depreciated property,
plant and equipment other than leased assets using the declining-balance method (with the
exception of buildings acquired on or after April 1, 1998, which are depreciated using the straightline method). However, starting from the fiscal year under review, the Company and its domestic
consolidated subsidiaries have changed the depreciation method to the straight-line method.
This change in the depreciation method is due to the determination that depreciation using thestraight-line method would better reflect the actual condition of usage of property, plant andequipment in a nod to the result of surveys on the actual status of the usage of property, plant andequipment and future business deployment that is planned in the “Seventh Medium-Term
Management Plan.”
As a result, operating income and ordinary income each increased by 211,092 thousand yen
compared with the figures calculated using the previous method.

Financial Statements

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.
Accordingly, these changes are effective from the beginning of the fiscal year under review.
These changes had no impact on operating income, ordinary income and income before income
taxes for the fiscal year under review.
Also, these changes had no impact on capital surplus for the fiscal year under review.

32
Notes to consolidated financial statements

(Notes to consolidated balance sheet)
1. Assets pledged as collateral and obligations related to collateral(1) Assets pledged as collateral
Buildings and structures
73,979 thousand yen
Land158,932 thousand yen
Total
232,911 thousand yen(2) Obligations related to collateral
Short-term loans payable
Total

50,000 thousand yen
50,000 thousand yen

2. Accumulated depreciation of property, plant and equipment
30,070,620 thousand yen
3. Notes receivable endorsed

33
Notes to consolidated financial statements

199,803 thousand yen

May 11, 2015
Board of Directors’ Meeting
October 28, 2015
Board of Directors’ Meeting

Class ofsharesCommonstock
Commonstock

Total
dividends
982,058
thousand yen
984,656
thousand yen

Dividends
per share
30.00 yen
30.00 yen

Record date
March 31,2015
September
30, 2015

Effectivedate
May 29,2015
November25, 2015(2) Among dividends whose record date within this consolidated accounting period, those having
an effective date within the following consolidated accounting period (scheduled)Class of
Total
Source ofDividends
RecordEffective
Resolution
sharesdividends
dividends
per sharedate
date
May 10, 2016
Board ofCommon984,652 Retained
March 31,
May 30,30.00 yen
Directors’
stock
thousand yen earnings
2016
2016
Meeting
Note: Total dividends include dividends of 6,660 thousand yen to the stock grant trusts.

34
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements

Resolution

Audit Report

2. Dividends(1) Dividends paid

Reference Documents for
General Meeting of Shareholders(Notes to consolidated statements of changes in net assets)
1. Class and number of issued shares and treasury shares
Number of shares Number of shares Number of shares Number of sharesat the beginning of increased during decreased during at the end of this
this consolidated
this consolidated this consolidated consolidated
accounting period accounting period accounting period accounting period(Thousands of(Thousands of(Thousands of(Thousands ofshares)shares)shares)shares)Issued shares
Common stock
36,25436,254
Total
36,25436,254
Treasury shares
Common stock
3,519
222
86
3,654
Total
3,519
222
86
3,654
(Notes) 1. The increase of 0 thousand shares in treasury shares of common stock was due to thepurchase of shares less than one unit. The increase of 222 thousand shares was due tothe acquisition of the Company’s shares by the stock grant trusts.
2. The decrease of 86 thousand shares in treasury shares of common stock was due to theexercise of stock options.
3. The treasury shares include 145 thousand shares held by the ESOP trust and 76
thousand shares held by the BIP trust.

(Notes to financial instruments)
1. Status of financial instruments
As for fund investments, the Group limits to short-term deposits, etc., and procures funds throughloans provided by financial institutions, such as banks.
The credit risk involved in notes receivable and trade accounts receivable are reduced inaccordance with the credit control regulations. Investment securities mainly consist of shares, andmarket prices of listed shares are evaluated on a regular basis.
Loans payable are used for working funds, capital expenditure and M&A funds. Derivativetransactions are made within the scope of actual demand pursuant to the internal management
regulations.
2. Market value, etc., of financial instruments
The amount, market value, and their difference reported on the consolidated balance sheet on
March 31, 2016 (consolidated fiscal closing date for the current fiscal year), are as follows:(Thousands of yen)Amount on
consolidated financial Market value (*1)
Difference
statements (*1)
(1) Cash and cash equivalents
16,668,868
16,668,868–(2) Notes receivable and11,558,400
11,558,400–
accounts receivable-trade(3) Investment securities
Other securities
148,959
148,959–(4) Notes payable and accounts(8,875,855)(8,875,855)–
payable-trade(5) Short-term loans payable(1,845,255)(1,845,255)–(6) Accounts payable-other(1,891,414)(1,891,414)–(7) Income taxes payable(2,012,613)(2,012,613)–(8) Long-term loans payable(including current portion(26,854,600)(26,974,318)
119,718of long-term loans payable)(9) Derivative transactions
Those subject to hedge(158,168)(158,168)–
accounting (*2)(*1) Those included in liabilities are shown in parentheses.
(*2) Net receivables and payables resulting from derivative transactions are shown at net amount,and items which become net payables in total are shown in parentheses.
(Notes) 1. Methods for calculating market values of financial instruments, as well as securities andderivative transactions(1) Cash and cash equivalents, as well as (2) Notes receivable and accounts receivabletrade
These items are settled in a short term and market values thereof are almost
equivalent to their book values. Therefore, these are stated at their book values.

35
Notes to consolidated financial statements

Principle
processing
methods

Forwardcontracts
Selling
contracts

Precious
metal
products

15,409,043(Notes to lease real estate)
Not stated because of its relative unimportance(Notes to information per share)
Net assets per share
Net income per share

1,560.21 yen
153.54 yen(Notes to significant subsequent events)
Not applicable

36
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders(Note) 2. Unlisted shares (6,834 thousand yen on the consolidated balance sheet) have no market
prices and their future cash flows cannot be estimated. Because of this, we consider it isvery difficult to know market values and therefore, such shares are not included in “(3)Investment securities.”

Consolidated
Financial Statements

Methods forcalculating
Market values
such market
More thanvaluesone yearStated at the
price–
15,567,212
presented bytrade partners

Contract amount, etc.

Financial Statements

Hedge
Types, etc., ofMajor hedged
accounting
derivative
targets
methodstransactions

Audit Report(3) Investment securities and other securities
Market values of these items are stated at prices of stock exchanges, and investment
trusts are stated at prices presented by financial institutions we have transactions with.
(4) Notes payable and accounts payable-trade, (5) Short-term loans payable, (6) Accounts
payable-other, and (7) Income taxes payable
These items are settled in a short term and market values thereof are almost
equivalent to their book values. Therefore, these are stated at their book values.
(8) Long-term loans payable (including current portion of long-term loans payable)
Market values of Long-term loans payable (including current portion of long-termloans payable) are stated in accordance with a method where the total amount of theprincipal and interest is discounted at an interest rate assumed in case new loans of asimilar nature are provided.
(9) Derivative transactions
1) Those which are not subject to hedge accounting
Not applicable2) Those which are subject to hedge accounting
The contract amount, etc., on consolidated fiscal closing date by hedge accounting
method are as follows:(Thousands of yen)

Financial statements
Balance sheet (as of March 31, 2016)
Account

Account
ASSETSLIABILITIESCurrent liabilities
Current assets
40,092,088
Short-term loans payable
Cash and deposits
1,859,982
Current portion of long-term
Deferred tax assets
11,608loans payable
Accounts payable-other
Short-term loans to affiliated
37,096,856
Accrued expenses
companies
Provision for directors’
Income taxes receivable
1,107,563
bonusesOther
16,077
Other
Noncurrent liabilities
Noncurrent assets
33,917,073
Long-term loans payable
Property, plant and
6,321,354
Provision for management
equipment
board incentive plan trust
Buildings
2,914,168
Provision for stocks payment
Tools, equipment andTotal liabilities
6,230
fixtures
NET ASSETS
Land
3,400,955
Shareholders’ equity
Capital stock
Intangible assets
55,924
Capital surplus
Software55,924
Capital reserve
Investments and other
Other capital surplus
27,539,794
assetsRetained earnings
Shares of affiliated
Other retained earnings
27,519,040
companies
Retained earnings
Deferred tax assets
20,725carried forward
Treasury stock
Other
28
TOTAL NET ASSETSTOTAL LIABILITIES AND
Total assets
74,009,161
NET ASSETS(Note) Amounts less than one thousand yen are omitted.

37
Balance sheet

Amount(Thousands of yen)Amount
5,442,134
300,000
5,020,000
74,25823,04017,500
7,335
20,352,568
20,334,600
7,315
10,652
25,794,702
48,214,459
4,480,817
23,086,727
6,054,118
17,032,608
26,017,981
26,017,981
26,017,981(5,371,066)
48,214,459
74,009,161

99,199
5,764,245

44,43044,430106,323

106,323
5,702,352

27,205
5,027

32,232
5,670,120

Convocation NoticeBusiness Reports

36,25151,00011,213
734

258,513

Consolidated
Financial Statements

131,165
122,778
84
4,484

Financial Statements(Thousands of yen)Amount
6,865,475
1,260,543
5,604,932

Reference Documents for
General Meeting of Shareholders

Audit ReportStatements of income (April 1, 2015 to March 31, 2016)
Account
Operating revenue
Operating expenses
Operating income
Non-operating income
Interest income
Guarantee commission received
Foreign exchange gains
Other
Non-operating expenses
Interest expenses
Commission for syndicate loan
Consultant fee
OtherOrdinary income
Extraordinary gain
Gain on reversal of subscription rights to shares
Extraordinary loss
Impairment losses
Net income before income taxes
Income taxes-current
Income taxes-deferred
Net income(Note) Amounts less than one thousand yen are omitted.

38
Statements of income

Statements of changes in net assets (April 1, 2015 to March 31, 2016)(Thousands of yen)
Shareholders’ equity
Capital surplus
Retained earnings
Other retained
Capital stockearnings
Other capital
Capital reserve
surplusRetained earnings
carried forward
Balance at April
1, 2015
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes of
items other thanshareholders’equityTotal changes
during the period
Balance at March
31, 2016

Balance at April
1, 2015
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during
the period
Total changes
during the period
Balance at March
31, 2016

4,480,817

6,054,118

16,958,438

22,314,576

Treasury stock

Total shareholders’equity(5,159,609)

44,648,341(1,966,715)(1,966,715)

5,670,120

74,1695,670,120(338,722)(338,722)

127,265

201,435––

74,1693,703,405(211,457)

3,566,117

4,480,817

6,054,118

17,032,608

26,017,981(5,371,066)

48,214,459

Subscription
rights to shares

Total net assets

77,90844,726,249(1,966,715)
5,670,120(338,722)
201,435(77,908)(77,908)(77,908)

3,488,209–

48,214,459(Note) Amounts less than one thousand yen are omitted.

39
Statements of changes in net assets

: To allow for the payment of bonuses to directors,
the standard for estimated amounts of bonuses
to be paid is recorded.
Provision for management board incentive: To allow for the granting of the Company sharesplan trust
to the Company’s Directors in accordance with
the Regulations Concerning Stock Issuance, anamount of stock grant obligations estimated at
the end of the fiscal year under review isrecorded.
Provision for stocks payment: To allow for the granting of the Company sharesto the Group employees in accordance with theRegulations Concerning Stock Issuance, anamount of stock grant obligations estimated at
the end of the fiscal year under review isrecorded.

4. Other important items for preparing financial statements
1) Hedge accounting
Hedge accounting methods: The Company accounts for hedging activities
under deferral hedge accounting. Furiate-shori(accounting method in which the current andforward rate difference is allocated by period
length for the calculation at the accounting
period) is applied to forward foreign exchange

40
Notes to non-consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements

3. Accounting standards for provisions
Provision for director’s bonuses

Financial Statements

2. Depreciation methods for noncurrent assets
Property, plant and equipment: Straight-line method
Assets with acquisition amount of 100 thousand
yen or more to less than 200 thousand yen are
equally depreciated for three years.
Intangible assets: Straight-line method
Software for internal use is amortized under thestraight-line method based on the period forwhich our company can use such software (5years or less).

Audit Report

1. Valuation standards and valuation methods for assets
Securities
Shares of subsidiaries: Cost mainly determined by the moving-averagemethod.

Reference Documents for
General Meeting of Shareholders

Notes to non-consolidated financial statements(Notes to significant accounting policies)contracts which conform to the requirements ofsuch hedge accounting. Tokurei-shori (anaccounting method in which the net interest
swap amount is treated by adjusting the intereston hedged items) is applied to interest rate
swap contracts that conform to the requirementof such hedge accounting.
Hedging instruments and targets
Hedging instruments
Hedged targets
Methods for valuation of
appropriateness for hedging

2) Accounting method for consumption
taxes: Currency swaps and interest rate swaps: Payment of principal and interest of long-termloans payable: During the start of hedging to the judgment ofappropriateness, accumulated rate fluctuationsin hedged targets and hedging instruments arecompared and then valuation is made on thebasis of the amount of these fluctuations. For
currency swaps subject to furiate-shori andinterest rate swaps subject to tokurei-shori, thevaluation of appropriateness is omitted.
: Consumption taxes are accounted for using thenet method of reporting.

(2) Accounting method for consumption taxes : Consumption taxes are accounted for using thenet method of reporting.
(Notes to changes in accounting policies)
Change in depreciation method of property, plant and equipment
The Company had formerly depreciated property, plant and equipment using the decliningbalance method (with the exception of buildings acquired on or after April 1, 1998, which are
depreciated using the straight-line method). However, starting from the fiscal year under review,
the Company has changed the depreciation method to the straight-line method.
This change in the depreciation method is due to the determination that depreciation using thestraight-line method would better reflect the actual condition of usage of property, plant andequipment in a nod to the result of surveys on the actual status of the usage of property, plant andequipment and future business deployment that is planned in the “Seventh Medium-Term
Management Plan.”
As a result, operating income, ordinary income and income before income taxes each increased
by 13,139 thousand yen compared with the figures calculated using the previous method.

41
Notes to non-consolidated financial statements

Convocation Notice(Notes to balance sheet)
1. Accumulated depreciation of property, plant and equipment 1,505,299 thousand yen(Notes to statements of changes in net assets)
Class and number of treasury stocks
Number of shares Number of shares Number of shares Number of sharesat the beginning
increased during
decreased during at the end of thisClass of shares of this fiscal year this fiscal year
this fiscal year
fiscal year
(Thousands of(Thousands of(Thousands of(Thousands ofshares)shares)shares)shares)Common stocks
3,519
222
86
3,654
Total
3,519
222
86
3,654
(Notes) 1. The increase of 0 thousand shares in treasury shares of common stock was due to thepurchase of shares less than one unit. The increase of 222 thousand shares was due tothe acquisition of the Company’s shares by the stock grant trusts.
2. The decrease of 86 thousand shares in treasury shares of common stock was due to theexercise of stock options.
3. The treasury shares include 145 thousand shares held by the ESOP trust and 76
thousand shares held by the BIP trust.

42
Notes to non-consolidated financial statements

Financial Statements

6,865,475 thousand yen
86,599 thousand yen
253,926 thousand yen

Audit Report(Notes to statements of income)Amount of transactions with affiliated companies
Amount of operating transactions with affiliated companies
Operating income
Amount of other operating transactions
Amount of transactions other than operating transactions

Reference Documents for
General Meeting of Shareholders

3. Monetary claims and monetary obligations related to affiliated companies
Short-term monetary claims
37,110,771 thousand yen
Short-term monetary obligations
67,174 thousand yen

Consolidated
Financial Statements

Business Reports

2. Guarantee liabilities
Guarantees are provided for the bank loans of the following company.
Asahi Refining Canada Ltd.
18,275,414 thousand yen
Total
18,275,414 thousand yen

(Notes to tax effect accounting)Breakdowns of main items causing deferred tax assets and deferred tax liabilities
Deferred tax assets
Provision for stocks payment
3,261 thousand yen
Impairment losses
17,422 thousand yen
Business tax
4,214 thousand yen
Provision for directors’ bonuses
5,400 thousand yen
Other2,035 thousand yen
Total deferred tax assets
32,334 thousand yen
Net deferred tax assets
32,334 thousand yen(Notes to transactions with related parties)(1) Subsidiaries and affiliated companies, etc.
Category

Name ofcompanies

Voting rights(%)

Relationshipwith relatedparties

Details oftransaction

Amount oftransaction(Thousands ofyen)

Account

Term-endbalance(Thousands ofyen)

Subsidiary

Asahi Refining
Canada Ltd.

Owned
Indirect 100%

Debt guarantee

Debt guarantee

18,275,414––

Collection ofloaned funds

13,753,704

Loan of funds(Note 1)37,096,856

37,096,856

Short-termloans toaffiliatedcompanies

746,000––

5,600,000––

Support of funds
Subsidiary

Asahi Pretec
Corp.

Owned
Direct 100%

Management
guidance
Receipt ofdividends

Management
guidance(Note 2)
Receipt ofdividends

Transaction terms and conditions and policy, etc., to determine terms and conditions fortransactions(Note 1) As for loans of funds, we reasonably determine interest rates taking into consideration
market interest rates.
(Note 2) We determine prices and other terms and conditions for transactions by reference toprevailing market interest rates, etc.
(2) Board members and major individual shareholders, etc.
Category

Name

Board
memberBoard
memberBoard
memberBoard
memberYoshikatsu
TakeuchiTomoyaHigashiura
Yukio Tanabe
Kazuo
Kawabata

Voting rights(%)

Relationshipwith relatedparties

Details oftransaction

Owns
Direct 0.0%
Owns
Direct 0.0%
Owns
Direct 0.0%
Owns
Direct 0.0%

Exercise ofstock options
Exercise ofstock options
Exercise ofstock options
Exercise ofstock options

Exercise of stock
options (Note)
Exercise of stock
options (Note)
Exercise of stock
options (Note)
Exercise of stock
options (Note)

Amount oftransaction(Thousands ofyen)

Account

Term-endbalance(Thousands ofyen)

11,997––

11,997––

11,997––

11,997––

Transaction terms and conditions and policy, etc., to determine terms and conditions fortransactions(Note) The stock options granted in accordance with the Annual General Meeting of
Shareholders held on June 16, 2010 exercised during the fiscal year under review arestated above.

43
Notes to non-consolidated financial statements

Convocation Notice(Notes to information per share)
Net assets per share
Net income per share

1,478.98 yen
173.01 yen

Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports(Notes to significant subsequent events)
Not applicable44
Notes to non-consolidated financial statements

Audit Reports
Transcript of accounting auditor’s audit report on consolidated financial statements
Independent Auditor’s Report
May 6, 2016
To the Board of Directors of
Asahi Holdings, Inc.
Ernst & Young ShinNihon LLC
Designated andCertified Public Accountant
Engagement Partner,
Designated andCertified Public Accountant
Engagement Partner,

Mitsuo Cho
Toshinari
TakenoPursuant to Article 444, paragraph 4 of the Companies Act, we have audited the consolidated
financial statements, namely the consolidated balance sheet, the consolidated statement of income,and the consolidated statement of changes in net assets of Asahi Holdings, Inc. for the consolidated
fiscal year from April 1, 2015 to March 31, 2016, including notes to the consolidated financial
statements.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of consolidated financial
statements in conformity with corporate accounting principles generally accepted in Japan. This
includes the improvement and application of the internal control that management deemed necessary
to prepare and fairly present consolidated financial statements that are free from material
misstatements caused by fraud or error.
Auditors’ Responsibility
Our responsibility is to express independent opinions on consolidated financial statements based on
our audit. We conducted our audit in accordance with auditing standards generally accepted in Japan.
Those standards require that we draw up a plan and perform the audit pursuant to the plan to obtainreasonable assurance about whether the consolidated financial statements are free from material
misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the consolidated financial statements. Audit procedures are selected and applied depending on
auditor judgment on the basis of the assessment of the risks of material misstatements of theconsolidated financial statements arising from fraud or error. The purpose of the audit of theconsolidated financial statements is not to express an opinion on the validity of internal control, but
in assessing the risks, the auditors consider internal control relevant to the preparation and fairpresentation of the consolidated financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the accounting policies adopted
by management, application methods therefor and estimates made by management, as well as
evaluating the overall financial statement presentation.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Audit Opinion
In our opinion, the consolidated financial statements referred to the above present fairly, in all

45
Transcript of accounting auditor’s audit report on consolidated financial statements

Convocation Notice
Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

material respects, the assets as well as income and losses in the period pertaining to consolidated
financial statements of the corporate group which consists of Asahi Holdings, Inc. and its
consolidated subsidiaries in conformity with corporate accounting principles generally accepted inJapan.
Interests
There are no interests between the Company and us or engagement partners, which should be statedin compliance with the Certified Public Accountants Act.

46
Transcript of accounting auditor’s audit report on consolidated financial statements

Transcript of accounting auditor’s audit report
Independent Auditor’s Report
May 6, 2016
To the Board of Directors of
Asahi Holdings, Inc.
Ernst & Young ShinNihon LLC
Designated andCertified Public Accountant
Engagement Partner,
Designated andCertified Public Accountant
Engagement Partner,

Mitsuo Cho
Toshinari
TakenoPursuant to Article 436, paragraph 2, item 1 of the Companies Act, we have audited the financial
statements, namely the balance sheet, the statements of income, and the statements of changes in net
assets of Asahi Holdings, Inc. for the 7th fiscal year from April 1, 2015 to March 31, 2016, including
notes to non-consolidated financial statements and supplementary schedules thereto.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of financial statements andsupplementary schedules thereto in conformity with corporate accounting principles generally
accepted in Japan. This includes the improvement and application of the internal control thatmanagement deemed necessary to prepare and fairly present financial statements and supplementaryschedules thereto that are free from material misstatements caused by fraud or error.
Auditors’ Responsibility
Our responsibility is to express independent opinions on financial statements and supplementaryschedules thereto based on our audit. We conducted our audit in accordance with auditing standards
generally accepted in Japan. Those standards require that we draw up a plan and perform the audit
pursuant to the plan to obtain reasonable assurance about whether the financial statements and the
supplementary schedules thereto are free from material misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements and the supplementary schedules thereto. Audit procedures are selected
and applied depending on auditors’ judgment on the basis of the assessment of the risks of material
misstatements of the financial statements and the supplementary schedules thereto arising from fraud
or error. The purpose of the audit of the financial statements and the supplementary schedules thereto
is not to express an opinion on the validity of internal control, but in assessing the risks, the auditors
consider internal control relevant to the preparation and fair presentation of the financial statements
and the supplementary schedules thereto in order to design audit procedures that are appropriate in
the circumstances. An audit also includes evaluating the accounting policies adopted by management,
application methods therefor and estimates made by management, as well as evaluating the overall
financial statement presentation.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Audit Opinion
In our opinion, the financial statements and the supplementary schedules thereto referred to theabove present fairly, in all material respects, the assets as well as income and losses in the period

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Transcript of accounting auditor’s audit reportConvocation Notice
Reference Documents for
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Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

pertaining to such financial statements and the supplementary schedules thereto in conformity withcorporate accounting principles generally accepted in Japan.
Interests
There are no interests between the Company and us or engagement partners, which should be statedin compliance with the Certified Public Accountants Act.

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Transcript of accounting auditor’s audit reportTranscript of Audit and Supervisory Committee’s audit report
Audit Report
The Audit and Supervisory Committee audited the directors’ performance of their duties during the
7th fiscal year (from April 1, 2015 to March 31, 2016), and hereby reports the method and results of
the audit as follows.
1. Method and Content of Audit
The Audit and Supervisory Committee received reports periodically from directors and employees
about the details of Board of Directors’ resolutions concerning the matters set forth in Article 39913, Paragraph 1, Item 1 (b) and (c), of the Companies Act, as well as the establishment andapplication of the internal control systems based on such resolutions, and then requested
explanations as necessary, expressed opinions and conducted audits by the following methods.
1) In conformity with the Audit and Supervisory Committee Auditing Standards established by
the Audit and Supervisory Committee, in accordance with the audit policies and important
audit items, and in cooperation with the internal audit division and internal control division,
each Audit and Supervisory Committee Member attended important meetings, received
reports on the status of performance of duties from the directors and other employees andrequested explanations as necessary, examined important approval/decision documents, andinspected the status of the corporate affairs and assets of the Company. Regarding theCompany’s subsidiaries, the processes of determining the execution of business operations
were investigated by attending important meetings, receiving reports on businesses andrequesting explanations as necessary.
2) Each Audit and Supervisory Committee Member monitored and verified whether theaccounting auditor maintained its independence and properly conducted its audit, received areport from the accounting auditor on the status of its performance of duties, and requested
explanations as necessary. Each Audit and Supervisory Committee Member was notified by
the accounting auditor that it had established a “system to ensure that the performance of
duties of the accounting auditor was properly conducted” (the matters listed in the items of
Article 131 of the Company Accounting Regulations) in accordance with the “Quality Control
Standards for Audits” (Business Accounting Council on October 28, 2005), and requested
explanations as necessary.
Based on the above-described methods, each Audit and Supervisory Committee Member
examined the business report and the supplementary schedules thereto, the financial statements(balance sheet, statements of income and statements of changes in net assets) and the
supplementary schedules thereto, as well as the consolidated financial statements (consolidatedbalance sheet, consolidated statements of income and consolidated statements of changes in net
assets), for the fiscal year under review.
2. Results of Audit

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Transcript of Audit and Supervisory Committee’s audit reportAudit and Supervisory Committee, Asahi Holdings, Inc.
Chairman:
Shoji Morii
Full-time Audit and Supervisory Committee Member: Yukio Tanabe
Audit and Supervisory Committee Member:
Kazuhiko Tokumine
Audit and Supervisory Committee Member:
Hiroharu Okubo

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Audit Report(Note) Audit and Supervisory Committee Members Shoji Morii, Kazuhiko Tokumine and Hiroharu
Okubo are Outside Directors set forth in Article 2, Item 15 and Article 331, Paragraph 6 of
the Companies Act.

Consolidated
Financial Statements

May 10, 2016

Financial Statements(1) Results of audit of business report, etc.
(i) We acknowledge that the business report and the supplementary schedules thereto fairly
present the status of the company in conformity with the applicable laws and regulations
and the Articles of Incorporation of the company.
(ii) We acknowledge that no misconduct or material fact constituting a violation of any law or
regulation or the Articles of Incorporation of the company was found with respect to thedirectors’ performance of their duties.
(iii)We acknowledge that the Board of Directors’ resolutions with respect to the internal control
systems are appropriate. We did not find any matter to be mentioned with respect to thedirectors’ performance of their duties concerning the internal control systems.
(2) Results of audit of financial statements and supplementary schedules thereto
We acknowledge that the methods and results of audit performed by the Accounting Auditor,
Ernst & Young ShinNihon LLC, are appropriate.
(3) Results of audit of consolidated financial statements
We acknowledge that the methods and results of audit performed by the Accounting Auditor,
Ernst & Young ShinNihon LLC, are appropriate.

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Transcript of Audit and Supervisory Committee’s audit reportReference Documents for General Meeting of Shareholders
Proposal

Election of Five (5) Directors (Excluding Directors Serving as the Audit andSupervisory Committee Members)

The terms of office all five (5) Directors (excluding Directors serving as the Audit andSupervisory Committee Members; the same applies hereinafter in this proposal) will expire.
Accordingly, we propose the election of five (5) Directors.
The Audit and Supervisory Committee has expressed no opinion on this proposal.
The candidates for Director to be elected are as follows.
Candidate
No.

1

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

October 1973: Senior Managing Director of
Asahi Pretec Corp.
May 1981:
Appointed as Representative
Director and President of Asahi
Pretec Corp.
April 2009:
Appointed as Representative
Director and President of Asahi
Holdings, Inc.
April 2011:
Appointed as CEO & COO of
Mitsuharu Terayama
Asahi Holdings, Inc.
(March 10, 1940)
April 2011:
Appointed as Chairman and
To be Reelected
Director of Asahi Pretec Corp. (topresent)
June 2012:
Appointed as CEO of Asahi
Holdings, Inc.
June 2014:
Appointed as President & CEO of
Asahi Holdings, Inc. (to present)[Significant concurrent duties]
Appointed as Chairman and Director of Asahi
Pretec Corp.

Ownershipof Shares

882,345
shares(Reason for nomination as a candidate)
Mr. Terayama engages in the management of the entire Group as a Representative Director of theCompany and as a Representative Director/Director of the Group companies. The Company
therefore requests his election as a Director of the Company based on its judgment that his
continued tenure of office as a Director is appropriate because his past performance of having
driven the entire Group with strong leadership, as well as his deep insight and abundant experiencein overall management, would contribute to the further functional reinforcement of the Board of
Directors and the corporate governance of the entire Group.

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Financial Statements

8,050
shares(Reason for nomination as a candidate)
Mr. Takeuchi engages in the management of the Group as a Director of the Company and as a
Representative Director/Director of the Group companies, having deep insight and abundant
experience in overall management. The Company therefore requests his election as a Director of theCompany based on its judgment that his continued tenure of office as a Director is appropriate
because his abundant job experience particularly in the environmental preservation business and thelife & health business would contribute to the sustainable enhancement of the corporate value of theGroup.

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Convocation NoticeBusiness Reports

April 1999:
June 2001:

2

Joined Asahi Pretec Corp.
Appointed as Director andGeneral Manager of General
Affairs Department of Asahi
Pretec Corp.
April 2004:
Appointed as Director andGeneral Manager ofEnvironmental Business Divisionand concurrently serving as
General Manager of Business
Coordination Division of Asahi
Yoshikatsu Takeuchi
Pretec Corp.
(January 1, 1956)
March 2006: Appointed as Director and
To be Reelected
General Manager ofEnvironmental Recycling
Business Division of Asahi Pretec
Corp.
May 2008:
Appointed as Representative
Director and President of Japan
Waste Corporation (to present)
April 2009:
Appointed as Director of Asahi
Holdings, Inc. (to present)[Significant concurrent duties]
Representative Director and President of Japan
Waste Corporation

Ownershipof Shares

Consolidated
Financial Statements

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Audit Report

Name(Date of birth)

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CandidateNo.

Candidate
No.

3

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

February 2001: Joined Asahi Pretec Corp.
June 2006:
Appointed as Director andGeneral Manager of
Administration Division of Asahi
Pretec Corp.
April 2009:
Appointed as Director andGeneral Manager of Corporate
Development & Administration
Division of Asahi Holdings, Inc.
June 2010:
Appointed as Director andTomoya Higashiura
General Manager of Precious(January 26, 1961)
Metal Recycling Business
To be Reelected
Division of Asahi Pretec Corp.
April 2011:
Appointed as Director of Asahi
Holdings, Inc. (to present)
January 2012: Appointed as Director of Asahi
Pretec Corp.
June 2014:
Appointed as Representative
Director & President of Asahi
Pretec Corp. (to present)[Significant concurrent duties]
Representative Director & President of Asahi Pretec
Corp.

Ownershipof Shares

7,700
shares(Reason for nomination as a candidate)
Mr. Higashiura engages in the management of the Group as a Director of the Company and as a
Representative Director/Director of the Group companies, having deep insight and abundant
experience in overall management. The Company therefore requests his election as a Director of
the Company based on its judgment that his continued tenure of office as a Director is appropriate
because his abundant job experience particularly in the precious metal business and theenvironmental preservation business would contribute to the sustainable enhancement of thecorporate value of the Group.

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Consolidated
Financial Statements

Business Reports

June 2011:

1,000
sharesAudit Report

4

Joined Asahi Pretec Corp.
Appointed as General Manager ofInformation Technology
Department of Asahi Pretec Corp.
Appointed as Chief Information
Officer of Asahi Holdings group
April 2012:
Appointed as General Manager ofInformation Technology
Department of Asahi Holdings,
Inc.
June 2013:
Appointed as Director andGeneral Manager of Information
Technology Department andconcurrently serving as General
Manager of Planning &Communication Department of
Keitaro Shigemasa
Asahi Holdings, Inc.
(February 15, 1965) July 2014:
Appointed as Director and
To be Reelected
General Manager of Information
Technology Department andconcurrently serving as General
Manager of Human Resources
Department of Asahi Holdings,
Inc.
December 2014:Appointed as Representative
Director & President of Asahi
Americas Holdings, Inc. (topresent)
April 2016:
Appointed as General Manager ofInformation Technology
Department of Asahi Holdings,
Inc. (to present)[Significant concurrent duties]
Representative Director & President of Asahi
Americas Holdings, Inc.

Ownershipof Shares(Reason for nomination as a candidate)
Mr. Shigemasa engages in the management of the Group as a Director of the Company and as a
Representative Director of the Group companies, having deep insight and abundant experience inoverall management. The Company therefore requests his election as a Director of the Company
based on its judgment that his continued tenure of office as a Director is appropriate because hisabundant job experience particularly in the overseas business would contribute to the sustainableenhancement of the corporate value of the Group.

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Convocation Notice

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Financial Statements

Name(Date of birth)

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CandidateNo.

Candidate
No.

5

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Kazuo Kawabata(April 20, 1957)
To be Reelected

July 2008:
Joined Asahi Pretec Corp.
October 2008: Appointed as Deputy Head ofTechnology Support &Production Management Divisionof Asahi Pretec Corp.
April 2012:
Appointed as General Manager ofTechno Center of Asahi Pretec
Corp.
April 2013:
Appointed as Director andGeneral Manager of Techno
Center of Asahi Pretec Corp.
June 2014:
Appointed as Director of Asahi
Holdings, Inc. (to present)
December 2014: Appointed as Director of Asahi
Americas Holdings, Inc. (topresent)
April 2016:
Appointed as Director of Asahi
Pretec Corp. (to present)[Significant concurrent duties]
Director of Asahi Pretec Corp.
Director of Asahi Americas Holdings, Inc.

Ownershipof Shares

10,200shares(Reason for nomination as a candidate)
Mr. Kawabata engages in the management of the Group as a Director of the Company and as a
Director of the Group companies, having deep insight and abundant experience in overallmanagement. The Company therefore requests his election as a Director of the Company based on
its judgment that his continued tenure of office as a Director is appropriate because his abundantjob experience particularly in the overseas business and technical areas would contribute to thesustainable enhancement of the corporate value of the Group.
Note:

There are no special interests between each candidate and the Company.

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